After years of fits and starts and temporary patches, a large cloud may finally be parting over the health care landscape.
House Speaker John Boehner (R-Ohio) and Minority Leader Nancy Pelosi (D-Calif.) on Tuesday unveiled a bipartisan bill to repeal Medicare’s troubled sustainable growth rate formula, long in place to control increased spending in the government program. While paying for the SGR fix will require $70 billion in further cuts to hospitals and other providers, American Hospital Association officials support the measure.
“For us, like everyone else in the health care field, getting the SGR behind us is a real positive,” Tom Nickels, senior vice president for federal relations at the AHA, told me Wednesday morning. “There have been 17 bills passed dealing with this on a temporary basis, and it’s time to get this over with. Every time one of those 17 bills got passed, there were always risks of hospitals cuts to pay for them, and in some cases that did occur. And, if there were more temporary fixes, that risk would continue. So, getting it behind us is a good thing.”
In a letter to Congress on Thursday, AHA President and CEO Rich Umbdenstock urged reps to approve the bill, commending the “careful balance” struck in funding the deal. He also praised the avoidance of such hot-button issues as cutting payments for outpatient hospital services, Medicare bad debt, graduate medical education and critical access hospitals. Other positives from the AHA's perspective include avoiding any further delay in implementing ICD-10, extending soon-expiring provisions such as the Medicare Dependent Hospital program, rural low-volume adjustment, rural ambulance add-on, partial enforcement delay on the two-midnight policy and the Children’s Health Insurance Program. Replacing the SGR will reportedly cost $210 billion. About $140 billion of that is not paid for as part of the House package. The measure seeks to move physician payment closer to a value-based stream, similar to what is happening with hospital reimbursement.
Physician groups, similarly, voiced approval of the SGR fix. American Medical Association President Robert Wah, M.D., in an email to members Tuesday, said the formula has “been plaguing physicians and patients since 1997,” and asked Congress to quickly pass the bill this week, with providers facing a 21 percent payment cut next week short of passage. “We can’t afford to let our patients suffer,” Wah wrote.
“We applaud this most recent compromise as a significant step forward and salute the Republican and Democratic House leadership and committee chairmen for coming together to repeal Medicare’s flawed sustainable growth rate formula and reform the physician payment system,” echoed Association of American Medical Colleges President and CEO Darrell Kirch, M.D., in a statement Tuesday.
While the House is expected to take up the bill on Thursday, it’s unclear as of yet when the Senate will follow. The Hill reports that senators may not have enough time to debate the issue before adjourning for a two-week recess Friday and, instead, may OK a short-term patch before discussing the topic in full when they return.
The AHA’s Nickels also expressed disappointment that the bill does not address how Medicare readmission penalties are assessed, nor does it include broader reform of the troubled recovery audit contract program, but other bills have been introduced, he said, to make those fixes.
“I think they struck a pretty careful balance,” Nickels said. “It’s not perfect. There are hospital reductions in here, but I think, looking at the size and the scope of the problem, they did a good job.”