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Congress Makes Significant Progress on Physician Payment Reform

docOn Feb. 6, 2014, the Senate Finance, House Energy and Commerce and House Ways and Means Committees released bipartisan legislation to repeal Medicare’s sustainable growth rate (SGR) physician payment system. The “SGR Repeal and Medicare Payment Modernization Act ” (S. 2000/H.R. 4015), establishes a new streamlined value-based incentive payment system called the Merit-Based Incentive Payment System, or MIPS. The new program consolidates the three existing Medicare incentive programs — Physician Quality Reporting System (PQRS), Electronic Health Records (EHR) and Value-Based Payment Modifier (VBPM) — and allows physicians to opt-out of the fee-for-service system in favor of participating in alternative payment models (APMs), such as accountable care organizations, patient-centered medical homes and other similar arrangements.

Because it meets many of neurosurgery’s core principles, the AANS and CNS are supporting passage of the bill, provided, however, that Congress is able to identify acceptable budget offsets to cover the estimated $150 billion price tag. In a letter to Congress, the AANS and CNS noted that the legislation includes a number of elements that are essential for physician payment reform:

  • Repeals the SGR and provides physicians a five-year period of payment stability with positive updates;
  • Consolidates the current PQRS, EHR and VBPM programs and eliminates the penalties associated with these programs;
  • Provides physicians a choice of payment models, including fee-for-service;
  • Includes positive incentives for quality improvement payment programs that allow all physicians the opportunity to earn bonus payments;
  • Enhances the ability of physicians, rather than the government, to develop quality measures and clinical practice improvement activities; and
  • Clarifies that quality improvement program requirements do not create new standards of care for purposes of medical malpractice lawsuits.

Although the legislation incorporates many of neurosurgery’s recommendations, the AANS and CNS nevertheless continue to have ongoing concerns about several aspects of the bill, which may adversely affect Medicare beneficiaries’ access to specialty care. In our letter, we pointed out our disappointment that the bill does not include positive base payment updates every year, noting that medical practice costs will rise in excess of 25 percent over the next decade and “physicians will continue to lose ground to inflation — and this is on top of the past decade of flat Medicare payments.” Additionally, we objected to a section of the bill that instructs the Centers for Medicare and Medicaid Services to make additional cuts to so-called “misvalued” codes, which will redistribute an additional $1 billion from specialty services across the entire Medicare physician fee schedule over the next three years. Finally, the AANS and CNS encouraged Congress to exercise ongoing oversight over the MIPS program “to ensure that the performance metrics employed are in fact reflective of the views of the medical profession and the scoring system is fair and accurate.”

Organized medicine is pressing Congress to act swiftly and pass the “SGR Repeal and Medicare Payment Modernization Act” prior to the expiration of the current SGR “patch” at the end of March. There is widespread, bipartisan support for repeal, from the editorial pages of major news outlets, to health policy thought leaders, to Medicare beneficiary organizations and most physician organizations, including the American Medical Association and American College of Surgeons. If Congress can find the money to pay for the bill, we may be able drive the final nail in the SGR’s coffin once and for all.

Click here to download a copy of the section-by-section summary of the legislation.

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