One Step Forward, One Step Out the Door – Senate Action Needed for SGR Repeal

April 2, 2015 | By Lawrence J. Tabas

The House of Representative recently passed legislation, by a sweeping vote of 392-37, which aims to change the way physicians are paid. The legislation, called the Medicare Access and CHIP Reauthorization Act, repeals and replaces Medicare’s sustainable growth rate formula (“SGR”). Despite the broad bipartisan support the legislation received in the House, the Senate failed to act on it before leaving for a two-week recess. A decision is expected from the Senate shortly after they return to the office on April 13.

The SGR was originally passed as part of the Balanced Budget Act of 1997 to control Medicare spending on physician services. However, it has been flawed, and over the years, Congress has repeatedly put patches into place to avoid physician payment cuts. The most recent patch expired March 31, 2015, which means physicians face a 21% Medicare payment cut. According to reports, the Centers for Medicare and Medicaid will likely wait to process Medicare physician payment claims until the Senate takes action on the legislation.

The legislation attempts to bring long-term stability to the Medicare physician fee schedule. From 2015-2019, physicians will receive an annual increase of 0.5%. The 2019 rates will then remain constant through 2025. In 2026 and beyond, depending on participation in alternative payment models, certain physicians may be eligible to receive annual increases of 0.75%, while others will receive increases of .25%.

To read summaries of the legislation, click here and here.

To read the legislation in full, click here.


Categorized In: Legislation, Medicare

About the Authors

Lawrence J. Tabas


Lawrence is the Chair for Obermayer’s Health Care Law Department and Election Law Practice Group. Lawrence’s Health Care Law legal experience includes the representation of Pennsylvania County governments in Behavioral Health Managed...

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