House Democrats have introduced legislation (HR 3961) that would end the yearly ritual of canceling automatic cuts in Medicare physician payment rates after the Senate failed to do so last month. The bill would eliminate the sustainable growth rate (SGR) formula that automatically controls Medicare costs by limiting payment rates for physician services. Instead, it would tie payment rates to inflation. The new bill would allow spending on physician services to increase at the rate of gross domestic product plus 1 percent, and preventive and primary care service spending could grow at GDP plus 2 percent. Groups, including AARP and the American Medical Association, have backed the plan.

Any bill passed in the House could face trouble in the Senate, where a similar bill (S 1776) stalled earlier this month following a procedural vote.

CMS on Friday announced that if Congress does nothing to address the issue, Medicare payments to physicians would be cut by 21.2 percent next year as a result of the SGR formula. Cuts to reimbursement rates for medical imaging and cardiovascular services are scheduled to be even sharper.