After numerous failed attempts to replace the sustainable growth rate (SGR), the formula that annually determines physician reimbursement rates under Medicare, lawmakers have again begun to discuss solutions to the SGR issue.
There are two main challenges to replacing the SGR: Finding a way to offset the estimated $316 billion, 10-year cost for a permanent fix and a lack of consensus among lawmakers on how to do so.
Although the cost issue remains, Reps. Joe Heck (R-Nev.) and Allyson Schwartz (D-Pa.) recently introduced legislation (HR 5707) that would discard SGR and set a five-year transition period during which providers would get minor rate increases and CMS would create and test new payment formulas. CMS plans to have four delivery and payment options for physicians by 2017. The change would be paid for by anticipated savings from the end of the wars in Iraq and Afghanistan.