Lawmaker Letter to 'Super Committee' Makes Case for SGR Repeal

Margaret Dick Tocknell, for HealthLeaders Media , October 10, 2011

Members of Congress who added their name to the letter include Rep. Todd Akin (R-MO), Rep. Barney Frank (D-MA), Rep. Dennis Kucinich (D-Ohio), and Rep. Phil Roe, MD (R-TN).

The letter was sent on the very day that the Medicare Payment Advisory Commission voted to repeal the SGR and replace it with a plan that will include cutting reimbursements by $335 billion over 10 years. MedPAC, which advises Congress on Medicare payment matters, proposed that specialist reimbursement be reduced by 17.7% over three years and then frozen for seven years. PCP reimbursements would remain unchanged for the next 10 years. The remaining $235 billion in reductions would come from a combination of payment cuts to providers and health plans, including hospitals, Medicare Advantage plans, and durable medical equipment. 

While asking for the repeal of the SGR, the Congressional letter offered only a vague statement on what might replace SGR: “The sustainable growth rate must be repealed and replaced by a payment system that promotes efficiency, quality, and value, and ensures access to medical services for Medicare beneficiaries.”

Tali Israeli, a spokesperson for Rep. Schwartz, says the congresswoman is concerned that MedPAC’s cuts are too severe. “There needs to be a smoother transition and more certainty in the future for the providers,” Israeli told HealthLeaders Media. 

Schwartz is developing legislation to provide for an SGR alternative, but no details concerning what might be included in the potential bill are available. Israeli says it is doubtful that the legislation will be presented before the end of the year.

Time is of the essence. Congress has until October 14 to provide its recommendation on how to reduce the deficit to the debt committee. The super committee must vote on its debt reduction proposal by November 23, and Congress must vote on the debt committee proposal by December 23. If SGR is not repealed, a 29.4% cut in physician reimbursements will go into effect at the beginning of 2012.

Margaret Dick Tocknell is a reporter/editor with HealthLeaders Media.

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2 comments on "Lawmaker Letter to 'Super Committee' Makes Case for SGR Repeal"

S Daniels (10/10/2011 at 3:32 PM)
Just pay doctors an annual compensation. Base rate based on historic volume of M & M patients with opportunity for additional payment based on quality & cost outcomes.

msamms (10/10/2011 at 10:12 AM)
New Scoring innovation is THE simple solution to the healthcare cost problem! I went to D.C., in August, to provide each Super Committee member healthcare legislative assistant information about an awesome [INVALID]native to the usual slash and burn overall reimbursement cuts that usually occurs within healthcare. In her book, Overtreated, Shannon Brownlee states, "...medicine does not function like other economic markets. If doctors found they weren't getting enough business, they didn't have to slash their fees in order to attract new patients; they could simply give more medical care to patients they already had...". She further describes this process as artificial demand creation. A much better way is offered through This is an innovation that is fair and will result in higher quality medicine while creating better healthcare economics. I proposed a generic scoring version that can be supported by Congress as anybody can participate in the scoring arena. This is an effective way of dealing with artificial demand creation. Attending to artificial demand creation will avoid the indiscriminate slash and burn across-the-board reimbursement cut mentality which was recently proposed by MedPAC. Healthcare scoring that takes into consideration procedure saturation, within a defined geometry, is a new model that makes perfect sense and avoids penalizing under-served areas of the U.S. This is a paradigm change that must be embraced. The Scoring process: If a provider has not performed a diagnostic test within the previous 12-months, the provider must apply for a score. A score is issued using complex algorithms that are based upon existing supply and capacity within a defined geographic region. Payers will [INVALID] reimbursement based upon the score. This process does not interfere with the sacred physician-patient relationship and does not deny any patient any needed service. Once the scoring process is fully deployed and the reduction in artificial demand creation has subsided, fewer redundant and unnecessary diagnostic services will be provided. The overall U.S. healthcare system will benefit from reduced costs. The healthcare scoring innovation will save $944 billion over the next 10 years in the U.S. healthcare system.




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