Doctors Await Decision on SGR, Pay Cuts

Cheryl Clark, for HealthLeaders Media , November 7, 2011

Another result is that more doctors might retire earlier. They may also reduce the number of support staff in their offices, straining the workloads of those who remain.
According to Carmel, there's "already a 20% gap between Medicare payment updates and the cost of caring for seniors." This population needs more focus and supportive care, especially to manage chronic diseases and prevent avoidable hospitalizations, he says.

Numerous alternatives are being floated within the Beltway. One, according to a Nov. 3 report in the journal Health Affairs, was proposed by the Bowles-Simpson Commission, also known as the National Commission on Fiscal Responsibility and Reform. This would freeze doctors' paychecks through 2013, reduce them by 1% in 2014, and reinstate the SGR in 2015 with 2014 as the base spending year. This plan would cost $261.7 billion over 10 years, according to analysis by the Congressional Budget Office.

The White House wants to repeal the SGR, estimating a 10-year cost of $293 billion.

MedPAC would freeze primary care physician pay, but impose a 5.9% reduction in reimbursement for specialists, which the commission estimates would cost $200 billion over 10 years.

Of course, there's always the option of continuing to "kick the can down the road," further delaying the imposition of the SGR formula for another year, which would mean the pay reduction scheduled for 2013 would be even more untenable.


According to Hood of the ACP, "enacting a short-term fix to prevent the January 1 cut will add hundreds of billions of dollars to projected Medicare spending compared to a permanent solution, continue to endanger patient access to doctors, and create roadblocks to promising new models to improve outcomes and lower the costs of care."

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