Legislation Providing Permanent SGR Fix Dies in Senate

In another blow to payment measures for physicians, Senate leaders were unable to bring a bill to the Senate floor that would have permanently fixed the sustainable growth rate, or SGR, formula, which is used to determine Medicare's physician payment rates. Without a fix to the formula, physicians in the Medicare program face a 21 percent pay cut in January.

The Medicare Physician Fairness Act of 2009, or S. 1776, (at the THOMAS Web site, type "S. 1776" in the search box after selecting "Bill Number") was introduced by Sen. Debbie Stabenow, D-Mich., on Oct. 14. It would have reset the SGR to zero and eliminated the $245 billion in debt that has accumulated during the past six years as a result of congressional "fixes" to ensure physician payments were not reduced by the SGR formula. Senate Democrats needed 60 votes to bring the bill to the Senate for a vote but could only muster 47 votes, essentially killing the measure.

A number of senators objected to the bill because Senate supporters of the legislation had not identified cost offsets to pay for the measure.

"Obviously, this is disappointing," said AAFP President Lori Heim, M.D., of Vass, N.C., about defeat of the measure. "But we will continue to press for physician payment reform."

The AAFP issued a call to its members last Thursday asking them to contact their legislators in an attempt to get the bill passed.

"We were supportive of the bill and felt it was the best way forward," said Heim. She called on Congress to continue to work to pass a permanent fix to the SGR formula. "Every year, we keep saying we need a permanent fix and we get a Band-Aid instead," said Heim. "We will continue to support a permanent fix, so (family physicians) can move forward.

"We would like to get to the point where we can actually start talking about what is the best replacement for the SGR as opposed to these continual Band-Aid approaches that don't provide the stability that physicians need," Heim said.

The SGR determines annual Medicare payment rates by using a formula that aligns actual spending rates with specified targets. In the past several years, spending has exceeded targeted rates, triggering steep reductions in physician payment rates, which have been averted only by last minute congressional intervention.