Work Continues on SGR as House Passes Medicare Payment Bill

Senate, Obama Administration Unlikely to Approve

December 14, 2011 05:30 pm News Staff

The House last night passed H.R. 3630, which would provide a 1 percent increase in the Medicare physician payment rate for the next two years and block a 27.4 percent payment reduction scheduled to go into effect on Jan. 1.

However, it is widely expected that the bill will not have enough support in the Senate to pass, creating a real possibility that Congress could adjourn for the holidays without preventing the pending Medicare physician payment cut called for by the sustainable growth rate, or SGR.

The House passed the Medicare payment provision as part of a larger bill that would extend the payroll tax cut and unemployment programs. But Senate Democratic leaders are objecting to financing mechanisms in the bill and restrictions on certain air-quality regulations, as well as a provision that would require the Obama administration to make a decision on the future of the Keystone XL pipeline, a proposed 1,700-mile conduit that would run from Alberta, Canada, to southern Texas. The Obama administration has issued a statement saying it will veto the bill if Congress approves the legislation as passed by the House.

The two-year Medicare payment patch included in the bill would cost about $40 billion during the next 10 years, according to the Congressional Budget Office. To finance the payment fix, the House bill would repeal or scale back programs in the Patient Protection and Affordable Care Act, including the Preventive Health Fund. This also has made the bill unacceptable to Senate Democratic leaders.

Meanwhile, the AAFP is continuing its push for a repeal of the SGR and a specified payment rate for the next three to five years to give various demonstration programs and alternative health care delivery models enough time to generate sufficient data to determine which payment methods make the most sense from both a fiscal and a quality perspective. The AAFP also is calling for a higher payment rate for primary care physicians who provide primary care services.