The physician community secured a huge victory in April when Congress finally passed legislation to repeal the broken sustainable growth rate (SGR) formula, which set reimbursement for physicians under Medicare. For years, the entire physician community has been advocating that Congress repeal the broken, outdated formula since it didn’t accurately reflect the costs of providing care to Medicare beneficiaries.
History of SGR repeal
Since 2002, both Congressional Republicans and Democrats have been saying that the system needed to be changed, with the incentives for physicians changing from quantity to quality. However, each and every year, physicians ran into the same obstacle: How do we pay for a repeal of the SGR?
AGA Institute
co-executive vice president, Lynn P. Robinson, JD, was honored to represent AGA at an historic event and awe-inspiring ceremony in the White House Rose Garden to celebrate the signing of the SGR repeal legislation.
This obstacle doomed any type of meaningful reform as Congress would wait until the 11th hour to figure out how to prevent deep cuts in physician reimbursement, which led to a temporary fix. Every year we would be told, “We’ll fix this temporarily so that next year we can focus on a permanent solution.” And every year, we just received the same old temporary “doc-fix.” The term “doc-fix” became such common nomenclature around Washington that even people outside of health care knew that this was a “must pass” piece of legislation that Congress needed to address every year.
Physician groups were also told by Congressional leaders throughout the years that Congress wasn’t just going to hand them billions of dollars to make this problem go away, but that physicians needed to make initiatives to demonstrate that they were willing to invest in quality improvement and value-based care. Many organizations, including AGA, invested millions of dollars to develop quality improvement measures, clinical service lines, clinical data registries, initiatives with private payers and other initiatives to improve outcomes for patients.
AGA, through the leadership of John I. Allen, MD, MBA, president, AGA Institute, developed the AGA Roadmap for the Future of GI Practice, which recognized that the health-care landscape was changing and that AGA needed to be the leader in determining quality measurement for gastroenterology or that it would be dictated to us by Medicare and other payers. Dr. Allen recognized that, regardless of whether Congress repealed the SGR or not, private payers were implementing many of these changes and there was a real opportunity for AGA to lead the way to ensure that our members would be ready and prepared for a value-based payment system.
The SGR repeal
AGA Institute
Frank Pallone Jr. and Lynn Robinson
Unbeknownst to many health care lobbyists in Washington, House Speaker John Boehner (R-OH), and House Minority Leader Nancy Pelosi, D-CA, were secretly negotiating an SGR repeal package based on legislation that was crafted last year by a bipartisan, bicameral group of legislators that won the support of the entire physician community. That legislation, the SGR Repeal and Medicare Provider Payment Modernization Act of 2014, was the model that became the Medicare Access and CHIP Reauthorization Act, which overwhelmingly passed both chambers of Congress and that President Obama signed into law. This legislation repeals the SGR, transitions physicians into a value-based payment system and empowers physicians to determine their updates by how much risk they are willing take on by enrolling in either the Merit-Based Incentive Payment System (MIPS) or an alternative payment model (APMs). APMs, such as bundle payment models, will yield a higher return since the physician takes on more risk and MIPS is based on some of the current quality improvement programs, such as the Physician Quality Reporting System, value-based payment modifier and meaningful use, which are combined in the new legislation.
What’s next
Like most major pieces of legislation, the real work will come during implementation. Our work will continue during the regulation and comment period. We know that we have our work cut out for us, but we are confident that AGA has the foundation in place to ensure that our members have the tools they need to survive and thrive in a value-based world. We will continue to work to insure that the transition to a value-based world is as seamless as possible.
