Introduction of SGR Repeal and Medicare Provider Payment Modernization Act of 2014

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ISASS staff participated in a conference call conducted by the American Medical Association (AMA) in which the SRG Repeal Legislation was discussed. We felt ISASS members would want to review the information presented.

Staff for the chairmen and ranking minority members of the three Congressional committees of jurisdiction briefed physician groups this afternoon on the results of their bicameral, bipartisan negotiations on repealing the SGR. The “SGR Repeal and Medicare Provider Payment Modernization Act of 2014,” which was introduced by Rep. Michael Burgess, MD (R-TX) in the House as H.R. 4015, addresses only the policy provisions related to eliminating the flawed payment update formula. It does not include financial offsets or any of the usual extender policies.

The AMA is still reviewing the legislative language in detail, but following are some of the main provisions:

  • The SGR would be repealed immediately.
  • Positive annual payment updates of 0.5 percent would be provided for five years.
  • The VBP program has been replaced with a similar Merit-Based Incentive Payment System or MIPS, which includes prospectively-set performance thresholds and offers flexibility in the imposition of performance requirements that are inappropriate for some specialties.
  • The effective date of the MIPS program would be one year later than the original VBP proposal, and will start in 2018.
  • The MIPS funding pool was increased and is no longer budget neutral, and the phase-in of penalty risks for those who fall in the lowest performance quartile has been capped at a maximum of 9 percent (as opposed to the previous 12 percent).
  • The 5 percent added incentive payment for physicians in Alternative Payment Models was retained.
  • Funding for technical assistance to small practices of 15 or fewer professionals was doubled.
  • Provisions similar to the Standards of Care Protection Act are included.
  • Physicians who opt out of Medicare to engage in private contracting with their patients would no longer be required to renew their opt-out status every two years.

Members of the Congressional Doctors Caucus were heavily engaged throughout the negotiations until late last night, pursuing the policy goals they outlined in a letter last December.

Read the Official Section-by-Section Summary of the Legislation (PDF) »

The AMA greeted today’s developments with enthusiasm, congratulating House and Senate negotiators for taking this critical step. In addition, the AMA strongly cautioned against continuing the cycle of short-term patches by merely addressing the imminent 2014 cut without resolving the underlying problem caused by the SGR, characterizing that strategy as fiscally irresponsible. A copy of Dr. Hoven’s statement on the introduction of the bill is also attached.

Read Dr. Hoven’s Statement on the Introduction of the Bill (PDF) »