SGR, RIP

On April 14, 2015 the Senate voted 92-to-8 to approve legislation previously passed by the House that puts an end to the SGR-based physician payment formula for Medicare services. At posting time, President Obama said he would sign the bill. The Senate-passed measure is identical to the bill approved by the House; all amendments introduced in the Senate were defeated.

After the vote, many medical societies, including the AMA and AAOS, heaped praise on Congress. In a rare moment of brevity from Capitol Hill, Michigan Rep. Fred Upton told Kaiser Health News (KHN), “Stick a fork in it. It’s finally done.”

But according to KHN, “while the law lays out a structure on how to move to new [Medicare] payment models, much of their development will be left to future administrations and federal regulators.” And an even colder rain on the parade came in a report from Paul Spitalnic, the head actuary at the Centers for Medicare and Medicaid Services (CMS). Spitalnic’s report soberly observes that the legislation about to be signed into law “raises important long-range concerns that would almost certainly need to be addressed by future legislation.” While the bill specifies physician payment-update amounts for all future years, the CMS report says that “the specified rate updates would be inadequate in years when levels of inflation are higher or when the cumulative effect of price updates not keeping up with physician costs becomes too large.”

So while orthopaedists in the twilight of their active-practice careers may be able to “stick a fork in it,” younger surgeons may be distracted by debates about physician Medicare payments that are apt to crop up again.

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