The U.S. Senate, by a 92-8 vote late April 14, passed a bipartisan bill that includes a permanent solution to the “doc fix,” a method utilized by the government to ensure payment to Medicare providers kept pace with inflation. The U.S. House of Representatives approved the same bill more than two weeks ago, and President Barack Obama is expected to sign it. Had the Senate failed to pass the bill, Medicare rates to physicians would have decreased by 21 percent, as required under current law.

Specifically, the bill repeals Medicare’s sustainable growth rate formula for physician reimbursement, replacing it with a new value-based system. Doctors’ Medicare payments will increase by 0.5 percent every year through 2019. Thereafter, base payments will remain steady through 2025, but doctors will also receive bonuses or penalties depending on their performance scores. Their performance scores will take into account such things as meaningful usage of electronic medical record systems and the implementation of care models that highlight quality over quantity.

From 2026 forward, doctors and other medical providers who utilize alternative payment systems will receive a 1 percent annual increase in their Medicare reimbursement rates, while others who do not participate in alternative payment models will see 0.5 percent increases.

The bipartisan bill also funds the Children’s Health Insurance Program through 2017 and provides substantial funding for community health centers.

To help pay the expected cost of the bill, estimated at more than $210 billion, high-income seniors will pay higher premiums for doctor and outpatient care and prescription drug coverage, and the bill will require basic co-payments in Medigap plans.