is a strong possibility that Congress will enact legislation to end its annual legislative exercise of deferring Medicare physician payment cuts prescribed by the Sustainable Growth Rate (SGR) reimbursement formula. While a permanent "doc fix" has long been a goal, it has been prohibitively expensive to find offsets to pay for it. In February, however, the Congressional Budget Office, citing slower growth in Medicare costs, lowered its estimate for the 10 year cost of addressing the formula and freezing physicians' payments to $138 billion -- almost $100 billion less than last year's estimates for a permanent fix.
While finding $138 billion in offsets is still a challenge, there is a good deal of enthusiasm in Congress for pursuing a permanent solution before the most recent "fix" expires at the end of the year. The House Energy and Commerce and Ways and Means Committees have outlined a proposal to repeal the SGR and replace it with a new framework for Medicare's physician payment system. House Republicans have expressed optimism that legislation may be considered by the full House this summer. The Senate is also eyeing a potential fix, as the issue came up during the confirmation hearing this week for CMS Administrator Marilyn Tavenner. In addition, President Obama's Fiscal Year 2014 budget, released this week, proposes a permanent "doc fix" replaced with a Medicare physician payment model similar to the House Republican approach.
The potential of addressing this issue is important not only for physicians, but also for health care interests that may be targeted to pay for the permanent "fix" and for interests that have relied on this annual health vehicle to address other programs or issues.