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San Francisco Marin Medical Society Blog

House Passes Year-Long SGR Patch, Includes California GPCI Fix



This morning the U.S. House of Representatives passed “Protecting Access to Medicare Act of 2014” (HR 4302) to delay for 12 months a scheduled Medicare 24% sustainable growth rate (SGR) cut by voice vote.

Details of SGR Patch

The compromise measure contains a slew of additional health care provisions and benefits for physicians, hospitals, drug makers and other providers, including:

  • Grant Medicare physicians a 0.5% fee increase through December 31, 2014, and then a 0% update until April 1, 2015
  • California Medicare locality update, known as the California geographic practice cost index (GPCI) fix. The GPCI fix holds rural physicians harmless from cuts permanently.
  • Delay the deadline to implement the new ICD-10 diagnostic and procedure code sets by one year, to October 1, 2015
  • Delay implementation of the new inpatient payment rule for hospitals, known as the two-midnight rule, by 6 months, to March

Organized Medicine Criticizes SGR Patch, Urges for Permanent Payment Reform

Unable to come to an agreement on how to fund a permanent repeal of the badly broken formula, despite a bill with bipartisan, bicameral support, Congress appears poised to kick the can down the road for the 17th time in just 10 years. The California Medical Association (CMA) circulated a letter urging the House to take the time to fund the permanent repeal and pass it rather than adopting another year-long patch. The letter supported the “perseverance of the House and Senate Committees to achieve a bipartisan, bicameral agreement to repeal the flawed Medicare SGR and institute a reasonable new payment system.”

Over 90 national, stat, and specialty physician organizations called for a no vote on this legislation in the House of Representatives. The one-year patch is expected to cost roughly $20 billion. A significant chunk of that money will be generated through a budget gimmick, extending Medicare sequester cuts beyond the 10-year window used for budget scoring purposes. It is also funded with other physician cuts from misvalued codes and imaging criteria.

This latest patch is part of a decade long string of patches that have cost U.S. taxpayers $150 billion, close to the cost of a permanent fix. Moreover, many of the physician funding sources in the current patch legislation could be more cost-effectively applied in a permanent reform bill.

Click here to see the bill passed by the House.



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