‘Extremely disappointed’ in SGR repeal delay, AMA & AHA implore Senate to act

The American Medical Association (AMA) expressed extreme disappointment after the Senate failed to pass a bill that would repeal the sustainable growth rate (SGR) before it recessed for over two weeks. The repeal of the SGR, which currently is set to dramatically reduce physician payment rates on April 1, 2015, was expected after a bipartisan bill was passed by the House of Representatives last week (see House passes SGR repeal, Health Law Daily, March 26, 2015). The American Hospital Association (AHA) joined the AMA’s plea for action on the bill as soon as the Senate reconvenes. The Senate previously expressed that it would consider the bill on April 13, 2015 (see Overworked from budget passage, Senate recesses before SGR repeal vote, Health Law Daily, March 27, 2015).

The bill

Currently, the SGR requires cuts to Medicare payments to physicians whenever spending exceeds previously set targets and, if not repealed, this provision would translate into payments to physicians being reduced by more than 20 percent. In the past, temporary fixes to reduction have been adopted but a recently proposed bipartisan bill, H.R. 2, would repeal the SGR entirely and, instead, increase payments from July through December of 2015 and in each calendar year through 2019 by 0.5 percent (see New bipartisan bill would wipe out SGR, extend CHIP, and add laundry list of changes, Health Law Daily, March 24, 2015). The bill, if enacted, would also: (1) extend the Children’s Health Insurance Program through 2019; (2) extend the 1.0 floor of the Geographic Practice Cost Index, the ambulance add-on payment, and the Medicare rural home health add-on; and (3) make permanent certain extensions of Medicaid programs and payments.

Action, and lack thereof

On March 26, 2015, the House passed H.R. 2 by a vote of 392 to 37. After the vote on the bill, which was not split along party lines, the President announced his intention to sign it if it passed the Senate. However, the next day, when it was to be considered on the Senate floor, the body announced that it would not hear take action on it until after its recess, which is to last over two weeks. The delay in hearing the proposed legislation was thought to be caused by the lengthy session that eventually resulted in the passage of a Senate budget resolution.

Reactions

In their press release, the AMA commented on the delay, stating the following: “The [AMA] is extremely disappointed that the U.S. Senate did not vote on the Medicare and CHIP Reauthorization Act (MACRA) before leaving for recess today. Their failure to act leaves physicians facing a devastating 21 percent cut in Medicare reimbursements when the current [SGR] payment patch expires on March 31.” The AMA further “urged” the Senate to consider the bill again immediately on return from recess. The AHA wrote a letter to the Senate, dated March 26, that stated it was in support of the Senate’s confirmation of a permanent fix to the SGR in the form of the repeal. Rich Umbdenstock, President and CEO of the AHA, commended the legislature on the drafting of the bill, writing, “While we are disappointed that hospitals would looked to as an offset given that Medicare already pays less than the cost of delivering services to beneficiaries, the package strikes a careful balance in the way it funds an SGR repeal and embraces a number of structural reforms to the Medicare program.”