President signs “Pathway for SGR Reform” Act

Jan. 6, 2014

On December 26, 2013, President Barack Obama signed into law the Pathway for SGR (Medicare Sustainable Growth Rate) Reform Act of 2013. This new law prevents a scheduled payment reduction for physicians and other practitioners who treat Medicare patients from taking effect on January 1, 2014, as was scheduled, and provides for a 0.5 percent increase for services through March 31, 2014.

The Pathway for SGR Reform Act of 2013 was attached as an amendment to the Bipartisan Budget Agreement of 2013 brokered by Sen. Patty Murray (D-WA) and Rep. Paul Ryan (R-WI), which passed the House on December 12 and the Senate on December 18.  The 3-month reprieve from the SGR cuts was added to the budget deal by the House before it voted to approve the package.

The Congressional Budget Office estimated that the temporary fix would cost $3.3 billion in 2014, and a total of $7.3 billion through 2023.  It would be paid for by cutting payments for non-reimbursed hospital-based care.  The SGR Reform Act also extends the 2 percent sequestration cut to Medicare payments by 2 years, to 2023.  It encourages the Centers for Medicare and Medicaid Services to simplify physicians’ administrative burden by coordinating quality measure requirements, and give doctors more timely feedback on those measures.

Congress and the Administration appear committed to a permanent solution to eliminating the SGR formula in the existing statutory methodology.  When it returns the week of January 6th, Congress will continue work on the Budget deal and a permanent SGR fix. Energy and Commerce Committee Health Subcommittee Chairman Pitts (R-PA) has announced a hearing for Thursday, January 6th to discuss “The Extenders Policies: What Are They and How Should They Continue Under a Permanent SGR Repeal Landscape?

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