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SGR – The House Weighs In While the Senate Goes on Vacation

Written by: Darlene D'Altorio-Jones (1959-2015) on Monday, March 30, 2015 Posted in: Outpatient Rehab

A big push from the House of Representatives to present the first possible permanent fix to the Sustainable Growth Formula and avoid a 21 percent reduction in payment to the Physician Fee Scheduled as early as April 1, 2015, came to a grinding halt when S. 810 was left to discuss after the Senate’s spring break.  Having all possibilities covered, CMS acted early and released a statement on what they were prepared to do should a final vote not be completed in time.

Believing the passage of H.R. 1470 legislation, as it was connected to H.R. 2 –  Medicare and Chip Reauthorization Act (MACRA), gave some hope that a bipartisan, unified committee bill to replace the flawed-formula of the Sustainable Growth Rate had not only passed the House of Representatives, but in blinding speed might also finally win the favor of the Senate presented as S.810.

The bill moves payment from a volume-based to a rewards-value-based payment system and averts a 21 percent cut in payment for Physician Fee Scheduled payments as of April 1, 2015; instead the Senate left on vacation.

CMS, through a MedLearn Matters Update on March 24th, was prepared for this possibility and on that date stated,  “The Administration urges Congress to take action to ensure these cuts do not take effect. However, until that happens, CMS must take steps to implement the negative update. Under current law, electronic claims are not paid sooner than 14 calendar days (29 days for paper claims) after the date of receipt. CMS will notify you on or before April 11, 2015, with more information about the status of Congressional action to avert the negative update and next steps.”

Since the Senate is not scheduled to return until April 13th, it appears further information will be forthcoming from CMS who, conveniently, has 14 calendar days after the date of bill receipt to make payments. This tight time frame gives the Senate a day to consider S. 810, and to vote if they too believe the House proposed framework and package is merit-worthy (using the word ‘merit’ with tremendous weight on the future of PFS reimbursement).

The SGR repeal legislation will provide 0.5%  updates for the next five years and provides for the current payment system through 2019.  At that time, it will provide an incentive payment program called “Merit-Based Incentive Payment System (MIPS); which will consolidate no less than three programs into one reimbursement solution. The systems to be streamlined would be PQRS, the Value-Based Modifier and EHR Meaningful Use reporting requirements.

The ultimate goal for CMS is to move as many health care professionals as possible into Alternative Payment Systems (APS), as professionals who receive a significant portion of their revenues through APS would be excluded from MIPS. The MIPS program will consider four areas: Quality, Resource Use, EHR Meaningful Use and Clinical Practice Improvement activities, to reward payment. The bill highlights how annual measures updates will be reviewed and published, and how the scoring and weighting of all the factors mentioned will translate to incentivized payments.

Possibilities for payment will include negative adjustments for performance that falls below thresholds, with those reductions funding positive payments to professionals above thresholds. For those at threshold, a zero adjustment is imposed. In addition to negative, neutral or positive payments will be an exceptional performance threshold enabling at least 75 percent of those who receive positive adjustments to receive a capped additional incentive payment.  Better performers could receive larger incentive payments up to a capped amount annually.

Encouraging participation in alternative payment models holds different payment incentives also discussed in HR 1470.  Until the Senate returns and weighs in on S. 810, along with provisions to continue up to 34 mentioned health extender programs in HR 2, the SGR fix is, at best, still in limbo.

Was leaving on vacation without addressing SGR a smart move?  Only time will tell!

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