Lawmakers Offer New Plan to End 'Doc-Fix' Cuts to Healthcare Providers

Lawmakers in Congress believe they have finally found the solution to the Sustainable Growth Rate (SGR) provision of Medicare which, save for some last minute legislation, would have slashed reimbursements to physicians by 26.5 percent.

The proverbial sword of Damocles hanging over every healthcare provider’s head has been the SGR, also known as the “Doc Fix.” As Congress has done every year since 2003, they postponed the cuts to physicians by finding the money somewhere else. This year’s cut was averted by legislation in the Taxpayer Relief Act of 2012 that shifted the cut onto hospitals and other groups.

Yesterday Reps. Allyson Schwartz (D-Pa.) and Joe Heck (R-Nev.) went once more into the breach and filed legislation to permanently fix the Doc Fix. This is the second year they have attempted it, but last year’s bill failed to gain traction because other lawmakers were not comfortable that the funding would have come from savings resulting from reduced military presence in Iraq and Afghanistan.

On Monday the Congressional Budget Office released its forecast of spending for the next 10 years, and in its analysis found that the cost to fund the SGR was half earlier projections, from $244 billion to $138 billion.

The SGR formula has been in place since 1997. In the first years, it awarded physicians a boost in the reimbursement rate; since 2002 the SGR has cut physician’s reimbursement rate, and Congress has forestalled those reductions since 2003. Unless Congress acts to fix the Doc Fix, physicians will be facing a 25 percent cut on Jan. 1, 2014.

According to the Politico blog, provider associations are encouraged by the bill, though groups such as the American Medical Association have stopped short of endorsing it.