American Medical Association Seeks Abolishment of Sustainable Growth Rate's 'Doc Fix'

Reform of Medicare must begin with elimination of the Sustainable Growth Rate (SGR) formula, according to executives from the American Medical Association.

“These realities pose obstacles to widespread adoption of the kind of innovative care and delivery models needed to reinvigorate our Medicare program in the service to 47 million Americans,” AMA CEO James L. Madara said during a recent policy conference hosted by the National Journal and sponsored by the AMA. “Our work to build a strong and sustainable Medicare system is just one effort by the American Medical Association in making and shaping a better future for patients, physicians and our nation.”

According to Dr. Madara, the AMA has drafted a transition plan to move to new Medicare payment schemes that begins with elimination of the SGR, also known as the “Doc Fix.”

Since 2003 Congress has averted Medicare reimbursement cuts from the SGR, which have accrued every year. The cut for 2013 was supposed to be 26.5 percent, but was waived at the last minute by the American Taxpayer Relief Act passed on Jan. 1. Next year’s cut is slated to be 25 percent, but as reported last week, a bill was submitted in Congress to permanently eliminate the SGR.

The AMA lauded the Centers for Medicare and Medicaid Services (CMS) announcement last week they are piloting a bundled hospital and physician payment models. “The objective of this initiative is to improve the quality of health care delivery for Medicare beneficiaries, while reducing program expenditures, by aligning the financial incentives of all providers,” said acting CMS Administrator Marilyn Tavenner, who last week was nominated to assume the post permanently.

“It is important that physicians in a variety of practice types have opportunities to participate in bundled payment program pilots,” said AMA President Jeremy A. Lazarus. “The AMA urges CMS to provide opportunities for additional practices, which may not have been ready to apply when the program was first announced, to participate. We encourage CMS to offer additional models, as the four existing models all involve an inpatient hospital stay.”