Medicare Payment Advisory Commission (MedPac) doc fix doesn't impress

By:

Stephanie Bouchard

The Medicare Payment Advisory Commission is proposing to fix the Sustainable Growth Rate by sharing the cost of repealing the SGR among physicians, other health professionals, providers in other sectors and beneficiaries. The response from those in the industry has been less than supportive.

MedPAC, a body that advises Congress on Medicare payment policy, presented a draft of its proposal last week. In it, MedPAC said its SGR repeal would cost about $200 billion. To pay for its repeal plan, MedPAC suggests instituting a 10-year payment rate freeze for primary care physicians and three years of reduced payments at 5.9 percent each for specialists followed by a seven-year payment freeze. It also recommends offsets totaling about $235 billion. Those offsets would come from cuts to Medicare Part D drug plans (32 percent); post-acute care facilities (21 percent); Medicare benefits to seniors (14 percent); hospitals (11 percent); laboratories (9 percent); durable medical equipment (6 percent); Medicare Advantage (5 percent); and others (2 percent).

“While we fully appreciate the need to correct problems in the Medicare payment system for physicians, we are deeply concerned that this MedPAC outline to address the so-called 'doc fix' disproportionately targets the (skilled nursing facility) sector – and the net impact of these proposed Medicare cuts would place seniors' care at deep risk, jeopardize jobs across America and further destabilize the nation's second largest health facility employer," said Alan G. Rosenbloom, president of the Alliance for Quality Nursing Home Care in a statement.

“… As we have in the past, we will continue to insist today that the U.S. Congress should make its Medicare funding decisions based upon the complete set of funding variables and economic realities facing skilled nursing facilities, our patients and our workforce,” he added. “This MedPAC outline inherently fails to recognize these realities."

Organizations representing physicians are balking at the proposed cuts and freezes to physician payment rates. In a statement, the American College of Surgeons praised MedPAC for recognizing the need to eliminate the SGR but the organization criticized the commission for undervaluing the role of physicians.

“Unfortunately, while the MedPAC recommendations being considered do eliminate the SGR, they fail to meet the goal of quality and further jeopardize access to care,” reads ACS’ statement. “The recommendations do not value the role all physicians have in the continuum of care and would have a devastating impact on access to surgical care.”

“We do not believe that cuts are the answer,” ACS’ statement continues. “We believe that a replacement of the SGR needs to be created that leverages quality, bends the cost curve, pays down the SGR debt and incentivizes value in the future. Over the next several years, the cost of caring for the frail and elderly will place an enormous strain on the country's healthcare resources. As a result, the ACS supports redesigning the delivery system to meet this critical demand by applying a shared savings model centered around quality and value incentivizing all physicians to adopt better practices.”

Follow HFN associate editor Stephanie Bouchard on Twitter @SBouchardHFN.