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House of Representatives Repeals Flawed SGR Formula; Senate Action Pending

House of Representatives Repeals Flawed SGR Formula; Senate Action Pending

On Thursday, by a vote of 392 to 37, the U.S. House of Representatives overwhelmingly passed the Medicare Access and CHIP Reauthorization Act (H.R. 2). The bill will repeal the flawed sustainable growth rate (SGR) formula and replace it with a value-based payment system for all Medicare providers. Supporters were hopeful that the Senate would consider the bill before adjourning for a two-week spring recess on Friday, yet Senate Majority Leader Mitch McConnell announced that the Senate will act quickly to consider H.R. 2 after the recess.

Current Medicare Physician Fee Schedule reimbursement rates are set to expire on Tuesday, March 31st. All Medicare providers are scheduled to receive a 21 percent reduction in reimbursement at that time due to the SGR formula. While the Senate’s failure to act by April 1st technically triggers the 21 percent reduction, it is unlikely that the cut will take effect. As in the past, CMS will hold claims for 14 days, which gives Congress additional time to complete action on H.R.2 to repeal the SGR formula once and for all.

The Academy is closely monitoring this legislation and will keep the membership apprised as the Senate considers H.R. 2 in April. 

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