Legislative Update

As the deadline for Congressional action to prevent a massive CMS SGR 21% cut in physician fee schedule payments on March 31, 2015 approaches, we would like to update you on where things stand with regard to a long-term vs. short-term SGR fix.

During a recent speech before the Federation of American Hospitals (FAH), Representative Kevin McCarthy (R-CA) and Rep. Paul Ryan (R-WI) said that an SGR fix was “within reach” this year but that it wouldn’t get done by the time the current “patch” expires on March 31st.

Currently, it appears as though the most likely “pay for”, for an SGR patch extension will be to add another year to Medicare sequestration.  As you know, the 2% Medicare sequestration is currently projected to expire at the end of 2024.  Adding a year on the back end (extending until 2025), results in about $5 billion dollars in “savings” to the Medicare program. This is nearly enough to offset the cost of another temporary SGR fix.  It is not clear whether the temporary fix will include a modest increase (.5%) in the Conversion Factor (CF).

Break Away from the Static

The most likely scenario at this point is that between now and March 31st, Congress will adopt a short-term SGR patch to give the House and Senate additional time to identify the offsets necessary to “pay for” an SGR fix.  This way, they can avoid any delays in payment or the need to refile claims because Congress failed to enact an SGR fix in time.

There remains to be broad bi-partisan agreement on what should replace the SGR but there is no agreement on how to pay for the replacement.  The “pay for” has been and continues to be the stumbling block.  Both McCarthy and Ryan expressed optimism that they could find the necessary offsets this year but gave no indication of just where those savings would come from.

As always, ADVOCATE will keep you updated on this and other issues impacting radiology as they become available.

Best regards,
Kirk Reinitz, CPA