Congress is racing toward a March 31 deadline to replace the much-maligned sustainable growth rate formula, used to determine Medicare payment for physicians, with a more progressive pay-for-performance model.  Missing the deadline would mean nephrologists and other specialists paid by Medicare will face a more than 20% payment cut April 1.

Legislators came close to a new payment formula last year, but could not agree on how to pay for it. President Barack Obama signed into law legislation that provided a temporary one-year patch for the SGR last April.

The latest deal would offset only about $70 billion of the more than $200 billion cost of making the permanent fix.  Late in the afternoon on March 13 , Reps. Paul Ryan, R-Wis., Sander Levin, D-Mich., Fred Upton, R-Mich., and Frank Pallone, D-N.J., the top members of two key committees, confirmed they are in talks for a permanent fix.


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“Last year, the Ways and Means and Energy and Commerce Committees came together, on a bipartisan basis, to propose a permanent alternative to the broken SGR system," they said in a statement. "We are now engaging in active discussions on a bipartisan basis — following up on the work done by leadership — to try to achieve an effective permanent resolution to the SGR problem, strengthen Medicare for our seniors, and extend the popular Children’s Health Insurance Program."

Ryan and others are proposing a two-year extension of the Children’s Health Insurance Program (CHIP). The deal would be a compromise for Democrats, who hoped for a four-year extension of the program.

The “doc fix” portion would cost an estimated $174 billion of the $200 billion, spread over 10 years, according to the Congressional Budget Office.