New Legislation May Fix How Medicare Pays Doctors

A new bipartisan bill in the U.S. House of Representatives seeks to base more physician reimbursement on performance and quality measures to remedy a flaw in how physicians are paid through Medicare.

House members seek to repeal Medicare’s sustainable growth rate (SGR) reimbursement formula that caused significant cuts to doctor payments from Medicare.

The bill would increase payments by 0.5 percent each year through 2018. Come 2019, Medicare will start tying payments to quality measurements such as clinical care, patient and caregiver experience, population health and other factors. To determine any bonuses in pay, physicians will be evaluated against their peers against various measures by the U.S. Secretary of Health and Human Services.

The American Medical Association and other groups expressed their support of the payment models because they will lower healthcare costs while providing better quality care.  A Forbes article stated that the SGA model would have hit some healthcare businesses by as much as 25 percent and large cuts like that would negatively impact patient care. It also noted that since not all medical services are the same, it’d be illogical to base reimbursement rates on the profit margins earned by different provider segments.

Read the final draft of the Medicare legislation here.

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