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Medicare 24% Cut Averted; ICD-10 Delayed

Last night’s passage of the Protecting Access to Medicare Act by the US Senate ended the hopes of an industry awaiting a permanent solution to the chaos created by the flawed sustainable growth rate (SGR). With a 64-to-35 vote on Monday night, the Senate approved the 13-month “Doc Fix” patch passed by the House of Representatives last week.

Without Congressional intervention, Medicare reimbursement for physicians was set to plunge by 24% starting April 1. While the 24% cut was averted, the legislation once again delays for another year – the 12th year in a row to be exact – a solution to the flawed SGR, leaving the health care industry with the bill’s other provisions that:

  • Impose a 0% payment update – there will be no more, or less, Medicare reimbursement through March 31, 2015.
  • Leave in place the 2% sequestration budget cuts.
  • Expand the sequestration reductions to 2024; in that year, the payment cut will be 4% during the first six months of the fiscal year and 0% for the final six months.
  • Delay transition to ICD-10 for at least 12 months; specifically, the measure states: “The Secretary of Health and Human Services may not, prior to October 1, 2015, adopt ICD–10 code sets as the standard for code sets…”
  • Eliminate the limitation on deductibles for employer-sponsored health plans, thereby pushing more financial responsibility onto the laps of patients.
  • Extend the 1.0 Geographic Practice Cost Index (GPCI) floor for another year, thus shoring up reimbursement in areas hit with potential decreases to this component of the Resource-based Relative Value Scale.
  • Establish “appropriate use” criteria for ordering and providing physicians for certain imaging services.
  • Expand the identification of potentially mis-valued RVUs for procedure codes.
  • Call for a study of the Relative Value Scale Update Committee (RUC), which has advised the government about RVUs since the program’s inception.
  • Revise the Metropolitan Service Areas in California to differentiate reimbursement based on geographic index values, beginning in 2017.
  • Establish demonstration programs for community-based behavioral health.

Financing for the act wasn’t identified, so the Senate had to vote to waive a budget point of order based on the violation of its own “pay-go” rule.

The bill now heads to desk of President Obama, who is expected to sign it.

Woodcock & Associates: Changing the Way You Work