Fixing the formula: Congress reaches agreement on SGR

Optometrists have scored an important victory in legislation to revamp Medicare's payment formula. Under a new bill, ODs would get full recognition as eligible physician providers in new payment incentives programs.

ODs would get full recognition as eligible physician providers.

On Feb. 6, Rep. Michael C. Burgess, M.D. (R-Texas) introduced the SGR Repeal and Medicare Provider Payment Modernization Act (H.R. 4015). The bill reflects a bipartisan agreement between House and Senate lawmakers to fix Medicare's sustainable growth rate (SGR) payment formula. 

Following on the heels of the AOA's late-2013 advocacy efforts on payment reform, the bill would repeal the flawed SGR formula. It would replace the SGR with a system that focuses on quality and accountability. It would remove the immediate threat of Medicare reimbursement cuts. It also would provide annual updates of 0.5 percent over five years during a transition to a performance-based model.

Highlights of the legislation

The proposed legislation would include several improvements, according to the AOA:

  • Repealing the SGR formula.
  • Removing a 24 percent cut scheduled for April 1—and even larger cuts planned for future years.
  • Merging three existing quality programs (Physician Quality Reporting System, Electronic Health Record Meaningful Use and Value-Based Modifier) into one improved program that rewards ODs and others who meet certain performance standards.
  • Introducing a new pay and penalty scale based on composite scoring and replacing current penalties at the end of 2017.
  • Awarding a 5 percent bonus to providers who get a large portion of revenue from an improved-quality program in Medicare's traditional fee-for-service system or in alternative models such as accountable care organizations.
  • Expanding Medicare data use to encourage quality improvement and transparency.

Room for improvement

As the bill progresses, the AOA will push for further enhancements for ODs.

For example, there's restrictive language on what types of providers can bill Medicare for care management services of patients with complex chronic conditions. Although no optometrists qualify for a similar existing program, the AOA opposes a statutory exclusion. Also, ODs would face a one-year delayed start date on a provision that measures resources used during certain care episodes for specific patient conditions. This effort is largely aimed at assessing resources used during high-cost hospital-based interventions covered under Medicare Part A.

Congress is working to find a funding source for the legislation. During this process, the AOA will continue its fight to ensure fair treatment for optometrists and their patients.

For more information, email the AOA Washington Office or call 800-365-2219.

February 11, 2014

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