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Second Opinion

Learn about policy issues important to medical schools and teaching hospitals, with Executive Vice President Atul Grover, M.D., Ph.D.

House Passes SGR Reform, Senate Punts Until After Recess

March 27, 2015—The House March 26 overwhelmingly (392-37) passed the Medicare Access and CHIP Reauthorization Act of 2015 (H.R.2),bipartisan legislation introduced March 24 by leaders of the House Energy and Commerce and Ways and Means Committees which permanently replaces Medicare’s sustainable growth rate (SGR) formula, reforms physician payment, and extends funding for Children’s Health Insurance Program (CHIP). Senate consideration of H.R. 2 was delayed until members return from a two-week spring recess.

Though physicians face a 21 percent cut in Medicare reimbursement when the current SGR patch expires March 31, CMS has the ability to hold claims for 10 business days, allowing the Senate time to vote on the package upon return to Washington.

In a March 26 statement, AAMC President and CEO, Darrell G. Kirch, M.D., applauded the bipartisan effort garnered to pass H.R. 2 stating, “We thank the Republican and Democratic House and committee leaders for coming together to address this important issue. This bipartisan agreement to achieve a permanent solution to the ongoing threat of Medicare physician payment cuts is critical to ensuring that all Americans get the quality health care they need.”

The compromise builds upon the SGR Repeal and Medicare Provider Payment Modernization Act (H.R. 1470)bipartisan, bicameral legislation negotiated and agreed to in the 113th Congress [see Washington Highlights, Feb. 7, 2014] and reintroduced March 19 in the House and Senate.

In addition to reforming the Medicare physician payment system, the new package also reauthorizes CHIP through fiscal year (FY) 2017, extends the partial enforcement delay of CMS’ two-midnight policy for short stay inpatient hospitalizations, and extends funding for the National Health Services Corps and the Teaching Health Center (THC) program for two additional years.

Joining eight fellow hospital and health systems, the AAMC sent  a March 25 support letter to House members, stating “We appreciate the effort that has been put forth in crafting this legislation. Eliminating planned cuts to physicians in Medicare will ensure access to care for our nation’s Medicare beneficiaries.”

The Obama Administration March 25 released a Statement of Administration Policy affirming the President’s support for the passage of H.R. 2, stating, “the proposal would advance the Administration's goal of moving the Nation's health care delivery system toward one that achieves better care, smarter spending, and healthier people through the expansion of new health care payment models, which could contribute to slowing long-term health care cost growth.”


Len Marquez
Director, Government Relations
Telephone: 202-862-6281


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