Medicare Payment Reform for 2009-2017

AMA House of Delegates Push for SGR Changes

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[Staff Reporters]

According to the American Medical News, November 24, 2008, the AMA House of Delegates is setting the groundwork for a major push to reform Medicare physician payment next year.

AMA Lobby

The AMA will continue to lobby Congress for changes in the sustainable growth rate [SGR] formula to better reflect practice costs, to improve the accuracy of the index that gauges increases in those costs and to investigate geographic pay disparities; among other issues.

AMA Council on Medical Service

The AMA Council on Medical Service also requested physician input on payment systems that could replace or improve the current one. These newer compensation models might include:

  • bundled payments, under which physicians are paid flat rates per episode of care, rather than per service;
  • gainsharing, under which hospitals and doctors agree to share incentive pay and savings from quality improvement;
  • medical homes, under which doctors are paid for coordinating care; and,
  • pay-for-performance, under which doctors are paid based on quality measures.


To date, it is unclear which new compensation model[s] will prevail; if any?


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7 Responses

  1. Primary Care Fiasco

    “Let us not forget the looming physician shortage at the primary care entry level of patients into the system. Universal coverage without primary is access is meaningless. Just ask Massachusetts citizens. And if Congress follows its formula for cutting Medicare by 21% in June 2009, we will have a political donnybrook of unimaginable dimensions on our hands. If that cut occurs, it is likely 1/3 of physicians will no longer accept new Medicare or Medicaid patients. The outcry from the disenfranchised but entitlement-minded populace will be thunderous”

    Richard Reece; MD
    From: Who will speak for independent physicians at the reform table?



  2. No Senate Action on SGR; Pay Cut Looms

    Doctors on March 1 will experience a 21.2% cut to Medicare physician payments because of the Senate’s inability to act on a temporary measure to halt the scheduled reduction.

    Legislation to stave off the cut to physician payments for 30 days passed easily enough in the House Thursday evening, but was blocked repeatedly in the Senate by retiring Sen. Jim Bunning (R-KY), who claims the fix to the sustainable growth-rate formula, along with other Medicare extensions in the bill, would add to the national debt.

    Medical groups in statements voiced their immediate displeasure with lawmakers. “Our message to the U.S. Senate is stop playing games with Medicare patients and the physicians who care for them,” said J. James Rohack, president of the American Medical Association. “It is shocking that the Senate would abandon our most vulnerable patients, making them the collateral damage of their procedural games.”

    Source: Jennifer Lubell, Modern Healthcare [2/26/10]


  3. UPDATE 2011:

    [AMA to Offer Payment Formula Proposal]

    The American Medical Association is expected to propose a three-part approach to changing the Medicare physician payment formula in a congressional hearing Thursday May 5, 2011, to examine the issue.

    According to a copy of AMA President Dr. Cecil Wilson’s written testimony, the association representing 216,000 of the nation’s physicians suggests fixing the current payment system by repealing the sustainable growth-rate formula; implementing a five-year period of stable Medicare physician payments that keep pace with medical practice cost growth; and shifting to new payment models that enhance care coordination, quality, appropriateness and costs.

    Source: Modern Physician [5/4/11]


  4. Medicare Premiums to Rise By Less Than Expected in 2012

    Medicare part B premiums for most beneficiaries are going up in 2012 by a smaller-than-expected $3.50 per month, to $99.90, according to the WSJ.

    Hope Rachel Hetico RN MHA


  5. Disclosing Doctors’ Medicare Pay Might Be ‘Pretty Damning’

    The Obama administration’s plan to release how much the Medicare system paid individual doctors for specific procedures could blow the lid off one of the most jealously guarded secrets in medicine.

    Apparently, a very contentious issue!



  6. Bundled Payments for Oncology – Update 2014
    [Creating Value-Based Episodes of Care]

    Did you know that annual spending for cancer treatment in the U.S. is set to reach $184 billion by 2020? The large and growing bill has raised concerns that fee-for-service payments for oncology are promoting over-treatment and use of more expensive drugs irrespective of patient benefit.

    With cancer rates projected to rise steeply in the next two decades, this is a critical time to improve efficiency and standardize quality in oncology services, and many see episode-based bundled payments as a promising strategy.

    Any thoughts?



  7. CMS Delays Expansion of Bundled Payment Programs

    CMS has delayed the expansion of a major bundled payment pilot, Comprehensive Care for Joint Replacement (CJR), and the implementation of its bundled payment initiatives for cardiac care from July 1 to Oct. 1, 2017, according to an interim final rule posted to the Federal Register. It also delayed, for a second time, the effective date of a final rule laying out the implementation of CJR and other bundled payment programs, from March 21 to May 20, 2017.

    The Trump administration’s move to delay these initiatives raises questions about the future of government initiatives to usher in healthcare out of fee-for-service operations and into a new age of value-based payment. Such efforts were a hallmark of healthcare reform under the Obama administration, which set the goal of having half of traditional Medicare dollars go through alternative payment models by 2018.

    Source: Elizabeth Whitman, Modern Healthcare [3/20/17]


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