The Sustainable Growth Rate (SGR) is part of the formula used to calculate physician reimbursement for Medicare. Unfortunately, the basic premise of the formula is flawed. The SGR formula is linked to the performance of the overall economy, yet the medical needs of individual patients do not shrink whenever the economy slows. When overall spending on services in the SGR exceeds the per capita gross domestic product, cuts to physician reimbursement are triggered. The SGR also includes the costs of drugs covered under Medicare Part B, a cost over which physicians have no control. Notably, spending on these Part B drugs is increasing at a higher rate than spending on actual physician services. This skews the calculation of the SGR and triggers overly harsh reductions in physician reimbursement.
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Explore This IssueMay 2007
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Congress should repeal the SGR formula and base payments on the growth of the Medical Economic Index, replacing the flawed payment methodology to avoid continually bandaging a broken system.
The ACR asks Congress to support a long-term fix to the Medicare physician reimbursement issue. Repairing the SGR formula is imperative to ensure that physicians will be fairly compensated and that patients will have access to appropriate care.
Enact Arthritis Act
The ACR exhorts Congress to enact the Arthritis Prevention, Control, and Cure Act of 2007 (S. 626/H.R.1283). This legislation would expand efforts to discover and implement new ways to prevent, treat, and care for patients with arthritis and related rheumatic diseases. See “Arthritis Act Provisions,” above, to learn how the act would enhance rheumatic disease research and public awareness.
Revoke Imaging Cuts
Because of a provision in the Deficit Reduction Act of 2005, imaging studies such as flat films and duel-energy X-ray absorptiometry (DXA) have been reduced to the Hospital Outpatient Perspective Payment System rate. This reimbursement reduction negatively affects not only rheumatologists who perform vital and timely imaging studies in their offices but also patient care—especially women’s access to treatment—and will increase cost for Medicare beneficiaries.
Additionally, the Centers for Medicare and Medicaid Services has made changes to the practice expense calculation for DXA, decreasing reimbursement for this vital service a staggering 75%. The ACR is concerned that if reimbursement continues to drop, patients will be unable to receive these important studies.
The ACR encourages members of Congress to revoke the imaging cuts in the “Deficit Reduction Act of 2005” so physicians can continue to perform these necessary studies.
Increase Research and Public Health Funding
The ACR supports increased funding to federal programs engaged in vital research to combat arthritis and related diseases. (See “Key Rheumatology Research Agencies,” below.) These programs are essential for finding innovative treatments that can help millions of Americans live longer, healthier, and more productive lives, and they are critical to developing more effective treatments, decreasing costs, and improving the quality of life for patients suffering from rheumatic diseases.