Obama signs SGR fix after House passes 6-month delay

By Kate Madden Yee, AuntMinnie.com staff writer

June 25, 2010 -- President Barack Obama this morning signed legislation that retroactively reverses to June 1 the 21% cut in Medicare payments to doctors implemented on June 18 under the sustainable growth rate (SGR) formula. The move came after the U.S. House of Representatives on Thursday resolved an impasse that had held up SGR legislation passed by the Senate.

The House passed HR 3962 by a vote of 417-1. It delays until November 30 the cut in the Medicare Physician Fee Schedule (MPFS) mandated by the SGR formula and, in fact, raises physician payments, also retroactive to June 1, by 2.2%.

The Centers for Medicare and Medicaid Services (CMS) has directed Medicare claims administration contractors to discontinue processing claims at the negative update rates and to hold all claims temporarily for services rendered June 1 and later, until the new 2.2% update rates are tested and loaded into the Medicare contractors' claims processing systems, according to CMS spokesperson Ellen Griffith. June claims that have been paid at the negative update rates will be reprocessed as soon as possible. CMS expects to start processing claims at the new rates no later than July 1.

The Senate passed the measure June 18, after breaking it out of the larger jobs bill legislation (HR 4213) in an effort to appease Senate Republicans and some Democrats who wanted certainty that the fix would be paid for. The bill's costs are offset by a $4.2 billion cut in hospital Medicare reimbursement garnered by changing a Medicare policy called the "72-hour" rule, according to Senate Finance Committee documents.

With HR 3962 in the House, Senate boosters hoped it would move quickly through that body and become law. But Speaker Nancy Pelosi (D-CA) stalled, saying that the House would not take up the "inadequate" measure until the Senate produced jobs legislation. She softened her position on June 23, and the House passed the bill.

Senate Finance Committee Chairman Max Baucus (D-MT) and Ranking Member Chuck Grassley (R-IA) praised the House for passing the bill.

"Our House colleagues deserve praise for standing with us today to help fulfill our responsibility to seniors and military families ... across the country," Baucus said.

"This legislation reverses a payment cut that is jeopardizing access to physician services for Medicare beneficiaries and military families," Grassley said. "This action was critically needed so there's no disruption in services for anyone."

Despite the last-minute resolution, the issue isn't permanently resolved: On December 1, the 2.2% increase will be rescinded and the 21% SGR cut will take effect if Congress doesn't broker a permanent fix. This would then be followed by another cut in the MPFS conversion factor -- on top of the 21% cut -- that is slated to take effect on January 1, 2011.

By Kate Madden Yee
AuntMinnie.com staff writer
June 25, 2010

House holds SGR fix hostage to jobs bill, June 22, 2010

CMS begins paying claims at lower SGR rate, June 21, 2010

Senate delays Medicare cuts until December, June 18, 2010

Senate committee takes SGR action, June 18, 2010

CMS extends Medicare claim hold, June 14, 2010

Copyright © 2010 AuntMinnie.com

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