Sustainable Growth Rate Repeal Bill Will Harm Medicare Patients

Senate Should Repeal SGR Without the Merit-Based Incentive Payment System

Washington, D.C. – As the U.S. Senate prepares to consider legislation to repeal Medicare’s Sustainable Growth Rate (SGR), senators need to know the bill will replace the SGR with something worse.

“The SGR is unworkable and needs to go,” said Dr. David Hogberg, senior fellow at the National Center for Public Policy Research. “But the bill under consideration creates a new Medicare payment system that, ultimately, will harm the sickest Medicare patients.”

In a new National Policy Analysis, “SGR Repeal Bill Will Harm Medicare Patients,” Dr. Hogberg explains the Medicare Access and CHIP Reauthorization Act will reward physicians for avoiding the patients most in need.

The bill creates a new payment system called the Merit-Based Incentive Payment System (MIPS). Under MIPS, physicians will be paid in part by how well they do on various quality measures. If they score above the average score on a quality measure, they receive a bonus. If they score below, they will be penalized.

Dr. Hogberg explains this will incentivize physicians to eschew sicker patients.

“Consider A1c, the level of a patient’s blood sugar and a common quality measure for diabetics,” said Dr. Hogberg. “Physicians who are subject to this quality measure can boost their score by limiting their diabetic patients to those who are easy to treat. They will avoid diabetic patients who need much more encouragement and monitoring, since taking on too many of those patients could result in a below average score on the A1c measure and, hence, a penalty.”

Furthermore, this system encourages more talented physicians to pursue the less challenging avenues of medicine, since that is where the healthiest patients are likely to be, making it easier to receive a bonus under MIPS. They will avoid the more challenging avenues where the sickest patients are likely to be.

“Ultimately, the sickest patients will suffer as MIPS incentivizes the best physicians to avoid them,” said Dr. Hogberg.

“The House has already passed this bill without giving much thought to what they are replacing the SGR with,” said Dr. Hogberg. “It would be wise for the Senate to slow down the process and eliminate MIPS from the legislation.”

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