Health Subcommittee Continues Work Toward Permanent Solution to SGR

January 9, 2014

Members Hear From Experts on Cost, Benefits of “Extenders” Policies Often Considered with Short-Term SGR Fixes

WASHINGTON, DC – The House Energy and Commerce Subcommittee on Health today held a hearing, “The Extenders Policies: What Are They and How Should They Continue Under a Permanent SGR Repeal Landscape?”

“This Subcommittee has played an integral role in advancing a permanent repeal of the Sustainable Growth Rate (SGR) and implementing a sound replacement policy for Medicare reimbursements to physicians. We reported out Dr. Burgess’ Medicare Patient Access and Quality Improvement Act of 2013 (H.R. 2810) by voice vote, and the Full Committee reported it out favorably by a vote of 51 to 0 last July,” said Subcommittee Chairman Joe Pitts (R-PA). “As we move ahead with a permanent SGR fix, we also need to examine the expiring Medicare, Medicaid, Children’s Health Insurance Program (CHIP), and human services provisions that have traditionally moved with the SGR. The purpose of today’s hearing is to look at these ‘extenders’ and evaluate whether some of these short-term provisions should be made permanent, and, if so, how best to accomplish this.”

Health Subcommittee Vice Chairman Michael C. Burgess, M.D. (R-TX) added, “The reason we are here today is because of the real progress that has been made on the repeal of the Sustainable Growth Rate formula which has been a problem for a lot of us for a long time. The cake is literally in the oven baking and today we’re going to talk about what else may go into that before the process is completed.”

Members heard from experts regarding the value of these initiatives in order to assess possible changes as members continue to work toward a permanent solution to the flawed SGR formula. Many of these “extenders” policies carry significant costs to taxpayers and any changes to them deserve serious consideration. Subcommittee Chairman Pitts explained, “This is a time for us to be very prudent, even skeptical, given the enormous costs of these policies, and do our job on behalf of the taxpayers to ensure every dollar spent is reviewed for efficacy.”

Chairman of the Medicare Payment Advisory Commission (MedPAC) Glenn Hackbarth testified, “As part of the Commission’s Congressional mandate, each year MedPAC makes recommendations to the Congress on how payments to health care providers in Medicare should be updated or improved. … including temporary policies that require annual reauthorization at a budgetary cost to the taxpayer. In these instances, the Commission reviews the available data, policy options, and includes this analysis in our standing reports to Congress. In making our assessment of temporary policies, the Commission often uses a common set of questions:

  • What effect would the policy have on program spending relative to current law?
  • What effect would the policy have on beneficiaries’ access to care?
  • What effect would the policy have on the quality of care?
  • Does the policy advance payment reform? Does it move Medicare payment policy way from fragmented fee-for-service (FFS) payment and encourage a more integrated delivery system?”

There is a limited amount of data available regarding each of these programs. Today’s hearing provided an opportunity for members to hear more about many of these “extenders” policies, the merit of each, and the cost of each. The committee remains encouraged by its progress toward a permanent solution on the SGR and remains hopeful that this year the full Congress will complete the work begun by the Health Subcommittee.

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