Congress rang in 2013 with legislation to prevent the “fiscal cliff”. Among other tax resolutions and spending cuts, The American Taxpayer Relief Act included a “doc fix” that prevented a 26.5% cut in Medicare physician payments required under the Sustainable Growth Rate Formula (SGR). 
While that’s great news for doctors, it’s not so great for hospitals. The legislation asks hospitals pick up much of the $30 billion tab needed to postpone SGR payment reductions for another year. Over the next decade, Medicare payment increases for inpatient and overnight care will be adjusted downward and Medicaid disproportionate share payments to hospitals will be cut $4.2 billion. “While fixing the physician payment formula is essential, it should not be done by jeopardizing hospitals’ ability to care for seniors and their communities,” AHA President and CEO Rich Umbdenstock said in a statement. “Additional payment reductions will make it harder for patients to access the care they need and depend on.” Although their payments will not be cut this year, physicians aren’t necessarily celebrating. The latest legislation marks the 15 th time Congress has acted to prevent cuts to physician Medicare payments, and many physicians have had enough. In a statement, Jeremy A. Lazarus, MD, President of the American Medical Association expressed the AMA’s frustration over the annual SGR “crisis”. “This patch temporarily alleviates the problem, but Congress’ work is not complete; it has simply delayed this massive, unsustainable cut for one year. Over the next months, it must act to eliminate this ongoing problem once and for all,” Lazarus said. Delaying implementation of the SGR is a start, but the healthcare industry is not out of the woods yet. The American Taxpayer Relief Act did not eliminate the sequester, which calls for $500 billion in federal spending cuts, including a 2% cut to Medicare funding. It simply pushed the implementation date back two months. That means we get to do this all over again in February.
While that’s great news for doctors, it’s not so great for hospitals. The legislation asks hospitals pick up much of the $30 billion tab needed to postpone SGR payment reductions for another year. Over the next decade, Medicare payment increases for inpatient and overnight care will be adjusted downward and Medicaid disproportionate share payments to hospitals will be cut $4.2 billion. “While fixing the physician payment formula is essential, it should not be done by jeopardizing hospitals’ ability to care for seniors and their communities,” AHA President and CEO Rich Umbdenstock said in a statement. “Additional payment reductions will make it harder for patients to access the care they need and depend on.” Although their payments will not be cut this year, physicians aren’t necessarily celebrating. The latest legislation marks the 15 th time Congress has acted to prevent cuts to physician Medicare payments, and many physicians have had enough. In a statement, Jeremy A. Lazarus, MD, President of the American Medical Association expressed the AMA’s frustration over the annual SGR “crisis”. “This patch temporarily alleviates the problem, but Congress’ work is not complete; it has simply delayed this massive, unsustainable cut for one year. Over the next months, it must act to eliminate this ongoing problem once and for all,” Lazarus said. Delaying implementation of the SGR is a start, but the healthcare industry is not out of the woods yet. The American Taxpayer Relief Act did not eliminate the sequester, which calls for $500 billion in federal spending cuts, including a 2% cut to Medicare funding. It simply pushed the implementation date back two months. That means we get to do this all over again in February.
