Is The Death Of SGR A Good Thing, Or A Bad Thing?

By: Stephen Siegel

On April 16 President Obama signed the Medicare Access and Chip Reauthorization Act (“MACRA”). MACRA abandons the Sustainable Growth Rate (“SGR”) for adjusting the Medicare Physician Fee Schedule and provides a new approach to paying for the services rendered by physicians and other healthcare professionals (i.e., dentists, ARNPs and PAs). Healthcare professionals should take the time to become familiar with this new reimbursement method during its 5 year phase in period. (MACRA addresses a number of other significant issues, including “gainsharing”, which are beyond the scope of this article.)

Starting in 2015 through 2019, the annual Physician Fee Schedule increase will be one-half of one percent (0.5%). Thereafter, the reimbursement rate paid to each healthcare professional will be adjusted to reflect his or her performance under what MACRA calls a Merit-Based Payment Incentive System (“MIPS”), which focuses on 4 areas:

  • Quality;
  • Resource use/efficiency;
  • Meaningful use of electronic health records; and
  • Clinical practice improvements.

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