Medicare News!! SGR Repealed, 21% Cut Averted

Health Professional Shortage AreasOn Tuesday, April 14th, the Senate voted to approve the Medicare Access and CHIP Reauthorization Act, H.R. 2. This legislation, which passed the House of Representatives on March 26, permanently repeals the Medicare Sustainable Growth Rate (SGR) formula. President Obama will sign the bill into law.

In addition to SGR repeal, the law includes three major elements impacting physician group practices. The law:


  1. Averts the 21% payment cut that went into effect April 1, 2015 and erases future SGR cuts. It ensures a 5-year period of stable, annual updates of 0.5% in order to transition to a new payment system. Physicians will receive an annual update of 0.5% in each of the years 2015 through 2019. The first 0.5% update will begin July 1, 2015. The second 0.5% update will begin January 1, 2016.
  2. Provides additional financial incentives for providers who move into alternative payment models (APMs).  Provides a 5% bonus for eligible professionals who receive a significant share of their revenue through an APM from 2019 through 2024.
  3. Harmonizes and streamlines existing Medicare quality reporting programs. Sunsets the penalties associated with PQRS, the value-based payment modifier (VBPM), and meaningful use (MU) in 2018. Incorporates certain measures from PQRS, the VBPM and MU into a new program called the Merit-Based Incentive Payment System (MIPS).


Additionally, the legislation reverses the Center for Medicare & Medicaid Services’ decision to eliminate the use of 10- and 90–day global surgical codes in Medicare.


It should also be noted that the implementation date for ICD-10 was not affected by this legislation.  You should continue to put measures in place for transitioning to ICD-10 by October 1, 2015.  CMS has many online resources available to assist your practice in getting familiar with ICD-10, you can refer to for tools and guidance.