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Committees seek comment on physician payment proposal

October 31, 2013

Leaders of the House Ways and Means and Senate Finance committees today released a discussion draft of a bipartisan proposal to replace the Medicare Sustainable Growth Rate formula for annual payment updates under the Physician Fee Schedule with a value-based payment program starting in 2017. The proposal, which does not specify a funding source, would freeze current payment levels under the PFS through 2023. After 2023, physicians and professionals who participate in an advanced Alternative Payment Model that involves two-sided financial risk and quality measurement would receive an annual update of 2%, while all other physicians and professionals would receive an annual update of 1%. Payment penalties under the Physician Quality Reporting System, Electronic Health Record Incentive Program and Value-Based Modifier would sunset in 2016. Instead, the penalties that would have been assessed under those programs would fund a Value Based Purchasing program under which physicians and other professionals would receive an incentive payment based on their performance on quality measures, resource use, clinical practice improvement activities and EHR meaningful use. Physicians and other professionals paid under the PFS who receive a significant portion of their revenue from an advanced APM would be exempt from the incentive program and instead receive a bonus payment starting in 2016. The proposal also would establish payment for complex chronic care management for physicians and other professionals practicing in a patient centered medical home or comparable specialty practice, among other provisions. The committees will accept comments on the proposal through Nov. 12 at sgrcomments@finance.senate.gov and sgrwhitepaper@mail.house.gov.