NAHC’s President Val J. Halamandaris Praises U.S. House Passage of SGR Reform Bill
March 27, 2015 07:34 AM
An overwhelming majority in the U.S. House of Representatives today passed Medicare legislation that reforms the physician payment formula otherwise known as the Sustainable Growth Rate (SGR). The legislation now goes to the Senate, which appears increasingly likely to pass the bill before closing for recess tomorrow.
The House passed the bill with 392 members voting in favor and only 37 against. Four were not voting.
Val J. Halamandaris, President of the National Association for Home Care & Hospice (NAHC), praised the House passage of the bill.
“This bill lifts a black cloud that has been perpetuated over the aged, ill, and disabled for over a decade,” Halamandaris said. “The flawed physician payment formula has been like a game of Russian Roulette. The physicians of America had a gun to their head. I want to thank Speaker Boehner and Minority Leader Pelosi for reaching across the aisle to negotiate this miraculous agreement. It is a good thing for the providers that have financed 17 previous ‘patches’ through reductions in their payment rates.”
Halamandaris also praised the inclusion of the rural add-on, which had been a top priority for NAHC.
“The rural add-on extension is a matter of life and death for our rural areas,” Halamandaris said. “I know the vital meaning of the rural add-on for patients who live in areas with limited access to care. To smell the clear air should not be a death sentence. Our Medicare system should not discriminate against someone based on an accident of birth. The rural add-on helps to prevent that.”
While the inclusion of the rural add-on is an important victory, the measure also contains some problematic provisions for home care and hospice. As previously reported, the bill sets the annual payment rate update (Market Basket Index) at 1 percent in 2018. This represents an estimated 1 point reduction from what would otherwise be the update.
NAHC continues its efforts to remove the rate reduction. NAHC is prepared to present alternatives that could achieve comparable savings. There also may be an opportunity later this year for NAHC to work with Congress to provide alternative reforms to Medicare to replace the rate cuts.
In addition, the bill contains a modification of the home health surety bond requirements, setting the bond minimum at $50,000 and allowing Medicare to scale the bond value up commensurate with the volume of Medicare revenue in the home health agency.
Halamandaris said NAHC is still working to replace both the payment cuts and the surety bond requirement.
“Our work is not done. While providers would very likely face higher cuts under the current system, we intend to provide Congress with alternative proposals to replace the payment cuts to providers. After three years of rebasing, home care and hospice has made enough sacrifices. We will also continue working to remove the nonsensical surety bond requirement in the bill which would cost $130 million over 10 years while only saving $10 million.”
The overall bill would institute a permanent fix in the physician payment methodology. This is great news for Medicare providers as there have been 17 previous “patches” that were most often financed by cutting provider payment rates. Since the House bill provides only $70 billion in offsets for a $200-plus billion in costs over 10 years, providers’ rate cuts likely total much less than a series of additional patches.
Update: The Senate has adjourned for recess without passing the SGR bill, which means the Senate will not consider the legislation for at least two weeks. Senate leaders plan to take up the legislation soon after the Senate returns from the Congressional spring recess on Monday, April 13. This gives NAHC more time to remove the surety bond provision. Please click here to contact your Senators using the Legislative Action Center to remove the surety bond requirement right away.