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SGR, ICD-10 extensions approved by Senate

SGR, ICD-10 extensions approved by Senate

By Catherine Hollander
Posted: March 31, 2014 - 7:45 pm ET

The Senate approved a bill Monday evening that prevents steep cuts to Medicare physician payments from going into effect for one year and delays the conversion to ICD-10 diagnostic and procedure codes for at least one year.

The Senate voted 64-35 in favor of the Protecting Access to Medicare Act of 2014, which the House approved last Thursday. Assuming the president signs the legislation, it will be the 17th such patch that Congress has enacted since the so-called Medicare sustainable growth-rate formula became law in 1997.

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Many senators made their disappointment with this short-term solution clear on Monday.

Sen. Tom Coburn (R-Okla.) said it was an example of “why the American people are disgusted with (Congress). “We should be fixing this problem, instead of delaying the problem,” Coburn said before the legislation passed.

Sen. Ben Cardin (D-Md.) gestured in frustration as he urged Congress to pass a permanent solution to this perennial problem. “We have two options: Another temporary fix, continuing uncertainty, continuing this problem down the road, asking those who didn't cause it to pay for it, even though it's already been paid for before—or we could really take care of it.”

It wasn't to be. The Protecting Access to Medicare Act of 2014 will freeze Medicare physician payments only through March 2015. Senate Majority Leader Harry Reid (D-Nev.) said the legislation was “not ideal,” but that he lacked the votes for a permanent solution. Without the patch, physician payments would have been cut by 24% on Tuesday. The measure was approved by the House last week.

Ardis Dee Hoven, president of the American Medical Association, said in a statement her organization, on the other hand, was “deeply disappointed” with the patch. “This bill perpetuates an environment of uncertainty for physicians, making it harder for them to implement new innovative systems to better coordinate care and improve quality of care for patients,” Hoven said.

The Federation of American Hospitals praised Congress for averting the cut. “Absent the immediate option of a comprehensive overhaul to permanently repeal and replace the sustainable growth rate, the (Federation of American Hospitals) believes action now through the passage of this patch is necessary for hospitals and patients, especially seniors and vulnerable Americans as well as residents of rural areas, to avoid reduced access to care,” the trade group for investor-owned hospitals said in a statement.

Hopes had been high that Congress would pass a permanent solution this year. The momentum began building in February 2013, when the nonpartisan Congressional Budget Office unexpectedly cut the cost of a permanent fix by over $100 billion based on lower projections for Medicare spending. Last month, the House Energy and Commerce and Ways and Means committees and Senate Finance Committee released a bipartisan proposal for reforming the formula, a rare example of bipartisan, bicameral cooperation in Congress—they just couldn't agree on how to pay for it. That continued to be a sticking point on Monday.

Sen. Ron Wyden (D-Ore.), the new chairman of the Senate Finance Committee, asked the Senate to consider a unanimous consent to pass a permanent replacement for the SGR funded by savings from winding down the war in Afghanistan. Sen. Jeff Sessions (R-Ala.) objected, then put forward his own solution: repealing the Affordable Care Act's mandate for individuals to have health insurance, which would produce savings because the government would pay less in subsidies if fewer people get coverage. Wyden immediately objected to Sessions' request for the Senate to pass that measure by unanimous consent, stopping it in its tracks.

The exchange was repeated later Monday afternoon, with Sen. Orrin Hatch (R-Utah), the ranking member on the Finance Committee, volleying with Wyden over the same legislative proposals. Wyden ultimately voted no on the temporary fix passed by Congress.

Still, talk of a permanent fix didn't stop even as it became clear how the vote would play out. “We're farther down the road than we've ever been before,” said Julius Hobson, a senior policy adviser at Polsinelli who closely follows doc fix negotiations.

“Once this legislation is signed into law, we need to get back to the negotiating table,” Hatch said.

The House passed the same bill last Thursday by voice vote, which means it will now go to President Barack Obama. The White House did not respond to a request for comment on whether the president would sign the bill into law.

The CMS had been holding firm to an October deadline for the healthcare industry to implement ICD-10 codes, even though the AMA, the Medical Group Management Association and others continued to express serious concerns about the feasibility and costs of meeting it. The American Hospital Association, on the other hand, strongly opposed delaying ICD-10 implementation for an additional year.

The American Health Information Management Association expressed disappointment with the delay and asked for an explanation of the wording “at least one year” that describes the delay in the legislation. “On behalf of our more than 72,000 members who have prepared for ICD-10 in good faith, AHIMA will seek immediate clarification on a number of technical issues such as the exact length of the delay,” AHIMA CEO Lynne Thomas Gordon said in a statement.

The inclusion of the ICD-10 delay in the bill came as a surprise because CMS Administrator Marilyn Tavenner said one month ago that there would be no extension. The ICD-10 issue was not a focus of Monday's floor debate over the bill.

The bill passed Monday would also partially delay enforcement of a controversial inpatient payment rule for hospitals, the “two-midnight rule,” for six months.

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