The chairs of the House Energy and Commerce and Ways and Means Committees, along with the ranking Democratic members of those panels, introduced legislation late Friday filling in the details of the $200 billion-plus deal crafted by House Speaker John Boehner and Minority Leader Nancy Pelosi to repeal Medicare's sustainable growth-rate formula.
This followed a Thursday announcement of policy bills to repeal the SGR formula. The latest legislation includes the details of financing the deal, as well as provisions for funding the Children's Health Insurance Program and community health centers.
The contours are similar to what Modern Healthcare originally reported March 13. The $200 billion-plus package would extend CHIP and funding for community health centers by two years. The latter comes at a cost of $7.2 billion and was a late addition to the package.
The legislation is expected to be taken up next week. If enacted, it would end the cycle of perennial fights over Medicare payments to doctors that has prevailed in Washington for more than a decade. Congress faces a March 31 deadline to avert cuts in payments of 21.2%. If the House and Senate can't get a deal done, it would require an 18th consecutive short-term fix.
"This bipartisan agreement puts us on the road to real reforms to strengthen Medicare for our seniors and puts the broken Sustainable Growth Rate in the rearview mirror forever,” Rep. Fred Upton (R-Mich.), chair of the Energy and Commerce Committee, said in a statement. “The SGR has generated repeated crises for nearly two decades. We have a historic opportunity to finally move to a system that promotes quality over quantity and begins the important work of addressing Medicare's structural issues."
The National Association of Community Health Centers issued a statement urging support for the proposal. “If Congress does not act now, access to healthcare for millions of people—including 4.3 million women and 2.5 million children—will be lost in a few short months,” according to the statement. “Now is the time to act.”
Roughly a third of the cost of the plan will be offset through spending reductions to other healthcare programs. Those cuts are split roughly evenly between hits to providers and Medicare beneficiaries.
The latter will target the top 2% of enrollees, according to a fact sheet that accompanied the release of the package. Beneficiaries with incomes between $133,500 and $160,000 would see their share of premiums increase from 50% to 65%. And those with incomes between $160,000 and $214,000 would see their share of premiums rise from 65% to 75%. The proposal would also phase out Medigap plans that have no Part B deductible, although that would apply only for beneficiaries who become eligible in 2020.
The hits to providers include an extension of cuts to the Disproportionate Share Hospital program that were part of the Affordable Care Act through 2025. In addition, there is a rate change that will reduce funding to post-acute providers, including skilled-nursing facilities and hospice providers, starting in 2018.
The doc fix deal appears poised for passage next week. But Senate Democrats continue to balk at the terms of the deal. That could still derail the Boehner-Pelosi agreement.
“They need the Senate locked in on this by the end of the weekend, or it's not going to happen,” said Julie Scott Allen, senior vice president with the District Policy Group at Drinker Biddle & Reath.