Bipartisan House-Senate SGR Proposal Emphasizes EHRs

by HIMSS Government Relations

On October 30th, the Senate Finance Committee and the House Ways and Means Committee released a discussion draft to replace the Medicare Sustainable Growth Rate (SGR) formula. Public comments are invited by November 12, 2013.

The proposal adds focus on adoption of electronic health (EHR) systems, and calls for major changes to the HITECH-authorized Medicare and Medicaid EHR incentive programs. The bicameral, bipartisan proposal also emphasizes a revised value-based performance (VBP) payment program, including the following provision:

“Under the proposal, Medicare payments to professionals would be adjusted based on performance on a single budget-neutral incentive payment program. Payments would be adjusted beginning in 2017 based on professionals’ performance in a prior period. The Value-Based Performance (VBP) Payment Program represents a more streamlined approach than maintaining the three distinct programs that exist under current law. The VBP composite score and associated payment incentive incorporates the current law programs’ emphasis on quality, resource use, and use of electronic health records (EHRs) in a cohesive manner.” (Emphasis added.)

Along with quality, resource use and clinical practice improvement, adoption and meaningful use of EHRs could account for up to 25 percent of the reimbursement formula for 2017 through 2019.  Once EHR adoption reaches 75 percent overall, that component of the formula could drop to 15 percent of the total.

Conspicuously absent from the Senate Finance/House Ways and Means Committees’ proposal is the lack of a pay-as-you-go provision.  It also does not provide for annual updates through 2023.  The Committees’ proposal summary can be viewed here.

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