President Obama signs Medicare ‘doc fix’ bill

President Obama signed H.R. 2, the permanent “doc fix” that repeals the sustainable growth rate and ends close to 20 years of uncertainty over how doctors are reimbursed by Medicare. This was a rare bipartisan achievement by Democrats and Republicans. The former sustainable growth rate formula, imposed to try to control Medicare costs, never worked, as Congress 17 times over-rode its own bill in annual “doc fixes.” Had the bill not passed, doctors faced a 21 percent pay cut from Medicare starting this month. Bill H.R. 2 provides positive annual payment updates of 0.5 percent, starting July 1 and lasting through 2019. Claims that were held for the first half of April will be processed and paid at the rates that were in place before the 21 percent cut was scheduled to take effect. More than a fix, the bill is a further step in moving healthcare toward a value-based reimbursement model that bases physician payment on quality and clinical improvement. While physicians will receive a 5 percent bonus for participation in advanced payment models under the SGR replacement starting in 2019, growth in payments is not directly tied to participation in these models until 2026.