Senate Passes Fiscal Cliff Deal with 1-Year SGR Fix

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Around 2 a.m. the U.S. Senate voted 89 to 8 to pass a fiscal cliff deal that would temporarily put off the automatic spending cuts set to be implemented at midnight and preserve some but not all scheduled tax cuts. The deal also included a one year fix for the sustainable growth rate (SGR) formula that would have cut Medicare physician payment by more than 27 percent.

Physician groups, including the American Medical Association (AMA) and the American College of Radiology (ACR), had lobbied hard to make this the year that the SGR formula was finally repealed once and for all. The type of “grand bargain” to fix the deficit and reform Medicare that legislators had talked about at the end of 2012 seemed to open the door to such a large-scale -- and large-cost -- change. However, with the failure of the negotiations the fate of a permanent SGR fix dimmed too.

Instead of introducing new legislation, the Senate leadership opted to add the fiscal cliff deal as an amendment to the American Taxpayers Relief Act (H.R. 8) that the House had already passed. With the amendment, the bill goes back to the House for a second vote. House Speaker John Boehner had told news outlets that he could convene the House on New Year’s Day for a vote. A bill that is passed before markets open on Wednesday could minimize disruption to stock prices.

The bill text includes a couple of provisions relevant to radiology, but not the longed for repeal of the multiple procedure payment reduction (MPPR) on the professional component of imaging services or the removal of the device tax on medical equipment manufacturers.

The bill instructs the secretary of Health and Human Services to use a 90 percent equipment utilization rate on advanced imaging equipment for fee schedules established for 2014 and in all subsequent years. In addition, it reduces the payment for hospitals on stereotactic brain radiosurgery (HCPCS code 77371) furnished as an outpatient service. It exempts certain community hospitals and rural hospitals.

To read the full text of the bill, click here.