AMA, MGMA letters to lawmakers suggest SGR alternatives

Letters sent last Friday to House Ways and Means Committee chairs Dave Camp (R-Mich.) and Wally Herger (R-Calif.) from the American Medical Association (AMA) and Medical Group Management Association (MGMA) suggest a number of different payment approaches aimed at a long-term solution to the current Medicare sustainable growth rate (SGR).

Both letters were submitted in response to a request from the committee seeking ideas on how to create new payment models.

“There is widespread agreement among experts and stakeholders that the existing physician payment system under the Medicare program is inadequate,” wrote Susan Turney, MD, president and CEO of MGMA. “Although Congress has repeatedly intervened to prevent rate cuts, it has never eradicated the formula that dictates these cuts.”

[See also: Medicare trust fund projected to run dry by 2024]

In the AMA letter, James L. Madara, MD, executive vice president of the AMA, lays out a number of different payment proposals that include rewarding doctors for quality and efficiency, developing new models of payment and suggestions for increasing patient involvement with care decisions while also addressing current regulatory roadblocks.

“Innovative payment models can give physicians the resources and flexibility to re-design care to keep patients healthier, better manage chronic conditions, improve care coordination, reduce duplication of services, and prevent avoidable admissions, and do so in ways that will control costs for the Medicare program,” wrote Madara.

Among the recommendations from the AMA are a request that Medicare create what is essentially a menu of different payment reforms and models during a transition period away from SGR and current fee-for-service payments. The new payment models should be broadened, the letter asserts, from the current shared savings and ACO programs to also include bundled payments, performance-based payments, global and condition-specific payment systems, warranties for care and medical homes.

[See also: MedPAC approves SGR repeal proposal]

Further, application to participate in these programs should be ongoing, not one-time, single-deadline programs.

“To date, those wishing to participate in new Medicare payment and delivery reform pilots have had to respond to requests for applications made available on a one-time basis with a short turnaround time. It is difficult to plan ahead for these announcements and organize the projects and resources necessary for a successful proposal,” Madara noted. “Going forward, opportunities to engage in new models need to be available on an ongoing basis so physicians can plan for the needed changes and join as they become ready.”