Dear Chairman Baucus and Senator Hatch:
The United States health care system is in the midst of profound change, and we now
have a unique opportunity to improve and restructure how we deliver and pay for care in
this country. Many ground-breaking innovations, including many led by physicians, are
already underway in Medicare and the private sector that can guide the development of a
new and improved Medicare physician payment system. These models include patient centered medical homes, accountable care organizations, an array of approaches to
bundled payments and shared savings arrangements as well as new initiatives designed
by regional health improvement collaboratives.
The sustainable growth rate (SGR) formula is an enormous impediment to successful
health care delivery and payment reforms that can improve the quality of patient care
while lowering growth in costs. Physicians facing the constant specter of severe cuts
under the SGR cannot invest their time, energy, and resources in care re-design. The first
step in moving to a higher performing Medicare program must be the elimination of the
SGR formula. The status quo is bad for patients, physicians, and taxpayers.
Physicians face yet another steep payment cut of 27 percent on January 1, 2013. For
more than a decade, average payment rates under the SGR have remained stagnant and
today are barely higher than their 2001 levels. Each year, patient access to care is eroded
because the threat of steep physician payment cuts and last-minute congressional action
to avoid these cuts create an environment where new Medicare patients have difficulty
securing physician appointments. Congress must stop this vicious cycle now so that a
transitional framework can be put in place that will provide some stability and
predictability for seniors and physicians, along with needed delivery innovations.
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