20.1% Medicare Cut Averted for At Least 3 Months

January 2, 2014

Just before New Year's, the president signed the Bipartisan Budget Act, which includes the Pathway for SGR Reform Act, providing a three-month SGR "patch" - which expires on March 31, 2014. By the time the patch is set to expire, lawmakers plan to repeal the SGR permanently and replace it with an improved Medicare physician payment system. The steep cut that would have taken place on January 1 due to the SGR has been averted. As a result of the SGR patch, Medicare payments will increase by 0.5 percent across the board on January 1 and the conversion factor after all adjustments for this time period will be $35.8228.

The $7.3 billion cost of the measure will be paid for through adjusted reductions in Medicaid payments to hospitals with many uninsured patients, lower payments to long-term-care hospitals and an extension of the Medicare sequester for FY 2023.

Further information will be provided when made available.