SGR Repeal is a “Game-Changer” for Health IT | Healthcare Informatics Magazine | Health IT | Information Technology Skip to content Skip to navigation

Blair Childs: SGR Repeal is a “Game-Changer” for Health IT

April 15, 2015
by Gabriel Perna and Rajiv Leventhal
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Industry stakeholders are overwhelmingly praising Congress for passing the Medicare Access and CHIP Reauthorization Act, which repealed the Sustainable Growth Rate (SGR) formula for reimbursing physicians under Medicare. 
The Senate passed the legislation by a vote of 92 to 8 last night. The House of Representatives had approved the bill by a vote of 392 to 37 on March 26. President Barack Obama, in a statement, gave his stamp of approval and is expected to make it official by signing into law.
“This bipartisan bill will protect health coverage for millions of Americans, and I will be proud to sign it into law. I hope Congress builds on this good work by finding more ways to make sure every American has access to the quality, affordable health care they deserve,” President Obama said. 
By removing Medicare’s SGR Formula for physician payment and instituting a 0.5-percent payment update for the next five years for physicians, the bill has reduced a yearly burden for many providers, said Kenneth Kleinberg, managing director at The Advisory Group. “This removes a lot of uncertainty in the marketplace,” he said. 
The bill also replaces physicians’ mandatory participation in the Value-Based Payment Program under Medicare (for all physicians participating in Medicare) with a new Merit-based Incentive Payment System, or “MIPS.” This aspect of the bill has pleased many provider-based stakeholder groups. The American Academy of Family Physicians (AAFP) called it a major triumph and said it will shift the nation towards reimbursement for care that’s based on quality, not quantity.
For health IT stakeholders, the bill has numerous ramifications. It promotes and defines interoperability, requires metrics to measure interoperability, requires a report to Congress on the progress of interoperability by the last day of 2018, requires attestation that vendors/providers are not blocking data, and more. Blair Childs, senior vice president of public affairs at Premier Inc., told Healthcare Informatics that the bill is a “game-changer.” 
“For the first time, interoperability is central to certified electronic health record technology (CEHRT), including the requirement of having metrics to measure interoperability,” Childs said in an email. He noted that is especially relevant because MACRA consolidated reporting requirements for meaningful use, the phyician quality reporting system (PQRS), and the value modifier. “We believe that interoperability of EHR systems and across all health IT assets must be available in a cost-effective way before penalties are imposed on the providers,” he added.
Childs also talked about interoperability and how it impacts the value-based care measures of MACRA. “This law, coupled with another recent announcement of HHS’ goal to shift up to 50 percent of Medicare payments from fee-for-service to alternative payments by 2018 could not make the realities any more clear: advanced payment and value-based care models can no longer be thought of as fads. In fact, they are the new normal. And interoperable health IT is a key element to making these transformations,” said Childs. 
Randy Lee, M.D., chief of staff at Hamilton General Hospital in rural Texas, praised the repeal bill and talk about it’s impact on data analytics. "I think it will aid vendors and force them to flesh out their business and data analytics functionality, because you're going to have to get good quality data that you can manipulate so you can make sure you're on the positive side in the balance books for value-based care," he said. "Care quality will improve with that focus," he added. "I like to call it the 'mama rule'—if we as care teams will focus on taking care of patients, just like our mamas took care of us, it will make everything in regards to federal programs so much clearer.” 

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