Stalled Fiscal Cliff Negotiations Threaten Attempts to Avert 27 percent SGR and 2 percent Sequestration Cuts to Medicare Effective January 1, 2013

Progress on the "fiscal cliff" negotiations between the White House and Congress have stalled, increasing the likelihood that the scheduled 29 percent cut to Medicare physician payments will be triggered January 1, 2013.  The massive cut is the result of a 27 percent physician payment cut mandated by the Medicare Sustainable Growth Rate (SGR) formula and a 2 percent cut included in the sequestration, or pending across-the-board cuts to federal spending mandated by the Budget Control Act. Congressional leaders have indicated that fixes to both cuts will likely be linked.   

Negotiations over a path forward to avert the "fiscal cliff" appeared to have stalled based on the issue of top tax rates associated with the expiration of the Bush-era tax cuts as well as disagreement over total reductions to entitlement spending. Most recently, an attempt by the House to pass Speaker John Boehner’s "Plan B" proposal failed to advance. Negotiations are expected to resume as soon as Thursday, December 27, 2012.

ASA members are strongly encouraged to participate in an ongoing grassroots effort to Congress to stop the payment cuts to physicians.  

ASA has repeatedly called for the permanent repeal and replacement of the flawed SGR formula with a payment system that accurately reflects the cost of providing care. Similarly, ASA has called for Congress to take action to avert the 2 percent sequestration cut. Short of such action, ASA continues to advocate against cuts to physician payments and for the longest possible "doc fix" tied to positive payment updates. ASA will continue to monitor these negotiations, inform members of key developments and advocate on member's behalf.