House-Passed Bill for Disabled Could Alter Medicare Physician Fee Schedule

A bill written to assist disabled persons that passed the U.S. House of Representatives on December 3, 2014 could result in across-the-board Medicare payment cuts to physicians.  The bill, H.R. 647, the Achieving a Better Life Experience (ABLE) Act, would allow people with disabilities to create special savings accounts for education, housing and other needs without risking their government benefits such as Social Security or Medicaid.  The concept of the legislation enjoyed broad bipartisan support in both the House and the Senate.  However, shortly before House consideration of the bill, a last minute budgetary offset or “pay-for” was added to the bill that accelerated and expanded the onerous “misvalued procedure” initiative.

Included in the most recent patch to the Sustainable Growth Rate (SGR) formula, the Protecting Access to Medicare Act (PAMA), the “misvalued procedure” initiative directs the Centers for Medicare and Medicaid Services (CMS) to identify and address “potentially misvalued” services.  CMS must identify threshold savings that amount to 0.5 percent of the total Medicare fee schedule each year from 2017 until 2020.  If CMS is not successful in that effort, then the agency must make across-the-board cuts to equal the shortfall amount.  The provision included in the ABLE bill tracks the initiatives but changes the threshold and the timeframe.  The threshold amount involved increases to 1.0 percent of the fee schedule and the effort begins in 2016.  The threshold would reset back to 0.5 percent for 2017 and 2018.

Many organizations in the medical community opposed the inclusion of the “misvalued procedure” in the ABLE legislation. 

The ABLE bill will next move to the Senate for consideration.  More information will be posted as it becomes available.