• A
  • |
  • A
  • Text size

Medicare SGR Transition Principles

Eliminating the SGR formula is essential to developing a high performing Medicare program. In conjunction with SGR repeal, the following driving principles can provide a foundation for a transition plan that organized medicine can support.

See the AMA in action advancing payment and delivery reform

See the AMA in action advancing payment and delivery reform

Medicare SGR Transition Principles

  • Successful delivery reform is an essential foundation for transitioning to a high performing Medicare program that provides patient choice and meets the health care needs of a diverse patient population.
  • The Medicare program must invest and support physician infrastructure that provides the platform for delivery and payment reform.
  • Medicare payment updates should reflect costs of providing services as well as efforts and progress on quality improvements and managing costs.
The transition plan must include core elements that:
  • Reflect the diversity of physician practices and provide opportunities for physicians to choose payment models that work for their patients, practice, specialty and region;
  • Encourage incremental changes with positive incentives and rewards during a defined timetable, instead of using penalties to order abrupt changes in care delivery; and
  • Provide a way to measure progress and show policymakers that physicians are taking accountability for quality and costs.
In addition, the plan needs to be structured in a way that will:
  • Reward physicians for savings achieved across the health care spectrum;
  • Enhance prospects for physicians adopting new models to achieve positive updates;
  • Tie incentives to physicians’ own actions, not the actions of others or factors beyond their influence;
  • Enhance prospects to harmonize measures and alter incentives in current law;
  • Encourage systems of care, regional collaborative efforts, primary care and specialist cooperation while preserving patient choice;
  • Allow specialty and state society initiatives to be credited as delivery improvements (deeming authority) and recognize the central role of the profession in determining and measuring quality; and
  • Provide exemptions and alternative pathways for physicians in practice situations in which making or recovering the investments that may be needed to reform care delivery would constitute a hardship.

Download these principles.