AMA Wire

Wednesday, Nov. 28, 2012

This Week's News

CBO: Cost to delay SGR cut one year $7 billion more than originally thought

CBO: Cost to delay SGR cut one year $7 billion more than originally thought

New estimates by the Congressional Budget Office (CBO) have placed a $25 billion price tag on a one-year delay of the nearly 27 percent cut to Medicare physician payments scheduled for Jan. 1. This figure is $7 billion higher than the CBO's previous estimate.

Despite the increased cost estimate for postponing the physician payment cut, the CBO's report shows that the rate of growth in Medicare spending has decreased.

"The latest estimates from the CBO … [are] a prime example of why this broken system must be eliminated," President Jeremy A. Lazarus, MD, said in a statement.

Under the sustainable growth rate (SGR) formula, Medicare physician payments will be slashed by 26.5 percent on Jan. 1 if Congress fails to intervene.

"When lower rates of spending growth lead to a higher cost for reform, it is clear that the SGR does not work," Dr. Lazarus said. "It is time to stop this broken cycle in Medicare and move toward a program that ensures the best health outcomes for patients and a stable, rewarding practice environment for physicians."

The AMA and more than 100 other medical associations have called on Congress to eliminate the SGR and transition to a high-performing Medicare program. Last month, the organizations submitted principles and core elements for this transition. Read more in a recent blog post by Dr. Lazarus.