LeadingAge's Barbara Gay, far left, said the SGR legislation needs further study.

Bipartisan leaders from the Senate and House announced legislation Thursday to replace Medicare’s Sustainable Growth Rate formula for physician payments. Two major long-term care industry groups called it a step in the right direction.

The SGR Repeal and Medicare Provider Payment Modernization Act (H.R. 4015) would provide a 0.5% payment update for five years under a fee-for-service model, and consolidate the physician-quality reporting system, electronic health record and value-based modifier programs into one program. The summary also says the bill “implements a process to re-base misvalued codes” and “requires development of quality measures in close collaboration with physicians.”

Medicare payments to physicians and certain other healthcare professionals are set to decline by 24.4% on April 1 if Congressional does not act before then.

“We are encouraged by the bipartisan policy solutions released today that would permanently resolve the sustainable growth rate,” American Health Care Association/National Center for Assisted Living CEO Mark Parkinson said in a statement Thursday. However, the agreement “does not address how Congress would pay for the provisions outlined. With skilled nursing providers already operating on thin margins, across-the-board cuts to our providers are not the answer.”

LeadingAge’s Director of Government Affairs Barbara Gay also noted the legislation does not delve into offsets needed to pay for the new physician payments — or include therapy cap relief, another major issue for long-term care providers.

“We’re looking at and working with other stakeholder groups on the therapy caps,” she told McKnight’s. “We’re urging Congress to look at this. If the caps go into effect, it will have a severe impact. We have concerns and want to get these very important issues addressed.”

Physician groups, such as the American Medical Association,the American Academy of Family Physicians and the American College of Physicians were stronger in their support of the legislation yesterday. Charles Cutler, M.D., AAFP’s chairman of the Board of Regents, stated the package “creates incentives for care coordination efforts for patients with chronic care needs” and “expands the use of Medicare data for transparency and quality improvement,” both of which are issues on the minds of LTC providers.

Click here to read the summary of the package.