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AMA House of Delegates

AMA meeting: Doctors seek payment models to replace Medicare SGR

New Association policy says physicians should have the freedom to determine what models would apply best to their practices.

By — Posted July 1, 2013

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Delegates to the American Medical Association Annual Meeting in June adopted policy to replace Medicare’s sustainable growth rate formula with a range of payment models, allowing physicians to choose which options would work best for them.

That approach would reflect diversity in physician-led practice models, such as patient-centered medical homes and regional health collaboratives, while maintaining fee-for-service and private practice as viable options. AMA President Ardis Dee Hoven, MD, said that in transitioning from the SGR to a new system, it was vital to support doctors “in all types of practices, and avoid being too prescriptive in suggesting alternatives.”

Doctors also should have the flexibility to determine the basic payment method for their services, as well as the right “to establish their compensation arrangements, including private contracting, at a level which they believe fairly reflects the value of their professional judgment and services,” states the policy adopted by the House of Delegates.

Long-running fight

The policy reflects the general approach the AMA has taken in the 2013 debate over the SGR formula, which has been threatening payment cuts to doctors for more than a decade. According to Medicare’s trustees, the formula is set to cut payments by 24.7% in 2014, reducing rates to 61% of what private insurers pay for the same services.

Congress has enacted stopgap measures to prevent the cuts, but a permanent solution has been out of reach. House Republicans have drafted a proposal to repeal the SGR and modernize the program, but no timeline has been set for debate. At a congressional hearing in May, the AMA and other groups urged lawmakers to stabilize payments for five years, giving doctors time to help develop and test new pay models.

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