President signs bill postponing SGR cut

The President signed legislation (H.R. 3326) on December 19, 2009, that included a two month postponement of the scheduled 21.2 percent Sustainable Growth Rate (SGR) cut to Medicare provider payments. Congress passed the bill last week in the midst of the debate on health care reform. The SGR cut will be blocked until February 28, and Congress will have to address this Medicare issue by that deadline.

As you may recall, the House previously passed legislation (H.R. 3961) in November to permanently replace the SGR formula and provide a 1 percent update for 2010, but the bill has stalled in the Senate due to budgetary concerns. The Senate health care reform bill currently includes a provision to prevent the SGR cut for one year and provide a 0.5 percent update for 2010.

Other Medicare issues, including our 5 percent psychotherapy payment restoration, remain a key part of the health care reform bills currently under consideration. Following the implementation of across-the-board cuts resulting from the Centers for Medicare and Medicaid Services (CMS) five-year review, the APA Practice Organization successfully persuaded Congress in 2008 to restore payments for psychotherapy, the only codes that received relief. In 2009, APAPO secured language extending the restoration provision in the Senate and House health care reform bills, as well as all health care reform bills considered by committees of jurisdiction.

Because it is part of health care reform, this critical provision is unlikely to be enacted by January 1. However, Finance Committee staff has indicated that they will seek to apply the restoration to all Medicare payments in 2010.