Doc groups push SGR repeal to be funded by war savings

Congress should use money allocated for Overseas Contingency Operations (OCO), a budget line no longer needed for the Iraq and Afghanistan wars, to help fund a permanent fix to the sustainable growth rate (SGR) formula, urged more than 100 medical societies and physician groups, including the American Medical Association (AMA), Medscape Medical News reported.

Although political parties agree on the SGR, which currently calls for a 27.4% cut to Medicare reimbursements March 1, Congress has been unable to agree on how to pay for the solution. The Congressional Budget Office estimates it to be $290 billion if rates are frozen for 10 years.

In a Jan. 18 blog post, however, AMA President Peter Carmel wrote: "There is also now a clear pathway to offsetting the cost to repeal the SGR. Both the president's budget and the House-passed budget produced substantial savings--more than $1 trillion--by reducing future allocations for overseas contingency funding."

Organized medicine followed up the appeal Monday with a letter to Rep. Dave Camp (R-Migh.), chair of the House Ways and Means Committee, signed by 110 medical societies throughout the country. "Using the OCO baseline as an offset for the accumulated SGR bad debt amounts to 'cleaning the books' by eliminating one flawed budget gimmick with another," they wrote.

The idea's supporters, including medical societies representing every state except Alaska, Indiana, Louisiana and Utah, also encourage Congress to move swiftly, as the cost of SGR repeal escalates over time.

"An SGR patch of two years will cost $39 billion in 2012, increase the cost of repeal to $346 billion, and increase the size of the next scheduled cut to physician payments to 36%," they wrote. "Pushing off this problem continues this reckless pattern of spending billions of dollars only to make future cuts deeper and more expensive to solve."

To learn more:
- read the article from Medscape Medical News (registration required)
- see physician groups' letter to Congress
- see the press release from the AMA
- read this post from the AMA's On the Road with Dr. Carmel

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