MGMA: Impending SGR cuts may force practices to limit Medicare patients

More than two-thirds of practices said they would limit the number of new Medicare patients they accept unless Congress halts upcoming Medicare reimbursement cuts, according to a survey by the Medical Group Management Association (MGMA), released this week at its annual meeting in New Orleans.

The potential action comes as a result of a pending 23.6 percent cut on Dec. 1, followed by an additional reduction of 6.5 percent on Jan. 1, 2011, to the Medicare Part B conversion factor.

"This is a situation that must be dealt with immediately when Congress returns after the elections," said MGMA President and CEO William F. Jessee, MD.

MGMA conducted the survey from mid-September to mid-October and received responses from more than 2,860 practices where 63,000 physicians practice.

The cuts are part of Medicare's controversial sustainable growth rate (SGR) formula. The SGR has called for reductions in physician payment rates each year since 2002, and each time, Congress has acted to postpone the cuts. On June 25, President Obama signed a law postponing the SGR through Nov. 30.

If the SGR reductions are not postponed again before Dec. 1, the survey revealed that nearly half of the medical groups will stop seeing new Medicare patients, while 27.5 percent said they would cease treating all Medicare patients.

In addition to reducing the number of Medicare patients they see, physician practices are considering other steps to address decreased reimbursement:

• 76.6 percent will likely delay the purchase of new clinical equipment and/or facilities;
• 60.5 percent will likely reduce the number of administrative support staff;
• 54 percent will likely reduce clinical staff; and
• 45.3 percent will likely delay purchase of EHR systems.

Some 29.5 percent of practices began reducing the number of appointments for new Medicare patients in June when Congress failed to take action to avert Medicare payment cuts by the June 1 deadline, instead temporarily delaying the cuts retroactively.

MGMA's research indicates the uncertainty created by the retroactive legislation has already triggered the following actions by practices:

• 37.3 percent delayed purchasing EHR systems;
• 31.7 percent reduced the number of administrative staff; and
• 27.5 percent reduced the number of clinical staff.

"Uncertainty about the future is creating an unsustainable environment for many who practice in areas with large Medicare populations," Jessee said. "Congress must take action to block these pending cuts and provide an update that lasts, at a minimum, through the end of 2011. This will provide lawmakers and the provider community time to develop a long-term solution that ensures beneficiaries have continued access to quality care."