H.R. 4015: SGR Repeal and Medicare Provider Payment Modernization Act of 2014

H.R. 4015

SGR Repeal and Medicare Provider Payment Modernization Act of 2014

March 14, 2014 (113th Congress, 2nd Session)

Staff Contact

Floor Situation

On Friday, March 14, 2014, the House will consider H.R. 4015, the SGR Repeal and Medicare Provider Payment Modernization Act of 2014, under a rule.  H.R. 4015 was introduced on February 6, 2014 by Representative Burgess (R-TX) and has 104 cosponsors.  A companion bill was introduced in the Senate by former Senate Finance Chairman, Max Baucus (D-MT).

Bill Summary

H.R. 4015 repeals the current sustainable growth rate formula and replaces it with a permanent solution to address physician payments in the Medicare program. Specifically, the bill maintains the current half percent increase through the remainder of 2014 and continues the reimbursement rate from 2015 through 2018. Beginning in 2019, the payment levels would remain at current levels through 2023. Adjustments to the reimbursement rates between 2019 and 2023 may be made in one of two ways – through the merit incentive payment system (MIPS) or an Alternative Payment Model (APM).

Physicians may chose to participate in the MIPS, a system that improves the current fee for service system, including the current reporting requirements,[1] with a performance-based system. The MIPS focuses on four areas: (1) quality, (2) resource use, (3) meaningful use, and (4) clinical practice improvement activities, with participants subject to positive or negative performance adjustments based on performance in each of the four categories.  Those physicians meeting the performance threshold would see increases in reimbursement rates. 

Physicians may choose to participate in alternative payment models (APM) that incentivize physicians to develop new models of healthcare delivery and payment.  Those who participate in the APM must receive at least 25 percent of their Medicare revenue through an APM between 2018 and 2023. (This threshold increases over time). Those with a significant portion of their revenue from an APM or a patient centered medical home (PCMH) are eligible to receive a five percent bonus to address risk. After 2023, physicians participating in the APM are eligible for a one percent adjustment in their reimbursement rates.  A technical advisory committee is established to review and recommend physician-developed APMs based on criteria developed through an open comment process.

Finally, the bill expands the use of Medicare data for transparency and quality improvement.  Specifically, the bill makes quality and utilization data available on the physician compare website - allowing patients to make more informed decisions. It also allows qualified entities to provide analysis and underlying data to providers for purposes of quality improvement, subject to relevant privacy and security laws. Finally, the bill allows qualified clinical data registries to use claims data for purposes of quality improvement and patient safety.

[1] Current reporting requirements include the Physician Quality Reporting System, the Volume Based Modifier, and the Meaningful Use of Electronic Health Records


The sustainable growth rate is a formula that was enacted in 1997 to control physician spending under Medicare.  However, the SGR policy flaws have compelled Congress to override the formula driven cuts for more than a decade.  In fact, since 2003, Congress has spent nearly $150 billion in short term patches. On March 31, 2014, the most recent three month patch included in the Bipartisan Budget Act will expire.[1]  As a result, physicians will see an approximately 24 percent cut in reimbursement rates if left unaddressed.  

[1] See http://www.gpo.gov/fdsys/pkg/BILLS-113hjres59enr/pdf/BILLS-113hjres59enr.pdf.


CBO estimates that enacting H.R. 4015, with an amendment by Chairman Camp, will decrease direct spending by $31.1 billion over the 2014-2024 time period.[1]

Additional Information

For questions or further information contact the GOP Conference at 5-5107.