Physician Payment Reform in a Post-SGR World

On April 16, 2015, President Barack Obama signed the Medicare Access and CHIP Reauthorization Act (MACRA), which, among other things, finally repealed the Sustainable Growth Rate (SGR) mechanism of paying for physician services in Medicare. The SGR had been blamed for causing instability and uncertainty among physicians for over a decade and led to 17 overrides of scheduled cuts to the physician fee schedule, at a cost well in excess of $150 billion. Although the passage of MACRA was a significant legislative event, it is the implementation of MACRA, along with other health care payment and delivery reforms, that will profoundly shape the future health care system in the U.S.