Congressional leaders reached a budget agreement to avoid a government shutdown through the first quarter of 2013, but the deal does not include adjusting or repealing the sustainable growth-rate Medicare payment formula.

The agreement would extend government funding at $1.047 trillion—the top-line level for 2012—for six months after current funding expires on October 1.

According to a news release from Senate Majority Leader Harry Reid (D-Nev.), the federal budget agreement calls for a continuing resolution that will provide about $1.05 trillion to fund government operations for six months. A fix for SGR, as well as Medicare hospital supplemental payment extensions, are not included in the continuing resolution.

Reid’s announcement comes after a new Congressional Budget Office report found that the SGR formula will require a 27% cut to physician payments in 2013. The report analyzes several options for offsetting the cut, which could cost between $15.3 billion and $376.6 billion.

 

The lowest-cost option would feature short-term increases to Medicare physician reimbursements, followed by payment reductions of between 22% and 26%. The most-costly option would replace, restructure or reset the SGR, according to Modern Healthcare (Modern Healthcare, 7/31).

 

Source: California Healthline, August 1, 2012.