One of the key drivers of physician compensation and healthcare business valuation is future cash flows. So, with an eye on valuation, we are always staying on top of the latest in Medicaid reimbursement news.
The bottom line is that MedPAC's latest proposal is an attempt to fix the sustainable growth rate (SGR) problem that has persisted for years in Medicare's formulaic reimbursement construct. We have mentioned this problem in the past during last year's SGR here and its potential successor here.
MedPAC's new plan is for primary care physicians to have flat reimbursement for the next 10 years. On a parallel track, specialists will have Medicare cuts of 5.9% for three years in a row and then have flat compensation for the next seven years after that.
Kaiser Health News has a nice roundup of articles here.
We will see if this has the political legs to actually come to pass--obviously the physician community isn't happy. If it does pass, it may spark increased urgency for physician integration with hospitals and health systems.
I look forward to any comments or questions or feel free to call me at 317.844.4851 to discuss.