Doctors Brace For Steep Cuts In Medicare Payments

Its full name is the Medicare Sustainable Growth Rate. Enacted as part of the 1997 Balanced Budget Act, the SGR is designed to keep Medicare costs from increasing faster than the rate of economic growth.

In practice, it means regular cuts in Medicare payments to physicians, unless Congress intervenes. It’s already suspended the SGR cut five times over the past year. Failing a last minute intervention, the next cut will take effect in January.

Dr. William Gilmer is a neurologist and past president of the Harris County Medical Society.

"There’s going to be a large impact to the Texas Medical Center, which is the city’s largest employer. Some hospitals are already talking about selling, closing, consolidating. But even if you consolidate, you can’t make a profit when you are losing money on your product."

Gilmer says the 30% cut means many physicians will no longer be able to afford to treat Medicare patients.

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