The uptake of electronic health records among physician practices could stall as physicians face yet another threat of cuts in Medicare reimbursement, said William F. Jessee, MD, CEO of the Medical Group Management Association.

Jessee spoke Tuesday at a news conference at the group’s annual convention in Denver. The MGMA has 22,500 members, comprised of administrators and managers of medical groups across the country.

Physicians face a 21.5 percent cut in Medicare payments on January 1 under the government’s SGR (sustainable growth rate) formula. Congress has frequently modified the rate to avoid reductions in payment, and last year avoided a cut by giving doctors a 0.5 percent increase in payments.

The uncertainty over whether physicians will be hit with a cut this year, or whether Congress will postpone it again, could hurt IT purchases, Jessee said.

“If they don’t fix it, the ramifications could be pretty severe,” he said.

“If there is a fix to be had, it will be an expensive one," Jessee acknowledged, but “kicking the can down the road” would continue to add to the reimbursement nightmare.

“This is called digging your way out of a hole by digging it deeper,” he said.

For physicians facing a 21.5 percent cut in payments, the promise of $44,000 in incentives over five years tied to the meaningful use of healthcare IT doesn't seem like a good deal.

The MGMA and 59 other healthcare associations sent a letter to Congress and the administration in May calling for the elimination of the SGR mechanism.

“The SGR should be repealed this year and replaced with an updated system that reflects increases in physicians’ and other health professionals’ practice costs,” the letter stated. “A realistic budget baseline for future Medicare payment updates, which accurately reflects the anticipated costs of providing physicians with positive updates under a new update system in lieu of SGR-related cuts, should be incorporated into the federal budget."

Rather than buying an EHR system to begin implementation now – as they have been advised to do in order to qualify for the government incentives provided under the American Recovery and Reinvestment Act – physicians  are sitting on the sidelines waiting to see what happens, Jessee said.