BREAKING: House votes for permanent doc fix, bill goes to Senate

The U.S. House Thursday voted overwhelmingly in favor of scrapping Medicare's sustainable growth-rate formula, passing a permanent doc fix. The measure next goes to the Senate for a vote. President Barack Obamahas indicated he will sign the measure.

The Senate still needs to pass the bill before adjourning on Friday. Senate Democrats have raised concerns about abortion language in the legislation and only extending the Children's Health Insurance Program for two years, but those reservations have faded as the repeal package has gained momentum. If enacted it would end a cycle of short-term doc fixes that has persisted for more than a decade.

The legislation gives physicians an annual 0.5% bump for the next four years. Payment rates would then hold flat for six years. Then most doctors would see annual 0.25% payment increases. 

The bill also sets up a two-tier payment system that provides incentives for doctors to shift more of their practice into value-based payment models, including accountable care organizations, bundled-payment arrangements and medical homes.

House Minority Leader Nancy Pelosi called the bill “transformative in how it rewards the value not the volume” Thursday morning while speaking to the House.