Congressional lawmakers have reached a bipartisan agreement that would repeal and replace the sustainable growth rate (SGR) Medicare physician payment formula, according to a Modern Healthcare report.

Under the new system, physicians will receive a 0.5 percent pay increase each year for five years, according to a MedPage Today report, and SGR will be replaced with a formula that pays physicians based upon quality of care rather than quantity of services provided.

The bill, which combines the work of three congressional committees — Senate Finance, House Ways and Means and House Energy and Commerce — and still requires approval from Congress, is called the SGR Repeal and Medicare Provider Payment Modernization Act.

The bill does not identify how the increases in physician payments will be funded.