Medicare Compliance & Reimbursement

But: Industry insiders are already asking Congress to intervene.

If you thought that CMS wouldn’t follow through on its conversion factor (CF) reduction proposals — especially since Medicare providers are still recovering from pandemic fallout and dealing with inflation — think again. Read on for the scoop.

Context: On Nov. 1, the Centers for Medicare & Medicaid Services (CMS) issued the calendar year (CY) 2023 Medicare Physician Fee Schedule (MPFS) final rule. The bigger-than-usual reimbursement manifesto clocks in at 2,953 pages and covers an amalgam of hot topics from Part B payment and coverage policies to Medicare Shared Savings Program (MSSP) changes to the latest updates on COVID-19 interim rules. The MPFS final rule is scheduled for publication in the Federal Register on Nov. 18.

As is often the case, the CY 2023 MPFS final rule is a mixed bag of policy highs and lows. Among the high points, CMS follows through on its promises to bolster behavioral health, chronic pain management, and substance use disorders by aligning payment and coverage with the CMS Behavioral Health Strategy, a five-goal initiative that “seeks to remove barriers to care and services,” the agency says in a release.

“Access to services promoting behavioral health, wellness, and whole-person care is key to helping people achieve the best health possible,” says CMS Administrator Chiquita Brooks-LaSure in a release. “The Physician Fee Schedule final rule ensures that the people we serve will experience coordinated care and that they have access to prevention and treatment services for substance use, mental health services, crisis intervention, and pain care.”

The “whole-person approach” translates to Medicare updates in other areas, too. CMS also offers a boost to dental services, clarifies telehealth services post-COVID-19-PHE, and refines preventative vaccination administration payment policies, according to the MPFS final rule (see story, p. 4).

“The Biden-Harris Administration is committed to expanding access to vital prevention and treatment services,” explains HHS Secretary Xavier Becerra in a release. “Providing whole person support and services through Medicare will improve health and wellbeing for millions of Americans and even save lives.”

CF Cut Vexes Industry Organizations

One of the less popular MPFS changes surrounds CMS’ decision to reduce the CF in 2023.

CMS had originally proposed in July — to industry-wide consternation — to cut the CF by $1.53 for CY 2023, decreasing the rate from $34.61 to $33.08. But, instead of going with that change, the agency decided to cut the CF even more in the final rule to $33.06 or $1.55 less than the 2022 amount.

After the proposed CF reduction was announced, industry organizations urged CMS to reconsider such a detrimental pay cut. But that advocacy didn’t work, and now healthcare leaders are once again asking Congress to get involved.

The 4.5 percent reduction will surely have “a negative impact on patients’ access to certain services,” reasons the American Hospital Association (AHA) in a special bulletin on the rule. “Our concern is heightened by the fact that this cut is coming in the wake of nearly two years of unrelenting financial pressures on the health care system due to the ongoing COVID-19 public health emergency (PHE), increased inflation, rising staffing costs and increased costs for non-labor supply categories due to national shortages,” the AHA expounds.

The American Medical Association (AMA) points out that physicians are already feeling the heat and the CF cut would “create immediate financial instability in the Medicare physician payment system,” warns AMA President Jack Resneck Jr., MD, in a statement. “Unless Congress acts by the end of the year, physician Medicare payments are planned to be cut by nearly 8.5 percent in 2023 — partly from the 4 percent PAYGO sequester — which would severely impede patient access to care due to the forced closure of physician practices and put further strain on those that remained open during the pandemic,” he adds.

The Medical Group Management Association (MGMA) agrees that legislators must act now. “Ninety percent of medical practices reported that the projected reduction to 2023 Medicare payment would reduce access to care,” observes Anders Gilberg, MGMA Senior Vice President, Government Affairs, in a statement on the rule. “This cannot wait until next Congress — there are claims processing implications for retroactively applying these policies.”

Reminder: In the CY 2022 final rule, which came out in November 2021, CMS cut the CF by $1.30, reducing it from $34.89 to $33.59. That change coincided with the expiration of the 3.75-percent CF increase that had originally been a provision under the Consolidated Appropriations Act, 2021 (CAA). Last year’s CF saga continued when Congress stepped in with the Protecting Medicare and American Farmers from Sequester Cuts Act on Dec. 10, 2021 and added a 3-percent increase back into the CF equation (see Medicare Compliance & Reimbursement, Vol. 48, No. 1).