All They Want for Christmas Is … No Medicare Payment Cuts

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WASHINGTON — Doctor groups have their holiday wish list for Congress all written down, and not surprisingly, stopping cuts to Medicare physician payments are at the top of the list.

Physicians are facing two types of payment cuts in the Medicare program, unless Congress acts to stop them, Anders Gilberg, MGA, senior vice president for government affairs at the Medical Group Management Association (MGMA), a trade organization for physician practices, said in a phone interview (Disclosure: Gilberg is a member of the MedPage Today editorial board).

First of all, he explained, there is a pending 4.47% cut in the conversion factor, a multiplier used to calculate physician reimbursement for fee-for-service payments under Medicare. In addition, there is a pending 4% cut in physician fees due to PAYGO or “pay-as-you-go,” a rule requiring Congress to fully fund any legislation it passes.

“Historically, Congress has not allowed [PAYGO] to have been triggered, although there were concerning reports last week that Congress might not be able to get to it” by year’s end, Gilberg said.

Lack of an Inflation Adjustment a Problem

The 4.47% cut is particularly galling because every other healthcare sector — including inpatient hospital care providers, outpatient care providers, and skilled nursing facilities, gets an “inflation adjustment” increase in their Medicare pay — except physicians, Jack Resneck Jr., MD, president of the American Medical Association, said here Tuesday in a meeting with reporters. “Physicians are the one and only group where they face the same inflation and get cuts … This is a problem that has to be fixed.”

And the cut couldn’t come at a worse time — in addition to high inflation, physicians are facing a “tripledemic” of flu, respiratory syncytial virus (RSV) and COVID — this winter, along with provider shortages and high levels of burnout, he added. Resneck noted that a recent survey found that one in five physicians said they are planning to leave the practice of medicine in the next 2 years. “This is completely different in tone and quantity to me [than in previous years] and leaves me really worried,” he said. One bill being considered by Congress, H.R. 8800 — also known as the Supporting Medicare Providers Act of 2022 — would eliminate the 4.47% conversion factor cut; that bill has 80 Democratic and 29 Republican cosponsors in the House.

And that cut doesn’t affect just Medicare, Sterling Ransone Jr., MD, president of the American Academy of Family Physicians (AAFP), said in a phone interview. “Medicare sets policy for itself, but most insurers, be they private or TRICARE, tend to follow suit with what Medicare does. A lot of payments are indexed off what the Medicare rate is, so if the Medicare rate falls lower, other [payers] tend to fall in line.”

Push to Improve Prior Authorization

Prior authorization is also high on physicians’ wish list, according to Ransone, whose group was one of six physician organizations to send Congress a letter outlining their year-end healthcare priorities. The AAFP and other physician groups are supporting H.R. 3173, the Improving Seniors’ Timely Access to Care Act, which would standardize prior authorization procedures in Medicare Advantage plans, require plans to provide real-time prior authorization decisions in certain cases, and require plans to report annually on the percentage of such requests approved as well as average response time. The bill was passed by the House in September, and a companion measure in the Senate has 49 cosponsors — 26 Democrats and 23 Republicans.

“When I went into practice 20 years ago, prior authorization was used for a few brand new, expensive drugs … Now I get asked for prior authorization on everything I do,” Resneck, a dermatologist, told MedPage Today. “The average doctor is doing 41 of these a week.”

“Getting that legislation past Senate would be critical,” said Gilberg, adding that one of the roadblocks to its passage has been that the Congressional Budget Office (CBO) estimated that the bill would cost the federal government $16 billion to implement. According to the CBO, “By placing additional requirements on plans that use prior authorization, we expect H.R. 3173 would result in a greater use of services. We expect Medicare Advantage plans would increase their bids [for a Medicare contract] to include the cost of these additional services, which would result in higher payments to plans.”

Gilberg said Monday that the Centers for Medicare & Medicaid Services (CMS) is expected to soon release a proposed prior authorization regulation that could lower the CBO score. “We may have a window here where the CBO score on the legislation is reduced, and therefore it makes it more palatable for passage by the end of the year,” he said.

The proposed rule was issued Tuesday afternoon and, according to a CMS press release, would include requirements for certain payers to:

  • Include a specific reason when denying requests
  • Publicly report certain prior authorization metrics
  • Send decisions within 72 hours for expedited (i.e., urgent) requests
  • Send decisions within 7 calendar days for standard (i.e., non-urgent) requests

Ransone agreed that passage of the prior authorization bill was critical “If we can get Medicare Advantage to standardize the prior authorization process, it will make it a lot easier, especially for smaller [physician] offices,” he said. “Larger offices that are associated with a health system can afford to have numerous people doing the administrative part, but smaller offices can’t afford to hire those extra employees, so the more we can streamline prior authorization, the better it will be for all of our patients.”

Hopes for Preserving Telehealth Benefits

Preserving telehealth benefits for Medicare patients is another big priority. “Right now, the way the law is written, we’re happy that Congress extended telehealth [coverage] provisions to go for an extra 6 months after the end of the [COVID-19] public health emergency,” which is expected to expire in July 2023, Ransone said. “We’d like to see it extended for a year at least — probably through the end of 2024 — to allow us to maintain these services.”

“Telehealth has been a tremendous advance,” said Resneck, adding that Medicare’s increased coverage of telehealth during the pandemic — and the resulting explosion in its use — “really showed us that what was in the way was coverage. We do have breathing room at the end of the public health emergency, but Congress is going to have to act to extend that.”

Use of audio-only telehealth also needs to continue being included, he said. “I take care of patients who come from 2-to-3 hours away … Sometimes the visit fails and we need to have that as a back-up. Audio-only is not our first choice to deliver care, but having it as a back-up is critically important,” especially since some patients don’t have reliable Internet access.

Other issues are on physicians’ minds as well. The American Academy of Pediatrics (AAP), for example, urged Congress to enact H.R. 8876, the Jackie Walorski Maternal and Child Home Visiting Reauthorization Act of 2022, which was passed by the House in early December. The bill supports home visits for expectant and new parents who live in communities that are at-risk for poor maternal and child health outcomes.

“Pediatricians know first-hand the importance of the Maternal, Infant, and Early Childhood Home Visiting program,” AAP president Moira Szilagyi, MD, PhD, said in a statement. “Becoming a new parent can be an especially stressful time and home visiting helps to ensure families have the support, expertise and resources they need to thrive. Specially trained home visitors can help guide parents who may not otherwise have a place to turn. It complements the work we do as pediatricians, and makes sure children and families are supported when they return home from our clinics or practices … The AAP calls on lawmakers to include these critical policies and expanded funding in any comprehensive year-end legislation.”

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    Joyce Frieden oversees MedPage Today’s Washington coverage, including stories about Congress, the White House, the Supreme Court, healthcare trade associations, and federal agencies. She has 35 years of experience covering health policy. Follow

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