ACP Advocates for Legislation to Stop 2023 Cuts to Medicare Physician Fee Schedule

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Bipartisan legislation in Congress recognizes the need for a longer-term solution to promote and reward value-based payments

Oct. 21, 2022 (ACP) – Once again, American physicians are facing uncertainty at the end of the year as major reimbursement cuts loom unless the nation's leaders take action. Fortunately, there is a bipartisan bill in Congress that begins to address the problem.

The American College of Physicians is urging Congress to pass a bipartisan bill that prevents budget neutrality payment cuts scheduled to begin on Jan. 1, 2023, and also recognizes the need for the development of a longer-term solution. ACP is also advocating for legislation to end the annual Medicare physician payment freeze and provide an update to the Medicare Physician Fee Schedule that is consistent with the Medicare Economic Index update for the coming year.

The most pressing issue is preventing the mandatory 4.42 percent cut to the Medicare Physician Fee Schedule that will go into effect with the new year unless it is reversed by Congress, according to Shari Erickson, ACP chief advocacy officer and senior vice president. “A bipartisan bill has been introduced to do just that – H.R. 8800, the Supporting Medicare Providers Act of 2022 – and we've expressed support for it,” she said.

“The legislation would negate the impact the budget neutrality cuts would have and ensure that Medicare payment rates remain stable for physicians and their practices next year,” said Dr. Ryan D. Mire, president of ACP. “The bill also recognizes the need for Congress and the administration to take action on a longer-term solution that would promote and reward value-based payments and advance health equity.”

In the bigger picture, Medicare payment rates have not been updated for years and ACP believes that action is necessary to account for higher costs and rates not having been adjusted to account for those increased costs. Medicare physician payments have decreased by 20 percent from 2001 to 2021 when adjusted for inflation, according to the American Medical Association.

“Unless Congress acts, a continuing statutory freeze in annual Medicare physician payments is scheduled to last until 2026, when updates would resume at a rate of 0.25 percent per year, well below inflation rates,” Mire wrote in a Sept. 23 letter to congressional leaders. “As many physicians are still struggling with the financial challenges imposed by the COVID-19 pandemic and the lack of annual positive inflationary updates in their Medicare reimbursement, we urge the Congress to pass legislation that provides financial stability for our practices so that we can maintain access to care for our patients.”

“Congress is in recess now with the election coming up,” Erickson said, “and they'll need to come back and put together a spending bill to fund the federal government for the whole of next year.”

The challenge for Congress will be to find the time and support needed to move ahead with this legislation during the remaining legislative days this year. Erickson explained that because of their limited time and competing priorities, it is critically important for members of Congress to hear from their constituents about the need to address important issues, like the looming Medicare cuts. She urged ACP members to write to their senators and representatives in support of the relevant legislation. Members can take action by writing to their U.S. representatives to halt physician payment cuts and extend the 5 percent bonus for participation in alternative payment models. A form to send to representatives is available on the ACP website.

ACP's goal is to convince Congress to act in the near term to prevent the 2023 payment cuts, while also working toward a longer-term solution that eliminates the annual uncertainty over the next year's Medicare rates. “Congress needs to address the immediate issue,” Erickson said, “then we'll be able to work with policymakers to make more permanent changes in the way the physician fee schedule is constructed and enact comprehensive reform of the Quality Payment Program.”

Erickson said she is optimistic. It is very likely that the mandatory 2023 payment cuts will be reversed, she said, and major medical societies have united to push for more lasting reform. If all goes according to plan, Erickson believes ACP members will not see an annual cut in 2023 or face the prospect of one in future years. This effort also includes a push to increase payment rates to account for inflation.

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