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It's Final: Physician Payments Take a Big Cut for 2023, Expect a Reduced Access to Care They Say

Analysis  |  By Amanda Norris  
   November 02, 2022

Ninety percent of medical practices reported that the payment cuts found in the 2023 Medicare physician fee schedule would reduce access to care, the MGMA says.

Physician payment cuts are coming, significant changes to E/M services are finalized, and key reporting revisions are hitting telehealth and audio-only services, according to the final 2023 Medicare physician fee schedule.

Proposed payment cuts that drew vocal criticism from physician advocacy groups will move forward as planned, as CMS announced a 4.5% reduction to the 2023 Medicare Part B conversion factor (CF), effective January 1.

The CF will fall to $33.0607 in 2023, down from $34.6062 in 2022, largely due to budget neutrality adjustments. The final CF for 2023 is two cents lower than the rate CMS first proposed in July, according to Part B News.

The anesthesia conversion factor will also take a hit next year, down 4.4% as proposed.

Much like what we heard from the proposed rule, medical groups are not faring well with the finalized rule.

"As expected, CMS finalized a substantial reduction to the conversion factor — negatively impacting physician reimbursement across the board. It is more critical than ever that Congress act to avert these cuts, as well as the 4% PAYGO sequestration, before the end of the year," MGMA Senior Vice President Government Affairs Anders Gilberg said in a release.

"Ninety percent of medical practices reported that the projected reduction to 2023 Medicare payment would reduce access to care. This cannot wait until next Congress—there are claims processing implications for retroactively applying these policies," Gilberg said. "MGMA looks forward to working with both Congress and the Administration to mitigate these cuts and develop sustainable payment policies to allow physician practices to focus on treating patients instead of scrambling to keep their doors open."

Jack Resneck Jr., M.D. president of the American Medical Association (AMA) noted the same grievances and doubled down on the negative impact to access to care.

"The Medicare payment schedule released today puts Congress on notice that a nearly 4.5 percent across-the-board reduction in payment rates is an ominous reality unless lawmakers act before Jan. 1. The rate cuts would create immediate financial instability in the Medicare physician payment system and threaten patient access to Medicare-participating physicians. The AMA will continue working with Congress to prevent this harmful outcome," Resneck said.

Updates to E/M, telehealth, and more

CMS confirmed in the final rule that it will adopt the framework of the AMA’s revised E/M guidelines for facility and residential visits, including payment based on medical decision-making or time.

CMS intends to adopt the telehealth waiver extension that Congress passed in Consolidated Appropriations Act of 2022. The extension locks in a wide range of telehealth waivers for 151 days after the PHE expires, including the audio-only exceptions that have been popular with providers; the waiver of geographic and other limits ordinarily required for telehealth services; and the ability of therapists, occupational therapists, speech-language pathologists, and audiologists to bill such codes under telehealth.

For the Merit-based Incentive Payment System (MIPS), the category weight in 2023 will be 30% for Quality, 30% for Cost, 15% for Improvement Activities, and 25% for Promoting Interoperability. The data completeness threshold rises from 70% to 75%.

CMS will take applications for the MIPS Value Pathways (MVP) program that will eventually replace the current MIPS structure. The agency will also add five new MVPs to the seven in its MVP inventory.

As proposed, CMS will front money to ACOs with low revenue that treat underserved communities with advance investment payments (aka advance shared savings payments). The agency also will provide "greater flexibility in the progression to performance-based risk" to some ACOs, a CMS press release says, "allowing these organizations more time to redesign their care processes to be successful under risk arrangements."

CMS also will extend its incentive for voluntary reporting of eCQMs/MIPS CQMs through performance year 2024 (at which time it will replace the Web Interface reporting method for all Shared Savings ACOs) and institute a "health equity adjustment" for Medicare Shared Savings Program (MSSP) performance reporting. 

"Premier applauds CMS for finalizing reforms to certain aspects of the MSSP that incentivize provider participation. As Premier has long advocated, we must ensure that providers in ACOs have an adequate budget, and that we create incentives for rural and other vulnerable providers to move to value, " Soumi Saha, senior vice president of government affairs at Premier, said in a release. "We remain disappointed, however, that CMS is continuing to distinguish between low- and high-revenue for ACOs, especially in light of a Premier analysis demonstrating the differences between ACOs have more to do with cherry picking locations and attribution methodology than with real performance," Saha said.

National Association of ACOs (NAACOS) President and CEO Clif Gaus, Sc.D., had a similar sentiment.

"Today’s finalized changes to Medicare’s largest ACO program bring a win to patients and will absolutely help providers deliver accountable care to more beneficiaries. NAACOS thanks CMS for its leadership and following through on its promise to create a stronger Medicare program by improving accountable care models and speeding the movement toward value for all patients. On balance, we believe this final rule will grow participation in accountable care organizations, which have already generated billions of dollars of savings for our health system," Gaus said.

Amanda Norris is the Associate Content Manager of Finance, Payer, Revenue Cycle, and Strategy for HealthLeaders.

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