Physicians Still Face 2% Cut in Reimbursement Rates
EXECUTIVE DIRECTOR'S MESSAGE
The good news from Congress is that an 8.5% reduction in Medicare payments was not implemented. The bad news is that only 6.5% of the proposed cut was stopped, so physicians will still face a 2% cut in 2023.
The 2% cut comes on top of two decades of flat payment rates that haven’t been adjusted for inflation. When adjusted for inflation, Medicare physician payments have dropped by 22% from 2001 to 2021. Physicians simply cannot afford to operate under the current payment system.
CMA, SSVMS and physicians are extremely upset about the cut, and that unhappiness is being channeled toward aggressively pushing Congress to overhaul Medicare’s payment system in 2023.
CMA, SSVMS and physicians are extremely upset about the cut, and that unhappiness is being channeled toward aggressively pushing Congress to overhaul Medicare’s payment system in 2023. Goals include providing an annual inflation update, reducing administrative report burdens, revising budget neutrality requirements to allow appropriate changes in spending and exempt new services, and to allow more physician-led alternative payment models.
As America ages and people live longer, Medicare will be a growing element of many practices. Stable Medicare rates that include an adjustment for inflation in health care are needed to ensure the patients have more access to physicians, particularly in underserved areas, and to improve health equity overall.
When older Americans have the access they need to physicians and quality care, it reduces costs overall by preventing avoidable hospitalizations. Fair and predictable Medicare rates also allow physicians to invest and participate in value-based care models and they reduce the incentives for consolidation, one of the causes for increased health care costs.
One area that has had physicians clamoring for reform in Medicare and other health payment systems is prior authorization, which has become an administrative nightmare that can slow or even block care for patients. A bill to reform prior authorization by Sacramento Rep. Ami Bera, MD unanimously passed the House in September but things derailed in the Senate when the Congressional Budget Office scored the cost at $16 billion. Legislative leaders quickly called for the Biden Administration to issue regulations that would circumvent the legislative cost and allow these important reforms to be implemented as soon as possible.
Physicians were awarded a victory in December when the Centers for Medicare and Medicaid Services released a proposed rule to implement prior authorization reform. The rule would require Medicare Advantage plans, Medicaid managed care organizations, and health exchange plans to address prior authorization requests more promptly, streamlining and simplifying the process to ensure the timely provision of patient care and reducing burdens on physicians.
This win, along with others that included mechanisms to increase the domestic manufacture of drugs that are in short supply or experiencing supply chain issues, an expansion of physician wellness programs, and funding to improve access to mental health care, are the result of intensive lobbying by CMA members that include our own SSVMS physicians. I want to thank everyone who joined us on our trip to Washington, D.C. to meet with lawmakers and staff; your efforts have paid off and are helping physicians in our region, state and nation.
Congress has issued a request for information from several medical groups in advance of hearings that will be held to address the need for further Medicare payment reform and protecting access to care for our patients. Like everything else in Congress this year, we expect the process to be contentious but you can be sure we will do all we can to support CMA in achieving a fairer system for physicians so they can serve Medicare patients without it being such a financial and administrative burden. We’ll keep you up to date on how things progress in the coming year.
