On July 29, 2022, a “major proposed rule” is set to be published in the Federal Register and will be available online at the federalregister.gov, and govinfo.gov.1 This rule addresses:
- Medicare and Medicaid Programs;
- CY 2023 Payment Policies under the Physician Fee Schedule and Other Changes to Part B Payment Policies;
- Medicare Shared Savings Program Requirements;
- And other various changes.
This blog entry will look at the rules and new numbers around the Physician Fee Schedule (PFS) and how it will affect providers. It was reported on the RevCycle Intelligence website that the proposed rule “would lead to significant cuts to physician reimbursement next year.”2 The cut is due to the expiration of the 3 percent increase for Physician Fee Schedule reimbursements from CY 2022. The expiring increase comes from the “Protecting Medicare and American Farmers from Sequester Cuts Act, ” signed into law on December 10, 2021. As the congressional website explains: “Specifically, the bill continues to exempt Medicare from sequestration until March 31, 2022. (Sequestration is a process of automatic, usually across-the-board spending reductions under which budgetary resources are permanently cancelled to enforce specific budget policy goals.)”3 Moreso, and crucial to the cuts proposed, “… the bill (1) temporarily extends other provisions under Medicare, including a payment increase under the physician fee schedule; and (2) requires any debits recorded for FY2022 on the statutory pay-as-you-go (PAYGO) scorecards to be deducted from the scorecards for 2022 and added to the scorecards for 2023.”3 This essentially indicates that the increase is expiring and will be offset in CY 2023, and the initial impact means the CY 2023 conversion factor will be $33.08 for the Medicare Physician Fee Schedule. That reduction equates to $1.53 less than CY 2022. (For a detailed explanation of the equation for reimbursement see, The Medicare Conversion Factor4)
Furthermore, the same RevCycle Intelligence article predicts that “Physicians may be facing more payment cuts in the coming year.”3 This refers to the 4% PAYGO sequestration due to become active at the start of the new year. Predictably, the physician community is not pleased with the CY 2023 Medicare Physician Fee Schedule. In fact, Jack Resneck Jr., MD, president of the American Medical Association (AMA), released a statement via press release entitled, “Medicare payment schedule rule threatens patient access,” on July 7, 2022, that expresses their concerns.5 These adjustments are prompting many advocacy groups to call Congress to overhaul the Medicare physician payment system entirely.
Whatever the outcome on Jan. 1, 2023, there is little doubt that the proposed rule will undergo a series of changes and revisions, including the typical last-minute deal-making. Advantum Health will follow and report on the events.
Contact Advantum Health today to learn how we can assist with revenue cycle management, how to mitigate the pending Medicare PFS cuts, and increase profitability.