The new CMS proposed rule just dropped!
On July 7, CMS released its proposed rule for the Medicare Physician Fee Schedule (MPFS), and it really was quite the mixed bag.
Here are the highlights:
Conversion Factor Cuts: This was the big whammy from the release. The Conversion Factor (CF) is the basis for calculating Medicare payments to physicians. CMS is cutting this component by 4.42% - from $34.61 to $33.08. CMS basically went on to say that its hands were tied from increasing the CF as a result of statutes affecting Medicare, including budget neutrality & other nuanced stuff that kept the Centers from bumping reimbursement.
ACO Expansion: CMS wants to advance shared savings payments to new ACOs participating in the MSSP program to help address the social needs of Medicare beneficiaries in rural and underserved areas. The thinking is that by providing these payments, rural providers will get the investment needed to start their own ACOs. Changes in the proposed ruling would result in $650M in new shared savings payments to ACOs.
Behavioral Health: CMS proposed to allow therapists to practice under 'general' rather than 'direct' supervision by a PCP. On top of the intent to address behavioral staffing shortages, CMS wants to further integrate behavioral health into primary care by reimbursing behavioral clinicians linked to primary care practices.
Chronic Conditions: CMS wants to bundle certain treatments into per-month payments to encourage team-based chronic condition management.
Other Stuff: The smaller, more nuanced stuff relates to slight expansion for dental coverage for organ donors under Part B, changes to colonoscopy access and starting age of coverage to 45.
Madden's Musing
Physicians are pretty dang upset about the ~4% cut headed their way (as are most services verticals when their reimbursement is cut in a draconian fashion).
Numerous physician organizations cried foul about the proposed rule.
Here's a quote that sums up the sentiment quite nicely:
"The cost of running a medical practice has increased 39% in the past twenty years. When adjusted for inflation, the impact is a decline in value of Medicare physician payments of 28%. On top of jeopardizing patients' access to care, the proposed cuts further exacerbate the difficult operating environment surgical practices already face and the people that are affected most are our patients." - George Williams, MD, American Academy of Ophthalmology Senior Secretary for Advocacy
They're right to be upset.
We're facing a bizarre dichotomy in healthcare today.
On one hand, expense inflation is vastly higher than historical norms. It's hitting costs across the board (supplies, staff, utilities, G&A components).
No services vertical is immune to inflationary effects facing the U.S. this year and pricing power is more limited in healthcare in general as payors apply deflationary pressures on provider top lines. (I wrote about this effect back in April - in fact, it was one of my first ever Hospitalogy sends. OGs will remember!).
At the same time, CMS is hamstrung by statutory requirements to keep Medicare budget neutral along with other measures in place aimed at keeping the trust fund afloat.
It IS ironic to me, though, that CMS touts expanding access throughout the fact sheet release despite the fact that it was just forced to cut reimbursement in physician services, quite literally the most integral vertical for patient access.
CMS is well intentioned, but the statements struck me as contradictory.
If I'm a physician or any service provider, my main beef is with Congress right now and its lack of an answer to provide funding despite unprecedented levels of government spending over the past 2 years.
We're witnessing a massive swing in physician employment to corporate entities & hospitals right in front of our very eyes mostly driven by legislation (or lack thereof) propagated by buffoons. Independent physician groups are struggling to survive.
Meanwhile, continued consolidation will drive prices higher, ironically resulting in dire financial straits for the Medicare Trust Fund.
TL;DR: AHA > AMA, and healthcare continues as always to be a consolidation game. It's already hard enough to be a provider. Let's not make it harder.
If you have a different perspective, I'd love to hear your argument or thoughts!
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