Lawmakers shouldn’t heed a key Medicare advisory panel’s recommendation to freeze physician payments for the 2023 fiscal year, according to provider groups that stress practices are still feeling the brunt of the pandemic.
The Medicare Payment Advisory Commission (MedPAC), which advises Congress on Medicare policy and payment issues, recommended in a report to lawmakers Tuesday (PDF) that clinician payments are adequate, and they don’t need a bump in 2023. The panel felt physicians are expected to have a major rebound in 2023.
“Although clinicians have experienced declines in their Medicare service volume and revenue due to the pandemic, the Congress has provided tens of billions of dollars in relief funds to clinicians, and we expect volume and revenue to rebound to pre-pandemic levels (or higher) by 2023,” MedPAC’s report said.
But doctor groups slammed the recommendation for Congress, which MedPAC agreed to in January, to stand pat.
The American Medical Association (AMA) wrote in a letter to congressional leaders Tuesday that MedPAC ignores major disruptions practices are facing. For one thing, the recommendation doesn’t consider additional payment cuts such as the return of sequester cuts and inflationary increases.
“Current government data on key elements of the Medicare Economic Index make it clear that, without an inflation-based update, the gap between frozen physician payment rates and rising inflation in medical practice costs will widen considerably,” the letter said.
Other factors such as burnout and stress as well as a 14% decrease in Medicare payments due to patients delaying care are also major issues that call for Congress to rethink a freeze on Medicare payments for physicians, the AMA said.
The Medical Group Management Association said in a statement that it was “deeply troubled” by MedPAC’s decision.
“Without a modest annual payment update to keep up with the cost of inflation, physician practices will inevitably be forced to make difficult decisions about their Medicare participation—decisions that would certainly result in diminished access to the critical healthcare services on which beneficiaries rely,” the group said in a statement.
Physicians and other provider groups have been imploring Congress to forestall a series of cuts set to take effect soon as lawmakers look to unwind key pandemic relief.
Lawmakers passed in 2020 a moratorium on a 2% cut to Medicare payments installed by sequestration. But that moratorium will now expire, and the cuts will be phased back in. Starting in April, providers will face a 1% cut to payments, and the full cuts return in June.
Providers have charged that the moratorium should continue through the COVID-19 public health emergency (PHE), which is expected to run at least through July.
MedPAC also recommended to Congress no new pay bumps for ambulatory service centers and dialysis facilities.
But the group did call for pay bumps to hospitals of 2% for inpatient services and 2.5% for outpatient rates.
“Some hospital payment adequacy indicators improved while others declined; however, indicators varied substantially across hospitals and largely reflect temporary changes during the PHE rather than changes to the overall adequacy of Medicare payments to hospitals,” MedPAC’s report said.