Proposed Budget Deal Would Partially Delay Cut to Medicare Physician Payments

WASHINGTON — Physician groups wasted no time Tuesday expressing their dismay over a proposed $1.7 trillion budget deal in Congress that would rescind upcoming Medicare physician payment cuts — but only partially.

“MGMA is deeply dismayed by the failure of Congress to adequately address the full 4.5% cut to the Medicare conversion factor set to take effect on Jan. 1,” Anders Gilberg, MGA, senior vice president for government affairs at the Medical Group Management Association, a trade association for physician practices, said in a statement Tuesday. (Disclosure: Gilberg is a member of MedPage Today‘s editorial board.) “It is unconscionable that while every other provider category in the Medicare program is receiving a positive 2023 inflation update, physician rates will be cut. Medical practices are in no way immune to the impact of the broader economy, and have been suffering from significant staffing shortages, wage inflation, and drastic cost increases across the board. Any cut to the Medicare conversion factor is simply untenable in this environment.”

The measure would completely stave off a 4% cut required by pay-as-you-go, or PAYGO, rules. But physicians also were facing an additional 4.5% cut, and the proposed omnibus spending package would lessen that anticipated cut to 2%, something that American Medical Association president Jack Resneck Jr., MD, said would still threaten the viability of physician practices and endanger Medicare beneficiaries’ access to care.

“This 2% cut following two decades of flat payment rates will have consequences on health care access for older Americans,” he said in a statement. “High inflation compounds the threat to practice viability because physicians are the only Medicare providers without annual inflation-based updates. We are deeply worried that many practices will be forced to stop taking new Medicare patients – at a time when access to care is already inadequate. Congress must immediately begin the work of long-overdue Medicare physician payment reform that will lead to the program stability that beneficiaries and physicians need.”

NARAL Pro-Choice America, a pro-abortion rights organization, was displeased that the package didn’t include additional funding for family planning. “With an anti-choice Republican majority about to take control of the House and an abortion access crisis playing out across the country, it’s disappointing that this omnibus package failed to include critical funding increases for the Title X Family Planning Program,” Mini Timmaraju, JD, the group’s president, said in a statement. “This funding has long been a target of GOP attacks, despite the fact that it has helped tens of millions of Americans access essential care for more than 50 years. With reproductive freedom facing unprecedented threats from anti-choice extremists, we need to do everything we can to protect access to reproductive healthcare.”

Not all groups were disappointed, however. Andrew Hu, MPP, director of the action team at the Bipartisan Policy Center (BPC), said in a phone interview that several of his organization’s recommendations made it into the package. “One is coverage of marriage and family therapists and mental health counselors in Medicare beginning in 2024,” he said. That’s helpful because “one of the biggest issues we’ve been hearing [about] is lack of providers — patients don’t have anywhere to go.”

“Another area we’re happy to see is improving mobile crisis care,” he continued. When BPC reported on the new 988 suicide prevention hotline, “one of the areas we called out was the need to support the broader continuum of care. It’s great that we have this new number, but once they get there, they have to be able to go somewhere.” The package includes money for several localities in Florida and California to beef up their mobile crisis response teams.

Telehealth is also addressed in the bill, with a 2-year extension for current Medicare payment flexibilities for telehealth services. Right now, these flexibilities are extended to 150 days beyond the end of the COVID-19 public health emergency, but because it’s not clear when the PHE will end, it leaves providers uncertain, Hu said. “Extending it to a date certain is obviously good.”

Families USA, a left-leaning healthcare consumer organization, praised some of the package’s Medicaid provisions. “Despite uncertainty about how much support for Medicaid is cut, there are important wins for families in this legislation,” Frederick Isasi, JD, MPH, the organization’s executive director, said in a statement. “At a time when children’s health continues to be put to the test — we applaud Congress for taking action to ensure that children who rely on Medicaid and CHIP for their health care have a guarantee of 12 months of continuous coverage no matter where they live. Importantly, this bill eliminates bureaucratic hurdles that cause children to erroneously become uninsured and will prevent needless coverage gaps for eligible low-income kids.”

America’s Essential Hospitals (AEH), a trade group for safety-net hospitals, expressed a mixed view. “We thank congressional negotiators for supporting essential hospitals and their communities by agreeing to shore up the healthcare workforce, expand access to mental health and substance use disorder services, and extend flexibility for alternative care settings,” Bruce Siegel, MD, MPH, AEH president and CEO, said in a statement. “The omnibus would help essential hospitals and marginalized patients by extending telehealth and hospital-at-home flexibility. We also appreciate the bill’s provisions to increase graduate medical education slots for mental health care providers and extend the Children’s Health Insurance Program.”

However, he added, “while we are pleased the bill would avert the 4% Statutory Pay-As-You-Go (PAYGO) reduction and mitigate looming physician payment cuts, we are disappointed it lacks targeted funding for hospitals that serve a safety net role — essential hospitals. These hospitals continue to face immense financial pressure from high labor costs and workforce shortages and a surge in respiratory illnesses. We urge lawmakers to swiftly pass the omnibus and advance more support for the health care safety net.”

Congress is rushing to pass a budget deal by Friday to avert a government shutdown.