New Medicare physician fee schedule leaves docs fuming over pay cuts


Medicare’s recently announced 2023 physician payment rule likely trims doctors’ pay even as it aims to expand patients’ access to behavioral health services, chronic pain management, and hearing screening. The rule also seeks to ease financial and administrative burdens on accountable care organizations (ACOs).

But physician groups’ initial reactions centered on what the American Medical Association describes as a “damaging across-the-board reduction” of 4.4% in a base calculation, known as a conversion factor.

The reduction is only one of the current threats to physician’s finances, Jack Resneck Jr, MD, AMA’s president, said in a statement. Medicare payment rates also fail to account for inflation in practice costs and COVID-related challenges. Physician’s Medicare payments could be cut by nearly 8.5% in 2023, factoring in other budget cuts, Dr. Resneck said in the statement.

That “would severely impede patient access to care due to the forced closure of physician practices and put further strain on those that remained open during the pandemic,” he said.

A key driver of these cuts is a law that was intended to resolve budget battles between Congress and physicians, while also transitioning Medicare away from fee-for-service payments and pegging reimbursement to judgments about value of care provided. The Centers for Medicare & Medicaid Services thus had little choice about cuts mandated by the Medicare Access and CHIP Reauthorization Act (MACRA) of 2015.

For AMA and other physician groups, the finalization of the Medicare rule served as a rallying point to build support for pending legislation intended to stave off at least some payment cuts.

Federal officials should act soon to block the expected cuts before this season of Congress ends in January, said Anders Gilberg, senior vice president for government affairs at the Medical Group Management Association, in a statement.

“This cannot wait until next Congress – there are claims-processing implications for retroactively applying these policies,” Mr. Gilberg said.

He said MGMA would work with Congress and CMS “to mitigate these cuts and develop sustainable payment policies to allow physician practices to focus on treating patients instead of scrambling to keep their doors open.”

Chronic budget battles

Once seen as a promising resolution to chronic annual budget battles between physicians and Medicare, MACRA has proven a near-universal disappointment. A federal advisory commission in 2018 recommended that Congress scrap MACRA’s Merit-based Incentive Payment System (MIPS) and replace it with a new approach for attempting to tie reimbursement to judgments about the quality of medical care.

MACRA replaced an earlier budgeting approach on Medicare physician pay, known as the sustainable growth rate (SGR). Physician groups successfully lobbied Congress for many years to block threatened Medicare payment cuts. Between 2003 and April 2014, Congress passed 17 laws overriding the cuts to physician pay that the lawmakers earlier mandated through the SGR.

A similar pattern has emerged as Congress now acts on short-term fixes to stave off MACRA-mandated cuts. A law passed last December postponed cuts in physician pay from MACRA and federal budget laws.

And more than 70 members of the House support a bill (HR 8800) intended to block a slated 4.4% MACRA-related cut in physician pay for 2023. Two physicians, Rep. Ami Bera, MD, (D-CA) and Rep. Larry Bucshon (R-IN) sponsored the bill.

Among the groups backing the bill are the AMA, American Academy of Family Physicians, and American College of Physicians. The lawmakers may try to attach this bill to a large spending measure, known as an omnibus, that Congress will try to clear in December to avoid a partial government shutdown.

In a statement, Tochi Iroku-Malize, MD, MPH, MBA, the president of AAFP, urged Congress to factor in inflation in setting physician reimbursement and to reconsider Medicare’s approach to paying physicians.

“It’s past time to end the untenable physician payment cuts – which have now become an annual threat to the stability of physician practices – caused by Medicare budget neutrality requirements and the ongoing freeze in annual payment updates,” Dr. Iroku-Malize said.

Congress also needs to retool its approach to alternative payment models (APMs) intended to improve the quality of patient care, Dr. Iroku-Malize said.

“Physicians in APMs are better equipped to address unmet social needs and provide other enhanced services that are not supported by fee-for-service payment rates,” Dr. Iroku-Malize said. “However, insufficient Medicare fee-for-service payment rates, inadequate support, and burdensome timelines are undermining the move to value-based care and exacerbating our nation’s underinvestment in primary care.”


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