Following a recommendation from a key Medicare advisory panel to maintain the current freeze on physician payments in 2023, organized medicine is warning doing so would “imperil” access to care.
The Medicare Payment Advisory Commission (MedPAC) recommended no fee-for-service payment “update” – meaning no increase or decrease – for physicians in its March 15 Report to the Congress: Medicare Payment Policy. However, MedPAC did recommend an increase for other Medicare payment systems, including inpatient hospitals.
MedPAC’s analysis for physician services, in part, cited patient reports of “relatively good access to care” in a 2021 survey, as well as a growing supply of clinicians since 2015. Financial help the federal government has provided during the COVID-19 public health emergency (PHE) was also a factor in the decision to freeze payments.
“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 during the PHE, and we expect volume and revenue to rebound to prepandemic levels (or higher) by 2023,” MedPAC wrote.
The American Medical Association reacted swiftly to the report, with its executive vice president, James L. Madara, MD, writing the same day to congressional leadership that MedPAC’s recommendation “would imperil patient access to high-quality care as the costs to practice medicine continue to rise.” “Physicians have been enduring an increasing financial instability of the Medicare physician payment system due to a confluence of fiscal uncertainties related to the COVID-19 pandemic, statutory payment cuts, consistent lack of inflationary updates, and significant administrative barriers,” Dr. Madara wrote. “Freezing physician payment is also impossible to reconcile when viewed against the nearly eight percent payment increase the Centers for Medicare & Medicaid Services projects for Medicare Advantage plans in 2023.”
Dr. Madara also noted Medicare physician payments, when adjusted for inflation, fell 20% between 2001 and 2021, citing data from Medicare trustees.
“In addition to being asked to do more with fewer resources each year, physicians continue to face significant clinical and financial disruptions during the COVID-19 pandemic,” he wrote. The letter concluded: It’s urgent that Congress work with physicians “to develop solutions to the systematic problems with the Medicare physician payment system and preserve patient access to care. At a minimum, Congress must establish a stable, annual Medicare physician payment update that keeps pace with inflation and practice costs and allows for innovation to ensure Medicare patients continue to have access to physician practice-based care.”
Meanwhile, medicine is already dealing with physician payment cuts in the short term. Despite efforts by the Texas Medical Association to stop it, a three-month, 1% cut to Medicare physician payments just went into effect on April 1, and a permanent, additional 2% cut will go into effect on July 1 unless Congress acts.