MedPAC denies increased payments for doctors in 2023

January 25, 2022

2 minute read


Disclosures: Healio was unable to determine the relevant financial information at the time of publication.

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The Medicare Payment Advisory Commission, or MedPAC, has recommended no changes to the physician fee schedule for 2023, a move the ACP and AMA described as a freeze on physician payments.

The organizations immediately released statements criticizing the decision.

“MedPAC’s recommended plan would compromise access to primary care physicians and could create access issues for other specialties,” said CPA President George M. Abraham, MD, MPH, MACP, FIDSA, said in a statement. “In effect, a payment rate freeze would amount to a reduction in payments when inflation is taken into account.”

During the MedPAC public meeting, Ariel Winter, MPP, a senior policy analyst at MedPAC, claimed that “Medicare payments to clinicians declined by $9 billion from 2019 to 2020, but clinicians received tens of billions of dollars in pandemic relief funds for compensate for financial losses due to the pandemic”.

“Additionally, Congress and CMS have given clinicians a lot more flexibility to deliver telehealth,” he added.

Despite the pandemic, physician compensation from all payers increased from 2019 to 2020, Winter said.

However, according to research by the AMA, Medicare physician payments decreased by 20% from 2001 to 2020 after adjusting for inflation.

“The gap between what it costs to run a practice and the payment is driving consolidation and pushing doctors out of rural and underserved areas,” the AMA president said. Gerald E. Harmon, MD, said in a statement. “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.”

MedPAC has not commented on the WADA and ACP statements. A spokesperson referred Healio to the transcript of the meeting which included the recommendation not to change the fee schedule.

“It should not affect recipients’ access to care or clinicians’ willingness and ability to provide care,” Winter said at the meeting.

Although the American Academy of Family Physicians has not released a public statement following MedPAC’s recommendation, a representative told Healio that “the decision not to update physician payments despite rising costs, staff shortage and burnout is wrong”.

Hospitals, skilled nursing facilities and other healthcare providers are eligible for annual updates to account for rising input costs and inflation, but not payment to doctors, according to the AAFP.

“A lack of physician payment updates will worsen access to high-quality care, lead to consolidation and undermine the stability of PCP practices,” the organization said. “The AAFP continues to work toward the long-standing goal of shifting physician payment from fee-for-service to value-based alternative payment models. However, most alternative payment models are always based on underlying fee-for-service rates, and therefore we need to ensure that these payments are adequate and appropriate now.

In addition to the recent MedPAC ruling on physician payments, PCPs are grappling with a controversial billing dispute provision tied to the No Surprises Act that allows insurers to determine the rates that physicians and hospitals can charge, Healio previously reported. The AMA and other medical organizations sued the federal government to change the provision. Harmon said the provision is not sustainable for providers and may result in tighter networks for insured and uninsured patients, especially in rural and underserved areas.

The references:

WADA Statement on Continued Medicare Payment Freeze for Physicians. Published January 13, 2022. Accessed January 19, 2022.

Assessing the adequacy of payments and updating payments: services of physicians and other health professionals. Published January 13, 2022. Accessed January 19, 2022.

Internists say doctors’ payments should not be frozen. Published January 14, 2022. Accessed January 19, 2022.

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Elaine R. Knight