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APTA and more than 100 other organizations representing more than one million health care providers are once again looking to Congress to undo at least some of the impending damage of the proposed 2023 physician fee schedule for payment under Medicare. This time, however, the call for action isn't just about what's needed for next year, but a reminder to lawmakers that an overhaul of the entire payment system is long overdue.

"These year-over-year cuts clearly demonstrate that the Medicare physician payment system is broken," the organizations state in a letter to ranking members of the U.S. Senate Finance Committee, the House Ways and Means Committee, and the House Energy and Commerce Committee. "Systemic issues such as the negative impact of the [fee schedule's] budget neutrality requirements and the lack of an annual inflationary update will continue to generate significant instability for health care professionals moving forward, threatening beneficiaries' timely access to medical care."

The advocacy for a retooled payment system comes as organizations including APTA fight for the third year in a row to blunt the damage that would result from a U.S. Centers for Medicare & Medicaid Services' plan to cut the fee schedule conversion factor — a fundamental component in calculating payment for billed codes — this time, by 4.4%. For 2023, that far-ranging cut would be in addition to two federally mandated overall squeezes on Medicare — a 2% "sequestration" cut and a 4% reduction to comply with federal deficit reduction requirements, known as PAYGO.

CMS attempted to impose the conversion factor reductions in its fee schedule rules for 2021 and 2022, but Congress stepped in after the rules were finalized to provide additional funding that significantly offset the cuts in both years. Lawmakers also suspended the sequestration cut in 2021 (with a phase-in implemented in 2022), and delayed implementation of the PAYGO until 2023.

The letter describes the 2021 congressional actions as measures that "helped to ensure our nation’s seniors maintained access to high-quality care, especially as the COVID-19 pandemic continued to present numerous challenges."

"Unfortunately, Medicare providers face another round of significant payment cuts on January 1," the letter continues. "These cuts, combined with the pending threat of the 4 percent PAYGO reduction, are simply not sustainable." The organizations request that Congress provide funds to increase the proposed conversion factor by at least 4.5% and waive the PAYGO requirement.

The letter acknowledges that the even bigger task of reforming the fee schedule system will "require both collaboration and a significant time investment," but asserts that "we must work to ensure [Medicare] remains a robust and dependable option for those who need it the most, both in the short and long term."

"APTA, its members, and providers from just about every other corner of health care have known for some time that the entire physician fee schedule is woefully out of step with what's needed to ensure the best care," said Justin Elliott, APTA's vice president of government affairs. "By having to step in each year to fix egregious cuts, members of Congress are getting the message, too. We need to ensure that the need for systemic change stays front-of-mind with lawmakers as they consider how to address just the latest in what has now become a sadly predictable pattern of harmful reductions."


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