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Medicare’s 2023 fee schedule: cuts in reimbursement, expanded payments for behavioral health

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Physician groups warn cutbacks could reduce access to care

Doctors likely will see a 4.4% reduction in Medicare reimbursements under the 2023 Physician Fee Schedule (PFS) and could face cuts as high as 8.4% when other cuts are factored in. .

Th Calendar Year 2023 PFS Final Rule, released November 1, includes a $1.55 decrease in the PFS conversion factor, from $34.61 to $33.06. The Centers for Medicare & Medicaid Services (CMS) uses the conversion factor as tool in determining Medicare’s reimbursement rates for medical services and procedures. The new fee schedule will take effect January 1, 2023 unless Congress intervenes.

In addition, doctors could be facing a 4% fee reduction because of PAYGO sequestrations. Congress had suspended the sequestrations at the start of the COVID-19 pandemic, but they are due to resume at the start of 2023 absent Congressional action.

Physicians’ groups are expressing strong opposition to the updated PFS. “The rate cuts would create immediate financial instability in the Medicare physician payment system and threaten patient access to Medicare-participating physicians,” American Medical Association President Jack Resneck, Jr., MD said in a statement. “Unless Congress acts by the end of the year, physician Medicare payments are planned to be cut by nearly 8.5% in 2023…which 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.”

Tochi Iroku-Malize, MD, FAAFP, president of the American Academy of Family Physicians said the Rule will “result in unsustainable Medicare payment cuts for family physicians and put patients’ timely access to essential primary care at risk. We strongly urge Congress to protect patients and support physicians by averting these cuts and investing in a more sustainable Medicare physician payment system.”

Along with updates to the PFS, the 2023 Rule includes changes affecting access to behavioral health services and the accountable care organizations (ACOs) that are part of the Medicare Shared Savings Program.

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In a press release, CMS said it is “finalizing proposals to incorporate advance shared saving payments to certain new ACOs that can be used to support their participation in theShared Savings Program” including hiring more staff or addressing the social needs of Medicare beneficiaries. It will also allow ACOs to remain longer in financial tracks without downside risk, and include ACOs’ health equity performance in their quality scores. The agency says these steps are part of its strategy for having all traditional Medicare beneficiaries in an “accountable care relationship with their provider” by 2030.

In a statement, National Association of ACOs (NAACOS) President and CEO Clif Gaus, Sc.D., called the changes “a win to patients and will absolutely help providers deliver accountable care to more beneficiaries.

“On balance, we believe this final rule will grow participation in accountable care organizations, which have already generated billions of dollars of savings for our health system,” Gaus added.

Regarding behavioral health services, the Rule will promote what the agency is calling “whole-person care” by:

  • making it easier for Medicare beneficiaries to access such services by allowing behavioral health clinicians to work under the general, rather than direct, supervision of the Medicare practitioner,
  • allowing Medicare to reimburse programs providing treatment for opioid addiction that initiate buprenorphine treatment with patients via telecommunication,
  • allowing Medicare to pay for clinical psychologists and licensed clinical social workers who are providing integrated behavioral health care as part of a primary care team and,
  • providing a monthly payment for comprehensive treatment and management services for patients with chronic pain.

“Access to services promoting behavioral health, wellness, and whole-person care is key to helping people achieve the best health possible,” CMS Administrator Chiquita Brooks-LaSure said in a press release. “The Physician Fee Schedule final rule ensures that the people we serve will experience coordinated care and that they have access to prevention and treatment services for substance use, mental health services, crisis intervention, and pain care.”


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