Medicare Fee Schedule a Mixed Bag for 2023
By Emma Freer


The Centers for Medicare & Medicaid Services (CMS) recently posted the 2023 Medicare Physician Fee Schedule, which takes effect Jan. 1 and brings with it a mixed bag of consequences for physicians.

The Texas Medical Association continues to fight certain elements of the final rule, including a nearly 4.5% physician pay cut and additional changes to the already-byzantine Merit-Based Incentive Payment System (MIPS). But the association also celebrates the victories in the regulation, including expanded cancer coverage and reduced administrative requirements.

TMA experts discuss the key updates from the final rule in the new, on-demand 2023 Medicare Update webinar. It is free to TMA members, and you can earn 1 AMA PRA Category 1 Credits™ that may count as ethics credit. 

A physician paycut and other concerns

The 2023 fee schedule lowers the conversion factor that determines physician payments by 4.47% compared with the 2022 formula, leaving many physicians concerned about their bottom line. Barring intervention by Congress, the cut would be one of many to take effect next year, including a sequester cut and other reductions mandated by law, totaling 8.5%.

Robert Bennett, TMA vice president of medical economics, is hopeful Congress will act to avert the cuts, but he cautions lawmakers could wait until January to do so retroactively.

“There are so many issues being debated in Washington, D.C. right now,” he said during the event. “I’m worried this is a back-burner issue for them.”

TMA urges members physicians to download its Medicare Payment Cuts Toolkit, which outlines ways to press lawmakers to intervene.

In the meantime, TMA joined the American Medical Association and others in organized medicine in writing to Congressional leadership on Dec. 1.

“Put simply, the cost of Congressional inaction is an across-the-board cut that will further amplify the financial hardship physician practices are already facing while inhibiting Medicare from delivering on its promises to seniors and future generations,” the signatories wrote.

TMA also has joined forces with AMA and scores of state and specialty medical societies to push for comprehensive Medicare physician payment reform. Such a long-term fix would prevent the need for physicians to lobby their representatives multiple times a year about impending pay cuts – or risk their practice viability.

As in previous years, the fee schedule also includes changes to MIPS, one of two pathways under Medicare’s Quality Payment Program. CMS says the changes focus on MIPS Value Pathways (MVPs) – a new, optional reporting framework set to debut in the 2023 performance year – and limit adjustments to traditional MIPS in an effort to spur participation in MVPs.

TMA has repeatedly asked CMS to reconsider MVPs and to focus instead on the development of voluntary, physician-led alternative payment models (APMs). Still, Mr. Bennett encouraged physicians who participate in MIPS to consider MVPs, which he said function as a hybrid between fee-for-service MIPS and value-based care APMs.

CMS is hosting a webinar on Dec. 14 from 1-2 pm CT about MVPs, including its rollout and how physicians can submit an MVP candidate for consideration. You can register for the virtual event via Zoom.

Fee schedule gains

Despite these concerns, the 2023 fee schedule includes meaningful gains when it comes to the Medicare Shared Shavings Program (MSSP), evaluation and management (E/M) coding and payment, certain pandemic-era flexibilities, electronic prescribing of controlled substances, and colorectal cancer screening. 

TMA welcomes some of the changes to MSSP, which its experts say could reduce barriers to participation. For instance, CMS will make advanced investment payments available to certain new accountable care organizations, which they could use to purchase the technology and data management resources and to hire the care coordinators necessary to participate in the program.

At the same time, TMA has asked CMS to consider phasing in – and even limiting – recoupment of any advance funding to encourage long-term participation as well as providing new opportunities to engage specialists in Medicare’s value-based programs.

CMS also will institute significant changes to E/M coding in the new year, heeding recommendations from TMA and AMA. These include simplified documentation requirements and increased payment for services provided at several sites, including hospitals, emergency departments, nursing homes, and patient’s homes.

Although this is a positive development, Mr. Bennett said these payment increases contributed to the 4.47% reduction in the conversion factor, given federal budget neutrality requirements.

CMS also delayed the implementation of a confusing policy related to split (or shared) visits, which determines who should bill for a shared visit. The fee schedule maintains the existing guidelines, and CMS will revisit the issue in its 2024 fee schedule.

In addition, the 2023 fee schedule offers some guidance on telehealth coverage once the federal public health emergency (PHE) related to COVID-19 ends. With it, CMS has extended certain telehealth flexibilities for 151 days after the PHE ends, including allowing:

  • Practices to use non-HIPAA complaint telehealth platforms; and
  • Medicare patients to access telehealth services anywhere, including at home, and via audio-only options, among other changes.

This aligns with Congress’ action in March, when it passed a spending package extending these same flexibilities for 151 days after the PHE ends.

Shannon Vogel, TMA associate vice president of health information technology, said physicians should anticipate making changes once the PHE and the 151-day grace period end, such as phasing out non-HIPAA compliant telehealth platforms and audio-only telehealth services. But she added that they still have time to do so.

“At this point, we feel pretty confident that the PHE will probably extend through about mid-April or so,” she said, which would put the end of the grace period in mid-September.

The PHE is currently slated to expire in January. However, the federal government has said it will give states 60-days' notice of its end, a deadline that came and went in mid-November. Although the government hasn’t announced a new deadline, it previously has extended the emergency declaration in 90-day increments.

As recommended by TMA and others in organized medicine, CMS will delay until 2025 financial penalties for physicians who don’t electronically prescribe controlled substances. Although TMA supports this move, it has pushed CMS to go further by scrapping such penalties altogether, especially for those practices that do not do high volume e-prescribing.

Starting next year, Medicare patients also will benefit from expanded coverage of colorectal cancer screening tests, following advocacy by TMA and others in organized medicine. CMS gradually will reduce coinsurance payments for Medicare patients who undergo unplanned colorectal screening tests until 2030, when the federal agency will waive such copayments altogether.

TMA endorsed this policy change in its comment letter, writing that it would “reduce the financial burden facing Medicare [patients] whose screenings result in a diagnostic procedure” as well as “promote utilization of colorectal cancer screenings that save lives.”


Last Updated On

January 26, 2023

Originally Published On

December 07, 2022

Emma Freer

Associate Editor

(512) 370-1383

Emma Freer is a reporter for Texas Medicine. She previously worked in local news, covering city politics, economic development, and public health. A native Clevelander, she graduated from Columbia Journalism School and the University of St. Andrews.

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