• In The Trenches

    CMS and Congress Must Reform the MPFS

    September 28, 2021, 1:35 p.m. — No one expects a monolithic annual rule governing physician pay to deliver sunshine and chuckles. But the Medicare physician fee schedule shouldn’t be a nail-biter every year, either.

    Medicare on keyboard

    Here we are, though, wondering why CMS’ 2022 MPFS and Quality Payment Program proposed rule reads like a Stephen King novel when it comes to the conversion factor. One that has a very unhappy ending: potential pay cuts for primary care.

    The reasons for this are as convoluted as one of King’s lesser efforts, but I’ll sum them up this way.

    • Next year’s proposed conversion factor — the number multiplied by the relative value of each code in the fee schedule to determine the Medicare payment rate — is $33.58.
    • That’s 3.75% lower than the 2021 conversion factor of $34.89.
    • It’s set to go down because a 3.75% increase to the 2021 conversion factor, a Band-aid that Congress applied in December 2020, will expire at the end of the year.
    • That legislative patch was necessary because the 2021 conversion factor reflected a reduction of more than 10% from 2020’s rate.
    • And that reduction was because of Medicare’s federally mandated budget-neutrality requirement — the stipulation that CMS can’t improve payment in any area of the fee schedule without cutting it somewhere else.
    • We pushed hard for that fix because it allowed a long-planned boost to evaluation and management coding for which the Academy had long advocated.

    You see what I mean: Way too much suspense when what’s needed is stability.

    We know that CMS can’t unilaterally set the conversion factor, lacking as it does the power to waive budget neutrality. But CMS has plenty of power to support primary care in other ways, and the AAFP sees several opportunities in the proposed MPFS to do just that. It is, for example, well within the agency’s authority to direct fair valuation for several foundational primary care services.

    That’s the essence of what the Academy said in its detailed response this month to the MPFS proposed rule. (We expect to see the final rule in November; it will take effect on Jan. 1, 2022.)

    We also acknowledged there that primary care doesn't come away empty-handed from the rule as written. Several elements proposed in the fee schedule, as detailed in this AAFP News story, show that CMS has been listening to the Academy. In particular, the rule would initiate a long-overdue update of clinical labor pricing, something the agency hasn’t undertaken in almost two decades. All those years spent relying on outdated wage data have contributed to longstanding payment distortions between primary and select specialty care — which is why we are calling on CMS to enact this change immediately.

    At the same time, we’re lobbying Congress to maintain that 3.75% increase to the conversion factor through at least 2023, reflecting what we expect to be a protracted recovery from the public health emergency. In July, the Academy joined dozens of other medical and health care groups in explaining to House and Senate leaders why this bridge over the fee schedule’s compromised structure was of paramount importance: to avoid “significant disruptions” to the care Medicare beneficiaries depend upon.

    Beyond averting near-term failures, we added, Congress must work with CMS to reform these weaknesses, which have been costly for physicians. “The startling reality is that, adjusted for inflation in practice costs, Medicare physician pay actually declined 22% from 2001 to 2020,” we said.

    As the coalition behind that July letter demonstrates, the Academy has been far from an outlier among medical specialty societies in demanding this of Congress. The budget-neutrality requirement at the heart of this latest conversion-factor crisis has for too long stymied U.S. health care by trapping physician payment in outdated formulae. And that was before COVID-19 began termiting its way through the house of medicine, revealing a generation’s worth of decay in the fee-for-service model.

    Our comments to CMS touched on plenty of other important topics. We called on regulators there to

    • secure permanent coverage of audio-only telehealth services;
    • finalize a permanent coverage expansion of tele-mental health services without a proposed requirement for an in-person visit within six months;
    • allow physicians to bill Medicare for the costs of personal protective equipment and other expenses they incur to keep their practices, staff and patients safe;
    • improve payment for chronic care management;
    • immediately increase payment for vaccine administration services, in line with the agency’s own acknowledgment that rates have long been inadequate;
    • explore payment methodologies that fully account for the high value of immunizations;
    • help physicians transition into alternative payment models with a new reporting option in the Merit-based Incentive Payment System — as long as it leads to significant administrative simplification; and
    • Modify the MIPS program to protect physician practices from unfair penalties due to the pandemic.

    The Academy also sounded the alarm on a significant disappointment. Just when primary care practices were set to benefit from that long-overdue payment increase, the AAFP has instead heard from many employed physicians — the population that makes up the bulk of the specialty — that their employers were keeping their contracts at 2020 levels.

    “The AAFP urges CMS to use the tools at its disposal, including rulemaking and sub-regulatory guidance, to help ensure the 2021 evaluation and management RVU increases are passed down to primary care physicians,” we wrote. “We understand physicians’ contracts with private payers and the organizations that employ physicians are outside of CMS’ purview. However, we believe it’s important for CMS to know what is happening in this regard as it considers additional efforts to support primary care.”

    The Academy will keep pushing CMS and Congress to make every effort possible to support primary care. As I wrote in this space last year, “Accessible, affordable, comprehensive medical care for Americans is not a zero-sum proposition.” The agency can and must deliver stability to family physicians and their patients, who together have been buffeted for almost two years by the COVID-19 pandemic.

    Stephanie Quinn is senior vice president of advocacy, practice advancement and policy.


    The opinions and views expressed here are those of the authors and do not necessarily represent or reflect the opinions and views of the American Academy of Family Physicians. This blog is not intended to provide medical, financial, or legal advice. All comments are moderated and will be removed if they violate our Terms of Use.