Medicare pay cut dropped from spending bill passed by House

Andis Robeznieks , Senior News Writer

Changes to a federal spending bill approved by the House Feb. 6 would reduce a proposal to extend cuts to Medicare physician payments. Other provisions in the legislation can be seen as genuine wins for physician advocacy efforts, although the bill would significantly cut funding for the Prevention and Public Health Fund.

The measure, which was approved by a 245-182 vote, now goes to the Senate.

The AMA activated its Physicians Grassroots Network on Feb. 5 and worked with other physician groups to change language in the bill that called for a two-year extension of the “misvalued codes” policy that, if implemented, would have resulted in a decrease in physician Medicare payment to below 2015 levels in 2020.

The policy was mandated by the 2014 Protecting Access to Medicare Act (PAMA), which the AMA opposed. The legislated policy set targets to reduce Medicare spending on so-called misvalued or overvalued codes, and then reduces payments in the Medicare fee schedule if the targets are not met.

Congress, however, failed to recognize the eight years of work that had already been done on this issue and how there were no longer enough misvalued services left to review and revalue to meet the targets, according to a joint letter sent Feb. 5 to Congressional leaders and signed by the AMA, American Academy of Family Physicians, American College of Physicians and the American College of Surgeons.

“The targets were unrealistic, essentially guaranteeing billions in Medicare cuts that were used to offset other policies,” the letter stated. “We strongly urge you to not destabilize the Medicare program and ongoing efforts to transform it by extending this flawed policy.”

The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) provided for a regular 0.5 percent annual payment update in order to allow for a period of stability as physicians transition to MACRA’s Medicare Merit-based Incentive Payment System (MIPS) or Alternative Payment Models (APMs). As a result of the misvalued codes policy and other provisions, the update in the 2018 Medicare physician fee schedule was reduced to 0.31 percent, which makes it harder for physicians to make the investments in information technology and staffing that is needed to participate and succeed in MIPS or APMs.

The newest iteration of the spending bill, which is designed to prevent a Feb. 8 federal government shut down and finance government operations through March 23, reduces the misvalued codes policy extension to one year. This would result in a significantly reduced Medicare fee schedule update in 2019, but it would prevent the payment decrease that had been projected for 2020.

Other aspects of the bill are more positive. These include:

  • Excluding Medicare Part B drug costs from MIPS payment adjustments.
  • Providing three more years of additional flexibility for implementation of MIPS’ cost component.
  • Easing burdens connected to electronic health record requirements and removing mandate that meaningful-use standards become more stringent over time.
  • Giving additional authority to the Physician-Focused Payment Model Technical Advisory Committee to provide feedback to physicians developing of new payment models.
  • Reauthorizing $3.6 billion in annual funding for community health centers for two additional years.
  • Reauthorizing $310 million in annual funding for the National Health Service Corps for two additional years.
  • Doubling the annual funding for the Teaching Health Center Graduate Medical Education program to $126.5 million for two years.

Congress, however, is proposing to pay for these provisions by cutting $2.85 billion from the Prevention and Public Health Fund between 2018 and 2027.