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Will Congress avert Medicare physician fee cuts again at year-end?

As we approach this year's Thanksgiving holiday, thoughts turn toward the end of the year and the beginning of the new year. As was the case last year, on January 1 physicians face looming cuts in payments for services rendered to Medicare beneficiaries under the physician fee schedule (PFS). Will Congress decide to intervene and block some of those cuts as it did at the end of year? 

At year-end last year, Congress adopted the Consolidated Appropriations Act, 2021 that modified the Calendar Year (CY) 2021 PFS by:

  • Providing a 3.75% increase in PFS payments for CY 2021;
  • Suspending the 2% payment adjustment (sequestration) through March 31, 2021 (subsequently extended through the end of 2021);
  • Reinstating the 1.0 floor on the work Geographic Practice Cost Index through CY 2023; and
  • Delaying implementation of the "inherent complexity" add-on code for evaluation and management services (G2211) that would have reduced PFS payments due to budget neutrality until CY 2024.

Without the help of Congress, cuts in PFS payments will go into effect in 2022 for nearly 10% for numerous healthcare specialists, including radiologists. Those cuts can be averted.

Step one is extending the 2021 Medicare PFS adjustment of 3.75% for an additional year. U.S. Representatives Ami Bera, M.D. (D-CA) and Larry Bucshon, M.D. (R-IN) have introduced legislation, the Supporting Medicare Providers Act of 2021 (H.R. 6020) to extend that 3.75% increase in PFS through CY 2022.

Step two addresses another CMS policy change that also cuts payment for many physician specialties in 2022. In the CY 2022 final Medicare PFS, CMS updated practice expense payments for clinical labor costs. Because of budget neutrality, some specialties that have high clinical labor costs would see significant payment increases, but others such as interventional radiologists and radiation oncologists – which have high medical supply costs but relatively lower clinical labor expenditures – would face deep reductions in PFS payments in 2022. Representatives Bobby Rush (D-IL) and Gus Bilirakis (R-FL) are proposing the Medicare Stability for Patients and Providers Act to block the implementation of the clinical labor cost adjustment in 2022.

Along the way, Congress needs to decide whether the 2% payment reduction scheduled sequestration can be forestalled through the end of 2022 as well.

One hopes that Congress, busy with President Biden's Build Back Better legislation, can find the time and the will to address these looming 2022 Medicare PFS cuts as well.


health care & life sciences, medicare, mpfs, payment cuts, congress