Last evening, the U.S. Senate concluded the annual frantic ritual of having to intervene at year-end to prevent unwanted cuts in Medicare Physician Fee Schedule (MPFS) payments. On a vote of 59-34, senators passed S. 610, the “Protecting Medicare and American Farmers from Sequester Cuts Act” with a 59-34 vote. The year-ending legislation was approved earlier this week, on Tuesday, Dec. 7, by the U.S. House of Representatives. President Biden is expected to sign this legislation.
In the closing days of last year, Congress acted in a similar fashion to forestall Medicare payment cuts to physicians via provisions added to the Consolidated Appropriations Act, 2021. As with last year, many of the cuts in CY 2022 payments result from application of budget neutrality to overall MPFS payments, resulting in increases for some segments of the physician community which produce cuts for others. In 2022, interventional radiologists face additional payment cuts because of increases to certain physicians with high clinical labor costs. Interventional radiologists' payments are cut because of the clinical labor cost reallocation, despite their having higher medical supply costs in their in their office-based practices than most physicians.
The legislation, in response to approximately 10% in MPFS payment cuts contained in the CY MPFS final rule, has:
- suspended the 2% Medicare sequester for the first three months of 2022 (until March 31), followed by a reduction to 1% for the second quarter (until June 30). Full 2% sequestration reductions return beginning in the third quarter;
- increased CY 2022 payments by 3% (0.75% less than the conversion factor increase adopted by Congress in December 2021);
- delayed for one year cuts to the clinical laboratory payment schedule;
- delayed for one year the Medicare radiation oncology demonstration which would have brought cuts to that subspecialty; and
- delayed the 4% Medicare pay-as-you-go (PAYGO) cuts, also stopping any additional PAYGO cuts through 2022.
Even though this legislation suspended the Medicare sequestration cuts fully for only the first quarter of 2022, one hopes that Congress will take action in Spring 2022 to fully extend the 2% sequester reduction suspension throughout CY 2022, as they did earlier this year.