Physician Billing in 2022: 10% Medicare cut!

Physician billing rates for 2022 are now official with publication of the Medicare Physician Fee Schedule Final Rule. It includes

Physician Billing Cuts

Despite protests from virtually every major physician organization and thousands of letters, the Final Medicare Physician Fee Schedule has very few changes from the earlier interim Final Rule (see A 10% Cut to 2022 Physician Reimbursement?). As a result, the 9.75% cut to Medicare physician billing in 2022 remains in place. Intense lobbying of Congress is underway, but no action is expected until late December, at the earliest. Some observers expect partial help from Congress, while others are less sanguine.

As a reminder, the cuts include

  • a 4% reduction from the PAYGO law, which calls for Congress to make a series of cuts if federal spending reaches a certain threshold.
  • Elimination of the temporary 3.75% 2020 increase in the Conversion Factor to help physicians combat revenue shortfalls caused by the pandemic. The 2021 CF is $33.59, a decrease of $1.31 from the 2021 rate of $34.89.
  • A 2% cut in Medicare under sequestration.

It should be noted that the fee schedule is required to be budget neutral under law.

Recently, Reps. Ami Bera, MD, D-Calif., and Larry Bucshon, MD, R-Ind., introduced the Supporting Medicare Providers Act of 2021 to prevent the 3.75% CF cut.

A recent survey of 2,227 members from the American College of Surgeons by the Surgical Care Coalition, a collection of 13 advocacy groups, found that 57% of respondents believe the cuts to physician billing in 2022 would lead to longer wait times, while 56% believe the cuts could contribute to a delay in care.

The pay cut serves as a “reminder of the financial peril facing physician practices at the end of the year,” American Medical Association President Gerald Harmon, MD, said in a Nov. 3 news release. The AMA has urged Congress to avert this cut to the conversion factor as well as cuts to Medicare physician payments overall, which add up to a combined 9.75 percent reimbursement decrease in 2022.

“This comes at a time when physician practices are still recovering [from] the personal and financial impacts of the COVID public health emergency,” Dr. Harmon said. “Congress is beginning to recognize that this financial instability could limit healthcare access for Medicare patients. The clock is ticking.”

Other Impacts

Updates to clinical labor rates are expected to increase payments to primary care specialists, such as family practice, geriatrics, and internal medicine specialties. But many other specialists, including radiology, radiation oncology and others will see decreases (see Will Radiology Reimbursement be Slashed in 2022?). 

Telehealth Services

The Medicare final rule allows certain services, such as cardiac and cardiac rehabilitation to remain on the telehealth list through 2023 to give stakeholders more time to evaluate if they should be permanently added.

CMS also removed geographic restrictions for providers to offer mental health services via telehealth.

Original telehealth regulations required an in-person physician visit six months prior to the initial telehealth service for mental health. The final rule waives that requirement under certain circumstances and requires an in-person visit at least every 12 months.

CMS will also allow reimbursement for audio-only telehealth services for the treatment of mental health disorders. But only if the patient is not capable of making a video call. Also, rural health clinics and health centers can now furnish mental health services via “interactive real-time telecommunications technology.”

There is also a requirement to use a new modifier for services using audio-only communications, which will verify that the practitioner had the capability to provide two-way, audio/video technology, but instead, used audio-only technology due to patient choice or limitations.

Quality Payment Program/MIPS

Transition to the Merit-Based Incentive Payment System (MIPS) Value Pathways (MVPs) will not occur until the 2023 performance year.

  • The seven MVPs for the 2023 performance year are: rheumatology, stroke care and prevention, heart disease, chronic disease management, emergency medicine, lower extremity joint repair and anesthesia.
  • MIPS eligible clinicians can report the APM Performance Pathway as a subgroup, beginning with the 2023 performance year.
  • The performance threshold for the 2022 performance year/2024 payment year will be 75 points, an increase of 15 points.
  • The additional performance threshold will be set at 89 points.
  • For individuals, groups, and virtual groups reporting traditional MIPS, quality will be weighted at 30%, cost at 30%, interoperability at 25% and improvement activities at 15%.
  • The CMS Web Interface will be a quality reporting option for registered groups, virtual groups or other APM Entities for the 2022 performance period.
  • The 70% data completeness requirement will be retained for the 2023 performance period.