Calendar Year 2023 Medicare Physician Fee Schedule Final Rule

On November 01, 2022, the Centers for Medicare & Medicaid Services (CMS) issued a final rule that includes updates and policy changes for Medicare payments under the Physician Fee Schedule (PFS) and other Medicare Part B issues, effective on or after January 1, 2023.

For 30 years, Medicare payments have been made under PFS for the services of physicians and other billing professionals. These are the benchmarks used for most physician payments for services.

Unfortunately, CMS will cut the payment conversion factor for 2023 as compared to 2023, which reflects the expiration of the temporary 3% statutory payment increase. CMS also announced it will delay for one year (until 2024) implementing its policy to define the substantive portion of a split or shared visit.

Although it is impossible to predict fully, the trend will be toward CMS lowering rates in the future.

Highlights included:

• A decrease in rates of -4.47% ( and -4.42% for anesthesia) over 2022 rates
• Revised Evaluation and Management (E/M visits), including revised interpretive guidelines for levels of medical decision-making and elimination of the use of history and physical to determine code level (instead being replaced by medically appropriate history and exam)
• Updated Telehealth Services https://www.cms.gov/Medicare/Medicare-General-Information/Telehealth/Telehealth-Codes
• Improved access to behavioral health services to make greater use of behavioral health professionals, such as licensed professional counselors and licensed marriage and family therapists
• Maintains the MIPS (Merit-based performance) thresholds at 75 points
• Adds five new MIPs Value Pathways related to nephrology, oncology, neurological conditions, and promoting wellness
• Creates an advanced incentive payment pathway for low-revenue, new entrants
• Chronic pain management services
• Opioid treatment services
• Audiology services
• Dental and oral health
• Skin substitute products
• Colorectal cancer screening updates
• Rebasing and revising the 2017-based Medicare Economic Index (MEI). The update is 3.8%

All of these changes will directly or indirectly impact all physicians in the US. The negative impact will primarily be reducing patients’ access to certain services.

All physicians should take heed to decreased reimbursement after two years of financial pressure due to the ongoing COVID-19 pandemic, explosive inflation, rising staff costs, and other non-labor supply costs. The only positive is CMS delaying its split or shared visit policy, which would have made the physician revenue reductions even steeper.

There was a positive development in that CMS modified the Medicare Shared Savings Program (MSSP) quality scoring by adopting a sliding scale for shared-savings eligibility and adding a new health equity adjustment. The purpose of MSSP is to sustain long-term participation and reduce costs.

Key Takeaways

• Now is the time to act to maximize your compensation and benefits by contacting Contract Diagnostics to learn more about what you can do in your particular situation.
• Physician payments for services are declining.
• Regulations and bureaucracy are increasing.
• Contract Diagnostics has access to the most critical and relevant information to help you navigate these changing times.
• The US government is responsible for physician and hospital reimbursement and is now the largest payor. Labor costs are the most vulnerable.
• Physicians must remain vigilant in negotiating their compensation and benefits more than ever.
• Contacting Contract Diagnostics is your best defense in staying ahead of the curve by providing information physician employers don’t want you to have.