November 11, 2022

2023 Medicare Part B Final Rule Features Expected Payment Reductions

The Centers for Medicare & Medicaid Services has released the final rule for the CY 2023 Medicare physician fee schedule. As expected, the rule contains provisions that, when combined with other cuts to the program, amount to about a 10% reduction in Medicare physician payments starting Jan. 1. The WSMA, the American Medical Association, and much of organized medicine are strongly opposing these cuts and urging congressional intervention before the end of the year. Join your voice to ours by contacting your congressional representatives today.

In the rule, the 2023 Medicare conversion factor will be reduced by approximately 4.48% from $34.61 to $33.06. This incorporates the budget neutrality adjustments, which are required by law to ensure payment rates for individual services don't result in changes to estimated Medicare spending, the required statutory update to the conversion factor for 2023 of 0%, and the expiration of the 3% supplemental increase to physician fee schedule payments for 2022.

In addition to the final rule's 4.48% reduction for physician services, congressional Pay-As-You-Go rules require an automatic 4% cut in the program starting in 2023 as a result of new federal spending having nothing to do with physicians. Unless Congress acts by the end of the year, cuts in physician Medicare payments will total 8.42% in 2023, which would severely impede patient access to care due to the forced closure of physician practices and put further strain on those that remained open during the pandemic.

In other top lines, courtesy of the Medical Group Management Association, the final rule:

• Finalizes implementation of provisions of the Consolidated Appropriations Act, 2022 that extend the application of certain Medicare telehealth flexibilities for an additional 151 days after the end of the COVID-19 public health emergency, such as allowing telehealth services to be furnished to patients in their homes.
• Extends flexibilities to permit split/shared E/M visits to be billed based on one of three components (history, exam, or medical decision-making) or time until 2024.
• Expands access to behavioral health by permitting marriage and family therapists, licensed professional counselors, and others to furnish behavioral health services under general, instead of direct, supervision.
• Maintains the MIPS performance threshold at 75 points for the 2023 MIPS performance year/2025 payment year.
• Adds five new MIPS Value Pathways related to nephrology, oncology, neurological conditions, and promoting wellness for voluntary reporting beginning in 2023.
• Creates an advanced incentive payment pathway for certain low-revenue, new entrant accountable care organizations to bolster participation in the Medicare Shared Savings Program.

For more analysis of the rule's provisions, see this AMA article. Additional information about the final rule is available in the 2023 Medicare Physician Fee Schedule Final Rule fact sheet.