CMS Unveils 2023 Physician Fee Schedule, Promoting High-Value Care

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The federal Centers for Medicare & Medicaid Services (CMS) announced its 2023 Physician Fee Schedule (PFS) proposed rule, one that encompasses major changes to the Medicare Shared Savings Program (MSSP), and emphasis on whole-person care and health equity. Proponents of value-based healthcare are already cheering the proposed changes.

The announcement, posted to the agency’s website, began thus: “The Centers for Medicare & Medicaid Services (CMS) today issued the Calendar Year 2023 Physician Fee Schedule (PFS) proposed rule, which would significantly expand access to behavioral health services, Accountable Care Organizations (ACOs), cancer screening, and dental care — particularly in rural and underserved areas. These proposed changes play a key role in the Biden-Harris Administration’s Unity Agenda — especially its priorities to tackle our nation’s mental health crisis, beat the overdose and opioid epidemic, and end cancer as we know it through the Cancer Moonshot — and ensure CMS continues to deliver on its goals of advancing health equity, driving high-quality, whole-person care, and ensuring the sustainability of the Medicare program for future generations.”

“At CMS, we are constantly striving to expand access to high quality, comprehensive health care for people served by the Medicare program,” CMS Administrator Chiquita Brooks-LaSure said in a statement carried by the press release. “Today’s proposals expand access to vital medical services like behavioral health care, dental care, and cancer treatment options, all while promoting access, innovation, and cost savings in the Medicare program.”

And Meena Seshamani, M.D., CMS Deputy Administrator and Director of the Center for Medicare, said in a statement contained in the press release, that “Integrated coordinated, whole-person care — which addresses physical health, behavioral health, and social determinants of health — is crucial for people with Medicare, especially those with complex needs. If finalized, the proposals in this rule will advance equity, lead to better care, support healthier populations, and drive smarter spending of the Medicare dollar.”

The press release went on to note major changes planned for the MSSP program: “Accountable Care Organizations (ACOs) are groups of health care providers who come together to give coordinated, high-quality care to their Medicare patients. The Medicare Shared Savings Program covers more than 11 million people with Medicare and includes more than 500,000 providers. CMS is proposing changes to the Medicare Shared Savings Program that, if finalized, represent some of the most significant reforms since the final rule that established the program was finalized in November 2011 and ACOs began participating in 2012. Building on the CMS Innovation Center’s successful ACO Investment Model (AIM), CMS is proposing to incorporate advance shared savings payments to certain new Medicare Shared Savings Program ACOs that could be used to address Medicare beneficiaries’ social needs. This is one of the first times Traditional Medicare payments would be permitted for such uses, and is expected to be an opportunity for providers in rural and other underserved areas to make the investments needed to become an ACO and succeed in the program. CMS is also proposing that smaller ACOs have more time to transition to downside risk, further helping to grow participation in rural and underserved communities. CMS is also proposing a health equity adjustment to an ACO’s quality performance category score to reward excellent care delivered to underserved populations. Finally, CMS is proposing benchmark adjustments to encourage more ACOs to participate and succeed, which would help achieve the goal of having all people with Traditional Medicare in an accountable care relationship with a healthcare provider by 2030.”

Indeed, the agency noted, “The proposed CY 2023 PFS conversion factor is $33.08, a decrease of $1.53 to the CY 2022 PFS conversion factor of $34.61. This conversion factor accounts for the statutorily required update to the conversion factor for CY 2023 of 0%, the expiration of the 3% increase in PFS payments for CY 2022 as required by the Protecting Medicare and American Farmers From Sequester Cuts Act, and the statutorily required budget neutrality adjustment to account for changes in Relative Value Units.”

The proposed rule also includes changes to payment regulations for behavioral healthcare, to wit: “To help address the acute shortage of behavioral health practitioners, the agency is proposing to allow licensed professional counselors (LPCs), marriage and family therapists (LMFTs), and other types of behavioral health practitioners to provide behavioral health services under general (rather than direct) supervision. Additionally, CMS is proposing to pay for clinical psychologists and licensed clinical social workers to provide integrated behavioral health services as part of a patient’s primary care team.”

With regard to the proposed changes to the MSSP, CMS officials stated in a fact sheet that “Several of the proposals we are making in this proposed rule are expected to advance equity within the Shared Savings Program. Based on feedback from health care providers treating rural and underserved populations that they require upfront capital to make the necessary investments to succeed in accountable care and may also need additional time under a one-sided model before transitioning to performance-based risk, we are proposing to provide advance shared savings payments (referred to as advance investment payments) to low revenue ACOs, inexperienced with performance-based risk Medicare ACO initiatives, that are new to the Shared Savings Program (that is, not a renewing ACO or a re-entering ACO), and that serve underserved populations. These advance investment payments would increase when more beneficiaries who are dually eligible for Medicare and Medicaid or who live in areas with high deprivation (measured by the area deprivation index (ADI)), or both, are assigned to the ACO, and these funds would be available to address the social and other needs of people with Medicare. We are also proposing other modifications to certain existing policies under the Shared Savings Program to support organizations new to accountable care by providing greater flexibility in the progression to performance-based risk, allowing these organizations more time to redesign their care processes to be successful under risk arrangements.”

Plaudits and criticism

Some healthcare associations immediately applauded the announcement. The leaders of NAACOS, the Washington, D.C.-based National Association of ACOs, which represent a large percentage of ACOS operating nationwide, expressed enthusiasm. In a statement posted to the association’s website on Thursday, Clif Gaus, Sc.D., NAACOS’s president and CEO said, “NAACOS sends a big bravo to the Centers for Medicare and Medicaid Services (CMS) for taking steps to reach its goal of creating a stronger Medicare by strengthening accountable care models and speed the movement toward value for all patients. While we are still studying the major changes, policies in today’s proposed Physician Fee Schedule will help grow participation in accountable care organizations (ACOs), helping realize the CMS Innovation Center’s recent Strategy Refresh to have every Medicare beneficiary in a relationship with a provider accountable for his or her quality and total cost of care by 2030.”

What’s more, Gaus said in the statement, “Importantly, CMS projects today’s proposed changes would save Medicare more than $15 billion and yield $650 million in higher shared savings payments to ACOs. We know the most successful alternative payment models (APMs) are when providers are held accountable for patient outcomes for the entire year, as ACOs do.” 

 As Gaus said, “Among the positive changes proposed today, CMS proposed to:

•            Give ACOs more time before advancing to the highest levels of risk;

•            Make fairer, more accurate financial benchmarks for ACOs by incorporating a prospectively projected administrative growth factor;

•            Add a health equity quality adjustment for high quality performance in ACOs with high underserved populations;

•            Provide advance shared savings payments to smaller ACOs that serve underserved populations;

•            Account for an ACO’s prior savings in rebased benchmarks to help mitigate the lowering of an ACO’s benchmark over time; and

•            Make positive changes to quality scoring approaches.

 NAACOS thanks both the Biden administration and congressional champions of ACOs for their leadership on changes in today’s rule,” Gaus said. “We will continue to work closely with CMS and Congress on additional necessary changes such as extending the 5 percent Advanced APM bonus, which expires this fall.”

On the other hand, leaders at the Englewood, Colo.-based Medical Group Management Association (MGMA), reacted negatively towards the conversion factor element in the proposed rule. A statement released on Thursday and attributed to Anders Gilberg, MGMA’s senior vice president, government affairs, was posted to the association’s website. “Having reviewed the proposed 2023 Medicare Physician Fee Schedule, MGMA is incredibly concerned about the likely impact of the proposed 4.42 percent reduction to the conversion factor, especially in light of the financial uncertainty which medical groups have faced over the past two years stemming from the COVID-19 pandemic, inflation, and the staffing crisis,” Gilberg said in the statement. “These proposed cuts, coupled with the 4 percent PAYGO sequestration scheduled to take effect on Jan. 1, 2023, will have a detrimental impact on group practices, with 58 percent of recently surveyed groups indicating they are considering limiting the number of new Medicare beneficiaries served. MGMA appreciates the continued efforts from CMS to ensure cohesion of post-pandemic policies for medical group practices. The extension of regulatory Medicare telehealth flexibilities to align with the 151 days of congressionally extended telehealth policies will ensure practices have the ability to continue furnishing the highest quality care to patients.”

The fact sheet on the proposed changes to the MSSP program can be found here.

 

 



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