Rheumatologists, many of whom have struggled to keep their doors open and continue caring for patients through the COVID-19 pandemic, are facing a new and significant challenge—a 9.75% overall cut to Medicare reimbursement rates. The cuts arise from a combination of federal policies, including the latest Medicare Physician Fee Schedule (MPFS), scheduled to take effect simultaneously Jan. 1, 2022, according to Elizabeth (Blair) Solow, MD, chair of the ACR’s Government Affairs Committee and a rheumatologist with the UT Southwestern Medical Center in Dallas.
“Cognitive specialists, such as rheumatologists, rely on adequate reimbursement for their work, including critical thinking and management of long-term diseases. Any cuts to reimbursement, particularly of this magnitude, will strain providers’ ability to keep their practice above water,” Dr. Solow cautions.
Congress has recognized in the recent past how such cuts will be detrimental to providers and has implemented temporary legislative fixes, she explains. “We hope Congress will consider similar legislative interventions again to help providers continue taking care of patients with rheumatic diseases.”
ACR President David Karp, MD, PhD, stresses how important it is for rheumatologists to speak up about the negative effects these cuts will have on patient care and to work with other groups that represent providers whose major billings come from the Centers for Medicare & Medicaid Services (CMS) and on Capitol Hill. “Unfortunately, once cuts are enacted, they are difficult to reverse, so it is imperative that the ACR and its members act now to prevent this from happening,” he says.
How the Final Cuts Equal 9.75%
Three simultaneous cuts will combine to reduce provider payments through Medicare by 9.75%, explains Lennie McDaniel, JD, ACR director of congressional affairs.
The first is a 2% Medicare sequestration cut that has been made annually since 2013 through the Budget Control Act of 2011. In the past, however, Congress has placed a moratorium on this cut, including the most recent extension of the moratorium through the 2020 CARES Act.
The second cut comes from the expiration of a COVID-19 relief measure that bumped provider reimbursements up by 3.75%. This adjustment to the conversion factor for all Medicare services in 2021 was implemented to afford some short-term stability for healthcare professionals struggling with the financial impact of the COVID-19 pandemic. The relief measure expires Dec. 31, 2021, “even though the pandemic continues to wreak havoc on providers across the country,” Ms. McDaniel notes.
The third cut is due to the American Rescue Plan/COVID-19 relief bill passed in March 2021, which triggered a Statutory Pay-As-You-Go (PAYGO) cut that requires mandatory spending increases to be offset by tax increases or cuts to other areas of mandatory spending. The $1.9 trillion allocated for the American Rescue Plan Act triggered a 4% reduction in Medicare that equates to a $36 billion cut in Medicare reimbursement.1
The 4% reduction and the expiring 3.75% bump—both related to COVID relief—combine with the 2% annual Medicare sequestration cut for an overall 9.75% cut in the 2022 Medicare reimbursement rate for providers, including rheumatologists. “These are hugely significant cuts to physician Medicare reimbursements, at a time when practices’ bottom lines are most at risk and we’re facing en masse provider retirements due to pandemic emotional and financial stress,” Ms. McDaniel says.
The newest cuts compound historically flat physician payments over the past couple of decades, even though other areas of Medicare spending have generally kept up with inflation. After adjusting for the inflation in practice costs, Ms. McDaniel explains, Medicare physician payments have declined by 22% from 2001 to 2020.
“These latest cuts may impact non-Medicare patients, too, if third-party payers align their rates with these new Medicare rates, as they often do,” Ms. McDaniel cautions. She stresses that “physician practices already in survival mode will only face more difficult financial challenges if the 2022 Medicare cuts are implemented.”
How Reimbursement Cuts Will Impact Practices
Solo private practice rheumatologist Chris Phillips, MD, who works in Paducah, Ky., agrees that the 2022 Medicare reimbursement rate cuts come after years of Medicare undervaluation of rheumatology services.
“The uncertainty that potential cuts like this place on us as small business owners cannot be overstated,” he notes, explaining that independent practices remain the most cost-effective sites of care, yet these same practices are the most threatened by the currently scheduled reimbursement cuts.
Dr. Phillips says it’s unfortunate that it took the COVID-19 pandemic to roll back the unfair sequester cuts when rheumatologists were just celebrating Medicare’s recognition of the value of cognitive care by adjusting reimbursement for E/M codes to favor cognitive services.
Coming off these recent wins, he says, “it seems hard to believe we again face a cut, this time of nearly 10%, which will again force us to examine our overhead expenses, including staffing levels, and again have to give thought to Medicare patients’ access to our practices—something I had hoped we were done having to consider.”
Dr. Karp, who is chief of the Rheumatic Diseases Division at UT Southwestern Medical Center in Dallas, worries that the 2022 reimbursement cuts will result in new and widespread access problems for Medicare patients. “The planned cuts in reimbursement for Medicare services will threaten the financial stability of rheumatology practices at a time when there are still pressures from the COVID-19 pandemic, which will hinder practices’ ability to grow to meet the increasing needs of older Americans.”
How the College Is Responding
“Only a literal act of Congress can avert these cuts,” Ms. McDaniel reiterates. She’s working with ACR leaders and other provider specialty groups, the Arthritis Foundation and other patient groups and broader medical community representatives, such as the American Medical Association to request legislation that will reduce the cuts. To this end, the ACR joined with coalition partners to request legislation from Congress to maintain the 3.75% increase to the conversion factor through at least calendar years 2022 and 2023 and to pursue critical MPFS reforms to avoid arbitrary reductions to reimbursement unrelated to the cost of providing care.
The ACR is also supporting physician members of Congress in asking Congressional leaders to act now to prevent the 9.75% in overall Medicare reimbursement cuts from taking effect Jan. 1, 2022, and maintain stable patient access to care.
What Every Rheumatologist Can Do
Dr. Solow says every rheumatologist’s voice is needed to explain to legislators how these historically significant cuts will negatively affect their practice and, most importantly, their patients.
“If our representatives do not hear from us, they may think we are doing well and will let these cuts go through. Every ACR member needs to reach out to Congress and let them know how these reimbursement rate cuts will threaten our ability to care for our patients and will also risk our ability to recruit new physicians into the field of rheumatology.”
Contact your legislators directly to explain how the 9.75% cut in Medicare reimbursement will hurt your practice and your patients.
Carina Stanton is a freelance science journalist based in Denver.
Reference
- Swagel PL. Letter to Honorable Kevin McCarthy, Republican Leader, U.S. House of Representatives, Re: Potential statutory pay-as-you-go effects of the American Rescue Plan Act of 2021. Congressional Budget Office. 2021 Feb 25. https://www.cbo.gov/system/files/2021-02/57030-McCarthy.pdf.
