Changes to the MPFS

In the proposed rule, CMS proposes reducing MPFS payment rates by 1.25% in calendar year (CY) 2024 compared to CY 2023. CMS is also proposing several payment increases for primary care and other types of direct patient care.

For CY 2024, the conversion factor would decrease by 3.34% compared to CY 2023, going from $33.89 to $32.75. This decrease reflects the expiration of a 2.5% statutory payment increase for CY 2023; a 1.25% statutory payment increase for 2024; a 0% conversation factor update under the Medicare Access and CHIP Reauthorization Act; and a -2.17$ budget-neutrality adjustment.

Building on CMS' goal of increasing health equity, the agency has proposed coding and payment for several new services to help underserved communities. These include certain caregiver training programs, separate coding and payment for community health integration services, payment for principal illness navigation services, and coding and payment for social determinants of health risk assessments.

As part of the Biden administration's Cancer Moonshot initiative, the proposed rule also includes payments for certain dental services prior to and during different cancer treatments, including chemotherapy.

The agency also proposed several new behavioral health provisions to expand access to care. For the first time, marriage and family therapists and mental health counselors will be allowed to enroll in Medicare and bill for their services. There are also several proposed payment increases for crisis care, substance use disorder treatment, and psychotherapy.

For its Medicare Shared Savings Program (MSSP), CMS proposed new changes to promote whole-person care, including revisions to its Accountable Care Organization (ACO) assignment methodology and its financial benchmarking methodology.

In addition, the rule proposes delaying the implementation of a new policy that would base the payment rate for split (or shared) evaluation and management visits on the amount of time spent by the billing practitioner.

The agency has also proposed the extension of several telehealth provisions, such as reimbursement at non-facility rates for certain telehealth services in a patient's home, maintaining and expanding additional payment for certain vaccines administered in a home, and updating the MSSP quality measurement policies.

CMS will accept comments on the proposed rule through Sept. 11.

Changes to the OPPS

In the proposed rule, CMS proposes increasing OPPS payment rates by 2.8% for CY 2024, based on a projected hospital market basket percentage increase of 3%, reduced by a 0.2-percentage point productivity adjustment.

The proposed rule also includes new provisions to increase access to behavioral healthcare, including the creation of a new benefit category called the Intensive Outpatient Program. This program would cover mental health services for Medicare beneficiaries who need frequent but less intensive care than what is provided at hospitals.

In addition, the rule proposes updated Medicare payment rates for the partial hospitalization program, which is an alternative to psychiatric hospitalization.

CMS also proposed several changes to hospital transparency requirements. These proposals include requirements for standardized formats for machine-readable files, revisions to the oversight and enforcement process, and new website requirements to improve navigation.

CMS will accept comments on the proposed rule through Sept. 11, with the final rule expected in November.

Commentary

According to CMS, the proposed rules aim to advance health equity, expand access to critical medical services, and increase compliance with hospital price transparency rules.

"At CMS, our mission is to expand access to health care and ensure that health coverage is meaningful to the people we serve," said CMS Administrator Chiquita Brooks-LaSure. "CMS' proposals in the proposed physician payment rule would help people with Medicare navigate cancer treatment and have access to more types of behavioral health providers, strengthen primary care, and for the first time, allow Medicare payment for services performed by community health workers."

In addition, "CMS is taking action to help shape a resilient, equitable, and high-value health care system" through its proposed OPPS rule, Brooks-LaSure said. "This proposed rule expands access to behavioral health care and supports the Biden-Harris Administration's priority to remove barriers that limit price transparency with a goal of increasing competition to bring down health care costs."

However, several medical groups have expressed disappointment in the proposed payment updates.

Anders Gilberg, SVP for government affairs at the Medical Group Management Association, said, "The proposed 2024 Medicare Physician Fee Schedule (PFS) raises significant concerns for medical groups related to its 3.4% reduction to the conversion factor, which further increases the gap between physician practice expenses and Medicare reimbursement rates."

American Medical Association president Jesse Ehrenfeld also noted that, "When adjusted for inflation, Medicare physician payment already has effectively declined 26% from 2001 to 2023 before additional inflation and these cuts are factored in."

Similarly, the American Hospital Association (AHA) pushed back against the proposed payment increase in the OPPS, arguing that it was insufficient in the face of persistent financial challenges among hospitals.

"Without a more robust payment update in the final rule, hospitals' and health systems' ability to continue caring for patients and providing essential services for their communities may be jeopardized," Stacey Hughes, AHA's EVP. "Most hospitals across the country continue to operate on negative or very thin margins that make providing care and investing in their workforce very challenging day to day."

One group did applaud the agency's proposed changes. Clif Gaus, president and CEO of the National Association of ACOs, praised CMS' "commitment to supporting value-based care and growing participation in accountable care organizations." (CMS press release, 7/13 [1]; CMS MPFS fact sheet, 7/13; CMS MPFS Medicare Shared Savings Program Proposals fact sheet, 7/13; AHA News, 7/13 [1]; CMS press release, 7/13 [2]; CMS OPPS fact sheet, 7/13; CMS OPPS hospital price transparency proposals fact sheet, 7/13; AHA News, 7/13 [2]; Berryman, Modern Healthcare, 7/13; Frieden, MedPage Today, 7/14)

The health care industry is now seeing the confluence of three major price transparency policies: hospital price transparency, payer price transparency, and surprise billing. A panel of Advisory Board experts sat down to discuss these policies and their potential impact. Read on to learn five takeaways from that discussion.