ACR praises bipartisan letter urging US House leaders to avert impending 'Medicare cliff'
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A bipartisan group of 247 members of Congress have signed a letter urging their own leadership to address several looming Medicare cuts that would reduce reimbursements to providers by nearly 10% starting next year.
According to the American College of Rheumatology, these cuts, which could go into effect on Jan. 1, would severely impact practices already struggling to recover from the COVID-19 pandemic and potentially endanger patient access. Officials from the ACR praised members of the U.S. House of Representatives who signed the letter — spearheaded by Rep. Ami Bera (D-Calif.) and Rep. Larry Bucshon (R-Ind.) — in a press release.
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“The ACR thanks Reps. Bera and Bucshon, and all the other members of Congress who are calling on congressional leadership to address the looming ‘Medicare cliff’,” ACR President David Karp, MD, PhD, said in the release. “Extending physician payment adjustments for an additional year will help maintain providers’ operational stability that is still affected by the pandemic and ensure people living with rheumatic diseases do not see their care disrupted.”
This “Medicare cliff” is the result of three separate budgetary deadlines that, if allowed to pass at the end of calendar year, will collectively result in a 9.75% cut to reimbursements.
One of these deadlines is related to an expiring adjustment to the Medicare Physician Fee Schedule (PFS). At the end of 2020, Congress attempted to mitigate the financial impact of the pandemic on providers by introducing a one-time 3.75% payment increase for all PFS services in the Consolidated Appropriations Act of 2021. This increase is set to expire at the end of the year, despite providers continuing to struggle in the wake of the pandemic, according to the ACR.
“This payment adjustment afforded some short-term stability for health care professionals struggling with the impact of the COVID-19 pandemic but is expiring at the end of the calendar year while providers still struggle with COVID’s impact,” read the ACR press release, in part.
In addition, health care providers could see a 2% cut stemming from the expiring hold on the Medicare sequester. This sequester, which has been in place since 2013 but is often suspended by Congress, would automatically cut Medicare spending across the board. The current suspension expires at the end of 2021.
Lastly, there may be an additional 4% payment cut due to the Pay-As-You-Go budget rule, otherwise known as PAYGO. This rule requires spending increases be offset by either tax increases or cuts to other areas of mandatory spending. As the American Rescue Plan passed earlier this year did not include such an offset, the PAYGO rule will be triggered unless Congress moves to waive it.
In their letter, members of Congress urged House Speaker Nancy Pelosi (D-Calif.) and House Minority Leader Kevin McCarthy (R-Calif.) to address these imminent cuts, and calls for broader, long-term reforms to stabilize the Medicare payment system and better incentivize high-quality care.
“The current Medicare payment system does not adequately incentivize high-quality care, and reimbursement has failed to keep up with inflation,” read the letter, dated Oct. 14, in part.
“We believe broad systemic reforms to the payment system are critical to speed the transition to value-based care,” the authors continued. “However, as Congress begins the complex process of identifying and considering potential long-term reforms, we must also create stability by addressing the immediate payment cuts facing health care professionals. These cuts will strain our health care system and jeopardize patient access to medically necessary services.”
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