Medicare Reductions from a Lame-Duck Congress? Not likely!

On November 1, 2022, the Centers for Medicare and Medicaid Services (CMS) released its final rule cutting Medicare payments by 4.5% for physicians (including physicians, nurse practitioners, physician assistants as well as other providers). This reimbursement level is important because Medicare accounts for approximately 30% of physician payments in the U.S. In addition, many self-funded health plans, such as those who work with ClaimDOC, have a Medicare-based pricing strategy that can be impacted by extreme changes in Medicare reimbursement.

Not surprisingly, however, the announcement is like most things coming out of Washington, D.C. these days: Things are not exactly as they appear. To get the whole story about the final rule and to understand how this is likely to impact healthcare providers, a bit more digging is required, coupled with a healthy dose of skepticism. Medicare reimbursement levels are always subject to the Washington game-playing, lobbyist-wrangling, politician doomsday-proclaiming, and good, old-fashioned horse trading. Unfortunately for our healthcare system and patients, the brinksmanship seems to be so much worse this year with no end in sight, especially with a lame-duck Congress in place for the remainder of 2022.

While the final-final rule will likely mitigate any real reduction in overall Medicare payments for physicians, the not-so-final rule does foreshadow some evolution in Medicare payments to keep up with technology. For example, it looks like one product of the pandemic – payments for telemedicine – will be extended through 2023, signaling increasing acceptance of telemedicine as a useful mechanism for providing patient access to care, especially in highly needed specialties such as mental health. In addition, CMS is also placing more emphasis on primary care in the weights they apply to payment for those who spend more time with patients (e.g., primary care physicians) which is a shift from other procedure-based specialties (e.g., surgeons).

So how does this all impact ClaimDOC’s client health plans and, most importantly, our members? At first glance, a potential reduction in Medicare payments (and by extension for ClaimDOC’s Medicare-based pricing strategy) could create a modest reduction in claim payments. Upon further review, however, if previous years’ experience teaches us anything, ClaimDOC doesn’t anticipate a real reduction when the final-final rule comes out. Instead, we believe the rates will be restored at the 11th (or maybe the 13th) hour, which will do nothing to lower costs while, at the same time, cause disruption in how claims get properly priced because of the timing. This will cause a disruption for everyone (thanks again, Washington).

This is why ClaimDOC approaches Provider Relations differently than our competition. We are constantly building our relationships with providers, and we can be flexible in how we handle these timing issues in our processes. Yes, we have spirited and tough negotiations, and that will never change. But we also believe we better serve our plans and our members by working with their preferred providers to make sure the whole process – from Pave the Way® where we proactively reach out to providers to contracting and claims pricing – works to improve the overall member experience. This approach requires us to help providers anticipate changes like those bubbling up from Washington and to develop creative ways to find a common ground. Our thoughtful hybrid approach is harder than others with either a scorched earth or settlement strategy, but in the long run, we believe true partnership better serves our plans and the members.