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March 18, 2021

MedPAC Issues Annual Report on Medicare Payment Policy: Any Good Recommendations?

Every March, the Medicare Payment Advisory Commission (MedPAC) releases a comprehensive report to Congress outlining its recommendations for updating Medicare payments—and earlier this week, MedPAC issued its 2021 report. MedPAC is a commission funded by U.S. taxpayers whose purpose is to provide recommendations to Congress and the Centers for Medicare & Medicaid Services (CMS) about how to improve the Medicare Program. It includes 17 commissioners who are physicians, economists, and other health policy experts from across the country, as well as a sizable staff that conducts the research necessary to carry out MedPAC’s work. MedPAC not only issues annual reports, but also routinely responds to Congressional requests about Medicare spending and payment policy.

It is important to emphasize from the get-go that MedPAC’s recommendations are NOT BINDING. In other words, Congress and CMS can choose to accept them, adopt pieces of them, or ignore them completely. While MedPAC is known for closely analyzing data from the Medicare program and making recommendations based on that data, some of MedPAC’s recommendations over the years have been unrealistic and have had no chance of being fully adopted. For example, a few years ago, MedPAC recommended that the Merit-based Incentive Payment Program (MIPS) be eliminated and replaced with an alternative program that measures quality improvement at a population, rather than individual patient, level. While Congress and CMS clearly have no intention of completely scrapping MIPS any time soon, interestingly CMS did choose to incorporate part of MedPAC’s recommendation related to the use of population health measures into its new MIPS Value Pathways (MVP) framework.

Like in past years, the 2021 annual report includes recommendations that vary in terms of their likelihood of being adopted. Furthermore, there are some recommendations that we at ACEP agree with, while others that we strongly oppose. Starting with one that we strongly oppose, MedPAC recommends that Medicare physician payments receive a zero percent update next year—consistent with the update that physicians are set to receive under current law. MedPAC tries to make its case by claiming that Medicare beneficiaries’ access to care as well as the quality of care they receive have not changed considerably compared to previous years.

Arguing that the Medicare payment rate for physicians is adequate and does not need to be increased is plain wrong—as we all know that these payments have not kept up with inflation for decades. The annual updates also do not take into account the two percent sequestration reduction that continues to apply year after year (with respect to sequestration, Congress instituted a temporary moratorium that is set to expire soon—click here to urge your representative to extend the sequester moratorium!) Even the 2020 report from the “Medicare Trustees” acknowledges that updates for physician reimbursement are not sufficient. The Trustees believe that, absent a change in the delivery system, the availability and quality of care that Medicare beneficiaries receive will fall over time.

Moving on, another set of recommendations in MedPAC’s report that I want to highlight relate to the continued use of telehealth services past the end of the COVID-19 public health emergency (PHE). As avid readers of Regs & Eggs would know, I have focused numerous posts on the expansion of telehealth during the pandemic, including one post that details what temporary changes to the strict Medicare telehealth rules should continue to be waived past the end of pandemic and who (Congress or CMS) needs to act to make that happen. Over the last year, ACEP has encouraged Congress to completely eliminate some pre-pandemic restrictions, such as the limitation on where telehealth services can be delivered. Further, we have requested that CMS permanently add some codes that you as emergency physicians typically bill to the list of approved Medicare telehealth services. In the telehealth chapter of MedPAC’s report, the Commission does NOT recommend that any of the temporary telehealth policy changes instituted during the pandemic be made permanent. Instead, it recommends that Congress and CMS take action to allow for these same flexible policies to continue for another year or two—until enough data can be collected to truly assess the impact of telehealth services on healthcare costs and overall quality of care. The Commission also raises concerns about the increased potential for healthcare fraud related to the increased use of telehealth and requests that CMS implement certain safeguards to protect beneficiaries and the Medicare program from unnecessary spending.

While some may be disappointed that MedPAC decided not to fully endorse the expansion of telehealth, it would nevertheless be helpful as an intermediary step if Congress and CMS decided to adopt at least some of the Commission’s telehealth recommendations. If Congress and CMS do not intervene at all, the limitations on where telehealth services can be delivered (only in “originating site” facilities and rural areas) go back into effect immediately once the PHE ends—and Medicare will likely stop paying for emergency department (ED) evaluation and management (E/M) telehealth services at the end of the year. Extending these policies for even a year or two would be better than nothing! I should also note that ACEP has established a Task Force dedicated to working through various issues related to the expansion of telehealth in emergency medicine. Extending these telehealth flexibilities would also give the Task Force more time to develop sound recommendations around the delivery and reimbursement of emergency telehealth services in the long-term.

Only time will tell whether Congress or CMS will choose to adopt MedPAC’s telehealth recommendations or any other of the recommendations included in the report. In the meantime, the report certainly does give folks in the health policy community a lot to chew on and debate!

Until next week, this is Jeffrey saying, enjoy reading regs with your eggs.

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