MedPAC Considers Changes to Medicare Physician Payments as 2023-2024 Meeting Cycle Ends

Although MedPAC does not intend to include the topic in its June 2024 Report to Congress, the Commissioners discussed telehealth policy, including the extension of the COVID-19 Public Health Emergency (PHE) telehealth flexibilities and concerns about "telehealth-only providers." The MedPAC chair noted that telehealth and virtual care will be an area of continued interest and monitoring. MedPAC also intends to review the use of audio-only services and remote monitoring, and increasing use of technology. For more information on the telehealth session, download the slides.

MedPAC also engaged in another lengthy discussion of the Medicare Physician Fee Schedule (MPFS) annual payment update methodology. Acknowledging the repeated years of MPFS conversion factor reductions and failure for the methodology to account for inflation, MedPAC is seeking to address concerns that these shortcomings will decrease patient access to care. As it considers this issue for future action, staff presented three policy options for the commissioners to consider:

• Annually increase the practice expense (PE) portion of MPFS rates by the hospital market basket minus productivity
• Update MPFS rates each year by the Medicare Economic Index (MEI) minus one percentage point (with an update floor of half of MEI)
• Extend the Advanced Alternative Payment Model (APM) incentive payments scheduled to fully end in 2024

While no official Commission decision was made, commissioners seemed to gravitate toward the option that would provide an MEI update (minus one percentage point) across the full MPFS. The MedPAC Chair suggested that this work will continue and MedPAC would address physician payments in an "informational chapter" to be included in the June 2024 MedPAC Report to Congress. For more information on the physician payment session, download the slides. MedPAC will kick-off its 2024-2025 meeting cycle on September 5th and 6th.