FROM THE AUA PUBLIC POLICY COUNCIL Payment/Reimbursement

By: Eugene Rhee, MD, MBA | Posted on: 01 Apr 2022

The end of 2021 saw a flurry of activity with respect to Medicare funding for calendar year (CY) 2022. These actions not only impact payment and reimbursement for CY 2022, but have significant ramifications for future provision of Medicare funding. On December 10, 2021, President Biden signed S.610, “Protecting Medicare and American Farmers from Sequester Cuts Act” (the Act) into law. This legislation mitigated potentially devastating cuts to Medicare funding that would have kicked in on January 1, 2022. The original cuts, which came out to a nearly 10% reduction in Medicare funding, would have had a catastrophic impact on urologists’ ability to provide quality care to their patients (see figure).

Figure. CY 2022 MPFS.

Overall, this legislation mitigated Medicare cuts from what would have been an overall 9.75% cut for CY 2022 to an overall 2% cut for CY 2022. While this legislation significantly blunted the impact of these Medicare funding cuts, the fact remains that they are taking place at the worst time.

“It is inappropriate for patients’ care to be put at risk due to the constraints of a rigid funding system.”

It’s clear that Congress needs to address systemic issues in Medicare’s funding mechanism–specifically in the Medicare Physician Fee Schedule (MPFS)–in a holistic way to avoid such funding cliffs in the future. It is inappropriate for patients’ care to be put at risk due to the constraints of a rigid funding system.

In addition to the cuts described above, urology faces additional Medicare funding cuts due to the implementation of an update to clinical labor rates that the Centers for Medicare & Medicaid Services (CMS) use as one of the direct Practice Expense components that go into the valuation of services on the MPFS (these rates had not been updated in 20 years).

Due to the budget neutral nature of the MPFS, this update will have a significant negative impact on procedures with a major direct Practice Expense supply and equipment component. This includes a number of urology procedures, several of which face cuts of over 10%–for no other reasons than the statutorily required, budget-neutral nature of the MPFS and CMS’s inaction with respect to updating direct Practice Expense clinical labor rates.

AUA advocacy heavily engaged in these issues throughout 2021. AUA’s Congressional grassroots action in the fall of 2021 related to the Congressional “Dear Colleague” letter from Representatives Ami Bera, MD (D-CA-07) and Larry Bucshon, MD (R-IN-08) urging AUA members to contact their Members of Congress to oppose these payment cuts. That letter, signed by more than 245 lawmakers, outlined the breadth of potential payment cuts and was a major reason that Congressional leadership took notice of these issues.

“The AUA will continue to engage with Congress through 2022 alongside other physician specialty societies to ensure a long-term solution to Medicare’s inherent funding issues.”

The AUA also engaged with CMS and other medical specialties on the clinical labor update to ensure that CMS was aware of the major negative impacts that it would have on specialties with high supply and equipment direct Practice Expense components. The AUA’s written comments and face-to-face meeting with CMS officials ensured that several of the components of the clinical labor update were changed to blunt the impact of the update–including its phased implementation over a 4-year period. The AUA also continues to work as a partner in the Clinical Labor Coalition to engage Congress in trying to formulate a fix to this update.

The AUA will continue to engage with Congress through 2022 alongside other physician specialty societies to ensure a long-term solution to Medicare’s inherent funding issues. It is critical to ensure appropriate payment and reimbursement for urological procedures so that we are able to provide the highest quality care to our patients–we can accept no less.

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