CMS Releases CY2023 PFS With Big Changes to MSSP

The Centers for Medicare and Medicaid Services (CMS) has released the Calendar Year (CY) 2023 Physician Fee Schedule (PFS) final rule that reduces payments by almost 4.5% YOY and includes substantive changes for ACOs in the Medicare Shared Savings Program, expands access to behavioral health services, and decreases the conversion factor by $1.55.

Medicare payments are based on the relative resources used to furnish a medical service, and those services have relative value units (RVUs) applied to become payment rates through the use of a conversion factor. According to a CMS fact sheet, the reduction in this year’s conversion factor is a result of budget neutrality adjustments, which are required to ensure that payment rates for individual services don’t result in changes to the amount of Medicare spending.

The American Hospital Association expressed its concerns with the final rule noting the 4.5% cut is coming in the wake of nearly two years of unrelenting financial pressures due to the ongoing COVID-19 public health emergency (PHE). It also cited parallel pressures including increased inflation, rising staffing costs and increased costs for non-labor supply categories due to national shortages.

In a press release, CMS boasted the update in accessibility to behavioral health services as part of the Biden administration’s commitment to whole-person care and the 2022 CMS Behavioral Health Strategy. The new coverage policies include allowing behavioral health clinicians to offer services under general supervision of a Medicare practitioner. Additionally, Medicare will pay Opioid Treatment programs that use telehealth services to initiate treatment.

But the real coup de grace of the 2023 PFS is the overhaul of the Medicare Shared Savings Program (MSSP) and subsequent changes to the expansion of ACOs. According to another CMS Fact Sheet, the link to which is not working, changes will include additional time to a one-sided risk model before transition to performance-based risk, implementation of advance shared savings payments to low revenue ACOs and other modifications that will allow ACOs greater flexibility when the shift to performance-based risk is made.

CMS determined that the remodeling of MSSP was required after finding that underserved demographics were largely unrepresented within current ACOs, which led to a plateau in participation with MSSP payment models. Modern Healthcare reports that regulators expect that the changes will lead to $650 million in shared savings payments to ACOs.

The National Association of ACOs (NAACOS) was understandably overjoyed after years of fighting for lenience and higher incentives for new participant organizations. But while the changes meet a number of NAACOS demands, the Association remains concerned about accessibility and pathways into the program for rural ACOs. From NAACOS President and CEO Clif Gaus:

Specifically, CMS should consider correcting the ‘rural glitch,’ where ACOs no longer benefit from the regional adjustment when lowering the spending of their assigned patients. This change would greatly help ACOs, but remains in effect even after today’s changes.