Biden Signs Federal Spending Bill, Easing – But Not Eliminating – Scheduled Cuts to Medicare Fee Schedule

Chiropractors and Other Providers to Face 2% Cut in 2023, Additional Decrease in 2024

In a Nutshell… The Federal Spending Bill:

• Reduces the 4.5% cut to the Medicare conversion factor scheduled for January 1, 2023, to 2%
• Provides for a two-year postponement of the 4% PAYGO sequester cut triggered by the passage of 2021’s American Rescue Plan Act

Last night, President Joe Biden signed into law the Consolidated Appropriations Act of 2023, a nearly $1.7 trillion year-end omnibus spending bill that funds the federal government through the end of September 2023. The bill passed through Congress last week.

This omnibus spending bill addresses the pending 4.5% cut to the Medicare Physician Fee Schedule scheduled to begin January 1st. Unfortunately, the bill does not eliminate this cut entirely. Instead, rates will be cut by 2% in 2023, with additional cuts scheduled for 2024 (unless Congress acts sometime next year).

The bill also includes a two-year postponement of the 4% PAYGO sequester cut, triggered by the passage of the American Rescue Plan Act, which was also scheduled for 2023.

Even this 2% cut will threaten Medicare beneficiaries’ access to chiropractic care due to the increased financial instability of chiropractic practices across the nation. Payment cuts from previous years and two decades of essentially flat payment rates, added to high inflation and the lack of adequate annual inflation-based physician payment updates like those applied to other providers (hospitals, long-term care facilities, etc.), can challenge the financial viability of even the strongest practices, potentially creating a crisis in patient access throughout the Medicare system.

What’s Next?

Now that President Biden has signed the bill into law, WPS Medicare still needs to re-configure the fee schedule, previously released in November. Medicare will most likely not have enough time to release a new fee schedule based on these changes prior to January 1, 2023. As a result, here are some considerations for doctors billing Medicare.

Participating Providers

If you are participating with Medicare, continue to bill at your regular fees. Your bills will be processed based on the appropriate fee schedule once it is finalized. This is the recommendation even after the adjusted fee schedule is released.

Non-Participating Providers

If you are NOT a participating provider for Medicare, wait to submit your bills until the fee schedule is finalized. However, you may be able to process your claims using the currently published 2023 rates and inform your patients that additional amounts may be owed or require refunding. Billing based on the 2022 fee schedule is not recommended, as it would potentially result in collected amounts exceeding the statutory Limiting Charge.

Another consideration for non-par DCs: Waiting to bill until after the updated fee schedule is released can allow the patient’s deductible to be met, so your office will not have to recover fees from patients.

Stay tuned for updates to the 2023 Medicare Physician Fee Schedule as they become available.

Bill Also Contains Changes to Medicaid Rules and Processes

States Allowed to Restart the Redetermination Process

The omnibus spending package also includes a requirement that states start Medicaid eligibility redeterminations by April 1, 2023. Redetermination is the process by which Medicaid beneficiaries establish their eligibility for the program.

At the beginning of the COVID-19 public health emergency (PHE), Congress boosted the federal matching rate for state Medicaid payments, as long as the state did not drop anyone from the Medicare rolls until the end of the PHE (currently scheduled for mid-January). With states now being able to restart the redetermination process, it is estimated that as many as 18 million current Medicaid enrollees could become ineligible.

In preparation for the end of the federal PHE, MDHHS is encouraging providers to take the following steps:

• Verify beneficiary eligibility prior to services. Providers can visit the Eligibility and Enrollment webpage for step-by-step instructions.
• Remind beneficiaries to verify or update their contact information or report any changes online through MI Bridges. They can also call their local MDHHS office for help. Local office information can be found on MDHHS County Office webpage.
• Remind beneficiaries to open mail from MDHHS and complete and return renewal documents.
• Review the Medicaid policy bulletin and L letter webpages to see which policies or L letters may impact you.