A Commonsense Solution to Medicare Reimbursement

J Clin Pathways. 2023;9(3):E5-E6.

Some knowledge is common sense. For example, if you are paid less than what it costs to operate your business, you won’t be in business for very long. In health care, how­ever, physicians are living this upside-down reality. Treating patients on Medicare is no different than providing services for other patients—except for the reimbursement physicians receive after treatment. When it comes to reimbursement for these services, practices have been receiving the short end of the proverbial stick from Medicare for decades.

Currently, reimbursement for health care services under Medicare is determined by the annual Medicare Physician Fee Schedule (MPFS). Each year, MPFS rates are adjusted up or down depending on several factors, but inflation is not one of those variables. The end result is that physicians are reim­bursed for many services below the cost of inflation. This is a major problem for all practices, but especially damaging for small practices and those in rural or low-income areas. These practices depend on the income from Medicare reimburse­ments to stay afloat. When reimbursement is below the cost of inflation, practices cannot afford the staff and goods needed to keep the lights on, bills paid, and patients cared for.

The COVID-19 pandemic has aggravated these financial woes. As normal services were suspended to make room for emergency care and protect patients, many practices were hit by record-setting health care input cost inflation. Most nota­bly, this has included cost increases driven by shortages in both clinical and nonclinical staffing, which are extremely difficult to address.

Another threat is the pressure driven by misguided public policies, such as hefty profits some large hospitals and health systems generate from the 340B drug pricing program, “non­profit” tax breaks, or grandfathered site-disparate payments between physician offices and hospital outpatient departments. Combined with inadequate Medicare reimbursement for the services they provide, practices face constant pressure to merge or join hospital systems, or just close.

Since 2003, the Community Oncology Alliance has tracked the changing state of independent oncology prac­tices. Over the past two decades, 1,748 community on­cology practices have closed, been acquired by hospitals, undergone mergers, or reported financial struggles due to re­curring payment cuts and inadequate reimbursement.¹ As the number of practices decreases, patients must travel further and for longer periods of time to receive care, and they often must seek care in a more expensive hospital setting. Additionally, the lack of access to care caused by clinic closures can deter or delay patients from seeking care in the first place, exacerbating their health issues, which can lead to worse outcomes.

A new bipartisan bill in the US Congress, the Strengthen­ing Medicare for Patients and Providers Act (HR 2474),² aims to fix this glaring reimbursement problem. Introduced by Representatives Raul Ruiz, MD (D-CA-25), Larry Bucshon, MD (R-IN-08), Ami Bera, MD (D-CA-06), and Mariannette Miller-Meeks, MD (R-IA-01), the bill would link the MPFS to inflation as measured by the Medicare Economic Index. Do­ing so would ensure that physician reimbursement never falls below the cost of doing business, and it would improve the fiscal health of cancer care practices across the country.

This bill is supported by trusted medical organizations and should be a bipartisan issue. Both the Medicare Board of Trust­ees and the Medicare Payment Advisory Commission, organi­zations that are entrusted with the administration of the Medi­care program, support legislation to link Medicare payment rates to inflation. Regardless of party affiliation, each member of Congress has a duty to support the well-being of their con­stituents. Ensuring that the health care system in their district or state is properly funded is a step toward a healthier society.

HR 2474 also supports one of the biggest Centers for Medicare and Medicaid Services (CMS) initiatives: health eq­uity. Defined by CMS as “the attainment of the highest level of health for all people, where everyone has a fair and just opportunity to attain their optimal health regardless of race, ethnicity, disability, sexual orientation, gender identity, so­cioeconomic status, geography, preferred language, or other factors that affect access to care and health outcomes,” health equity is separated into 5 priorities by the CMS Framework for Health Equity 2022-2032.³ Priority 3, “Build Capacity of Health Care Organizations and the Workforce to Reduce Health and Health Care Disparities,” and Priority 5, “Increase All Forms of Accessibility to Health Care Services and Cov­erage,” are supported by HR 2474. By linking Medicare re­imbursement to inflation, Congress has the chance to properly fund health care practices across the country, enabling them to hire more talent, expand the services provided, and, most im­portantly, adapt to changing economic conditions to properly serve patients.

Oncology stakeholders who care about these issues should reach out to their elected congressional represen­tatives and tell them to support HR 2474. We all hope that we never need health care, but we are grateful that ser­vices are available when we do. That access is only possible if the professionals that deliver that care are reimbursed at a rate that reflects the true cost of doing business. We need a fighting chance in a tough economy, and HR 2474 offers us that opportunity.