The Biden administration’s proposed physician fee schedule for 2024 includes a 3.34% reduction in the conversion factor, leading to a 1.25% overall payment decrease. While primary care and other services may see pay increases, provider groups, such as the MGMA, are urging Congress to reassess existing laws to ensure fair compensation. They argue that Medicare’s budget neutrality requirements worsen the financial stability of medical practices, exacerbating the existing issue of inadequate coverage for delivering care to beneficiaries.
The Biden administration has unveiled its proposed physician fee schedule for 2024, and the anticipated 3.34% decrease in the conversion factor is likely to generate significant backlash from physicians.
According to a press release issued by the agency, the proposed rule would result in an overall payment decrease of 1.25% compared to 2023. However, the Centers for Medicare & Medicaid Services (CMS) have set the conversion factor at $32.75, representing a reduction of $1.14 or 3.34% from the previous year.
The conversion factor plays a crucial role in determining the dollar value assigned to the relative value unit, which is a key component in CMS’s calculation of payouts for Medicare physicians.
While proposing pay increases for primary care and other services, CMS acknowledged that these adjustments necessitate cuts in other areas to maintain budget neutrality.
Provider groups wasted no time expressing their concerns following the release of the rule. The Medical Group Management Association (MGMA), in a statement, called on Congress to reevaluate existing legislation to ensure fair compensation for providers.
Anders Gilberg, Senior Vice President of Government Affairs at the MGMA, stated in the release, “Medicare already falls short in covering the cost of delivering care to beneficiaries, and the proposed reduction to the 2024 conversion factor exacerbates the issue. Congress must revisit existing laws to provide an annual physician payment update in line with inflation and eliminate Medicare’s budget neutrality requirements that rob Peter to pay Paul, thereby offering much-needed financial stability for medical practices.”