Medicare Cuts Threaten Specialty Practices Nationwide

Medicare Cuts Threaten Specialty Practices Nationwide

The COVID-19 pandemic has brought to the forefront inequities and vulnerabilities that have always existed in our healthcare system. Yet, as the pandemic persists, policies that further limit access to care for underserved populations continue to be pushed forward.

For about a year now, providers have been ringing alarm bells about devastating cuts to Medicare funding for specialty care services directed by CMS. The 2022 Medicare Physician Fee Schedule final rule issued in November proposes reimbursement cuts of 20% that will harm a large variety of office-based specialists treating cancer, vascular and heart disease, dialysis patients, and more. The cuts will force free-standing medical clinics to close their doors, reducing treatment options for patients and, in many cases, leaving hospital-based care as the only option, despite the already existing strain on hospital resources.

Some claim the clinical labor pricing updates in the 2022 Physician Fee Schedule will help address workforce shortages among nurses and other clinical staff. However, this is based on the false assertion that staff won’t get pay raises in 2022 if clinical labor pricing isn’t updated. Salary data from the last 20 years shows that Medicare’s clinical labor pricing doesn’t dictate what doctors actually pay staff.

Further, proponents of the clinical labor cuts acknowledge that Medicare’s budget neutrality requirements will lead to payment reductions for many procedures, but they don’t address how the specialty practices performing those procedures will make up for lost revenue. By ignoring the dire consequences for specialty practices, they’re leaving an essential sector of the healthcare system out of the equation. With the clinical labor pricing in effect, specialty clinical staff won’t be getting raises — they’ll be losing their jobs as centers inevitably close.

With hospitals across the country overwhelmed, this is a particularly grim time to force the closures of specialty practices that provide a measure of relief to both the patient as well as these overburdened hospitals. Patients who are grappling with serious illness will have to face the added health risk of seeking treatment in a hospital setting.

In the long-term, these slashes in funding will accelerate the consolidation of our healthcare system, which limits patient choice and drives up costs for everyone. Large hospital systems are already devouring physician networks and office-based specialists in an effort to grab a larger portion of the pie. The CMS-directed cuts will only serve to help these organizations gain more market share and further drive down competition, which will lead to increased healthcare costs. Small, office-based healthcare providers cannot stay in business without reasonable reimbursement rates from the federal government.

Many of the illnesses treated by specialty clinics disproportionally affect underserved populations already struggling to access care. To be clear, these funding cuts will likely lead to worse health outcomes for Black, Hispanic, and Native Americans — exacerbating existing inequities. Easily accessible outpatient care centers in underserved communities could be shuttered permanently.

Fortunately, Congress has the opportunity to prevent these serious adverse outcomes by reversing the cuts in the upcoming omnibus appropriations legislation. Many lawmakers are sounding the alarms right alongside healthcare providers and patient advocates. In a 2021 letter to CMS, 75 lawmakers in the House of Representatives — led by Reps. Bobby Rush (D-Ill.) and Gus Bilirakis (R-Fla.) — highlighted the troubling impacts that the cuts would have on the U.S. healthcare system.

Patient access to appropriate care, hard-earned progress toward health equity, and even our capacity to fight the pandemic are at risk. There is only one ethical course of action: I respectfully encourage our representatives in Congress to act to prevent the weakening of our already strained healthcare system by providing relief for office-based specialty care and working on fundamental reform of the Physician Fee Schedule.

Mark Garcia, MD, is CMO for American Vascular Associates and the Health Policy Advisor for United Specialists for Patient Access.

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