Executives at major health systems are at odds with several aspects of CMS’ annual proposed changes to next year’s physician fee schedule and the Medicare Shared Savings Program.
One point of contention is the program’s “efficiency adjustment,” which presents a 2.5% pay reduction for thousands of procedures.
The 60-day comment period on the proposal ended Sept. 12. Trinity Health in Livonia, Mich., Providence in Renton, Wash., and Jefferson Health in Philadelphia are among the hundreds of organizations that provided comments.
Three things to know:
1. The 1,803-page proposed rule for 2026 includes a 3.62% increase to $33.42 in Medicare physician pay, a 2.5% decrease to work relative value units and intraservice time for non-time-based services and an end to a temporary rule allowing physicians to virtually supervise residents in all settings.
The rule also proposes a new ambulatory specialty pay model to address “significant areas of Medicare spending” like low back pain and heart failure, as well as switching skin substitutes from biologicals to incident-to supplies to cut Medicare spending on skin substitutes by up to 90%.
2. CMS’ downward 2.5% efficiency adjustment assumes specialists have become more efficient in certain common procedures. Multiple organizations objected to this premise, contending that time, costs and complexities are increasing.
Radiation oncology, radiology and some surgical specialties would unfairly see a decrease in RVUs, according to Trinity Health.
Providence, a 51-hospital system, said: “This efficiency adjustment is not the appropriate way to bring more timeliness to the RVU process.” The health system said the Medicare Economic Index has annually grown 3% to 5%, which “would compound the proposed 2.5% reduction to a more than 5% cut in non-time-based codes each year.”
Overall, the adjustment is “concerning” and lacks “empirical evidence,” according to a bariatric surgeon at Jefferson Health.
3. The American Medical Group Association — a trade group representing more than 175,000 physicians among upward of 400 health systems and medical groups — said inflation and rising practice costs have surpassed CMS’ physician payment updates since 2001.
The AMGA has urged Congress and CMS to create what it calls a more sustainable and predictable payment system.
