capitol hill report: medicare reimbursement update

As we enter the final weeks of January, Congress has still not passed a final budget for Fiscal Year (FY) 2024. The budget for FY 2024 was supposed to be passed in September. As Congress and the administration have been unable to come to a funding agreement, Congress has passed several continuing resolutions (CRs) that allow for additional negotiation time and keep the government open.

Last November, Congress passed two separate CRs that pushed funding deadline for different branches of the government to January 19 and February 2 of 2024. While Congress and the administration came to a deal on topline spending numbers over the holiday season, they were not able to come to an agreement between the House and Senate on how the funds would be spent. To avoid a government shutdown, an additional CR was passed on Friday, January 19, which pushed the funding deadlines to March 1 and March 8.

What Does This Mean for Your Medicare Reimbursement?

On January 1, 2024, the conversion factor in the Medicare Physician Fee Schedule was reduced by nearly 3.4 percent due to budget neutrality requirements. Congressional leadership and individual members of Congress had indicated to the physician community that a fix for those cuts would be included as part of the original January 19 funding deadline, which would allow all reimbursements for the year to be processed at the fixed level. However, there was no deal for a full funding package on January 19 and the CR did not include a temporary fix. This means that the nearly 3.4 percent cut to the conversion factor will remain in effect until Congress acts.

For neurology care providers, this means services delivered before the issue is addressed will be paid at the lower conversion factor rate. When the cuts were going to be addressed in January, it would have been feasible for neurologists to hold their Medicare claims until the issue was resolved. With the new deadline for action moving to March, it is important that you do not hold your claims—this will only delay payment. Claims will be processed based on date of service rather than date of filing. If you have any questions about how claims should be processed considering the delayed MPFS fix, please contact practice@aan.com.

What Can You Do to Help?

While Congress is still negotiating how they will address the conversion factor cuts, it’s important they understand just how urgent this is for neurologists and patients with neurologic conditions. There is currently no guarantee that Congress will include a MPFS fix in a March spending bill, so they need to hear from you about how this affects your patients and your practice.

Write your representative today and ask them to co-sponsor the Preserving Seniors’ Access to Physicians Act of 2023 (H.R. 6683), the only legislative vehicle that would fully eliminate the cuts to the MPFS.

While it remains unclear exactly how Congress will structure the final fix to account for its delay in action, the AAN will continue to monitor the situation and advocate for a fix that makes neurology care providers whole for 2024.

The delay does provide an opportunity for the AAN to advocate for other legislative priorities in a larger health care package being negotiated in the House and Senate. The January 19 funding deadline was also supposed to be a vehicle for a Pharmacy Benefit Manager (PBM) and price transparency reform bill. The House already passed its version of PBM reform, the Lower Costs More Transparency Act (H.R. 5378), which will need to be reconciled with the Senate’s version.

To date, the Senate has been able to merge the three main PBM bills that have passed out of committee: one from Finance, one from Commerce, and one from Health, Education, Labor, and Pensions (HELP). The Pharmacy Benefit Manager Reform Act (S. 1339), from the HELP Committee, included the Safe Step Act (S. 652) as an amendment. The Safe Step Act sets up an expedited process through which a physician or a patient can request an exception for insurance mandated step therapy and sets up five situations under which insurers must grant exceptions. If this provision is included in the Senate’s final PBM reform package, it would be the only provision that directly impacts patient access to care and decreases regulatory burden on neurology care providers.

Congress needs to hear from you about the importance of including this bill in a final PBM package. Without the Safe Step Act, this package would only provide transparency into how PBMs work and not provide any direct relief to providers or patients. Consider posting on X using our Action Center to urge your members of Congress to include the Safe Step Act in PBM reform legislation. The AAN will continue to push for an MPFS fix and other priorities as part of the March 1 funding deadline. If you have any questions about how this impacts you and your patients, please contact advocacy@aan.com.