Action Center

Ask Congress to Prevent Deep Medicare Cuts in 2021
Unless Congress takes action, changes in Medicare payments for routine physician visits will trigger sharp reductions in payments for psychologists’ services.

Psychologists and many other healthcare specialists will face steep cuts in Medicare payment rates for services in 2021, due to an almost 11% cut to the conversion factor used to calculate reimbursement rates.  The Centers for Medicare and Medicaid Services (CMS) released its proposed Physician Fee Schedule for 2021 on Aug. 3, including a new, updated coding structure for routine outpatient visits—known as evaluation and management (E/M) services—provided by physicians and certain nonphysician providers.  The new E/M billing codes will be simplified and paid at a higher rate.  Federal law requires budget neutrality in Medicare, meaning the aggregate changes CMS makes to Medicare provider payments each year must not increase or decrease expenditures by more than $20 million. Budget neutrality requires deep cuts in payment rates for other services in 2021 to offset the increased payments for outpatient E/M services. 
APA has been raising the alarm with CMS and Congress since learning of the new Medicare payment policies for E/M services and their effect on psychologists’ payments since 2019.  The day after the proposed rule was released, APA joined a wide array of both physician and nonphysician provider organizations in issuing a statement calling for waiving Medicare’s budget neutrality requirements in implementing the new E/M codes.  On Aug. 11, Congressman Bobby Rush (D-Ill.) sent a letter to House Speaker Nancy Pelosi and House Minority Leader Kevin McCarthy, signed by 93 of his House colleagues, urging that the budget neutrality requirement be waived for implementation of the new E/M codes in order to protect healthcare providers from “devastating” cuts that will ultimately decrease access to care for Medicare beneficiaries. 
Our nation’s health care system and its patients and providers are struggling with the COVID-19 pandemic.  Waiving budget neutrality requirements for implementation of the new outpatient E/M reimbursement rates will provide a critical reprieve for psychologists and a broad array of other nonphysician and physician healthcare providers facing substantial payment reductions in the coming months.
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