House GOP Doctors Caucus Releases Draft Legislation to Reform Medicare Physician Reimbursement

November 7, 2023 – On October 4th, the GOP Doctors Caucus released a discussion draft of legislation seeking to reform budget neutrality policies applied to the Medicare Physician Fee Schedule.

The goal of the draft legislation is to stabilize the fee schedule by ensuring that the budget neutrality calculations used by CMS are based on reality, not inaccurate projections of future spending or outdated practice cost data.  The draft legislation aims to address the following areas:

• Change the budget neutrality threshold from $20 million to $53 million in 2025.  The $53 million threshold would then be updated based on the MEI every five years starting in 2030.
• Implement budget neutrality corrections for overestimates and underestimates in utilization by creating a lookback period starting in 2025. The lookback would ensure that any over or underpayments are not carried over into future rates, and require that CMS use the best data available when creating a prospective payment adjustment.
• Provide timely updates to direct costs used to calculate practice expense relative value units (RVUs).
• Limit the year-to-year variance on the fee schedule Conversion Factor to no more than 2.5%.

The draft legislation is intended to generate bipartisan support from the key House and Senate committees with jurisdiction over the Medicare program.

Available Resources

• Discussion Draft: Legislation to Reform Medicare Physician Reimbursement