Inflation affects the practices of specialist physicians; Medicare needs tools to respond

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People with symptoms of age-related macular degeneration (AMD), a blinding retinal disease, should see a specialist immediately to save their sight. But what will happen to their vision if they have to wait weeks or months to see a doctor? Most people with retinal diseases such as AMD and diabetic retinopathy see a specialist up to once a month for treatment and usually need help getting to and from appointments. But what if nearby retina specialist offices close, resulting in driving an hour or more every few weeks for treatment?

We’ve all seen the headlines: Supply chain issues and labor shortages are contributing to the highest inflation in decades. While you may expect inflation in the form of higher grocery prices, you may not realize the impact it is having on doctors and ultimately health care. receive patients.

Specialist practices, especially private practices like mine, have been particularly hard hit by rising market prices. Recruiting and hiring new clinical or administrative staff is difficult in this competitive environment, which requires us to increase our starting salaries and adjust compensation for existing staff. This, in turn, increases the cost of our benefits. Beyond human capital, we face the same high prices for the goods we need to provide patient care, from specialized medical equipment to the most mundane cleaning products. Even when we can invest in new equipment or offices, which can help improve patient outcomes, shipping delays make their delivery unpredictable.

So, if doctors are facing such tough cost challenges, why aren’t prices for medical services rising like other prices in the economy and even other healthcare services? Unfortunately, it’s not that easy. For retina specialists like me, our patients tend to be older and on Medicare. Medicare rates are set annually by the Centers for Medicare & Medicaid Services (CMS); however, by law, CMS does not have the authority to apply an inflationary adjustment to physician payments.

Unlike every other Medicare payment system, from hospitals to skilled nursing facilities, physician compensation has not kept pace with inflation for more than two decades. Additionally, Medicare’s physician fee schedule is budget-neutral, so when CMS increases payments for some services, other services are arbitrarily reduced if the increase exceeds the budget limit. This happened recently for many specialist departments when CMS increased office visit codes. Since most private insurers’ rates reference Medicare prices, the program’s artificially low rates are reflected across the board.

Members of the Medicare Payment Advisory Commission (MedPAC) have expressed similar concerns. At its January 2022 public meeting, the commissioners highlighted the disparity between Medicare reimbursements to hospitals and physicians, pointing out that both providers are subject to the same inflationary effects related to their operating costs. According to an American Medical Association (AMA) analysis of Medicare Trustees data, the cost of running a doctor’s office increased by 39% between 2001 and 2021, while Medicare physician reimbursements adjusted for the inflation fell by 20% over the same period.

What impact will this have on patients? Fortunately, doctors will continue to do everything in their power to care for their patients. But that could mean your doctor won’t be able to hire enough clinical staff and you’ll have to wait longer for an appointment with your doctor, or you may have to travel a greater distance to receive care. because it does not have the staff to keep smaller, satellite or rural branches open. For some patients this may be tolerable, but many of my patients need immediate care to save their sight and almost always need a family member or caregiver to get to appointments.

Congress can and should step in and help this situation. With long-term reform of Medicare’s physician fee schedule, lawmakers can provide stability for beneficiaries and help medical practices meet the cost of doing business today.

Michael M. Lai, MD, PhD, is chairman of the Federal Affairs Committee of the American Society of Retina Specialists.


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