McDermottPlus Check-Up: November 4, 2022 - McDermott+Consulting

McDermottPlus Check-Up: November 4, 2022


Members of Congress remained in full campaign mode in this final week before the midterm elections on November 8. This week also saw a flurry of regulatory action, with the Centers for Medicare & Medicaid Services (CMS) issuing final payment rules related to hospital outpatient services, physician payments, end-stage renal disease (ESRD) and home health.


Senator Sets Forth Policy Options for Healthcare Cybersecurity. On November 3, Sen. Warner (D-VA) released a policy options paper to address cybersecurity in the healthcare sector. The paper, titled “Cybersecurity is Patient Safety,” outlines current cybersecurity threats facing the healthcare industry and offers a series of policy solutions, including efforts to improve the nation’s risk posture, efforts to adopt best practices, and ways to respond to and recover from cybersecurity attacks.

Upon release of the paper, Sen. Warner—who is chairman of the Senate Select Committee on Intelligence and a founder of the Senate Cybersecurity Caucus—noted that he is soliciting stakeholder feedback. Those interested in submitting comments are instructed to send a letter or an email to

Senate Finance Committee Democrats Release Report on Medicare Advantage Marketing. On November 3, Senate Finance Committee Democrats released a report on Medicare Advantage (MA) marketing practices. The report includes information about an increase in deceptive marketing practices targeting seniors with MA plans, and corroborates CMS data reporting that the number of beneficiary complaints related to MA plan marketing doubled between 2020 and 2021.

The report recommends that CMS take the following actions:

  • Reinstate previously loosened requirements related to MA marketing
  • Monitor disenrollment patterns and use CMS’s enforcement authority to hold bad actors accountable
  • Require agents and brokers to adhere to best practices
  • Implement robust rules around MA marketing materials and close regulatory loopholes that allow cold-calling
  • Support unbiased sources of information for beneficiaries, including State Health Insurance Assistance Programs and the Senior Medicare Patrol.


CMS Releases Final OPPS Rule. On November 1, CMS released the calendar year (CY) 2023 Medicare Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) Payment System final rule, which includes finalized policies related to Medicare OPPS and ASC payments.

For CY 2023, CMS applied a productivity-adjusted market basket increase of 3.8% under the OPPS and the ASC Payment System. However, CMS applied several budget neutrality and other adjustments, including a significant 3.09 percentage point reduction to account for changes to its 340B drug purchasing policy. After accounting for these adjustments, the CY 2023 OPPS conversion factor increases by 1.67% over the 2022 value. The ASC conversion factor increases by 3.88%, a different and more favorable adjustment largely because it is not directly impacted by the 340B-specific budget neutrality adjustment. In continuation of the agency’s existing policy, hospitals and ASCs that fail to meet their respective quality reporting program requirements will be subject to a 2% reduction.

The final rule also includes the following provisions:

  • Expands the categories of services subject to prior authorization to include facet joint interventions, with an implementation date of July 1, 2023, rather than March 1, 2023, to provide participants additional time
  • Does not extend the transitional pass-through payment for the five technologies with pass-through periods expiring at the end of CY 2022
  • Exempts rural sole community hospitals from CMS’s site-neutral payment policy
  • Finalizes conditions of participation, payment policies and enrollment process for rural emergency hospitals, the new hospital type authorized by legislation enacted in 2020
  • Cements recent flexibilities allowing certain non-physician practitioners to supervise select diagnostic services
  • Finalizes a policy to compensate hospitals for the increased cost of acquiring certain personal protective equipment during the COVID-19 pandemic.

A fact sheet and press release from CMS provide additional information.

CMS Releases Final Physician Fee Schedule Rule. On November 1, CMS released the CY 2023 Revisions to Payment Policies Under the Physician Fee Schedule and Other Revisions to Medicare Part B final rule, which includes final policies related to Medicare physician payment and the Quality Payment Program.

The final rule establishes a 4.47% cut to physician payments under the 2023 fee schedule unless Congress passes legislation that would offset or mitigate this reduction in payment. Stakeholders had hoped for an improvement over the proposed rule’s 4.42% reduction to the conversion factor, but the final rule’s methodology slightly increased the reduction. Physicians are concerned that full relief may not be possible given the significant cost of offsetting an almost 4.5% cut and the many competing interests facing Congress in an end-of-year legislative package.

The final rule also includes the following provisions:

  • Implements the statutory extension of coverage for certain telehealth services to 151 days after the end of the public health emergency
  • Begins the new Merit-based Incentive Payment System (MIPS) Value Pathways (MVPs) as a voluntary alternative to the MIPS in 2023 with 12 different pathways
  • Finalizes changes to the Medicare Shared Savings Program and introduces new advance investment payments intended to achieve the Administration’s goal of 100% participation in accountable care relationships by 2030
  • Outlines policies to make behavioral health care easier to access, including addressing the shortage of behavioral health practitioners.

Fact sheets (found here and here) and a press release from CMS provide additional information.

CMS Releases Final ESRD Rule. On October 31, CMS issued the CY 2023 final rule updating payment rates and policies under the ESRD PPS for renal dialysis services furnished to Medicare beneficiaries. The final rule also updates the acute kidney injury dialysis payment rate for renal dialysis services furnished by ESRD facilities for 2023, updates requirements for the ESRD Quality Incentive Program (QIP), and summarizes comments received in response to requests for information on topics that are relevant to the ESRD QIP.

CMS finalized an ESRD base payment rate of $265.57 for CY 2023, which is an increase of $7.67 from the final CY 2022 base payment rate of $257.90. Under the ESRD PPS, Medicare expects to pay $7.9 billion to approximately 7,800 ESRD facilities for furnishing renal dialysis services, and projects that the CY 2023 updates will increase the total payments to all ESRD facilities by 3.1% compared with CY 2022.

A fact sheet from CMS provides additional information.

CMS Releases Final Home Health Rule. On October 31, CMS released the CY 2023 Home Health PPS Rate Update final rule, which updates Medicare payment policies and rates for home health agencies (HHAs). The final rule includes updates to the Medicare home health PPS and the home infusion therapy services payment rates for CY 2023, in accordance with existing statutory and regulatory requirements.

In the final rule, CMS estimates that Medicare payments to HHAs in CY 2023 will increase in the aggregate by 0.7%, or $125 million, compared to CY 2022. The rule also discusses the future collection of data regarding the use of telecommunications technology during a 30-day home health period of care on home health claims, for which CMS will begin collecting data voluntarily January 1, 2023, and will then require on a mandatory basis starting July 1, 2023. In addition, the rule finalizes changes to the Home Health Quality Reporting Program requirements and to the Expanded Home Health Value-Based Purchasing Model.

A fact sheet from CMS provides additional information.


  • CMS issued a final rule implementing changes made by the Consolidated Appropriations Act, 2021, to update Medicare enrollment and eligibility rules in order to expand coverage and advance health equity.
  • CMS approved an amendment to Arkansas’s Medicaid section 1115 demonstration that will test innovative interventions to address housing and food insecurity, as well as other critical health-related social needs.
  • Affordable Care Act Marketplace open enrollment began on November 1 and runs through January 15, 2023. The US Department of Health and Human Services (HHS) issued a press release with additional information.
  • Rep. Williams (D-GA) introduced the HHS Reproductive and Sexual Health Ombuds Act (H.R. 9254). The legislation is intended to increase access to reproductive services by creating an ombuds for reproductive and sexual health within HHS.
  • A bipartisan letter from 46 senators to Senate leadership was delivered on November 2 (the day after CMS released major Medicare payment rules), calling on Congress to address the stability of Medicare payments to healthcare providers before the end of the year.


The midterm elections are November 8. Please join McDermott+Consulting for a post-election webinar on November 10 at 3:00 pm EST. Register here. Congress will return to session the week of November 14, largely for organizational business in preparation for the upcoming 118th Congress.


For more information, contact Debra CurtisKristen O’Brien or Erica Stocker.

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