UPDATE: On January 5, the Centers for Medicare & Medicaid Services (CMS) released updated national Medicare physician payment files that incorporate the changes in the Consolidated Appropriations Act of 2023. As indicated below, Congress reduced the 4.5% cut to Medicare physician payment by increasing the 2023 conversion factor (CF) by 2.5%. The updated 2023 Medicare physician payment schedule CF will be $33.8872. The CF, prior to this change, was $33.0607.
Congress passed a Fiscal Year (FY) 2023 omnibus funding bill, which funds all federal agencies through September 30, 2023, and includes several health policies, such as mitigating Medicare physician payment cuts, Food and Drug Administration (FDA) reforms, and telehealth expansion. The U.S. Senate passed the bill on Thursday, December 22, 2022, and the U.S. House of Representatives passed it the next day. President Biden is expected to sign the bill without delay. The bill comes after two Continuing Resolutions kept the government open past the start of FY2023 on October 1, 2022.
Federal Funding for Cancer Research
The bill significantly increases funding for the National Cancer Institute (NCI) to help advance our nation’s fight against cancer. The bill provides $7.3 billion for NCI—an increase of $408 million compared to FY2022—including full funding for the final year of appropriation for the original Cancer Moonshot. Congress also provided $47.5 billion for the National Institutes of Health (NIH)—an increase of $2.5 billion, or 5.6%, compared to FY2022. The Association for Clinical Oncology (ASCO) commends Congress for their bipartisan support for continued investment in biomedical research.
In addition, the bill provides $3.5 billion for FDA, an increase of $226 million. This includes full funding for the 21st Century Cures Act. Appropriators also directed the Centers for Disease Control and Prevention (CDC) to provide a funding increase for all its cancer programs.
Pediatric Cancer Programs
ASCO is pleased to see several pediatric cancer priorities funded in this bill. The agreement fully funds the Childhood Cancer Survivorship, Treatment, Access, and Research (STAR) Act to expand opportunities for childhood cancer research, improve efforts to identify and track childhood cancer incidences, and enhance the quality of life for childhood cancer survivors. Also fully funded is the Childhood Cancer Data Initiative (CCDI), which aims to improve treatments and outcomes for children, adolescents, and young adults with cancer by facilitating the collection, analysis, and sharing of childhood cancer data. The Gabriella Miller Kids First Research Act, which aims to help researchers uncover new insights into the biology of childhood cancer and structural birth defects, including the discovery of shared genetic pathways between these disorders, received $12.6 million for FY2023.
The bill provides $1.5 billion for the Advanced Research Projects Agency for Health (ARPA-H), available through FY 2025, and placed the agency within NIH. ARPA-H is the Biden Administration’s proposed new biomedical research agency focused on high-risk, bold, translational research projects. ASCO developed a set of principles to help guide the creation of this new agency and is excited to continue its work with Congress and the Administration to establish ARPA-H and accelerate progress against diseases like cancer.
Medicare Physician Payment
Congress took steps to mitigate upcoming cuts to Medicare physician reimbursement. Despite extensive advocacy efforts from ASCO and the provider community, Congress was unable to reach an agreement to fully prevent the cuts from going into effect. The legislation reduces the original 4.47% cut in the Medicare Physician Fee Schedule final rule by 2.5%, leading to a final estimated cut of approximately 2% for 2023. It also provides a 1.25% Conversion Factor adjustment for 2024 and waives the 4% Medicare statutory pay-as-you-go (PAYGO) cut for 2023 and 2024, but it did not address the 2% sequestration cut that went into effect earlier this year. Additionally, Congress extended the Advanced Alternative Payment Model bonus, providing a 3.5% incentive payment (down from 5%) for an additional year. These cuts remain of great concern to ASCO, and the Association will continue to invest in grassroots and Congressional advocacy that advances sustainable, long-term Medicare payment reform.
The omnibus bill also includes several FDA reforms that ASCO advocated to advance. The legislation contains changes to FDA’s accelerated approval pathway for drugs, giving the agency clear authority to require post-approval studies confirming the product’s benefit. It also allows FDA to set parameters – such as enrollment goals, milestones, and a target completion date for post-approval studies and to institute an expedited process for rescinding an accelerated approval while giving the drug sponsor an opportunity to appeal. The legislation also provides authority for FDA to require confirmatory studies to already be underway prior to approval or within a specified timeframe after approval is granted.
The bill requires drug manufacturers to submit a diversity action plan to the Secretary of Health and Human Services (HHS) for phase 3 studies of new drugs and clinical studies for most medical devices. The plan should outline enrollment goals, the rationale, and an explanation of how the sponsor intends to meet the goals aimed at improving diversity in trials. The legislation also requires HHS to provide guidance that clarifies the use of decentralized clinical studies to support the development of drugs and devices, including recommendations for how to advance the use of flexible and novel clinical trial designs and to help improve trial participant engagement, recruitment, enrollment, and retention of a meaningfully diverse clinical population.
Notably absent from the legislation were provisions that would have overhauled regulation of diagnostics and laboratory-developed tests (LDTs). ASCO and several coalition partners strongly encouraged Congress to include provisions that would modernize the regulation of all LDTs and in vitro diagnostic tests under a single framework and create a flexible, risk-based regulatory system that would incentivize and improve the development of advanced, reliable tests. The Association will continue to advocate for patients and their clinicians who expect the highest quality innovative tests available to diagnose and treat illnesses in the next session of Congress.
The bill extends all Medicare telehealth flexibilities that were extended in the Consolidated Appropriations Act of 2022, through December 31, 2024. While ASCO has been advocating for a permanent extension, this will allow Congress time to study how telehealth is being used, create parameters to avoid abuse, and identify a way to pay for the permanent expansion.
Despite extensive lobbying efforts, Congress did not include the Improving Seniors’ Timely Access to Care Act in the legislation. That bill aimed to streamline prior authorization requirements within Medicare Advantage—a top advocacy priority for ASCO. The Association is committed to working with its Congressional champions to prioritize this important bill in the new Congress.
The Association continues to analyze the legislative package and will provide additional details in the coming days.
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