Vaccine Incentives for Providers Would Change Due to 2 MPFS Proposals

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CMS is proposing to update vaccine administration reimbursement rates annually and make changes to adult vaccination quality metrics, beginning in 2023.

In the calendar year (CY) 2023 Medicare Physician Fee Schedule (MPFS), the Centers for Medicare and Medicaid Services (CMS) proposed 2 policy changes related to vaccine administration that could significantly alter the incentive structure for provider-administered vaccines. First, the agency is proposing a change to payments for vaccine administration based on stakeholder concerns that insufficient reimbursement is a barrier to administering routinely recommended adult vaccines. Second, CMS is proposing a change to quality measures in order to incentivize adult vaccination and improve uptake, particularly given immunization rate declines during the COVID-19 pandemic. Both proposals could have an impact on immunization rates for provider-administered vaccines.

Reimbursement for Vaccine Administration

The immunization community has long expressed concerns that CMS’s approach to establishing payment rates for vaccine administration results in low reimbursement, and that those low rates may deter providers from administering routinely recommended adult vaccines. Based on these concerns and stakeholder feedback on the importance of maintaining adequate and sustainable provider reimbursement rates, CMS is proposing to make annual, inflation-based adjustments to provider payment for vaccine administration starting in 2023. Additionally, CMS intends to adjust reimbursement for vaccine administration by geographic region.

These proposals reflect CMS’s acknowledgment of the public health importance of adult vaccination. They also follow several years in which CMS considered alternative approaches to establishing and updating vaccine administration payment rates; however, the agency did not finalize its proposals for CY 2020 or 2021 (Figure 1). Payment rates remained constant for 3 years until the agency adopted an interim payment rate for CY 2022.

Figure 1: MPFS Proposals Related to Reimbursement for Vaccine Administration
Figure 1: MPFS Proposals Related to Reimbursement for Vaccine Administration

If CMS finalizes this proposal, providers may experience a more stable payment rate that accounts for increases in provider expenses year over year. Stakeholders should consider the adequacy of the reimbursement levels and what inflation metric CMS should use for annual updates (e.g., Medicare Economic Index, Employment Cost Index, Consumer Price Index-Urban All Item). As the adult immunization pipeline grows, stakeholders should also consider other changes that could further support providers’ ability to administer vaccines. For example, CMS notes in the proposed rule that it may extend the $35 add-on payment for at-home COVID-19 vaccine administration to other routine vaccines. This extension could facilitate vaccine access for the most vulnerable beneficiaries, including patients who are homebound with chronic illness and those who face socioeconomic or geographical barriers to getting vaccinated outside of the home.

Adult Vaccine Quality Measurement

During the COVID-19 pandemic, immunization rates for adults declined significantly; adult immunization claims decreased on average by 32% from January 2020 to July 2021, resulting in an estimated 27 million missed doses. CMS has signaled a goal to improve uptake of adult vaccines in part by increasing provider incentives for vaccine administration.

In the MPFS proposed rule, CMS is proposing to adopt the Adult Immunization Status (AIS) composite measure in its Merit-based Incentive Payment System (MIPS). MIPS evaluates providers on several aspects of their care and adjusts Medicare payments based on the provider’s performance. Currently, MIPS includes individual measures for influenza and pneumococcal vaccination, and the proposed AIS composite would be a multi-rate measure that also addresses Td/Tdap and Zoster vaccination. MIPS allows providers to choose which measures they report; provider decisions about reporting will determine the impact of including this measure.

For the first 2 years of using the AIS measure, CMS would determine a provider’s performance using a weighted average of the 4 immunization rates. CMS is considering using an “all-or-none” scoring methodology beginning in year 3 that would require providers to demonstrate patients are completely up to date with recommended vaccines in order to achieve measure compliance. The transition to a multi-rate measure and proposed scoring methodology in year 3 could signal the agency’s expectation for comprehensive compliance with routine adult immunization recommendations, though it may also make some providers less likely to report on this measure.

As stakeholders evaluate the MPFS proposed rule, they should consider the likely impacts on providers and how the proposals may affect vaccination rates. In public comments on the rule, which are due September 6, stakeholders may also wish to propose other changes to reimbursement and quality measurement that could further incentivize providers to ensure patients are up to date on routinely recommend vaccines.

How Avalere Can Help

Avalere’s Vaccines Team is well positioned to help stakeholders understand and assess the potential impact of these and other proposed changes on patient vaccine access. Additionally, Avalere can support clients in assessing adult vaccination quality measurement gaps and identifying approaches to meaningfully integrate vaccine incentives into existing programs. For more information on how Avalere can support you in responding to policymakers on changes affecting the vaccine landscape, connect with us.

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