An Overview of the Physician Compensation Surveys Beginning in late May each year, numerous industry normative benchmark physician production and compensation surveys begin publishing the most recent year’s reports. When consulting benchmarking survey data for assessing physician compensation arrangements for FMV, it is important to understand and critically evaluate the quality of the data. This article pr ...

Ryan LLC v. FTC On August 20, 2024, a Texas federal judge stopped the FTC’s ban on noncompete agreements from going into effect on September 4, 2024. This decision comes after the FTC issued a final rule on April 23, 2024, that bans employers from imposing noncompetes on their employees. The FTC asserted that this exploitative practice kept wages low and suppressed new ideas. While the FTC’s ban will affect ...

Valuation Implications The U.S. government is the largest payor of medical costs, through Medicare and Medicaid, and consequently has a strong influence on reimbursement to healthcare providers. The 2025 proposed fee changes are significant. This article focuses on the proposed fee changes and how these changes may affect valuations of healthcare practices. The U.S. government is the largest payor of medica ...

Healthcare Industry and Valuation Implications On June 28, 2024, the U.S. Supreme Court issued a seismic decision in which it explicitly overruled “Chevron deference,” limiting the ability of federal agencies to rely on their own interpretation of the laws they administer. This 6-3 ruling is expected to significantly impact the heavily regulated healthcare industry. The authors share their thoughts on how t ...

Valuation-Shopping Investigated On December 19, 2023, the U.S. Department of Justice (DOJ) announced that it had entered into a $345 million settlement with Community Health Network Inc. (CHN), a healthcare network headquartered in Indianapolis, to resolve claims that the hospital violated the False Claims Act (FCA) by knowingly submitting Medicare claims for services which were referred in violation of the ...

Patchwork Approach Continues in Congress On March 9, 2024, President Biden signed into law a $460 billion spending package to continue funding the federal government for the remainder of the 2024 fiscal year. Contained within the spending package was legislation to cut in half the 2024 Medicare physician payment update of approximately -3.4%. This article discusses the payment update, other healthcare provi ...

The Impact on Payment Rate Updates, Hospital Price Transparency, Rural Hospital Designation, Drug Pricing, and Intensive Outpatient Program On November 2, 2023, the Centers for Medicare & Medicaid Services (CMS) released its finalized Outpatient Prospective Payment System (OPPS) for calendar year (CY) 2024. The finalized payment update increases payments to outpatient facilities and finalizes changes to ...

Praise and Patient Access Concerns Raised from the Cuts On November 2, 2023, the Centers for Medicare & Medicaid Services (CMS) released its finalized Medicare Physician Fee Schedule (MPFS) for calendar year (CY) 2024. While the finalized fee schedule cuts payments to physicians, there are a number of other (more positive) provisions in the final rule. An update to the September 2023 article on the prop ...

Stakeholders Welcome and Also Dispute Various Changes On July 13, 2023, the Centers for Medicare & Medicaid Services (CMS) released its proposed Medicare Physician Fee Schedule (MPFS) for calendar year (CY) 2024. In addition to the agency’s suggested cut to physician payments, the proposed rule announced changes in policies for the advancement of health equity, as well as the expansion of access to crit ...

The Aftermath of the 2022 AHA v. Azar SCOTUS Decision On July 13, 2023, the Centers for Medicare & Medicaid Services (CMS) released the proposed rule for the Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Centers (ASCs) for calendar year (CY) 2024. The agency proposes an increase in payments to all outpatient providers, introduces a new program, and announces their solution to repa ...

Reasons for the Recommendation and Responses On March 15, 2023, the Medicare Payment Advisory Commission (MedPAC) published its annual Report to Congress regarding the status of the Medicare program. Among other areas, the report detailed policy recommendations for the Medicare fee-for-service (FFS) payment systems, the Medicare Advantage (MA) program, and the Medicare prescription drug program (Medicare Pa ...

Post May 23, 2023, Developments Regarding Telehealth and Waivers Regardless of whether certain COVID-19 era waivers and flexibilities are made permanent, providers will be hard pressed to move away from what has become common practice over the past three years. A Premier Inc. survey of hospitals and non-acute providers found that 69% of respondents were still leveraging these waivers and flexibilities as of ...

Indications for 2023 After a record year in 2021 transactional activity, where healthcare mergers and acquisitions (M&A) were up by 56 percent, the market continued to thrive in 2022. Preliminary results revealed that 2022 M&A deals hit a record high of 2,409 deals; 150 transactions over what was observed in 2021. Despite economic challenges (e.g., rising interest rates and borrowing costs, inflatio ...

COVID-19 Pandemic Deemed Over and Waivers Ending On January 30, 2023, President Joseph Biden announced that the public health emergency (PHE) and national emergency declaration related to the COVID-19 pandemic will finally end on May 11, 2023, after being in place for over three years. This article will discuss the changes that will take place after both declarations cease, and the implications for stakehol ...

Valuation Implications On September 13, 2022, Representatives Ami Berra (D-CA-7) and Larry Bucshon (R-IN-8) introduced the Supporting Medicare Providers Act of 2022 (H.R. 8800), which aims to infuse the Medicare Physician Fee Schedule (MPFS) with a 4.42% funding increase for 2023. With a bipartisan coalition of 12 co-sponsors, the bill would have the practical effect of negating the impending 4.42% cut to t ...

Beyond Prescription Drug Costs On August 16, 2022, President Joseph Biden signed the Inflation Reduction Act of 2022 (IRA) into law. The broad bill, which covers healthcare, taxes, and climate change, had been passed around Congress in assorted versions with varying support for months, but under the specter of a record 40-year-high inflation rate, congressional Democrats ultimately came together to pass the ...

Valuation Implications Over the past couple of months, the Centers for Medicare & Medicaid Services (CMS) released the proposed rules for several of its payment schedules, indicating the state of healthcare reimbursement for the next year. This article briefly summarizes these proposed payment rules and discusses their significance to healthcare valuation professionals. The U.S. government is the larges ...

A Shake-up in the Evolution of the Healthcare Industry? As covered in a May 2021, NACVA QuickRead article, special purpose acquisition companies (SPACs) began tremendous growth in 2020 and looked to be a new mainstream avenue of investing. Two years later, the growth of SPACs across all industries, including healthcare, has plateaued and appears to be dropping in some industries. This article will examine h ...

Indications for 2022 After an understandable slowdown in 2020, due to the onset of the COVID-19 pandemic, merger and acquisition (M&A) activity in the healthcare industry accelerated in 2021, and the industry is expected to continue the high number of deals and high deal volume in 2022. This article will review the U.S. healthcare industry’s M&A activity in 2021 and discuss what these trends may mea ...

RAND Corporation 2022 Study Published in JAMA A study conducted by the RAND Corporation and published in the January 2022 issue of the Journal of the American Medical Association (JAMA) seeking to determine whether health systems primarily incentivize volume or value in their physician compensation models found that almost all physicians are still compensated through a volume-based model that rewards produc ...