Medicare Part B Payment Cuts to Audiology and Speech-Language Pathology Services

Audiologists and speech-language pathologists (SLPs) have faced significant payment cuts to Medicare Part B (outpatient) services beginning in 2021. Although extensive advocacy by ASHA and other stakeholders resulted in legislation that mitigated the cuts each year, the cuts were implemented on January 1, 2024, with only a 1.25% offset that was implemented by Congress at the end of 2022. Despite aggressive advocacy by ASHA and stakeholders, Congress did not act in 2023 to more fully address the 2024 cuts until it recently passed H.R. 4366, the Consolidated Appropriations Act, 2024, that will reduce Medicare Part B cuts from 3.4% to 1.7% for the remainder of 2024.

ASHA has engaged in ongoing advocacy and collaboration with CMS, key decision makers—including members of Congress—and other provider groups to find short- and long-term solutions. These activities are a part of our overall efforts to ensure adequate Medicare payment for audiology and speech-language pathology services.

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News and Updates

Impact on Audiologists and SLPs

In its release of the 2024 final rule for the Medicare Physician Fee Schedule (MPFS) for Part B services, CMS finalized an almost 3.4% decrease to the conversion factor (CF), which disproportionately impacts Medicare Part B payment for audiologists, SLPs, and all other Medicare provider groups that bill for services under the MPFS. This cut is primarily due to the expiration of the 2.5% payment adjustment to mitigate the impact of the 2023 cuts.

Audiologists and SLPs also face other annual Medicare cuts unrelated to the cut to the CF. These cuts, known as sequestration (2% reduction), and statutory "Pay-As-You-Go", or PAYGO, (4% reduction), could have resulted in over 10% in total cuts to overall Medicare payments when added to the CF reduction. Congress has acted to address some—but not all—of these cuts since 2021 by passing annual legislation that significantly reduced the cuts, including actions to mitigate the 2024 cuts through the initial 1.25% offset to the CF reduction, a waiver of the 4% PAYGO reduction, and the new 1.7% mitigation that begins on March 9, 2024. However, all of these actions to soften the cuts will expire at the end of 2024. Additional Congressional action is necessary to prevent or mitigate these cuts before 2025.

Summary of Estimated Payment Changes

For 2024, CMS estimated an overall 2% decrease in payment for audiology services and a 3% decrease for speech-language pathology services in addition to the adjustments outlined above. Before March 9, 2024, this meant that audiologists were experiencing at least a 7% total decrease in payment and SLPs an at least 8% total reduction decrease. After March 9, payment cuts should be reduced to about 5.3% for audiologists and 6.3% for SLPs. Keep in mind that the direct, cumulative impact of payment adjustments on individual clinicians or practices will vary depending on several factors, including locality-specific rates and the specific procedure codes billed. For additional information, please see ASHA's detailed analysis of the 2024 Medicare Fee Schedule. We will provide updated payment rates when CMS releases the new CF for use after March 9.

While ASHA is disappointed that Congress failed to fully reverse the 3.4% payment cut, the partial increase to Medicare payment rates by H.R. 4366 is a positive development that will lessen the impact of the MPFS CF cut for the remainder of the year, and demonstrates bipartisan congressional support for fully fixing this flawed policy in the future. ASHA’s advocacy efforts have focused on reversing these cuts in their entirety and working toward a long-term solution to stabilize Medicare payment policy. While far from ideal, Congressional action has continued to reduce the near-term Medicare payment cuts since 2021—which could have been as high as 10% or more annually—allowing additional time for ASHA to work with allied stakeholders to convince Congress to more fully address comprehensive reform to the Medicare payment system.

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Why This is Happening

The Medicare Part B payment cuts are the result of three separate statutory provisions designed to control federal spending. They are 1) budget neutrality, 2) statutory "Pay-As-You-Go" (PAYGO), and 3) sequestration. Advocacy by ASHA and other stakeholders helped lead to legislation postponing or mitigating these cuts since 2021. However, they will return in full in 2025 and will continue to be an annual issue without further Congressional action for both a short- and long-term fix.

See How We Got Here to learn more about the history behind the current Medicare Part B payment system. 

Budget Neutrality

A significant portion of the payment cuts came about because CMS finalized changes to office-based outpatient evaluation and management (E/M) procedure codes, resulting in payment increases for primary care services beginning in 2021. Every year, CMS must ensure that rate changes for all procedure codes paid under the MPFS remain budget neutral, as mandated by law. As a result, Medicare Part B providers may see incremental decreases in payments annually when CMS shifts funding to accommodate increases in payments for other services. The negative impact to across the board Medicare payments is higher than usual because of the significant increase in value for the updated E/M codes. Although legislation significantly reduced the E/M-related cuts in 2021 by 3.75%, 3% in 2022, 2.5% in 2023, and 2.95% in 2024, it didn't stop the E/M code changes, so the payment reductions will continue to return each year to meet the budget neutrality mandate, unless Congress and CMS find short- and long-term policy solutions.

Statutory PAYGO

This policy requires new legislation increasing the federal deficit to be offset by reduced spending elsewhere. Medicare payments are subject to this policy, but can't be reduced by more than 4%.

Sequestration

This policy stems from a 2011 law requiring automatic reductions in programs, such as Medicare, to impose fiscal restraint on federal spending. 

How We Got Here: A Timeline

The Medicare program is based on several federal laws, some that are more than 30 years old and have evolved over time. The impact of these various budget containment mechanisms are compounded by sequestration and PAYGO laws that are intended to cap federal spending more generally.

1989 The Omnibus Reconciliation Act of 1989 established budget neutrality requirements for Medicare payment, meaning that increases in payments to one set of services results in arbitrary reductions to payments for other services paid under the MPFS.
1997 Congress passed the Balanced Budget Act which created the therapy cap and the sustainable growth rate (SGR). The SGR was another arbitrary cost containment mechanism that capped an increase in spending at $20 million from year to year at $20 million. For example, if spending in 2002 was set to increase by $30 million compared to 2001, payments under the fee schedule had to be reduced by $10 million to keep them within the $20 million cap. This led to arbitrary payment reductions that Congress had to offset annually until the SGR was repealed in 2018.
2013 The American Taxpayer Relief Act imposed the multiple procedure payment reduction (MPPR) policy to help offset the cost of temporarily halting the therapy cap and SGR reductions scheduled for 2013. MPPR reduces the practice expense component of a Current Procedural Terminology (CPT®) code’s value when multiple CPT codes are billed for therapy services together on the same day. This decreases the overall payment for multiple therapy services billed on the same day for the same patient. 
2015 The therapy cap and SGR were eliminated through the Medicare Access and CHIP Reauthorization Act (MACRA) of 2015. This eliminated payment updates from 2020-2025 for all clinicians paid under the MPFS. In other words, Medicare Part B payment rates have not increased since 2020 and will not do so until 2026.

In summary, as of now, Medicare outpatient payment rates have been reduced as a result of:

  • budget neutrality requirements stemming all the way back to 1989;
  • no payment updates from 2020-2025 based on a nearly decade old law;
  • the MPPR policy for therapy services;
  • sequestration; and
  • PAYGO.

Where We Go from Here

History shows that changes to the payment system are hard to achieve and take time, in part because of the numerous layers of federal laws that have been applied to Medicare payment over time. For example, it took 31 years to repeal the SGR and the therapy cap. Policies like SGR impacted all providers—including audiologists and SLPs—demonstrating the need for a broad coalition consistently engaged with Congress to fix the problem. It also underscores that the payment system is fundamentally flawed and needs a major overhaul. However, we can't wait for a long-term fix as providers continue to face unsustainable payment cuts every year, so we must also continue to find short-term fixes to mitigate or eliminate the impact of the budget neutrality requirements we’re currently experiencing. 

While we do not expect additional Congressional action until the end of 2024—at the earliest—given the various political dynamics on Capitol Hill, ASHA remains committed to engaging Members of Congress to implement short and long-term fixes to the payment system. It's also critical for ASHA members to continue pushing your elected officials to ensure Medicare isn't forced to impose additional cuts in 2025.

ASHA provides resources to help members take action on this issue, including an easy-to-use template message that you can personalize and send to your Members of Congress within minutes. We can also help you set up virtual or in-person meetings with your Members of Congress in Washington, DC, or at their home offices in your state. Please consider partnering with us in advocacy to ensure Medicare payments adequately reflect your skill and education and maintain the viability of your businesses.

ASHA’s Advocacy Highlights

Congressional Advocacy

ASHA engages in ongoing advocacy with House and Senate members and staff directly and as part of a broad coalition of physician and nonphysician groups urging Congress to prevent cuts regardless of source and to seek short- and long-term solutions to Medicare payment cuts to audiology and speech-language pathology services. We also send or sign onto numerous letters calling for action to stop the cuts, as outlined below.

Regulatory Advocacy

ASHA engages in ongoing advocacy with CMS and the Department of Health and Human Services (HHS) directly and as part of a broad coalition of physician and nonphysician groups to find regulatory solutions to find strategies within CMS's authority to mitigate the negative impact of the cuts to providers, including audiologists and SLPs.

  • Comment letter to CMS [PDF] regarding the proposed 2024 Medicare Physician Fee Schedule (9/11/2023)
  • Surveyed ASHA members and developed an infographic [PDF] to demonstrate the impact of the payment cuts on patients and providers. (4/1/2023)
  • ASHA member sign-on letter [PDF] asking CMS to find ways to reduce the impact of the cuts and to work with Congress on long-term Medicare payment reform (9/6/2022)
  • Comment letter to CMS [PDF] regarding the proposed 2023 Medicare Physician Fee Schedule (9/6/2022)
  • Comment letter to CMS [PDF] regarding the proposed 2022 Medicare Physician Fee Schedule (9/9/2021)
  • Request for a meeting [PDF] with CMS Administrator Chiquita Brooks LaSure to discuss the payment cuts (7/2/2021)

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The American Speech-Language-Hearing Association (ASHA) is the national professional, scientific, and credentialing association for 234,000 members, certificate holders, and affiliates who are audiologists; speech-language pathologists; speech, language, and hearing scientists; audiology and speech-language pathology assistants; and students.

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