AAPA’s Top Federal Priority Secured in Bipartisan Agreement

December 22, 2020

AAPA commends Congress for passing legislation authorizing PAs to receive direct payment under Medicare as part of the Coronavirus Relief & Omnibus Agreement, which is expected to be signed into law by the president soon.

The PA Direct Payment Act (S.596/H.R. 1052) was included in the omnibus, along with a number of additional changes related to the Medicare program, and will take effect January 1, 2022.

Enactment of the PA Direct Payment Act will place PAs on equal footing with other Medicare providers who can be directly paid for services provided to Medicare patients. Current Medicare policy requires that the employer of a PA be paid for services provided to Medicare patients. However, other health professionals – physicians, advanced practice registered nurses (APRNs), physical therapists, psychologists, podiatrists, social workers, and others – are permitted to receive direct payment under their own name and National Provider Identifier number.

“The difficulties PAs face as a result of this outdated policy have never been more evident than during the COVID-19 pandemic,” said AAPA President and Chair of the Board Beth R. Smolko, DMSc, MMS, PA-C, DFAAPA. “AAPA leadership and advocacy staff have worked tirelessly to make the case to Congress that it was necessary to pass this legislation in order to modernize Medicare and fully utilize the PA workforce when our nation is confronting the pandemic. By including this bill in the omnibus, Congress has demonstrated its commitment to improving access to quality healthcare services provided by PAs. AAPA extends our gratitude to Congress for working to get a bipartisan agreement across the finish line that includes many updates to Medicare policy as well as providing much-needed support to American families and businesses.”

Advocating for passage of the PA Direct Payment Act has been a top priority for AAPA and PA advocates this Congress. Direct payment for PAs is one of the three important legislative pillars of Optimal Team Practice and has been a legislative goal for the organization since 2017. AAPA applauds the primary sponsors of the bill, Senators John Barrasso (R-WY) and Tom Carper (D-DE) in the Senate and U.S. Reps. Terri Sewell (D-AL) and Adrian Smith (R-NE) in the House of Representatives, for shepherding this bill through Congress.

Authorizing PAs to be paid directly by Medicare will ensure they can reassign their payments in a manner similar to physicians and APRNs. It will also ensure PAs who own their own practice in accordance with state law will be able to receive direct pay from the Medicare program. The inability to be paid directly hinders PAs from fully participating in the increasing number of emerging models of healthcare delivery. For example, the restriction often impedes PAs from obtaining employment with healthcare staffing companies or group practices used by hospitals to deliver care because PAs cannot reassign their Medicare payments to the hospital.

The COVID-19 pandemic reinforced the urgent need for the PA Direct Payment Act to become law by bringing to light many of the obstacles faced by PAs as a result of this outdated policy. This is especially the case in rural areas, where Medicare allows PA-owned rural health clinics (RHCs) to receive Medicare payments in some instances. These PA-owned RHCs are only permitted to receive Medicare payment for bundled RHC primary care services. PA-owned RHCs are required to bear the costs of services not included in the bundled payment. For instance, COVID-19 and flu testing, as well as other laboratory services, are not included in the payment bundle for RHC primary care services.

Another key update to Medicare policy included in the omnibus authorizes PAs in RHCs and Federally Qualified Health Centers (FQHCs) to furnish and bill for hospice “attending physician” services when RHC and FQHC patients become terminally ill and elect the hospice benefit.