The Centers for Medicare & Medicaid Services has released its proposed Medicare Physician Fee Schedule and issued a call for feedback on the proposed rule, which would take effect Jan. 1, 2023.

Medtech analyst Ryan Zimmerman and the team at BTIG went through the 2,000-page document and identified potentially market-moving changes in two areas: surgical glaucoma and advanced wound care.

CMS proposed cuts for most surgical glaucoma procedure payment rates to physicians, with double-digit losses for tube shunt revision (down 25% from $1,032 to $774), canaloplasty (down 19.9% from $761 to $610) and canaloplasty with a stent (down 11.4% from $799 to $708), according to BTIG research.

The canalplasty rate reduction would likely hit Omni surgical system developer Sight Sciences, Zimmerman said in a BTIG report. It could also give a lift to Alcon and Glaukos, which could see a smaller cut in routine cataract stent reimbursements (down 2.4% from $683 to $667)

“We feel that surgical glaucoma is shifting away from stent-based treatment to canaloplasty coming out of the IGC conference given the introduction of more canal-based devices and the reimbursement benefit afforded,” Zimmerman wrote, “but as reimbursement comes closer to parity with stents, we think the size and scale of both [Alcon] and [Glaukos] coupled with a more favorable comparable reimbursement landscape may result in a modest uptick in utilization that would have otherwise shifted to canal-based treatment.”

BTIG also noted that an interested party nominated six cataract surgery codes as potentially misvalued: 65820, 66174, 66982, 66984, 66989, 66991. Those are the main codes for goniotomy, canaloplasty, tube shunt revision, complex cataract with a stent and routine cataract with a stent.

The interested party’s suggested cataract procedures could be safely, effectively and conveniently performed in the non-facility office, and that CMS should recognize additional resources to do so. But the request to revisit rates puzzled BTIG’s analysts.

“We think this is a bad strategy for the entire surgical glaucoma space,” Zimmerman wrote. “CMS has already cut reimbursement in the surgical glaucoma space for physicians and the idea that a canal-based device would receive higher reimbursement going forward seems unlikely, in our view. Canal-based devices maintain a premium over stents already so why would CMS award additional reimbursement given the existing disparity? This only serves as a potential downside risk, in our view.”

On advanced wound care, CMS is proposing changes in synthetic and non-synthetic skin substitute payments. Specifically, skin substitutes would no longer be reimbursed at average sales price plus 6%, and would instead be paid on a practice expense methodology. That means the skin substitute would essentially be bundled into a procedure code, BTIG said.

That could limit options for physicians in the care of chronic wounds and decrease the use of more expensive products, like those made by companies such as Integra LifeSciences, Organogenesis and MiMedx.

BTIG said it expects the medtech industry and professional medical societies to oppose this proposal.

“Advanced wound care is a challenging and heterogeneous field among providers and patients, but if physicians (regardless of specialty) have to bear the costs of added treatments or products because CMS assigns a rate that doesn’t fully compensate for care, it will be tough to see the industry make advances,” Zimmerman wrote.

CMS is also proposing new Healthcare Common Procedure Coding System (HCPCS) codes that would take effect in calendar year 2024 to give manufacturers time to apply.

The 2023 Medicare Physician Fee Schedule is expected to be finalized in late November or early December of this year.