Academy Summary of the Final CY 2013 Medicare Physician Fee Schedule (MPFS)
On November 1, 2012, the Centers for Medicare & Medicaid Services (CMS) released the final Medicare physician fee schedule (MPFS) rule for calendar year (CY) 2013. The Academy submitted comments to CMS on the final rule, which can be viewed at http://www.entnet.org/Practice/Summaries-of-Regulations-and-Comment-Letters.cfm#CL. Some key provisions finalized in the 2013 rule included: Medicare Sustainable Growth Rate (SGR) The Medicare law includes the standard statutory formula that will require (absent congressional intervention) a CMS projected reduction of 26.5 percent to the MPFS conversion factor (CF), which would result in a CF of $25.0008 in 2013. Contractors are required to issue fee schedule files to their participating physicians in their locality, which include the estimated SGR cut that you may receive. Since Congress has not taken action for 2013 to fix the SGR at press time, the contractors cannot show payment rates that assume the problem will be resolved until legislation has actually been passed to do so. Thus, the fee schedules from contractors may assume the SGR cuts to all services for 2013. As in previous years, however, it is expected that Congress will take action to avoid the impending cut due to the sustainable growth rate (SGR) before the January 1, 2013, deadline. Impact for Otolaryngology-Head and Neck Surgery Overall, our specialty fared well regarding the impact of policy changes within the Medicare physician fee schedule for CY 2013. Otolaryngology-head and neck surgery saw a 2 percent cumulative increase in allowed charges for 2013, but physicians may see fluctuations in the Practice Expense (PE) for some services due to several policy changes. Other related specialties that saw an increase were allergy, plastic surgery, and oral-maxillofacial. Unfortunately, audiology saw a slight decrease. Depending on the make up of services provided in your practice, the affects of these changes will vary in their effect on reimbursement rates. One modification in the final rule is the change in formula for determining a maximum interest rate for equipment-related PE RVUs. In addition, increases to some PE RVUs for otolaryngology-head and neck surgery services may also occur as a result of the last of a four year transition of the Physician Practice Expense Information Survey (PPIS) data used to calculate practice expense RVUs for services. Improving Valuation of the Global Surgical Package Since 1992, CMS has applied the concept of payment for a global surgical package under the PFS. This means that for each surgical procedure, they establish a single payment, which includes payment for all related services typically furnished by the surgeon providing the procedure during the global period. The global surgical package payment rate is based on the work necessary for the typical surgery and related pre and post-operative work. CMS noted that different methodologies have been used in valuing global surgical services and more recently reviewed codes tend to have fewer evaluation and management (E/M) visits in their global periods. They observed that codes reviewed less recently did not appear to have the full work RVUs of each E/M service in the global surgical package, resulting in inconsistent numbers of E/M visits during the post-operative period across families of procedures. Under current policy, a surgeon is not required to document in the medical record what level of E/M visit is provided. CMS believes this practice makes it difficult to determine whether the number and type of visits provided in association with a surgical procedure is appropriate. As a result, CMS requested input in the proposed rule on how best to obtain accurate and current data on E/M services typically furnished as part of a global surgical package. Within the final rule they received a wealth of public feedback regarding methods to verify the number of E/M services provided within the global surgical period. In response, CMS stated it will carefully review and consider all input provided by commenters, and did not finalize any new requirements for tracking or reporting E/M visits associated with the global surgical period for CY 2013. The Agency was clear, however, that it intends to finalize new requirements during CY 2014 rulemaking. Potentially Misvalued Services Under the Fee Schedule Within the final rule, CMS identified 16 Harvard valued codes with annual allowed charges of greater than or equal to $10 million that warrant review as potentially misvalued services. Of these 16 codes, five were already scheduled for RUC review in 2012 and four had been referred to the CPT Editorial Panel. For the remaining codes, CMS stated that they are such low volume codes it may make gathering information on physician work and direct PE inputs difficult via the usual survey method. Given this, CMS encourages use of valid and reliable alternative data source to develop recommended values. Three of these codes had minor Otolaryngology use, including: 66180 Implant eye shunt; 67036 Removal of inner eye fluid; and 67917 Repair eyelid defect. The Academy staff and RUC team will monitor the review process for these procedures and determine if direct Academy involvement is warranted. Validating RVUs of Services Under the Affordable Care Act (ACA), CMS was directed to validate a sampling of RVUs for services. RAND and the Urban Institute will research processes for validating RVUs for potentially misvalued codes under the PFS. CMS notes they will provide additional detail on the validation contracts in future rulemaking. In the past, the Academy has expressed concern about the Agency’s engagement of an outside contractor and strongly urged CMS to be transparent with this process. Therapy Caps and Changes to Reporting Requirements for Therapy Services in 2013 CMS announced the therapy cap amounts for CY 2013, $1,900 for occupational therapy services and $1,900 for combined physical therapy and speech-language pathology services. CMS also finalizes several key changes to reporting requirements associated with the provision of therapy services, including speech-language pathology services, with a test phase starting January 1, 2013, with non-payment enforcement starting on July 1, 2013. For more details on the new reporting requirements, see the Academy’s summary online. Physician Quality Reporting System (PQRS) CMS includes many overarching changes to the PQRS system, with highlights of those potentially affecting Academy members below: Changes to Group Reporting: CMS changes the definition of a “group practice” from 25 or more eligible professionals to two or more eligible professionals. Modification of Reporting Periods: CMS allows the continuation of a 6 month reporting period (July 1–Dec. 31) for reporting measures groups via registry in 2013 and 2014 only. Satisfactorily reporting for 2013 and 2014 to avoid penalties in 2015 and 2016: CMS will allow individuals and group practices to report only one PQRS individual measure or one measures group to avoid the 2015 and 2016 penalty adjustment. The penalty adjustment will be a -1.5 percent in 2015 and -2 percent in 2016 and subsequent years. Individual Quality Measures: CMS added 13 new measures for reporting individual quality measures in 2013 and 45 new individual measures for 2014. However, the newly approved “Adult Sinusitis” measures were not included in any of their proposals. Physician Compare CMS finalized lowering the threshold of patients for reporting PQRS quality measures under the group practice reporting option to 20 beginning in 2013. This data is used to compile the published performance rates posted on the Physician Compare website. CMS finalized a policy allowing the reporting of measures that have been developed and collected by specialty societies to be reported on Physician Compare. CMS notes that they have begun to include physician information, such as successful participation in the Medicare E-prescribing (eRx) Incentive Program and PQRS. CMS also plans to publish additional information, a list of which is available in the Academy’s summary available online. Electronic Prescribing (eRx) Incentive Program CMS finalized reducing the minimum group practice size for participation in the eRx incentive program from 25 to two Eligible Professionals (EPs) for 2013. This is consistent with changes to the PQRS program for 2013. Groups of two to 24 EPs who wish to participate must have reassigned their Medicare billing rights to a single TIN to be eligible. CMS reduced the eRx reporting threshold for groups to 75, rather than the proposed 225, meaning groups of 2-24 will have to report the eRx numerator code during a denominator-eligible encounter at least 75 times from January 1 through December 31, 2013. CMS also lowered the 2014 reporting threshold for groups during the six month reporting period to 75. Value-Based Payment Modifier Beginning January 1, 2015, the ACA requires the Secretary to establish a value-based payment modifier (incentive or penalty) to specific physicians and groups of physicians. The incentive or penalty is based on measuring quality of care furnished as compared to cost of that care for Medicare beneficiaries with certain chronic conditions. The agency will begin a three year phase-in of the program that would apply the incentive or penalty (up to potential -1 percent) in 2015 based on 2013 performance for groups of 100 or more providers. CMS proposes that incentives or penalties in 2016 based on 2014 performance for groups of 100 or more providers. The program is voluntary the first two years, but not later than 2017, the value-based payment modifier will apply to all physicians, regardless of group size. Physician Feedback Reporting Program As part of the Value Based Payment Modifier program, the Secretary is required to provide Physician Feedback reports to providers that measure the resources used in providing care to beneficiaries and the quality of care. In 2013, CMS plans to circulate reports to all groups of physicians with 25 or more EPs (based on their TINs) and to individual physicians that satisfactorily reported measures through PQRS in 2012 regarding their performance on 15 administrative claims based measures. Finally, in the fall of 2014, CMS plans to issue reports based on 2013 data that show the amount of the VBP modifier, and the basis for its determination, to groups with 25 or more EPs. CMS will consider issuing reports to groups of less than 25 professionals, as well as individual professionals, in the future. For a more detailed summary on the final requirements for the programs highlighted above, visit the Academy’s CMS Regulations and Comment letter page at http://www.entnet.org/Practice/Summaries-of-Regulations-and-Comment-Letters.cfm#CL or email Academy staff at HealthPolicy@entnet.org.
On November 1, 2012, the Centers for Medicare & Medicaid Services (CMS) released the final Medicare physician fee schedule (MPFS) rule for calendar year (CY) 2013. The Academy submitted comments to CMS on the final rule, which can be viewed at http://www.entnet.org/Practice/Summaries-of-Regulations-and-Comment-Letters.cfm#CL.
Some key provisions finalized in the 2013 rule included:
Medicare Sustainable Growth Rate (SGR)
The Medicare law includes the standard statutory formula that will require (absent congressional intervention) a CMS projected reduction of 26.5 percent to the MPFS conversion factor (CF), which would result in a CF of $25.0008 in 2013. Contractors are required to issue fee schedule files to their participating physicians in their locality, which include the estimated SGR cut that you may receive. Since Congress has not taken action for 2013 to fix the SGR at press time, the contractors cannot show payment rates that assume the problem will be resolved until legislation has actually been passed to do so. Thus, the fee schedules from contractors may assume the SGR cuts to all services for 2013. As in previous years, however, it is expected that Congress will take action to avoid the impending cut due to the sustainable growth rate (SGR) before the January 1, 2013, deadline.
Impact for Otolaryngology-Head and Neck Surgery
Overall, our specialty fared well regarding the impact of policy changes within the Medicare physician fee schedule for CY 2013. Otolaryngology-head and neck surgery saw a 2 percent cumulative increase in allowed charges for 2013, but physicians may see fluctuations in the Practice Expense (PE) for some services due to several policy changes. Other related specialties that saw an increase were allergy, plastic surgery, and oral-maxillofacial. Unfortunately, audiology saw a slight decrease. Depending on the make up of services provided in your practice, the affects of these changes will vary in their effect on reimbursement rates. One modification in the final rule is the change in formula for determining a maximum interest rate for equipment-related PE RVUs. In addition, increases to some PE RVUs for otolaryngology-head and neck surgery services may also occur as a result of the last of a four year transition of the Physician Practice Expense Information Survey (PPIS) data used to calculate practice expense RVUs for services.
Improving Valuation of the Global Surgical Package
Since 1992, CMS has applied the concept of payment for a global surgical package under the PFS. This means that for each surgical procedure, they establish a single payment, which includes payment for all related services typically furnished by the surgeon providing the procedure during the global period. The global surgical package payment rate is based on the work necessary for the typical surgery and related pre and post-operative work. CMS noted that different methodologies have been used in valuing global surgical services and more recently reviewed codes tend to have fewer evaluation and management (E/M) visits in their global periods. They observed that codes reviewed less recently did not appear to have the full work RVUs of each E/M service in the global surgical package, resulting in inconsistent numbers of E/M visits during the post-operative period across families of procedures.
Under current policy, a surgeon is not required to document in the medical record what level of E/M visit is provided. CMS believes this practice makes it difficult to determine whether the number and type of visits provided in association with a surgical procedure is appropriate. As a result, CMS requested input in the proposed rule on how best to obtain accurate and current data on E/M services typically furnished as part of a global surgical package. Within the final rule they received a wealth of public feedback regarding methods to verify the number of E/M services provided within the global surgical period. In response, CMS stated it will carefully review and consider all input provided by commenters, and did not finalize any new requirements for tracking or reporting E/M visits associated with the global surgical period for CY 2013. The Agency was clear, however, that it intends to finalize new requirements during CY 2014 rulemaking.
Potentially Misvalued Services Under the Fee Schedule
Within the final rule, CMS identified 16 Harvard valued codes with annual allowed charges of greater than or equal to $10 million that warrant review as potentially misvalued services. Of these 16 codes, five were already scheduled for RUC review in 2012 and four had been referred to the CPT Editorial Panel. For the remaining codes, CMS stated that they are such low volume codes it may make gathering information on physician work and direct PE inputs difficult via the usual survey method. Given this, CMS encourages use of valid and reliable alternative data source to develop recommended values. Three of these codes had minor Otolaryngology use, including: 66180 Implant eye shunt; 67036 Removal of inner eye fluid; and 67917 Repair eyelid defect. The Academy staff and RUC team will monitor the review process for these procedures and determine if direct Academy involvement is warranted.
Validating RVUs of Services
Under the Affordable Care Act (ACA), CMS was directed to validate a sampling of RVUs for services. RAND and the Urban Institute will research processes for validating RVUs for potentially misvalued codes under the PFS. CMS notes they will provide additional detail on the validation contracts in future rulemaking. In the past, the Academy has expressed concern about the Agency’s engagement of an outside contractor and strongly urged CMS to be transparent with this process.
Therapy Caps and Changes to Reporting Requirements for Therapy Services in 2013
CMS announced the therapy cap amounts for CY 2013, $1,900 for occupational therapy services and $1,900 for combined physical therapy and speech-language pathology services. CMS also finalizes several key changes to reporting requirements associated with the provision of therapy services, including speech-language pathology services, with a test phase starting January 1, 2013, with non-payment enforcement starting on July 1, 2013. For more details on the new reporting requirements, see the Academy’s summary online.
Physician Quality Reporting System (PQRS)
CMS includes many overarching changes to the PQRS system, with highlights of those potentially affecting Academy members below:
- Changes to Group Reporting: CMS changes the definition of a “group practice” from 25 or more eligible professionals to two or more eligible professionals.
- Modification of Reporting Periods: CMS allows the continuation of a 6 month reporting period (July 1–Dec. 31) for reporting measures groups via registry in 2013 and 2014 only.
- Satisfactorily reporting for 2013 and 2014 to avoid penalties in 2015 and 2016: CMS will allow individuals and group practices to report only one PQRS individual measure or one measures group to avoid the 2015 and 2016 penalty adjustment. The penalty adjustment will be a -1.5 percent in 2015 and -2 percent in 2016 and subsequent years.
- Individual Quality Measures: CMS added 13 new measures for reporting individual quality measures in 2013 and 45 new individual measures for 2014. However, the newly approved “Adult Sinusitis” measures were not included in any of their proposals.
Physician Compare
CMS finalized lowering the threshold of patients for reporting PQRS quality measures under the group practice reporting option to 20 beginning in 2013. This data is used to compile the published performance rates posted on the Physician Compare website. CMS finalized a policy allowing the reporting of measures that have been developed and collected by specialty societies to be reported on Physician Compare. CMS notes that they have begun to include physician information, such as successful participation in the Medicare E-prescribing (eRx) Incentive Program and PQRS. CMS also plans to publish additional information, a list of which is available in the Academy’s summary available online.
Electronic Prescribing (eRx) Incentive Program
CMS finalized reducing the minimum group practice size for participation in the eRx incentive program from 25 to two Eligible Professionals (EPs) for 2013. This is consistent with changes to the PQRS program for 2013. Groups of two to 24 EPs who wish to participate must have reassigned their Medicare billing rights to a single TIN to be eligible. CMS reduced the eRx reporting threshold for groups to 75, rather than the proposed 225, meaning groups of 2-24 will have to report the eRx numerator code during a denominator-eligible encounter at least 75 times from January 1 through December 31, 2013. CMS also lowered the 2014 reporting threshold for groups during the six month reporting period to 75.
Value-Based Payment Modifier
Beginning January 1, 2015, the ACA requires the Secretary to establish a value-based payment modifier (incentive or penalty) to specific physicians and groups of physicians. The incentive or penalty is based on measuring quality of care furnished as compared to cost of that care for Medicare beneficiaries with certain chronic conditions. The agency will begin a three year phase-in of the program that would apply the incentive or penalty (up to potential -1 percent) in 2015 based on 2013 performance for groups of 100 or more providers. CMS proposes that incentives or penalties in 2016 based on 2014 performance for groups of 100 or more providers. The program is voluntary the first two years, but not later than 2017, the value-based payment modifier will apply to all physicians, regardless of group size.
Physician Feedback Reporting Program
As part of the Value Based Payment Modifier program, the Secretary is required to provide Physician Feedback reports to providers that measure the resources used in providing care to beneficiaries and the quality of care. In 2013, CMS plans to circulate reports to all groups of physicians with 25 or more EPs (based on their TINs) and to individual physicians that satisfactorily reported measures through PQRS in 2012 regarding their performance on 15 administrative claims based measures. Finally, in the fall of 2014, CMS plans to issue reports based on 2013 data that show the amount of the VBP modifier, and the basis for its determination, to groups with 25 or more EPs. CMS will consider issuing reports to groups of less than 25 professionals, as well as individual professionals, in the future.
For a more detailed summary on the final requirements for the programs highlighted above, visit the Academy’s CMS Regulations and Comment letter page at http://www.entnet.org/Practice/Summaries-of-Regulations-and-Comment-Letters.cfm#CL or email Academy staff at HealthPolicy@entnet.org.