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Volume 8, Issue 4 Download for iPad

CONGRESS AND MEDICARE’S 2014 PROPOSED RULES

On July 8, 2013 the Centers for Medicare and Medicaid Services (CMS) issued the 2014 proposed rules for the Medicare Physician Fee Schedule (MPFS) and the Hospital Outpatient Prospective Payment System (OPPS). These proposed rules are open for comment until 11:59pm ET, September 6, 2013. In drafting your comments, it may be helpful to read comments submitted by other oncology professionals, the proposed rule and submitted comments are available at www.regulations.gov/#!docketDetail;D=CMS-2013-0155

THE MEDICARE PHYSICIAN PAYMENT FORMULA

Once again, the Sustainable Growth Rate (SGR) calculation will result in a significant decrease in Medicare payments for physician services effective January 1, 2014 unless Congress acts to stop the cuts.

The SGR update methodology was formulated to control growth in Medicare spending for physician services. Under this formula, if actual expenditures for a year exceed the allowed or “target” expenditures the update is reduced for the following year. Conversely, if the actual expenditures are less than the allowed expenditures the update for the following year is increased. Read the CMS report on the SGR and conversion factor (CF) for detailed information on the four factors for calculating the SGR.

CMS estimates that the SGR formula will result in a negative 24.4% CF update for physician payments in 2014. In the proposed rule, CMS estimates a 2014 CF of $25.7109 adjusted to $26.8199 to include a budget neutrality adjustment. In comparison, the current 2013 CF is $34.0230.

As they did last year, CMS is calling on Congress to provide a long-term solution to the SGR formula rather than another temporary fix as they have each year since 2003. CMS states they are committed to working with the Congress to reform Medicare physician payments to incentivize quality and efficiency. As a reminder, CMS does not have the authority to act on the SGR issue, it will be up to Congress to take action.

On July 31, the House Energy and Commerce Committee unanimously approved draft legislation that would repeal the SGR and replace it with an annual statutory payment update to physicians of 0.5% per year from 2014 through 2018. The draft legislation is a good start, now the details including how to pay for the repeal, currently estimated at $140 billion, will have to be worked out. It is expected that there will be many refinements to the legislation as it moves through the political system.

ESTIMATED IMPACT OF THE PROPOSED 2014 PHYSICIAN FEE SCHEDULE

Estimated Impact of the Proposed 2014 Physician Fee Schedule

Each year, CMS projects the estimated impact of the proposed physician fee schedule changes by specialty. In addition to any proposed payment changes, CMS must make budget neutrality adjustments if changes to relative value units (RVUs) would cause expenditures to change by more than $20 million. These adjustments affect the distribution of Medicare expenditures across specialties. The estimated impact on total allowed charges by specialty shown in Table 1 does not include the effect of the SGR formula on the conversion factor.

Assuming that the SGR reductions will once again be prevented by Congress, CMS calculated the payment projections based on the CY 2013 CF of $34.0230 and adjusted by a positive budget neutrality adjustment to arrive at an estimated adjusted CF of $35.6653.

Table 1: Specialty Impact of 2014 Proposed Rule

Specialty

Impact of work and MP RVU changes

Impact of PE RVU changes

Combined Impact

Hematology/Oncology

2%

-3%

-1%

Radiation Oncology

1%

-6%

-5%

Rheumatology

2%

-5%

-3%

Source: CY 2014 Proposed MPFS

Evaluation and Management Services
Payment rates for office-based evaluation and management services (E/M) would decrease slightly for the lower level established patient office visits (99211-99213) and increase slightly for the higher-level established patient office visits (99214, 99215). At the same time, payment rates increase slightly for every office-based new patient E/M visit with the exception of the level one new patient visit (99201).

Payment rates would increase by approximately 3% for hospital visit and critical care codes.

Infusion Room Services
As shown in Table 2, nearly every infusion code would see a reduction in payment due to the proposed reduction in relative values assigned to practice expense. This is due to the recalibration of the Medicare Economic Index (MEI) which is used to update physician payments for inflation. The proposal would change the relative RVU weights assigned to physician work and practice expense. This redistribution would result in higher payments for those specialties whose payments are primarily based on physician work and lower payments for those specialties where the payment is largely based on higher practice expense proportions.
Calculation of the Medicare Economic Index

 

2013

2014 Proposed

Physician Work

48.266%

50.866%

Practice Expense

51.734%

49.134%

Total MEI

100%

100%

Table 2: Estimated Impact of Proposed Rule on CY 2014 Payment
CPT Code

Short Description

2013 CF = $34.0230

2014 CF = $35.6653*

% Change
2013-2014

96361

Hydration iv inf. add-on

15.31

14.62

-4.49%

96365

Ther/proph/diag iv inf, init

75.53

72.40

-4.14%

96366

Ther/proph/diag IV inf, add-on

21.77

21.76

-0.09%

96367

Tx/proph/dg addl seq iv inf

31.98

31.39

-1.86%

96368

Ther/diag concurrent inf

18.71

18.90

1.02%

96372

Ther/proph/diag inj, sc/im

25.86

24.97

-3.45%

96374

Ther/phrop/diag inj, iv push

57.50

55.28

-3.86%

96375

Ther/phrop/diag inj new drug add-on

22.46

22.11

-1.53%

96401

Chemotherapy, sc/im

75.87

73.47

-3.16%

96402

Chemo hormon antineopl sq/im

32.66

31.74

-2.82%

96409

Chemo, iv push, sngl drug

111.94

107.71

-3.78%

96411

Chemo, iv push, addl drug

62.60

60.27

-3.72%

96413

Chemo, iv infusion, 1 hr

143.24

138.02

-3.64%

96415

Chemo, iv infusion, addl hr

30.62

29.96

-2.16%

96416

Chemo, prolong infuse w/pump

142.56

137.31

-3.68%

96417

Chemo, iv infus each addl seq

71.11

68.63

-3.20%

Source: CY 2014 Proposed MPFS
* Payments based on the 2013 conversion factor of 34.0230, adjusted to 35.6653 to include the budget neutrality adjustment.

Finally, CMS proposes to cap payment for some non-facility (physician office) services at the rates established under the hospital outpatient prospective payment system (OPPS). In the proposed rule, CMS references comments they have received asserting that care provided in physician offices generally cost less than the same services in the hospital (facility) setting. They state that they agree with the commenters, and for that reason they are proposing to lower the payment rates on certain codes that are paid at a higher rate in an office than in an outpatient hospital department or an Ambulatory Surgical Center (ASC).

CMS identified approximately 200 codes that would be subject to this cap. The American Medical Association (AMA), independent labs, pathology offices as well as radiation oncologists are strongly opposing these cuts and requesting that CMS maintain the existing AMA-RUC process for valuing physician service codes.

There are 3 chemotherapy administration codes on the OPPs cap list, 96405 Intralesional chemo admin, 96440 Chemotherapy, intracavity and 96446 Chemotx admn prtl cavity, and under the cap proposal, payments for these services in the physician office would decrease by approximately 14%, 67% and 12% respectively. Nevertheless, the majority of services provided in the physician-based infusion center are already paid at a rate lower than that paid under the OPPS and CMS estimates the payment impact of the cap on total allowed charges for hematology/oncology would be a 1% increase (due to the budget neutrality adjustment).

 

Physician Quality Reporting System

Medicare’s Physician Quality Reporting System (PQRS) is a pay-for-reporting system that uses payment incentives and penalties to promote reporting of quality information by eligible providers (EPs). The PQRS provides an incentive payment to satisfactory reporters through 2014, and payment penalties based on this year’s data will begin in 2015. In 2015, CMS will impose a 1.5% penalty on practices that did not successfully participate in the 2013 PQRS. The payment penalty for those that do not successfully participate in 2014 would be 2% in 2016.

CMS is proposing to add 47 new individual measures and 3 measures groups to the PQRS. One new measures group, Optimizing Patient Exposure to Ionizing Radiation, may be of interest to clinics offering computed tomography (CT). Table 29 of the rule lists the proposed new measures for PQRS starting in 2014. The table includes a description of the measure, the rationale for proposing the measure and the PQRS reporting mechanisms for submitting the measure.

Significant changes are proposed for the 2014 PQRS program. CMS is proposing a substantial increase in the number of individual measures that must be reported via claims and registry. However, at the same time, they propose to lower the reporting threshold when reporting via registry.

CMS is also proposing a new reporting mechanism, the certified survey vendor reporting mechanism, that would allow groups of 25 or more EPs to count reporting of CG CAHPS (Clinician and Group Consumer Assessment of Healthcare Providers and Systems) survey measures towards meeting the criteria for successfully reporting for the 2014 PQRS incentive and avoiding the 2016 PQRS payment adjustment.

Proposed 2014 PQRS Changes Include:

  • For individual EPs increase the number of measures that must be reported via the claims and registry based reporting from 3 to 9
  • Change the reporting threshold for reporting individual measures via registry to require that EPs report on 50% of the EP’s applicable patients rather than 80%
  • For groups reporting individual measures via registry, increase the number of measures that must be reported from 3 to 9 and propose a 50% threshold instead of a 80% threshold
  • Eliminate the option to report measures groups by claims
  • Eliminate the six-month registry reporting option
  • EPs who meet the criteria for the 2014 PQRS incentive will automatically avoid the 2016 PQRS penalty
  • EPs who satisfactorily participate in a qualified clinical data registry for the full CY 2014 will avoid the 2016 PQRS penalty

Perhaps the most significant and positive proposal for oncologists is CMS’ proposal to include clinical data registries as a method of satisfying PQRS reporting. This proposal stems from The American Taxpayer Relief Act of 2012 (ATRA) which allows eligible professionals to be treated as satisfactorily submitting data on quality measures for covered professional services if the eligible professional satisfactorily participates in a qualified clinical data registry.

Earlier this year, the American Society of Clinical Oncology (ASCO) formally recommended that CMS use the Quality Oncology Practice Initiative® (QOPI) as a model clinical registry through which practices can meet their PQRS requirements. If accepted as a clinical data registry, practices satisfactorily participating in QOPI may meet the reporting requirements for both the PQRS and Value-Based Payment Modifier programs. More information on ASCO’s QOPI program is available at http://qopi.asco.org/.

The proposed rule includes the following proposed definition of a qualified clinical data registry, “A CMS-approved entity (such as a registry, certification board, collaborative, etc.) that collects medical and/or clinical data for the purpose of patient and disease tracking to foster improvement in the quality of care furnished to patients.”

In determining whether an entity should be considered a qualified clinical data registry, CMS states that the entity:

  • Must be able to submit quality measures data or results to CMS for purposes of demonstrating that, for a reporting period, its EPs have satisfactorily participated in PQRS
  • Must submit quality measures data on multiple payers
  • Must provide timely feedback at least quarterly on the measures for which the qualified clinical data registry would report on the individual EP’s behalf for purposes of the EP meeting the criteria for satisfactory participation under PQRS
  • Must possess a method to benchmark the quality of care measures an EP provides with that of other EPs performing the same or similar functions

Most importantly, under the clinical data registry option, EPs report the measures used by the clinical data registry instead of those on the PQRS measure list and EPs may report measures on all patients, not just Medicare Part B FFS patients. For the 2014 PQRS incentive and 2016 PQRS payment adjustment, CMS is proposing that EPs using clinical data registries would meet the criteria for satisfactory participation by reporting on at least 9 measures, one of which must be an outcome measure, to the registry. In addition, the reported measures must cover at least 3 of the National Quality Strategy domains, and each measure must be reported for at least 50% of the EPs applicable patients.

If in fact, ASCO’s QOPI program becomes certified as a clinical data registry by CMS, oncologists would benefit from the opportunity to report on measures developed by oncologists and which are relevant and actionable in the oncology clinic.

More information on the PQRS can be found on the CMS Website.

National Quality Strategy Domains in the PQRS

  • Patient Safety
  • Person and Caregiver-Centered Experience and Outcomes
  • Communication and Care Coordination
  • Effective Clinical Care
  • Community/Population Health
  • Efficiency and Cost Reduction

 

Value-Based Payment Modifier

The Affordable Care Act (ACA) of 2010 requires CMS to establish a value-based payment modifier (VM) to provide differential payment to a physician or group of physicians based on the quality and cost of care provided to Medicare beneficiaries. This initiative is part of the ongoing effort to move Medicare to a reimbursement system that pays for value. This program is specific to fee-for-service Medicare and does not include Medicare Advantage.

In developing the VM program, CMS continued their efforts to align reporting requirements across its quality programs by basing the VM program on participation in the PQRS. Medicare began phasing in the Value-Based Payment Modifier program in 2013 and must begin applying it to all physicians and groups of physicians no later than January 1, 2017.

In 2013, CMS established the threshold for application of the 2015 VM to groups of physicians with 100 or more EPs (this number includes physicians and other eligible practitioners, as defined in the PQRS program, such as physician assistants and nurse practitioners). These groups must self-nominate and choose one of three PQRS group reporting methods in order to avoid a negative 1% value modifier adjustment to their 2015 payment (based on their performance in 2013) under the physician pay schedule.

For the 2016 payment adjustment, which will be based on performance in CY 2014, CMS is proposing to decrease the group size and increase the negative payment adjustment. CMS proposes to apply the VM to all groups of physicians with 10 or more eligible professionals (EPs). Under this proposal, groups with 10 or more EPs must satisfactorily report in PQRS or satisfactorily participate in a qualified clinical data registry in CY 2014 to avoid a 2% payment reduction under the VM program in 2016. The VM program payment adjustment is separate from the PQRS payment adjustment.

In the CY 2013 VM reporting period, groups subject to the VM payment adjustment must report under the PQRS Group Practice Reporting Option (GPRO). In the proposed rule, CMS acknowledges that not all groups of physicians want to participate in PQRS as a group as they may want to report on different quality measures or use different reporting mechanisms. For this reason, CMS proposes to add the option for groups to participate in the PQRS individually in the CY 2014 VM performance period. Under this proposed option, at least 70 percent of the individual EPs in the group must avoid the CY 2016 PQRS payment adjustment by any of the reporting options available under the PQRS.

Another component to the VM program is “quality-tiering” through which CMS will reward higher quality care delivered at lower cost as mandated by the ACA. Under quality-tiering, CMS evaluates performance on quality and cost measures to determine if a group’s performance is statistically better, the same, or worse than the national mean. The Value Modifier is then calculated based on the group’s performance and could result in an upward, downward, or no payment adjustment.

Quality-tiering is an optional aspect of the 2015 VM program. However, CMS is proposing to make quality-tiering mandatory in the 2016 VM program for groups with 10 or more EPs. As proposed, groups of physicians with 100 or more EPs would either receive upward, neutral or downward adjustment under the quality-tiering methodology. While groups of physicians with between 10 and 99 EPs will either receive an upward or neutral adjustment, based on the quality-tiering methodology, but they will not be subject to a downward adjustment.

Table 3 shows the proposed VM program quality-tiering payment adjustment amounts for CY 2016, which will be based on CY 2014 reporting. This program is legislatively mandated to be budget neutral. For this reason the upward payment adjustment factor (x) would be determined after the performance period has ended and positive adjustments to groups of physicians would be offset by negative adjustments to other groups of physicians.

CMS reiterates that groups of physicians that furnish high quality care will not have a downward adjustment, even if they furnish such care at high costs. In addition, CMS says that they would continue to provide an additional upward payment adjustment of +1.0x to groups of physicians that care for high-risk beneficiaries.

Table 3: 2016 Value-Based Payment Modifier Amounts

Quality/Cost Low cost Average cost High cost
High quality *+2.0x *+1.0x +0.0%
Average quality *+1.0x +0.0%

-1.0%
Low quality +0.0% -1.0% -2.0%

Source: CY 2014 Proposed MPFS
*Groups of physicians eligible for an additional +1.0x if reporting Physician Quality Reporting System quality measures and average beneficiary risk score is in the top 25% of all beneficiary risk scores

If you missed the July 25, 2013 MLN Connects National Provider Call, you can access the slides and the transcript on the CMS Outreach and Education Website. During this call, CMS provides details on their 2014 MPFS proposals for the PQRS and VM program including information on their proposal for mandatory quality-tiering for the 2016 VM payment adjustment.

In Figure 1, CMS illustrates the alignment of the PQRS and the VM payment adjustment. Nevertheless, even though the reporting requirements for the two programs are aligned the penalties for each remain separate. In other words, if you are subject to the VM payment adjustment and you are not a satisfactory reporter for PQRS, you would receive both the PQRS penalty and the VM penalty.

Value Modifier and PQRS


Figure 1: Value Modifier and PQRS
Source: CMS MLN Connects National Provider Call July 25, 2013

 

Requirements for Billing “Incident To” Services

CMS defines “Incident to” services as those services that are furnished incident to physician professional services in the physician’s office or in a patient’s home. These services are billed as Part B services as if the physician personally provided them, and they are paid under the physician fee schedule. Services supervised by certain non-physician providers (NPP) may also be billed incident to the NPP and are paid at 85% of the physician fee schedule.

CMS addresses the fact that over time the services commonly furnished in physician offices and billed “incident to” have expanded to include more complicated services and CMS notes that states are responding by adopting standards regulating the delivery of health care services to protect the health and safety of their citizens.

The 2009 Office of Inspector General (OIG) report entitled “Prevalence and Qualifications of Nonphysicians Who Performed Medicare Physician Services” includes a recommendation that CMS amend the “incident to” policy regulations to require that services and supplies be furnished in accordance with applicable state law. In response, CMS proposes to add a new paragraph in the policy stating, “Services and supplies must be furnished in accordance with applicable State law” and to amend the definition of auxiliary personnel to require that the individual performing “incident to” services “meets any applicable requirements to provide the services, including licensure, imposed by the state in which the services are being furnished.”

According to CMS, the proposed amendment to the “incident to” policy will ensure that auxiliary personnel providing services to Medicare beneficiaries’ incident to the services of other practitioners do so in accordance with applicable state requirements, and to ensure that Medicare payments can be recovered when such services are not furnished in compliance with the state law.

Physician Compare Website

The development of the Physician Compare Website was mandated under The Affordable Care Act (ACA). The website was launched in 2010 and it contains information on physicians and other providers who bill Medicare. Currently, this website contains information on provider participation in Medicare’s quality programs as well as basic provider and practice information.

For 2014, CMS is proposing to begin publically reporting all measures collected through the Group Practice Reporting Option (GPRO) web interface for groups of all sizes participating in the 2014 PQRS GPRO and for Accountable Care Organizations (ACOs) participating in the Medicare Shared Savings Program. CMS proposes a 30-day preview period prior to publication of quality data on Physician Compare, so group practices and ACOs can view their data as it will appear on Physician Compare before it is publicly reported.

CMS also proposes to publically report certain measures that groups report via registries and EHRs for the 2014 PQRS GPRO. Finally, CMS is also requesting comments on posting performance on patient experience survey-based measures for individual eligible professionals starting with data collected for CY 2015.

While supportive of the Medicare Compare initiative, the AMA states their disappointment that CMS is proposing to expand the website before ensuring that the search function and underlying demographics of the data are accurate.

The data on Physician Compare comes primarily from the Provider Enrollment, Chain, and Ownership System (PECOS). Providers may add, edit or correct the information listed via PECOS.

 

EHR PROGRAM

CMS is proposing to allow PQRS-EPs to submit clinical quality measures (CQMs) using qualified clinical registries (as defined for PQRS) to meet the CQM reporting component for meaningful use beginning in 2014. This option would only be open to those EPs who have completed their first year demonstrating meaningful use.

 

PART B DRUGS

The proposed rule does not include any revisions to payment for Part B drugs, nevertheless it mentions this (on page 243 of the PDF) under the heading Impact on Beneficiaries, “ …revisions to payment for Part B drugs will have a positive impact and improve the quality and value of care provided to Medicare beneficiaries.”

Recovery of Overpayments

CMS can waive the recovery of overpayments for items that are not reasonable and necessary when the provider is presumed to be “without fault”. Currently, the provider is presumed to be without fault if the overpayment determination is made more than three years after the claim was paid. CMS is proposing to change this timeframe to five years, allowing an additional two years during which the payment can be recouped. In previous proposals, CMS sought to increase the look-back time on these overpayments to 10-years. CMS also reminds us that they retain their authority to reopen claims for any reason within one year, for good cause within 4 years, and at any time for fraud or similar fault.

 

COMPLEX CHRONIC CARE

In 2013, the AMA established three new codes for Complex Chronic Care, CPT codes 99487-99489. At the time, in the 2013 Final Rule, CMS determined that they would not pay for these services in part because they include non face-to-face services. Still, they said they would continue to consider coverage for these services in the future.

In the 2014 proposed rule, saying that they are committed to primary care and seeking ways to improve payment for these services, CMS proposes to begin paying for Complex Chronic Care services in 2015. However, the CMS proposal for these services include significant requirements above those established in CPT. Medicare is proposing to establish two new G-codes for reporting complex chronic care.

CMS provides the following description and G-codes for the complex chronic care services:

Complex chronic care management services furnished to patients with multiple (two or more) complex chronic conditions expected to last at least 12 months, or until the death of the patient, that place the patient at significant risk of death, acute exacerbation/decompensation, or functional decline;

  • GXXX1, initial services; one or more hours; initial 90 days
  • GXXX2, subsequent services; one or more hours; subsequent 90 days

Because CMS’ intention was to provide additional payment for primary care some of the proposed requirements would make it difficult for oncologists to report these codes.

In a summary on the proposed rule, the AMA applauds CMS for their proposal to cover complex chronic care services in 2015 and they state the CPT and RUC will work with CMS and stakeholders to discourage overly burdensome requirements and to ensure that the payment is appropriate.

SIGNIFICANT HOSPITAL OUTPATIENT PROPOSALS

There are two very interesting proposals in the Hospital Outpatient Prospective Payment System (OPPS) that would further compress the HOPD payments by expanding packaged items and services and collapsing the current five levels of outpatient visit codes into a single code for each type of outpatient hospital visit.

Under the proposed packaging expansion, procedures described by add-on codes would not be separately payable but instead would be “packaged” or included in the payment for the primary procedure code. The codes CMS proposes to package include all of the drug/fluid administration add-on codes. CMS proposes to eliminate the payment for the add-on codes and to increase the payment for the initial drug/fluid administration codes between 38%-109%.

According to CMS, recognizing a single visit level for clinic visits is appropriate because it furthers their goal of using larger payment bundles to maximize hospitals’ incentives to provide care in the most efficient manner and to reduce the administrative burden on hospitals.

CMS proposes to develop a new alphanumeric HCPCS codes for each visit type, GxxxA for type A ED visits, GxxxB for type B ED visits and GxxxC for clinic visits. In addition, there would no longer be a distinction between new and established patient clinic visits.

Outpatient clinic visits such as those billed in the outpatient infusion center, would be reduced to a single level of payment and billed with the new outpatient clinic visit code GxxxC (x is a placeholder until the code is developed). Payment rates for the current visit codes levels 1-5 are paid between $56.77-175.79, under the proposal GxxxC would be paid at $88.31.

Published by Rise Marie Cleland. Sponsored by Lilly Oncology

CONTACT US
Risë Marie Cleland Rise@Oplinc.com

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UPCOMING ISSUE
Comments and suggestions for future issues are welcome, please forward correspondence to Risë Marie Cleland by email at: Rise@Oplinc.com

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ABOUT THE EDITOR
Risë Marie Cleland is the Founder and CEO of Oplinc, Inc., a national organization of oncology professionals. Through Oplinc, Inc., Ms. Cleland publishes the weekly Oplinc Fast Facts focusing on the timely dissemination of information pertaining to billing, reimbursement and practice management in the oncology office and Oplinc’s Best Practices Review, which provides a more in-depth look at the issues and challenges facing oncology practices. Ms. Cleland also works as a consultant and advisor for physician practices, pharmaceutical companies and distributors.

IMPORTANT NOTICES
Please note that this newsletter is presented for informational purposes only. It is not intended to provide coding, billing or legal advice. Regulations and policies concerning Medicare reimbursement are a rapidly changing area of the law. While we have made every effort to be current as of the issue date, the information may not be as current or comprehensive when you review it. Please consult with your legal counsel for any specific reimbursement information. For Medicare regulations visit: www.cms.gov.

CPT® is a Trademark of the American Medical Association Current Procedural Terminology (CPT) is copyright 2013 American Medical Association. All Rights Reserved. No fee schedules, basic units, relative values, or related listings are included in CPT. The AMA assumes no liability for the data contained herein.

Copyright ©2013 Oplinc, Inc.

Oplinc, Inc., grants permission to distribute this newsletter without prior permission provided it is forwarded unedited and in its entirety.

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