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From Health Law Daily, July 15, 2015

First post-SGR formula repeal physician fee schedule introduced by CMS

By Harold M. Bishop, J.D.

The first Physician Fee Schedule (PFS) Proposed rule since the repeal of the Sustainable Growth Rate (SGR) formula has been issued by CMS. The Proposed rule updates payment policies and rates for Medicare services by physicians, nurse practitioners, physician assistants, physical therapists, radiation therapy centers, and independent diagnostic testing facilities performed after January 1, 2016. Changes to several of the quality reporting initiatives that are associated with PFS payments are also proposed. Finally, the Proposed rule begins to set forth CMS policies regarding the implementation of the new Merit-Based Incentive Payment System (MIPS), required by the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) (P.L. 114-10), which also repealed the SGR formula (Proposed rule, 80 FR 41686, July 15, 2015).

Payment provisions. The PFS pays for service furnished by physicians and other practitioners at all sites of service. The Proposed rule makes payment updates in the following categories:

  • Part B drugs (biosimilar biological products). CMS is proposing to clarify that the payment amount for a billing code that describes a biosimilar biological drug product is based on the average sales price of all biosimilar biological products that reference a common biological product’s license application.

  • Misvalued code target. Section 3134 of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) instructed CMS to identify “misvalued codes” in the PFS. CMS is proposing a methodology for the implementation of this provision, which would identify changes that achieve 0.25 percent in net reductions. CMS may make further changes in the Final rule to move closer to the statutory goal of 1.0 percent based on public comment.

  • Misvalued code changes for radiation therapy. CMS is proposing to change the utilization rate assumption used to determine the per minute cost of the capital equipment by assuming that the equipment is generally used for 35 hours per week (a 70 percent utilization rate) instead of 25 hours per week (a 50 percent utilization rate).

  • Phase-in of significant RVU reductions. The Protecting Access to Medicare Act of 2014 (PAMA) (P.L. 113-93) required if the total relative value units (RVUs) for a service would otherwise be decreased by an estimated amount equal to or greater than 20 percent as compared to the total RVUs for the previous year, the adjustments must be phased-in over a two-year period. CMS is proposing to reduce a service by the maximum allowed amount (e.g., 19 percent) in the first year, and phase in the remainder of the reduction in the second year.

  • Misvalued code changes in lower GI endoscopy services. CMS is seeking recommendations for valuation of the work associated with moderate sedation before proposing an approach that allows Medicare to make payments based on the resource costs associated with the moderate sedation or anesthesia services that are being furnished during lower gastrointestinal endoscopy (GI) procedures.

  • “Incident to” policy. CMS is proposing to clarify that the billing physician or practitioner for “incident to” services must also be the supervising physician or practitioner.

  • CPCI expansion. CMS is asking for comment on issues related to potential expansion of the Comprehensive Primary Care Initiative (CPCI), but is not proposing an actual expansion at this time.

  • Value-Based Payment Modifier. The Value-Based Payment Modifier (Value Modifier) program is set to expire in calendar year (CY) 2018, and a new program, required by MACRA, called MIPS begins in CY 2019. The Proposed rule provides guidance to insure a smooth transition from the Value Modifier to MIPS.

  • Physician self-referral. CMS is proposing to update rules regarding physician self-referral by: (1) permitting payment to physicians for the purpose of employing nonphysician practitioners; (2) clarifying that a broad range of actions comply with the website and advertising requirements; and (3) clarifying terminology and providing policy guidance.

MACRA changes. Prior to the enactment of MACRA, the longest interval for which a Medicare opt-out affidavit from a physician or practitioner could be effective was two years. Section 106(a) of MACRA states that opt-out affidavits filed 60 days after the date of enactment automatically renew every two years. CMS is proposing that physicians and practitioners are able to rescind their opt-out status if they notify CMS at least 30 days prior to the start of the next two-year period. CMS proposes conforming existing regulations to this MACRA requirement.

To help with implementation of MIPS, CMS is requesting input on a number of pieces of MACRA, including: (1) the selection of low-volume threshold, (2) the definition of clinical practice improvement activities, and (3) input on how to define a physician-focused payment model, as discussed in section 101(e) of MACRA.

CMS also plans to send out a Request for Information seeking comment on a broader range of issues surrounding MACRA implementation.

Quality reporting. The Proposed rule would make changes to various quality reporting initiatives, including: (1) the Physician Quality Reporting System; (2) the Physician Value-Based Payment Modifier (Value Modifier); (3) the Medicare Electronic Health Record (EHR) Incentive Program; (4) the Medicare Shared Savings Program (MSSP); and (5) the Physician Compare website.

  • Physician Quality Reporting System (PQRS). For 2018, CMS proposes to establish the same criteria for satisfactory reporting and, in lieu of satisfactory reporting, satisfactory participation in a qualified clinical data registry (QCDR), that was established for the 2017 PQRS payment adjustment, which requires the reporting of nine measures covering three National Quality Strategy domains. If an individual eligible professional or group practice does not satisfactorily report or satisfactorily participate while submitting data on PQRS quality measures, a 2.0 percent negative payment adjustment would apply in 2018. After 2018, payment adjustments for quality reporting will be made under MIPS, as required by MACRA.

  • Physician Compare. In 2016, in addition to continuing existing policies for public report on Physician Compare, CMS also proposes several new policies: (1) to include an indicator on profile pages for individual eligible professionals (EPs) who satisfactorily report the new PQRS Cardiovascular Prevention measures group; (2) to make individual-level QCDR measures available for public reporting, and, new to 2016, to publicly report group-level QCDR measures; (3) to publicly report an item (or measure)-level benchmark derived using the Achievable Benchmark of Care (ABC™) methodology; and (4) to include in the downloadable database the Value Modifier tiers for cost and quality; and (5) to publicly report in the downloadable database utilization data for individual EPs.

  • EHR Incentive Program. CMS is proposing to revise the definition of certified EHR technology to require certification of EHR technology in accordance with criterion proposed by the Office of the National Coordinator for Health Information Technology in relation to CMS’ form and manner requirements for electronic submission of Clinical Quality Measure certified electronic health record technology.

  • Medicare Shared Savings Program. The 2016 Proposed rule includes changes specific to certain sections of the MSSP regulations and solicits feedback from stakeholders on: (1) adding a measure of statin drug therapy for the prevention and treatment of cardiovascular disease to align it with PQRS; (2) preserving flexibility to maintain or revert measures to pay for reporting if a measure owner determines the measure no longer aligns with updated clinical practice or causes patient harm; and (3) clarifying how PQRS-eligible professionals participating within an accountable care organization (ACO) meet their PQRS reporting requirements when their ACO satisfactorily reports quality measures.

Advance care control and planning. The Proposed rule also seeks comments on establishing a separate payment and a payment rate for two advance care planning services provided to Medicare beneficiaries by physicians and other practitioners. This proposal would provide beneficiaries and practitioners greater opportunity and flexibility to utilize these planning sessions at the most appropriate time for patients and their families.

Comment submission and effective date. CMS is accepting public comments on the Proposed rule until September 8, 2015. CMS will issue the Final rule by November 1, 2015.

MainStory: TopStory CMSNews CoPNews DrugBiologicNews EHRNews HealthReformNews PaymentNews PartBNews PhysicianNews QualityNews StarkNews

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