Doctor concerned with health care law

Breaking news and expert analysis on legal and compliance issues

[Back To Home][Back To Archives]

From Health Law Daily, July 7, 2014

Telehealth, transparency increased by Part B rule

By Kathryn S. Beard, JD

CMS released an advance copy of its Medicare Physician Fee Schedule (PFS) Proposed rule for calendar year (CY) 2015, which revises PFS payment polices and makes other policy changes related to Medicare Part B payment. The Proposed rule, which will be published in the Federal Register on July 11, 2014, ensures that payment systems are updated to reflect changes in medical practice and the relative value of services. The Proposed rule also implements changes required by the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148).

PFS. Payments under the PFS are based on national uniform relative value units (RVUs), which account for the relative resources used in furnishing a service. RVUs are established for three categories of resources: work, practice expenses; and malpractice expenses, with geographic adjustments incorporated to reflect the variations in the costs of furnishing services in different geographic areas. These values are multiplied by a conversion factor (CF) to convert the RVUs into payment rates. RVUs are updated periodically to reflect changes in medical practice and the relative value of services, which changes the payment amounts.

Effect of Sustainable Growth Rate.The statutory Sustainable Growth Rate (SGR), which would require a 24.4 percent reduction in the update to PFS, was avoided for part of CY 2015 by the Protecting Access to Medicare Act of 2014, whichextended the current payment rate until March 31, 2015. In the absence of further Congressional action, the Proposed rule notes that the applicable update for the remainder of the year will be based on the statutory SGR formula and the CF will be adjusted accordingly.

Telehealth. Medicare currently offers certain services to Medicare beneficiaries under the telehealth benefit, which pays an originating site fee to the originating site and provides separate payment to the distant site practitioner for furnishing the service, when all telehealth requirements are met. In the Proposed rule, CMS seeks to add four services to the telehealth benefit: annual wellness visits, psychoanalysis, psychotherapy, and prolonged evaluation and management services.

Misvalued codes. As required by the ACA, CMS has been identifying and reviewing potentially misvalued codes, and making adjustments where appropriate. The Proposed rule would add about 80 codes to the list of potentially misvalued codes. Most of these codes were identified by reviewing high-expenditure services by specialty that have not been recently reviewed. The Proposed rule would also refine the way CMS accounts for the infrastructure costs associated with radiation therapy equipment, and reflect that x-rays are currently done digitally rather than with analog film.

Transparency. CMS seeks to enhance transparency in PFS ratesetting due to its ongoing implementation of the misvalued codes initiative. CMS’s identification of misvalued codes has demonstrated that the agency’s practice of implementing changes in payment rates under the misvalued codes process prior to an opportunity for public comment is problematic. CMS has worked to change the process for receiving information on new and revised codes under the misvalued code process in order to allow all misvalued code revisions to go through notice and comment rulemaking before being adopted. If finalized, the new process would ensure that no changes to services rates (except for entirely new services never before valued under the PFS) would be effective until CMS has responded to public comment.

Chronic care management. In the Final rule for the CY 2014 PFS, CMS established a policy to make separate payments for non-face-to-face CCM services for Medicare beneficiaries who have multiple (two or more) significant chronic conditions. CCM services include regular development and revision of a plan of care, communication with other treating health professionals, and medication management. The Proposed rule addresses three aspects of CCM services: a payment rate of $41.92 for the code that can be billed no more frequently than once per month per qualified patient; greater flexibility in the supervision of clinical staff providing CCM services; and standards for electronic health records.

Open payments. CMS also used the Proposed rule to respond to “questions and experience administering” the Open Payments program, by proposing four changes: deleting the definition of “covered device,” because it duplicates another existing definition; deleting the Continuing Education Exclusion in its entirety to create a more consistent reporting requirement; requiring the reporting of the marketed name of related covered and non-covered drugs, devices, biologicals, or medical supplies, unless the payment or other transfer of value is not related to a particular covered or non-covered drug, device, biological or medical supply; and requiring applicable manufacturers to report stocks, stock options, or any other ownership interest as distinct categories.

Other changes. In addition to the above, the Proposed rule includes changes to the ambulance fee schedule regulations, the Physician Compare website, the Physician Quality Reporting System, the Medicare Shared Savings Program, the Value-Based Payment Modifier and the Physician Feedback Program.

The actual values used to compute physician payments for CY 2015 are not yet available, but will be published as part of the CY 2015 PFS Final rule by November 1, 2014. To ensure consideration, CMS must receive comments on the Proposed rule by September 2, 2014.

MainStory: TopStory NewsStory ReimbursementNews AgencyNews HealthCareReformNews CMSNews BillingNews PartBNews PhysicianNews DrugBiologicalNews DMENews

Health Law Daily

Introducing Wolters Kluwer Health Law Daily — a daily reporting service created by attorneys, for attorneys — providing same-day coverage of breaking news, court decisions, legislation, and regulatory activity.


A complete daily report of the news that affects your world

  • View full summaries of federal and state court decisions.
  • Access full text of legislative and regulatory developments.
  • Customize your daily email by topic and/or jurisdiction.
  • Search archives for stories of interest.

Not just news — the right news

  • Get expert analysis written by subject matter specialists—created by attorneys for attorneys.
  • Track law firms and organizations in the headlines with our new “Who’s in the News” feature.
  • Promote your firm with our new reprint policy.

24/7 access for a 24/7 world

  • Forward information with special copyright permissions, encouraging collaboration between counsel and colleagues.
  • Save time with mobile apps for your BlackBerry, iPhone, iPad, Android, or Kindle.
  • Access all links from any mobile device without being prompted for user name and password.