Medicare proposed rule: What you need to know

August 19, 2014

The Centers for Medicare & Medicaid Services proposed changes to Medicare payment cover the Physician Quality Reporting System, value-based payment modification, potential relative value unit changes, targeted codes, and a change in global for future years, among other items.

It is that time again. Every year, the Centers for Medicare & Medicaid Services releases proposed changes to Medicare payment in late June or early July, previewing what changes are being considered. This year’s proposed rule, released on July 3, can be viewed in full on the CMS website. As in previous years, the proposed rule provides thoughts on the Physician Quality Reporting System (PQRS), value-based payment modification, potential relative value unit changes, targeted codes, and a change in global for future years, among other items.

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Specialties and individuals were given until Sept. 2 to submit comments on the proposed rule. The AUA and other groups were preparing comments at press time. Keep in mind that these are proposals; the final rule is not published until late October or early November. However, it is worth taking note of these issues and providing feedback.

We will address a few of the highlights.

Pay cuts loom in 2015

The temporary patch to the conversion factor passed last year protects Medicare payments at near-current levels until April 1, 2015. After this time, the sustainable growth rate (SGR) kicks in and the dreaded decrease from 6 years of kicking the can down the road will be implemented without intervention from Congress. The American Medical Association, the AUA, and others continue to lobby for a long-term fix of the SGR. Once again, we will likely be left hoping for a last-minute solution. As no one knows what will happen in an election year, it is hard to project what to expect for this issue.

Once again, Medicare has identified a few codes that are “misvalued.” Typically, this means that Medicare feels that codes are valued too high. Although the list of “misvalued” codes is not long, it does include some significant codes for urology, the most notable being 52000 (Cystourethroscopy [separate procedure]). Several other codes on the list have recently undergone significant decreases, including abdominal ultrasounds (76700, 76705), one urodynamics code (51728), post-void residual (51798), bladder instillation (51700), and prostate needle biopsy (55700).

Medicare is also proposing to continue its attack on the value for pathology related to prostate biopsies, intending to delete all three of the high-volume prostate G codes and keeping only the 10-20 G code with its current value.

 

Next: 'Radical change' for global periods

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‘Radical change’ for global periods

Perhaps the most radical change proposed by Medicare is the elimination of 10- and 90-day global periods. The proposal recommends phasing in the changes, with 10-day global procedures moving to 0-day global procedures beginning in 2017 and 90-day global procedures moving to 0-day global procedures beginning in 2018.

The reaction to this proposal has been mixed. On the plus side, it would allow billing for preoperative and postoperative care and of course other services provided, whether related or unrelated, without modifiers or additional payment reductions. Additionally, coordination of care among providers, where surgery is provided by one physician or group and follow-up care is provided by others, will not require coordinated billing.

On the other hand, there is a great deal of fear from the surgical specialties related to both financial loss and patient care. First, the financial concerns. Medicare’s changes in RVUs and payment policy since the inception of the Resource-Based Relative Value Scale in 1992 have been directed at increasing payment to primary care specialties. Without changing the overall Medicare Part B budget, this means that every raise for a primary care physician is at the expense of other specialties. This proposal is no different; in fact, this proposal comes under the heading of misvalued procedures.

With a reduction in the global period, Medicare proposes to revalue all surgical services, removing all values for pre- and postoperative care. How this revaluing is accomplished will be very important.

Second, Medicare is exploring options as they relate to how payment for pre- and postoperative services are paid and how much they should be paid. Medicare has stated in its proposal that it views surgical services as overpaid due to changing care patterns, which, if correct, may result in lower payments to surgeons using codes and values for evaluation/management services as they exist. It also opens up pre- and postoperative care to a competitive process that could cost surgery providers as patients migrate to paid primary care providers for follow-up care. From a cost perspective, how malpractice values are adjusted will affect payment, and change in practice patterns could adversely affect malpractice premiums.

The effect on patient care may also be an issue. Without a global payment, patients would have to pay co-pays and co-insurance for each follow-up visit, which would be a disincentive for the patient to receive adequate follow-up care. Although the overall payment may be lower or at least no higher as a percent of care, we all know that perception is a big part of care decisions and many of those most in need of follow-up may not choose to pay for it.

Also under consideration is the fact that many care centers, such as universities-typically places that provide surgeries for patients who have traveled significant distances and are not involved in full patient follow-up-will obviously suffer financially. Many of these institutions are already the only facilities providing certain services; without financial incentive, we may experience a significant access issue for certain procedures. In addition, primary care providers may actively seek to provide postoperative care for all patients.

There is also the practical aspect of professional liability. If surgery is provided by one physician and the necessary follow-up care is not adequately provided or provided in a manner counter to care instructions from the surgeon, who bears responsibility for complications?

Finally, what is the private-payer community going to do? If Medicare makes this change, it will affect values in the system that currently are the basis for payment in greater than 80% of the private-pay market. How are your contracts going to be affected if the transition occurs? Typically, payers are at least 1 year behind Medicare with major policy changes. Are fee schedules going to be frozen during this process? Will private payers adopt portions of the Medicare change? Will practices once again be forced into radically different billing patterns for Medicare versus private payers?

All of these issues and their associated pros and cons are being discussed as everyone formulates responses to this proposal. The AUA is a part of a chorus of voices that will join the debate on this issue. We will keep you posted.

 

Next: PQRS changes proposed

 

PQRS changes proposed

Medicare is proposing to phase out some PQRS measures and add still others. Many of those targeted to be phased out are commonly reported and being removed as they are considered now to be part of practice; as such, even with a total number of measures now over 225, some specialties will continue to struggle to find adequate measures for their own practice.

As we enter both the penalty and bonus phase for participation in PQRS, Medicare is proposing to expand the role of PQRS in the value-based payment modifier system that will be implemented for virtually all groups in 2017. Medicare is proposing to double both the penalty and bonus for the value-based modifier system from the current proposed high of –2% to –4% and +2% to +4%. All offices will have to pay close attention to their reports and participation status to avoid these potential problems.

Medicare has indicated that reports to physicians are due this summer, so keep your eyes open. These reports are for services provided in 2013 and will be a preliminary indicator of your status with Medicare.

You will also need to keep an eye on the Physician Compare website. The site already lists every provider that is currently eligible to receive payment from Medicare. The site is proposed to be expanded to provide a list of which programs you have succeeded or failed in relative to PQRS, cost reporting, meaningful use, e-prescribing, etc. Monitor your status and correct errors; it will likely affect your payments.

Conclusion

Medicare is actively pursuing its stated goal of becoming an active payer. We will keep you posted as these proposals are finalized for 2015 and beyond. The transition process for health care practices is daunting when taken as whole. Break down all the issues as best you can, delegate, and survive.UT

The information in this column is designed to be authoritative, and every effort has been made to ensure its accuracy at the time it was written. However, readers are encouraged to check with their individual carrier or private payers for updates and to confirm that this information conforms to their specific rules.

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