While the rest of us were heading out the door for trick-or-treating, the Centers for Medicare & Medicaid Services (CMS) in the late afternoon of October 31 posted the final 2015 Medicare Physician Fee Schedule.
The Protecting Access to Medicare Act of 2014 provides for a 0% payment update for services furnished during the first quarter of calendar year 2015. After March 31, 2015, fee schedule rates will be reduced by an average of 21.2% from 2014 rates, absent Congressional action to address the impact of the sustainable growth rate (SGR) formula.
The payment policies finalized by CMS in the 1,195-page document, however, will have a direct and lasting impact on Part B providers’ day-to-day operations. From this point forward, there is no turning back on the road to value-based purchasing in the Medicare program.
(1) Chronic Care Management
As promised last year, CMS will move forward with payment for non-face-to-face chronic care management (CCM) services. Beginning January 1, 2015, Medicare will make a per-beneficiary-per-month payment at a rate of $40.39 for CCM services provided to patients with two or more significant chronic conditions. CMS had proposed a rate of $42.91 back in July, but the rate was reduced due to a mandated adjustment to the conversion factor, as opposed to any change in CMS’ valuation of the service.
Rather than create a new G code as proposed, CMS is using the new CPT code 99490, with the following description:
Chronic care management services, at least 20 minutes of clinical staff time directed by a physician or other qualified health care professional, per calendar month, with the following required elements: multiple (two or more) chronic conditions expected to last at least 12 months, or until the death of the patient; chronic conditions place the patient at significant risk of death, acute exacerbation/decompensation, or functional decline; comprehensive care plan established, implemented, revised, or monitored.
CMS finalized its proposal to eliminate the requirement that CCM services (as well as transitional care management services) be furnished under direct physician supervision (i.e., physician present in the office suite), opting instead for general supervision (no physician presence requirement). CMS also clarified the requirements for use of a certified electronic health record (EHR) in providing CCM services, as well as the requirements for an electronic care plan.
PYA will provide an in-depth discussion of CCM services during the final webinar in its four-part series on physician value-based purchasing entitled Providing and Billing Medicare for Chronic Care Management. The webinar is scheduled for Wednesday, November 19, at noon EST. You can register for this complimentary webinar and access recordings of the other webinars in the series here.
(2) Value Modifier
Over the last three years, CMS has introduced the value-based payment modifier for the Medicare Physician Fee Schedule. The value modifier provides for differential payment to solo practitioners and physician groups based on the quality of care they provide to Medicare beneficiaries compared to the cost of that care over a specified period of time.
Based on their relative scores on specified quality and efficiency measures, solo practitioners and physician groups will be placed in one of nine quality tiers ranging from high quality/low cost to low quality/high cost. Each tier will have a corresponding upward, downward, or neutral payment adjustment.
CMS has made available to providers resources detailing the calculation and application of the value modifier. The payment differentials go into effect in 2015 for groups with 100 or more eligible professionals (based on 2013 performance) and in 2016 for groups with ten or more (based on 2014 performance).
In the final rule, CMS expands the value modifier to apply to all physicians in 2017 (based on 2015 performance) and to include non-physician practitioners in 2018 (based on 2016 performance). CMS also increases the maximum upward and downward adjustments from -2.0%/+2.0% in 2015 and 2016 to -4.0%/+4.0% in 2017 (with one exception discussed below). Physicians who fail to report quality measures as required under the Physician Quality Reporting System (PQRS) in 2015 will be subject to the -4.0% adjustment, in addition to the 2% PQRS reporting penalty.
For 2017, solo practitioners and physicians in groups with less than 10 eligible professionals shall be subject to a -2.0%/+2.0% adjustment. Also, these physicians also will not be subject to any downward adjustments in 2017 so long as they meet PQRS reporting requirements. Those that do not meet those requirements, however, will be subject to the full negative 2% payment adjustment (in addition to the 2% PQRS reporting penalty).
At noon EST this Wednesday, November 5, PYA will be presenting the third webinar in its four-part series on physician value-based purchasing entitled Study Guide for the Value Modifier. Again, you can register for this complimentary webinar and access recordings of the other webinars in the series here.
(3) Physician Feedback Program/QRURs
On September 30, CMS made available on its portal customized Quality and Resource Use Reports (QRURs) for all solo practitioners and group practices based on 2013 data. Each QRUR includes the recipient’s performance on the quality and cost measures used to calculate the value modifier as well as the specific performance tier to which the recipient would be assigned based on its scores on those measures.
For those groups subject to the value modifier in 2015 (those with 100+ eligible professionals), the QRUR shows how the group’s payments will be affected. CMS strongly encourages all providers to access their QRURs to better understand their current performance levels and how to improve their scores on quality and cost measures. CMS will make available the QRURs based on 2014 data in the fall of 2015. These reports will show how groups with ten or more eligible professionals will be impacted by the value modifier in 2016.
In the final rule, CMS states it will make available informal review mechanisms for providers to request certain limited corrections to their QRURs. For 2015, such requests will have to be made by the end of February 2015. CMS intends to formalize and expand the review process in 2016 and beyond.
(4) Physician Quality Reporting System
After years of bonus payments for physicians who reported specific quality information to CMS, PQRS switches gears in 2015. Now, physicians who did not report in 2013 will be subject to a downward payment adjustment. Failure to report in 2014 will mean a downward adjustment in 2016.
For 2015, CMS will add 20 new individual measures and 2 measures groups to fill existing measure gaps. CMS also will be removing 50 measures from PQRS reporting, bringing the number of individual measures to 255. Generally speaking, physicians need only report on nine measures covering three of the six National Quality Strategy domains.
The final rule includes several changes to the methods and manner in which quality data is to be submitted. These are included in a three-page chart included in the rule, which details the various reporting options and the requirements associated with each.
Finally, CMS continues its phased approach for public reporting of PQRS data on the Physician Compare website. By 2016, the number of group-level and individual measures to be publicly reported will be expanded significantly, giving beneficiaries more information on which to base treatment decisions.
(5) Open Payment Act
The Open Payments program requires applicable manufacturers of covered drugs, devices, biologicals, and medical supplies to report payments or other transfers of value they make to physicians and teaching hospitals to CMS. This information will be made available to the public on CMS’ website through searchable databases.
As part of the final rule, CMS has eliminated the Continuing Education Exclusion in its entirety, noting this will create a more consistent reporting requirement. CMS also refined certain reporting requirements for applicable manufacturers.
(6) Elimination of Global Surgery Periods
CMS will eliminate all 10-day global codes in 2017 and all 90-day global codes in 2018, noting that many providers are not performing the number of post-surgical visits contemplated by these codes. To address this potential for misvaluation of surgical services, CMS plans to make one payment for all services rendered on the day of surgery and to pay separately for visits and services actually furnished any subsequent day.
(7) Expanded Telehealth Services
CMS includes four new services to the list of services that can be furnished to Medicare beneficiaries under the telehealth benefit. These include annual wellness visits, psychoanalysis, psychotherapy, and prolonged evaluation and management services.
(8) Medicare Shared Savings Program Quality Measures
The final rule includes updates to parts of the Medicare Shared Savings Program regulations. First, CMS will reward accountable care organizations (ACOs) that make year-to-year improvements in quality performance scores by adding a quality improvement measure that adds bonus points to each of the four quality measure domains based on improvement.
Second, CMS has made revisions to the quality measures reporting requirements to reflect up-to-date clinical guidelines and standards of practice, reduce duplicative measures, increase focus on claims-based outcome measures, and reduce the ACO reporting burden. New measures have been added to focus on avoidable admissions for patients with multiple chronic conditions, heart failure, and diabetes; depression remission; all-cause readmissions to a skilled nursing facility; and stewardship of patient resources. Also, the existing composite measures for diabetes and coronary artery disease have been updated.
(9) Off-Campus Hospital Departments
CMS will begin collecting data on services furnished in off-campus provider-based departments by requiring hospitals to report a modifier for those services furnished in an off-campus, provider-based department and by requiring physicians and other practitioners to use a new site of service code on professional claims. Hospital reporting will be voluntary for 2015 and mandatory in 2016. The new site- of-service code will not be effective until after January 1, 2016.
(10) Adjustments for Misvalued Codes
CMS continues its statutorily mandated hunt for misvalued codes, i.e., those codes for which work and/or practice expense (PE) relative value units (RVUs) are overstated based on comparison to actual practice. In the proposed rule, CMS had identified that special building requirements to house linear accelerators do not represent a direct cost in its PE methodology; instead, it is accounted for in the indirect PE methodology. CMS, therefore, proposed to remove these building requirements as a direct PE input from radiation treatment procedures. This seemingly minor change was expected to result in a 4% reduction in Part B payments for radiation oncology and an 8% reduction for radiation therapy centers.
In response to comments, CMS decided not to finalize this proposal. Instead, the agency will reconsider whether the vault is a direct or indirect cost sometime in the future. Two other adjustments CMS had proposed – payment reductions for hip and knee replacements and code changes for gastroenterology and radiation therapy services – also were delayed. CMS did finalize proposals relating to epidural pain injections and x-ray services (to account for discontinued use of analog film).
The 1000+ page final rule covers far more ground than is summarized here. The days of minor tweaks to the Medicare Physician Fee Schedule are over, as CMS works to implement significant payment reforms in the Medicare program. The final rule demonstrates CMS is considering public comments as it moves forward with this implementation, even if it does not always incorporate those recommendations.
PYA’s Opportunity Forecasting & Positioning Team can assist your organization in analyzing the impact of new payment policies and preparing comments for submission to CMS on future proposals. Additionally, our consultants can support your organization in developing CCM services, maximizing performance under the value modifier, complying with PQRS and Open Payment Act requirements, and establishing and expanding a successful telehealth program. For more information, please contact Marty Brown, Nancy McConnell, or Martie Ross at PYA, (800) 270-9629.
 Current Procedural Terminology (CPT)- a registered trademark of the American Medical Association.
 All PQRS measures are assigned to one of six quality improvement domains: (1) Patient and Family Engagement; (2) Patient Safety; (3) Care Coordination; (4) Population/Public Health; (5) Efficient Use of Healthcare Resources; and (6) Clinical Process/Effectiveness.