CMS Releases Proposed 2016 Fee Schedule

 In Articles, Provider Notes

Details of Medicare reimbursement are set each year through the publication of a Physician Fee Schedule rule. The proposed 2016 rule – all 815 pages – was released July 8th. Following a 60-day comment period, the final rule is expected in November with most provisions taking effect January 1, 2016.

Based on an initial review, we’ve identified the following key points:

  • Medicare Payment Rates: Medicare payments are based on RVU value times a set dollar amount. The MACRA legislation that repealed the SGR formula included a 0.5% increase in the conversion factor as of July 1 and an additional 0.5% increase effective January 1, 2016. The Physician Fee Schedule is the regulation that identifies changes in the RVU values for specific codes. In table 45, Centers for Medicare & Medicaid Services (CMS) estimates the impact of the proposed RVU changes on each of 56 specialties:
    • Reductions in payment rates due to RVU values are seen in 5 specialties: Radiation Therapy Centers (-9%), Radiation Oncology (-3%), Gastroenterology (-5%), Colon/Rectal Surgery (-1%) and Neurosurgery (-1%). These reductions would be offset by the scheduled increase of 0.5% in the conversion factor.
    • Significant increases in payment rates due to RVU values are seen in Pathology (8%) and Independent Laboratories (9%); seven specialties have a 1% increase.
  • Advanced Care Planning: CMS proposes to begin paying for providers who spend time discussing end-of-life planning with their patients using CPT code 99497 (first 30 minutes) and 99498 (each additional 30 minutes). Payment will be approximately $50. They seek comments on when and how these codes should be appropriately used.
  • Incident-to-Billing: CMS proposes a major change to incident-to billing rules which would require that the supervising physician be both on-site and the same physician that initially saw the patient and developed the plan of care.
  • Physician Compare Website: CMS proposes to publish performance rates on all quality measures submitted for PQRS regardless of reporting approach beginning in 2016 (2015 data). For 2017, they plan to add information on the Value-Based Modifiers (VBM) quality tier and a star-rating based on PQRS data.
  • PQRS, VBM and MIPS: CMS is beginning to construct the new Merit-Based Incentive Payment System (MIPS) which begins with the 2017 reporting year and combines PQRS, VBM, MU and a new “clinical quality improvement” initiative into a single quality score. As a result, there are relatively few changes proposed for these programs. As we see each year there are additions, deletions and revisions to specific quality measures; there are new requirements for validation and auditing of data submitted through registries and QCDRs. The VBM program expands in 2016 to include PAs, NPs, CNPs, and CRNAs, but not other mid-level providers. And, practices with less than 10 providers will begin to see downside risk based on 2016 data. The maximum penalty structure of 4% for larger practices and 2% for those under 10 providers is retained.
  • Additional sections of the proposed rule will be of interest to certain specialists and specific circumstances. These include updates and clarifications to the physician self-referral exceptions, new timeframes for opting out of Medicare and a new modifier if your CT equipment is not NEMA approved.
  • CMS uses the proposed rule to solicit comments on future regulatory activities, providing some insights into what the future may hold. This year, CMS specifically asks for comments regarding “Appropriate Use Criteria” for selected imaging services, obstacles to stratifying quality measures by race and ethnicity, and inputs to the new clinical improvement activity component of MIPS.

Watch for further details on the MSOC Health blog. We also recommend checking the MGMA Government Affairs at MGMA website and your specialty association. Or, put on your policy wonk hat and read key sections yourself here. If you’re not quite ready for that, CMS publishes a fact sheet that summarizes key provisions.

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