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American Academy of Family Physicians
Thursday Dec 23, 2010

The secret to getting a 10 percent Medicare bonus in 2011

Recently, I've seen ads for continuing education programs that nearly promise that their program will share inside knowledge on how to get the Centers for Medicare & Medicaid (CMS) Primary Care Incentive Program (PCIP) bonus. If you’re interested in the PCIP, I think I can save you from spending money on a continuing education program and some time. If you're a primary care physician who provides mostly office, nursing home and home visits to the Medicare patients in your practice you qualify for the bonus. Well ... it's almost that simple.

First, you must have enrolled in Medicare with a specialty designation that says you are a family physician or other primary care specialist. Under the Affordable Care Act, only physicians with a primary specialty designation of family medicine (08), internal medicine (11), geriatric medicine (38), or pediatric medicine (37) are considered potential primary care physicians. If a claim for a primary care service is submitted by a group practice, the claim must contain the National Provider Identifier (NPI) of a qualifying physician or provider on the claim line for the primary care service in order to qualify for the incentive payment.

Nurse practitioners (50), clinical nurse specialists (89) and physician assistants (97) may also be eligible for the PCIP regardless of the specialty area in which they may be practicing. These specific nonphysician practitioners are eligible for the PCIP based on their profession as long as their historical percentage of allowed charges for primary care services equals or exceeds the required threshold. Nonphysician practitioner services provided incident to a physician's service would be credited to the billing physician's allowed charges and payments. Only those services billed under the nonphysician practitioner's NPI will count toward their PCIP eligibility and bonus.

CMS will provide Medicare Administrative Contractors (MACs) with a list of the national provider identifiers (NPIs) of eligible primary care practitioners before Jan. 31 of each incentive year. You may check the file on your MAC's web site for your NPI number and contact the MAC if there are any questions regarding your eligibility for the PCIP. (Read a recent FPM article for more information on MACs.)

Second, a minimum of 59.5 percent of your allowed charges under the Medicare Physician Fee Schedule (PFS) in 2009 (the denominator, as shown below) must have been for designated primary care services (the numerator, as shown below) to qualify for the 2011 bonus. Primary care services are those reported with E/M codes 99201-99215 and 99304-99350. Charges for hospital and emergency department visits are removed from the denominator as well as services paid outside the PFS, including all lab charges and drugs, including vaccines, paid under Part B. Other ancillary services provided by physicians and paid under the physician fee schedule will be included in the calculation of allowed charges.

Here is how Medicare will calculate your percentage:

Allowed charges for primary care services X (multiplied by) 100
PFS charges – (minus) hospital E/M charges

If you wish to make your own determination on your claims history for 2009 (on which the 2011 incentive will be based), you need to run two billing reports by individual NPI number.

The first report would be of allowed amounts for services from 2009 claims paid by Medicare excluding the following codes: 

  • Laboratory services: CPT 80000 series, code G0328 for occult blood and code G0103 for PSA;
  • Flu vaccines: 90655-90658 and 90660;
  • Pneumococcal vaccines: 90669, 90732-90740;
  • HepB vaccine: 90743-90747;
  • Hospital, observation and emergency services: 99217-99223, 99231-99236, 99238-99239, 99281-99285 and
  • HCPCS codes for medications commonly administered in the practice and for durable medical equipment (DME) such as crutches, canes and glucose monitors.

The second report would be of the amount of total Medicare allowed charges in 2009 for claims billed with codes 99201-99215, 99304-99350.

You then divide the total allowed charges of the second report by the total allowed charges of the first report and multiply by 100. The result must be 59.5 or more to meet the criteria.

The PCIP payments will be calculated by the Medicare contractors and made quarterly for the primary care services furnished in that quarter. The incentive payment is based on the amount paid, and not the Medicare approved amount. Contractors will pay the primary care incentive payment at the same time and on the same check as the HPSA physician bonus when both are applicable.

Friday Dec 17, 2010

A happy new year, indeed!

In my last post ("Good news from Medicare, over time," Dec. 2, 2010), I mentioned that, assuming Congress intervenes again by the end of the year and the conversion factor for 2011 is no less than it is now, there would be good news for family physicians in the 2011 Medicare physician fee schedule. Well, I am happy to report that Congress and the President did intervene last week and approved legislation that extends the current Medicare physician payment rate through the end of 2011. 

Admittedly, no increase in the Medicare conversion factor does not sound like good news; after all, it's not like your expenses are going to remain flat for the next year. However, no increase is better than the 25 percent decrease that would have occurred in the absence of an extension. Further, as I noted in my last post, because of relative value unit changes, family physicians should experience an increase in the Medicare payment allowance for some of the services that they provide most often, not to mention the primary care bonus that Medicare will begin to pay in 2011. 

Congress also voted last week to exempt physicians from the Federal Trade Commission's Red Flags Rule. The rule, which applies to creditors and is in intended to stop identity theft, would have been onerous for the typical medical practice. That burden will now be avoided. 

So, as you prepare to ring in the new year, you may do so with the knowledge that you will not be paid any less by Medicare in 2011 and, in fact, as a family physician, you will probably be paid more. Happy new year!

Monday Dec 06, 2010

Not e-prescribing in 2011 may cost you in 2012

By law, Medicare must apply a 1-percent reduction to Medicare Physician Fee Schedule (MPFS) payments in 2012 for those physicians who do not successfully participate in the Medicare e-prescribing (eRx) incentive program in 2011. This applies to all physicians who provide at least 100 evaluation and management (E/M) and/or other services designated by the Centers for Medicare & Medicaid Services (CMS) as eRx denominator codes and receive at least 10 percent of their MPFS income from these. To avoid the fee reduction, covered physicians must adopt a "qualified" eRx system and report its use during at least 10 distinct encounters for services represented by a denominator code in the first six months of 2011 to avoid a 1-percent decrease in MPFS payments in 2012. The code to report is G8553, "At least one prescription created during the encounter was generated and transmitted electronically using a qualified eRx system," and it must be reported on the same claim as the associated denominator code.

The denominator codes are 90801, 90802, 90804-90806, 90807-90809, 90862, 92002, 92004, 92012, 92014, 96150-96152, 99201-99205, 99211-99215, 99304-99310, 99315, 99316, 99324-99328, 99334-99337, 99341-99343, 99345, 99347-99350, G0101, G0108, G0109.

CMS does allow for two hardship exceptions. These require reporting one of the following codes once during the period from Jan. 1, 2011, to June 30, 2011. The exceptions and codes are as follows:

• G8642 - The eligible professional practices in a rural area without sufficient high speed Internet access and requests a hardship exemption from the application of the payment adjustment under section 1848(a)(5)(A) of the Social Security Act,

• G8643 - The eligible professional practices in an area without sufficient available pharmacies for electronic prescribing and requests a hardship exemption from the application of the payment adjustment under section 1848(a)(5)(A) of the Social Security Act.

For a physician or nonphysician provider who would otherwise be required to participate in the eRx program but does not have prescribing privileges, a one-time reporting of code G8644, "Eligible provider does not have prescribing privileges," is required to be granted an exception.

On the up-side of this, successful eRx for the entire year in 2011 (reporting 25 encounters) will earn a bonus of 1 percent of all MPFS allowed charges for 2011. Also, it is not too late to claim a bonus of 2 percent for 2010 if you have been using an eRx system that qualifies for the incentive. Here's how:

1. Determine if you are using a qualified eRx system. There are two types of systems. You may use either a stand-alone eRx system or an electronic health record (EHR) system with eRx functionality. Your system must be able to perform the following tasks:

• Generate a complete active medication list incorporating electronic data received from applicable pharmacies and pharmacy benefit managers (PBMs), if available.

• Select medications, print prescriptions, electronically transmit prescriptions, and provide all alerts.

• Provide information related to lower cost, therapeutically appropriate alternatives, if any. (The availability of an eRx system to receive tiered-formulary information, if available, would meet this requirement for 2010.)

• Provide information on formulary or tiered-formulary medications, patient eligibility, and authorization requirements received electronically from the patient's drug plan, if available.

2. Submit code G8553 on at least 25 of your claims for E/M services with dates of service in 2010. Alternatively, you may choose to report a minimum of 25 patient encounters through a qualified registry or qualified EHR. CMS also offers a group reporting option for practices that also participate as a group in the Physician Quality Reporting System (PQRS, formerly PQRI).

The opportunity for a bonus will continue through 2013 but is reduced by .5 percent each year. I hope you can take advantage of the opportunities to receive a bonus while they exist and avoid the penalties that are scheduled to increase by .5 percent in each year through 2014.

Thursday Dec 02, 2010

Good news from Medicare, over time

In my last post ("SGR relief:  Let us give thanks, for now," Nov. 19, 2010), I referenced that the U.S. Senate had approved a one-month extension of the current Medicare physician fee schedule conversion factor and that the U.S. House of Representatives was expected to do the same when they returned from their Thanksgiving recess. I am happy to report, as Bob Edsall observed in the "Noteworthy" blog earlier this week, that the U.S. House acted as expected, and the conversion factor will remain at its current level through the end of the year. 

Assuming Congress intervenes again by the end of the year (a big assumption, I grant you) and the conversion factor for 2011 is no less than it is now, there is even more good news for family physicians in the 2011 Medicare physician fee schedule. At the current conversion factor and using the relative value units (RVUs) published in the final rule on the 2011 fee schedule, codes 99213 and 99214 (two of the CPT codes most commonly used by family physicians) will have Medicare allowances in 2011 that are 42 and 35 percent higher, respectively, than they were in 2006. The increase will be even larger for those family physicians that qualify for the Medicare primary care bonus that goes into effect next year. 

How is that possible, especially when the current conversion factor is less than it was in 2006? As you can see in this chart, which details the changes over time, the answer lies in the relative value units (RVUs) that are assigned to these codes. Physician work RVUs for these codes got a significant boost in 2007, as a result of the five-year review of the Medicare physician fee schedule, and they got another boost in 2010, when the Centers for Medicare & Medicaid Services (CMS) decided to quit paying for consultation codes and redistributed the RVUs to other evaluation and management (E/M) codes, like 99213 and 99214. The practice expense RVUs and professional liability insurance RVUs have also gone up, thanks to methodology changes at CMS and the use of more current data.  

Given the trials and tribulations to which the conversion factor has been subjected, it is easy to get discouraged about the state of Medicare payments, but it turns out that the reality is a little better than the perception for some of the codes family physicians use most often.  Admittedly, the gains did not occur overnight, which is why it's easy to overlook them, but they are there.  Or at least they will be, if Congress can continue to spare the conversion factor, like it did this week.   

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