American Academy of Family Physicians
Monday Jan 07, 2013

Webinar to discuss what's new in Medicare and Medicaid payment in 2013

With the Medicare payment cliff averted for now, Medicare payments should be fairly stable for a while. However, that does not mean there are no changes in store for Medicare and Medicaid this year.

From Medicare adding two new codes for transitional care management to Medicaid payments for some primary care services rising to the level of Medicare to the continuing use of Physician Quality Reporting System (PQRS) bonuses, it's going to be a busy year for family physicians understanding and taking advantage of the new payment rules.

My colleague Debra Seyfried and I will be covering these and other aspects of Medicare payment in 2013 during a live webinar at 1:00 p.m. (Central Standard Time) on Jan. 23, 2013. I would invite you to join us by registering online. It could make a difference to your bottom line this year and in years to come.

– Kent Moore, Senior Strategist for Physician Payment for the American Academy of Family Physicians

Friday Dec 21, 2012

Medicare's impending fiscal cliff for physicians

If the federal government does go over the "fiscal cliff" in a little more than a week, don't expect those overseeing physician reimbursements to pad the fall.

The Centers for Medicare and Medicaid Services (CMS) on Dec. 19 announced in an email and conference call with physicians that Medicare claims filed after the first of the year will be processed as normal, which means likely including a planned 26.5 percent reduction in the Medicare physician services conversion factor.

Physicians are also facing an additional 2 percent cut in the Medicare physician payment rate because of the Budget Control Act's sequestration provision.

Under current law, clean electronic claims are not paid sooner than 14 calendar days (29 days for paper claims) after the date of receipt. In similar past situations, CMS has taken advantage of that provision to have its contractors hold claims for up to 10 business days before processing them, in order to give Congress more time to act and to avoid processing claims twice when the conversion factor is in flux.

“The negative update of 27 percent under current law for the 2013 Medicare Physician Fee Schedule is scheduled to take effect on January 1, 2013,” CMS wrote in the email. “Given the current progress with the legislation, CMS must take steps to implement the negative update.”

CMS did say that it would notify physicians on or before Jan. 11, 2013, about the status of Congressional action to avert the negative update and next steps. Claims with dates of service on or before Dec. 31, 2012, will be unaffected in any case.

Ongoing efforts to avoid the cliff and override the planned rate reduction have so far failed and won't resume until after Christmas at the earliest.

In the meantime, you are advised to start taking steps to mitigate the disruption and meet your own financial obligations in January, in case the cuts actually take effect. This includes re-assessing your Medicare participation options and the extent to which you can continue to afford to care for Medicare beneficiaries. If you decide to limit your involvement with the Medicare program, notify your Medicare patients promptly, so that they, too, can explore other options to seek health care and medical treatment. Finally, you are encouraged to contact your Congressional representatives about this matter, and the American Academy of Family Physicians has provided a convenient means to do so.

–Kent Moore, Senior Strategist for Physician Payment for the American Academy of Family Physicians

Tuesday Dec 18, 2012

New rule would let more family physicians treat veterans

While many family physicians want to treat the military veterans in their communities, the Department of Veterans Affairs (VA) hasn't always made that easy. Thankfully, the VA recently began taking steps to loosen its regulations in such a way that family physicians could have greater ability to serve veterans and get paid by the VA for doing so.

Under current law, private physicians can provide certain hospital care and medical services to eligible veterans when VA facilities either are not accessible or aren't able to provide the necessary care. These services are provided under the Non-VA Care program. However, the program allows that non-VA care only if the veteran initially received treatment during a period of hospitalization.

Last month, the VA published a proposed revision to this regulation in the Federal Register. The change would enlarge the list of eligible providers where the veteran initially received care to include nursing homes, domiciliary care, or other medical services. The VA could authorize non-VA treatment under the program for up to 12 months, with the option of additional reauthorizations as needed.

The American Academy of Family Physicians (AAFP) enthusiastically supports this step since it improves health care access for veterans and will allow the VA to better utilize community resources. Separate from this proposed regulation, the AAFP is encouraging the VA to identify and remove additional barriers that inhibit the way community-based family physicians are able treat their patients who also happen to be veterans. Specifically, the AAFP is urging the VA to reexamine a burdensome regulatory requirement that in order for a veteran to obtain a prescription at the VA's discounted price it has to be written by a VA-affiliated provider. Instead, AAFP believes the VA should recognize the validity of a community-based physician's prescription.

The VA’s recent proposal won’t eliminate all of the barriers that community family physicians face in trying to serve veterans. However, it appears to be a step in the right direction for both veterans and their family physicians.

 –Kent Moore, Senior Strategist for Physician Payment for the American Academy of Family Physicians

Friday Aug 31, 2012

AAFP responds to proposed rule on 2013 Medicare physician fee schedule

On Aug. 22, 2012, the American Academy of Family Physicians (AAFP) responded to the proposed rule on the 2013 Medicare physician fee schedule. As promised, I am sharing that response with you. Here are some of the highlights; the AAFP:

  • Supports the Centers for Medicare & Medicaid Services' (CMS) proposal to create a code for post-discharge transitional care management as a short-term payment strategy; however, the AAFP urges CMS to limit the use of the code to the patient's primary care physician,
  • Supports CMS’s intent to investigate potentially misvalued codes, especially in regard to the number and level of post-operative evaluation and management services assumed to be included in global surgical services,
  • Urges CMS to not implement the Institute of Medicine recommendations pertaining to geographic practice cost indices, and instead asks that CMS refocus it's efforts on ensuring a properly distributed healthcare workforce that is meeting the demands of a growing beneficiary population,
  • Agrees with the proposal to add coverage of ‘‘additional preventive services’’ and supports the proposal to add them to the list of Medicare telehealth services for 2013; however, the AAFP questions several of the proposed payment amounts for these services,
  • Supports the CMS proposal to create new criteria for being a successful electronic prescriber for groups of two to 24 eligible professionals,
  • Strongly supports CMS’s proposal to streamline the implementation of the Physician Quality Reporting System incentive and reporting programs within the context of the Medicare Shared Saving Program,
  • Mostly supports the CMS proposal to begin applying the value-based payment modifier only to groups of 25 or more eligible providers in 2015, so the agency can begin learning how to properly fulfill the statutory requirements; however, the AAFP remains concerned with CMS’s inability to specify the exact amount of the upward payment adjustment because of budget neutrality considerations,
  • Fully supports the agency’s proposal to begin Medicare Part B coverage of the Hepatitis B vaccine for high-risk groups, specifically persons with diabetes.

The full text of the AAFP response is available online.

The comment period for the proposed rule ends on Sep. 4, 2012. After that deadline, we will have to wait for the final rule to see what CMS decides to do on all of these issues. CMS is expected to release the final rule on the 2013 Medicare physician fee schedule on or around Nov. 1, 2012.

Thursday Aug 16, 2012

Medicare physician fee schedule redux

In a previous blog, I posted about the proposed rule on the 2013 Medicare physician fee schedule. I subsequently received questions regarding whether or not the American Academy of Family Physicians (AAFP) had any involvement in the creation of the proposed 2013 fee schedule and what impact the fee schedule might have on family physicians. To the best of my knowledge, AAFP was not directly involved in the creation of the proposed 2013 Medicare physician fee schedule. The Centers for Medicare & Medicaid Services (CMS) essentially reserves sole responsibility for its creation.

AAFP  advocates with CMS throughout the year on elements of the physician fee schedule, and the results of that advocacy can be seen in CMS's estimate of the proposed rule's impact on family medicine. Specifically,  CMS estimates that family physicians will experience approximately a 7 percent increase in Medicare allowed charges in 2013, based on what is in the proposed rule (see page 12 of the AAFP's summary of the proposed rule). That percentage is higher than any other specialty listed. So, although AAFP can't take responsibility for creating the proposed rule, it can certainly take some credit for the estimated positive impact on family physicians.

AAFP is preparing a response to the proposed rule in advance of the Sep. 4, 2012, deadline for comments, and I look forward to sharing that with you in a future post. In the meantime, thanks for the questions, and please let me know if you have more.  

Tuesday Apr 17, 2012

ICD-10: The gift of time

In February, I posted that the U.S. Department of Health and Human Services (HHS) had signaled its intent to delay implementation of International Classification of Diseases, 10th Edition (ICD-10), which was scheduled to happen on Oct. 1, 2013. Now HHS made it almost official.

HHS Secretary Kathleen Sebelius announced a proposed rule that would delay the compliance date for ICD-10 from Oct. 1, 2013 to Oct. 1, 2014. The proposed rule is subject to a 30-day comment period before HHS finalizes it and makes the proposed delay completely official. 

As Cindy Hughes has noted in her most recent article in Family Practice Management, "While the delay may give you more time to prepare, it most certainly does not mean that you can postpone this work; it just means that if you start now, you might actually be ready by the new deadline." Cindy's article provides some great information in this regard, and you can find more information and resources on the American Academy of Family Physicians website.

So, HHS has provided the gift of another 365 days to prepare for implementation of ICD-10. Physicians and others would do wisely to use this gift to their advantage in getting ready. It seems unlikely that HHS will be this generous again in advance of the new deadline.

Monday May 09, 2011

Shields and swords

What is the difference between a shield and a sword?  Sometimes, it's hard to tell and may depend on where you sit.  This point was driven home to me recently in an exchange of correspondence between the AAFP and Wisconsin Physician Services (WPS), the Medicare contractor that processes Part B claims in several Midwestern states.     

Earlier this spring, the AAFP submitted comments to WPS regarding a draft local coverage determination (LCD) that WPS posted regarding home and domiciliary services (PDF download).  The AAFP expressed at least four concerns with the LCD, and it was clear from our comments that our primary concern was that WPS would use the LCD as a sword to unfairly penalize physicians who do home visits. 

Although WPS does not typically respond individually to comments made regarding draft LCDs, it did choose to respond to the AAFP comments in this case.  In doing so, it noted that a review of medical records for claims submitted by Part B providers in place of service "home" when the beneficiaries were also concurrently being seen by a home health agency showed that the service billed by the Part B provider was seldom, if ever, the service actually rendered.  WPS also shared statistics showing that utilization of home visit codes paid under the Medicare physician fee schedule was significantly higher in WPS's service area as compared to national averages, with financial implications for the Medicare trust fund.  From the letter, it was apparent that WPS viewed the draft LCD as a shield designed to protect Medicare and its beneficiaries. 

So, is the LCD a sword or a shield?  The answer clearly depends on whom you ask and, ultimately, how it is used.  In any case, the point of the story is that, when dealing with Medicare (and, likely, other payers, too), it is important to remember that there are often legitimate differences in perspective that must be acknowledged and addressed if true dialogue and progress is to occur. 

Friday Feb 25, 2011

From CMS, the better late than never department

Like the buddy who swears he will pay you the $20 he borrowed from you months ago, the Centers for Medicare and Medicaid Services (CMS) announced recently that it will finally reprocess a large number (i.e., hundreds of millions) of Medicare fee-for-service claims to account for retroactive Medicare payment increases implemented in 2010.  The AAFP and others had urged CMS as recently as December to make good on its debt

On Mar. 23, 2010, President Obama signed into law the Patient Protection and Affordable Care Act. Various provisions of the new law were effective Apr. 1, 2010, or earlier and, therefore, were implemented some time after their effective date. In addition, corrections to the 2010 Medicare Physician Fee Schedule (MPFS) were implemented at the same time as the Affordable Care Act revisions to the MPFS, with an effective date retroactive to Jan. 1, 2010.

Due to the retroactive effective dates of these provisions and the MPFS corrections, a large volume of Medicare fee-for-service claims need to be reprocessed.  This week, CMS staff stated on their monthly Open Door Forum for physicians, nurses, and allied health professionals that Medicare contractors will start reprocessing those claims within two weeks, while taking steps to ensure that new claims are accurately processed going forward.  CMS also issued a public notice to this effect. 

In most cases, no requests for adjustments are necessary, as the Medicare contractor will automatically reprocess the claims.  Only claims that include services with submitted charges that are lower than the revised 2010 fee schedule amount cannot be automatically reprocessed.  For those claims, you will need to request a reopening or adjustment. CMS has stated that in this situation, it will waive the normal one-year time limitation for the request for reopening claims, as this meets the “good cause” exception.

CMS has requested that claims not be resubmitted, because they will be denied as duplicate claims. CMS also reminded physicians of the Office of Inspector General's (OIG) policy related to waiving beneficiary cost-sharing amounts attributable to retroactive increases in payment rates based on the operation of new federal statutes or regulations. Specifically, physicians and other providers will not be subject to OIG administrative sanctions if they waive beneficiary liability in this situation, if they follow the criteria in the OIG policy statement.

It is unlikely that you will get all of the money that Medicare owes you all at once.  Adjustments owed to you will be added to future remittance advices as the 2010 claims are reprocessed.  If you have any questions in this regard, CMS advises you contact your local Medicare contractor. 

In the meantime, it might be time to see that buddy about the $20 he owes you. 

Friday Nov 05, 2010

The 2011 Medicare physician fee schedule is here

This week, the Centers for Medicare and Medicaid Services (CMS) unveiled its final rule on the 2011 Medicare physician fee schedule

An initial review shows positive news with respect to the primary care bonus that is effective in 2011. CMS apparently responded positively to comments from the American Academy of Family Physicians and others to change the primary care incentive payment implementation rules to make it more inclusive. As a result, CMS estimates that, under the new, less restrictive rules, about 80 percent of family physicians will qualify for the bonus. 

On the downside, the final rule with comment period announces a reduction to payment rates for physicians' services in 2011 under the sustainable growth rate (SGR) formula. The Medicare physician fee schedule rates are currently scheduled to be reduced under the SGR system on Dec. 1, 2010, and then again on Jan. 1, 2011 under current law. The total reduction in rates between November and January under the SGR system will be 24.9 percent. That means the conversion factor will drop from its current $36.8729 to $25.5217 in January, unless Congress and the President intervene. Of course, this week's Congressional election results may impact what happens in this regard, so stay tuned. 

The final rule will appear in the Federal Register on Nov. 29, 2010, and CMS will accept comments on certain aspects of it until Jan. 2, 2011.

Friday Oct 08, 2010

Accountable care organizations and the future of physician payment

This week, the Federal Trade Commission (FTC), the Centers for Medicare and Medicaid Services, and the Office of the Inspector General in the U.S. Department of Health and Human Services (HHS) discussed legal issues related to accountable care organizations (ACOs) during a public workshop in Baltimore.

As promised in the meeting agenda, an FTC panel debated circumstances under which independent health care providers participating in an ACO could engage in price point negotiations with private payers without running afoul of federal antitrust laws that prohibit price-fixing. Also, panel participants explored different ways in which the HHS secretary could exercise waiver authority or create new exceptions and safe harbors related to the physician self-referral law, the federal anti-kickback statute, and the civil monetary penalty law, for the purpose of encouraging the creation and development of ACOs. The AAFP submitted comments that were included in the meeting record, and the Academy will continue to track the progress of the issues discussed.
As I listened to the workshop and as I have thought about it since, my thoughts had less to do with how ACOs might be facilitated and more to do with what they might mean for coding by and payment of family physicians.  Regarding coding, I am inclined to think that ACOs will de-emphasize the importance of procedure and service coding while heightening the importance of diagnosis coding. My reason for thinking so is that I expect ACOs will be paid on something other than a fee-for-service basis and, in turn, will pay physicians accordingly. When payment is made, for example, on an episode-treatment or global capitation basis, coding of each individual service becomes much less important than it is under fee-for-service. At the same time, appropriate risk adjustment of global capitation or delineation of episodes of care will depend, at least initially, on correct and complete coding of each patient's condition(s), which is all about diagnosis coding.
Regarding the payments themselves, I am optimistic that family physicians can do well in an ACO model of health care delivery. Family medicine has long touted its value, essentially arguing that nobody can do it better for less. ACOs, according to proponents, are all about cost-effectiveness, which suggests that they will depend on family physicians to succeed. That dependency should create leverage for family physicians to be paid at a level that is commensurate with the value that they bring to the ACO. Of course, this assumes family physicians exercise this leverage and choose to play a key role in the formation and ongoing governance of ACOs. 
Admittedly, this is all a bit of crystal ball gazing on my part, and as my 401(k) results will attest, crystal ball gazing is not my strong suit. As in most matters, only time will tell, but I'd like to hear your predictions. What do you think?

Wednesday Dec 23, 2009

A familiar tune

The end-of-year holiday season is upon us.  I can always tell it is because of the displays in the stores, the songs on my radio, and the phone calls I receive asking about the status of next year's Medicare physician fee schedule

Each year about this time, I start getting phone calls from anxious physicians and their staff members asking if the Medicare fees really are going down in January or whether Congress will intervene as it has in the past.  This year is no different.  Under current law, the Medicare conversion factor (which converts relative value units (RVUs) to Medicare payment allowances) is scheduled to decrease by approximately 21 percent for services provided on or after Jan. 1, 2010.  That decrease will be partially offset by RVU increases announced for office visits and other evaluation and management services that family physicians frequently perform, but Medicare fees will still decline significantly if the conversion factor goes down. 

For the past several years, Congress has intervened at the last minute (or sometimes after the last minute) to either freeze the conversion factor or increase it slightly (although the increase is always less than the rate of inflation, so physicians still lose).  The expectation and hope is that Congress will do so again this time around.  For instance, as I write this, the U.S. House of Representatives' Rules Committee has produced a Defense appropriations bill that includes, among other things, a provision to extend the current Medicare physician payment rates through the end of February, with the expectation that this extension will give Congress enough time to enact  health reform legislation that includes a longer-term fix to Medicare's Sustainable Growth Rate (SGR) and physician fee schedule issue.  It's probably appropriate that the extension is attached to a Defense appropriations bill, since physicians would likely be up in arms if Medicare rates actually fell 21 percent. 

In the meantime, the fact remains that Medicare fees will drop in January unless Congress intervenes, which it has not completely done yet.  So, what's a physician to do?  Well, the good folks at the Centers for Medicare and Medicaid Services have given you until Jan. 31, 2010 to decide.  That's when the current period for changing your Medicare participation status for 2010 will end.  For more information,  I would encourage you to visit the Medicare participation options web page on the American Academy of Family Physicians' web site

And with that, I'll return to listening to the radio, where I can almost hear the Congressional Tabernacle Choir singing:

God rest ye merry gentlefolk; let nothing you dismay.

We plan to patch the SGR, and not to cut your pay.

Then do it all again next year, lest you should go astray.

So our tidings of comfort to the annoyed, to the annoyed.

So our tidings of comfort to the annoyed!

Thursday Dec 03, 2009

CMS issues a temporary cease fire

As a follow-up to my last posting ("Medicare shoots first and asks questions later," Nov. 19), I wanted to let readers know that the Centers for Medicare and Medicaid Services (CMS) announced on Nov. 23 that it would delay implementation of new rules that give Medicare the authority to reject claims for services or supplies when the ordering physician or health care professional is not enrolled in the Medicare Provider Enrollment, Chain, and Ownership System, or PECOS. The agency is delaying implementation of the new policy until April 5, 2010.  According to CMS, an extension of the implementation date will give physicians and other health care providers sufficient time to enroll or, if necessary, re-enroll in Medicare.  CMS has indicated that more detailed information about the rules delay will be published soon in MLN Matters, an online publication that is part of CMS's Medicare Learning Network.   

Interestingly, CMS's announcement came just a week after the American Academy of Family Physicians, the American Medical Association, and more than 50 other medical organizations sent a letter to CMS Acting Administrator Charlene Frizzera expressing concerns about the policy.  Among other things, the letter asked for an indefinite suspension of CMS's plans.  While April 5 does not constitute an "indefinite" suspension, it does suggest that CMS is listening and that collective advocacy on the part of organized medicine can have an impact.  When it comes to Medicare, one must take comfort where one can find it.

So, if you or other health care professionals who refer to you are not yet in PECOS, you have been granted a reprieve.  Just remember that a reprieve is not a pardon, and CMS will resume shooting on April 5, 2010.  In the meantime, to quote an old adage, "Forewarned is forearmed."

Thursday Nov 19, 2009

Medicare shoots first and asks questions later

On Oct. 5, 2009, the Centers for Medicare and Medicaid Services (CMS) quietly began implementing system edits intended to assure that Medicare Part B providers and suppliers bill for ordered or referred items or services only when those items or services are ordered or referred by physician and non-physician practitioners who are eligible to order/refer such services.  The edits are an expansion of existing claims edits intended to meet the Social Security Act requirements for ordering and referring providers.  Essentially, the law requires that a provider or supplier who bills Medicare for an item or service that was ordered or referred must show the name and unique identifier of the ordering/referring provider on the claim.

That is all well and good, but CMS has interpreted that to mean that claims that are the result of an order or a referral must contain the National Provider Identifier (NPI) and the name of the ordering/referring provider and the ordering/referring provider must be in the Medicare Provider Enrollment, Chain and Ownership System (PECOS) or in the Medicare contractor's claims processing system with the appropriate type of provider.  During Phase 1 of the implementation (Oct. 5, 2009 to Jan. 3, 2010),  if the ordering/referring provider is not in PECOS and is not in the claims system, the claim will continue to process and the Part B provider or supplier will receive a warning message on the Remittance Advice.  During Phase 2 (Jan. 4, 2010 and thereafter), if the ordering/referring provider is not in PECOS and is not in the claims system, the claim will not be paid. It will be rejected (but not denied), which means it can be resubmitted at some point, but it cannot be appealed.  For more information, you can read MedLearn Matters article 6417 on the CMS web site. 

Like seemingly all Medicare policies, this one is fraught with problems.  For instance, despite being enrolled in Medicare, if physicians and other health care practitioners are not in the PECOS database or in contractor files, those physicians, suppliers, and other health care practitioners to whom they refer and order services will not be paid. A physician or health care practitioner who enrolled in Medicare prior to 2003 when CMS began using PECOS will be required to re-enroll if they want to continue referring and ordering. As of July 2008, there were 793,346 physicians and other health care practitioners enrolled in Medicare.  According to data from an October 2009 Office of Inspector General report, there were 559,235 physicians and other health are practitioners in PECOS. Therefore, as many as 200,000 or 30 percent of all Medicare physicians and other health care practitioners are not in PECOS and will need to re-enroll, and we all know how glacial the pace of Medicare enrollment is. 

Another flaw is that some providers who commonly refer Medicare patients or order services for them do not typically enroll in Medicare.  For instance, some residents may not be enrolled in Medicare but will certainly be ordering or referring providers for Medicare purposes.  Likewise, dentists may be ordering/referring providers but otherwise have no reason to enroll in Medicare.  CMS staff indicate that they will soon be issuing instructions to deal with the dentist issue, but one wonders why CMS didn't think to do that before it started implementing the edits in question. 

Finally, physicians have no practical or convenient way to check whether the physicians or other health care practitioners who send them patients with orders or referrals are included in PECOS or other contractor enrollment records. CMS has promised to address this particular concern by making publicly available a list of eligible referral providers before January 2010, but again, one is left to wonder why they did not do so before implementing the edits.  I can only conclude that CMS staff favors the "shoot first and ask questions later" approach. 

In the meantime, downstream providers and suppliers of referred/ordered services/items are at risk of nonpayment, even though they are not responsible for the enrollment/reenrollment of physicians and other health care practitioners who legally order and refer patients to them for items or services.  That is why the AAFP, the AMA, and 54 other organizations are advocating with CMS to:

  1. Take action to ensure that otherwise acceptable claims are paid without delay or need for appeals;
  2. Indefinitely suspend the plan to deny these claims and instead wait at least until all practicing Medicare physicians, other health care practitioners, and residents can be revalidated and reenrolled or enrolled for the first time;  
  3. Focus its efforts on ensuring a smooth and efficient revalidation process, which will require physicians and other health care practitioners to re-enroll in Medicare if they have not done so since 2003; and, 
  4. Convene a high-level meeting with stakeholders to discuss concerns about ordering and referring physicians and other health care practitioners, and collaboratively develop a feasible and appropriate plan and timetable for addressing these concerns.

It remains to be seen how CMS will respond to this advocacy.  In the meantime, please be aware of the issue and how it may affect your Medicare claims beginning in January. 

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