No Pay Raise in 2016, but Shift to Value-based Pay Continues

AAFP Blasts CMS' Broken Promise of Positive Update in Fee Schedule

November 11, 2015 02:14 pm Sheri Porter

CMS released its final 2016 Medicare physician fee schedule( on Oct. 30, and the headliner news is causing consternation among the physician community.

[Red 0% on black background]

Here's why: A small but promised 0.5 percent Medicare pay increase was effectively reduced to zero for all physician specialties.

That's according to a quick analysis prepared by AAFP staff members and posted Nov. 6. on Family Practice Management's Getting Paid blog.

Physicians expected a 0.5 percent positive update to the Medicare conversion factor that was specified by the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) signed into law in April.

However, CMS was required under previous laws to identify and adjust overvalued CPT codes by reducing their relative value units by a total of 1 percent for 2016. Unfortunately, CMS missed its mark and was able to identify only 0.23 percent -- leaving a negative balance of 0.77 percent that the agency was required to make up by reducing the overall conversion factor.

In an interview with AAFP News, Academy President Wanda Filer, M.D., M.B.A., of York, Pa., blasted the federal government for its failure to deliver on a promise.

Story Highlights
  • The final 2016 Medicare physician fee schedule is out and shows that an expected 0.5 percent pay increase was effectively reduced to zero for all physician specialties.
  • AAFP President Wanda Filer, M.D., M.B.A., blasted the federal government for its failure to deliver on a promise.
  • She said the fee schedule is further evidence that the shift to value-based payment is underway.

"I am very disappointed with CMS, specifically, and their inability to identify 1 percent in overvalued CPT codes. As family physicians, we know that these (overvalued) codes are plentiful, but political backbone is required to achieve cuts," said Filer.

Kevin Burke, director of the AAFP's Division of Government Relations, pointed out that Congress shouldered part of the blame. "I am concerned with congressional efforts to prevent a thorough examination of CPT codes," Burke told AAFP News.

Filer said the resulting "convoluted math equation" that negated a hard-won and much anticipated 0.5 percent pay increase sounded like "an excuse" to physicians.

"Family physicians have been undervalued for way too long. The very physicians who are doing the heavy lifting when it comes to caring for Americans deserve much better," she declared. "At a time when we are penalized for not achieving meaningful use of our electronic health records, why are we penalized again when the government fails to deliver on this goal?"

Despite the disappointing news, Filer said she was relieved that the near-yearly threat of a massive pay cut attributable to the deeply flawed sustainable growth rate formula is forever gone.

"That threat was repealed by MACRA, and for that we are grateful," said Filer.

Additional Points to Ponder

AAFP advocacy and payment experts continue to scour the 1,358-page page rule and will fire off final comments to CMS before the Dec. 29 deadline. The Family Practice Management blog, as well as a summary written for the Nov. 9 Government Affairs Weekly report,(5 page PDF) are intended to give family physicians a heads up on particulars in the final rule that could affect them in the coming year.

For example, the final rule provides Medicare payment for advance care planning by recognizing CPT codes 99497 (about $86 for initial 30 minutes) and 99498 (about $75 for subsequent 30 minutes).

The rule also outlines changes to the Physician Quality Reporting System (PQRS) and ensures that all 2016 physician and group practice PQRS measures will be publicly available online. Furthermore, it finalizes the 281 measures in the PQRS measures set and the 18 measures in the group practice reporting option. And it adds a new reporting option for group practices that will allow reporting of quality measure data using a qualified clinical data registry.

The 2016 fee schedule rule clarifies the value-based payment modifier. For example, it

  • establishes policies to transition from the value modifier to the Merit-based Incentive Payment System (MIPS),
  • applies quality-tiering methodology to all physician groups and solo physicians that meet the MIPS criteria to help them avoid payment penalties,
  • sets maximum upward adjustments under the same methodology for the 2018 value modifier, and
  • sets the amount of payment at risk under the 2018 value modifier.

The rule also revises the definition of certified electronic health record technology.

In addition, the fee schedule rule delays enforcement of a federal law that would require physicians who order advanced diagnostic imaging services to consult with appropriate use criteria via a clinical decision support mechanism.

The appropriate use criteria requirement was set to take effect on Jan. 1, 2017, but CMS cited current limitations -- including clinical decision support mechanisms and electronic health records -- and noted it would further develop policies during the 2017 and 2018 rulemaking cycles.

Also, physicians who choose to opt of Medicare will appreciate that the process has been simplified. Physicians who filed valid opt-out affidavits on or after June 16, 2015, will no longer have to file renewal affidavits every two years.

Shifting Ground

For her part, Filer said it is important for all family physicians to recognize that the shift to value-based payment is already underway.

"The AAFP is highly engaged in and attentive to these efforts," she said. "This most recent reduction in the 2016 Medicare fee schedule shows continued weakening of the fee-for-service payment model."

Finally, Filer put CMS on notice that AAFP would stay abreast of the agency's ongoing project to identify undervalued codes.

"We have two more years to see positive pay increases, and it's important for CMS to know that its work is under scrutiny," said Filer. "We expect that goal to be met."

Related AAFP News Coverage
AAFP Fires Off Recommended Changes to 2016 Proposed Medicare Physician Fee Schedule

More From AAFP
Medicare Physician Fee Schedule

Additional Resources
CMS Press Release(

CMS Fact Sheet(

please wait Processing