Key Components of 2013 Medicare Physician Fee Schedule Highlighted in AAFP Summary

The final 2013 Medicare physician fee schedule rule has more than 1,300 pages, and some of the information contained in the rule is vital for AAFP members. To help busy family physicians, the AAFP has put together a summary (16-page PDF; About PDFs) that explains how various components of the 2013 fee schedule are likely to affect primary care and family medicine.

The summary addresses a variety of issues in the CMS final 2013 Medicare physician fee schedule, including the conversion factor for 2013, changes in relative value units, misvalued codes, geographic practice cost indices, telehealth services, primary care and care coordination, new preventive service G-codes, durable medical equipment (DME), and several CMS initiatives.

According to the summary, the 2012 physician fee schedule conversion factor is $34.04. Any payment increases in the fee schedule, however, will occur only if Congress blocks a 26.5 percent payment reduction scheduled to take effect on Jan. 1 as a result of the sustainable growth rate (SGR) formula. If Congress does not take action, the 2013 conversion factor will be $25, according to the summary.

"The 2013 (fee) schedule once again focuses a bright light on the dysfunctional sustainable growth rate formula on which Medicare payment is based," says the AAFP summary. "It re-emphasizes the imperative that Congress needs to permanently change the basis for calculating Medicare physician payment."

The summary also provides background on various components of the 2013 fee schedule, provides the AAFP's position on that particular part of the fee schedule and then discusses content in the proposed and final CMS regulations. In addressing primary care and care coordination, for example, the summary notes that the AAFP supports CMS's proposal to create a post-discharge, transitional care management (TCM) code as a short-term strategy, but the AAFP urges CMS to restrict use of the (payment) code to the patient's primary care physician. The TCM code is designed to pay physicians for coordinating patient care for the 30 days immediately following a hospital or nursing facility stay.

The AAFP summary also addresses payment for additional preventive services. For example, the Patient Protection and Affordable Care Act (ACA) gives CMS the authority to add coverage of additional preventive services. As a result, CMS now pays for six additional preventive services:

Although the AAFP agrees with covering additional preventive services, the Academy questioned some of the payment amounts. CMS also added similar preventive service codes for Medicare telehealth services, according to the summary.

CMS also made some changes regarding DME. The ACA requires physicians to conduct a face-to-face encounter with patients before they certify eligibility for home health services or DME. In the final regulation, CMS proposes that physicians communicate to the DME supplier -- and document that communication -- that the physician, a physician assistant, a nurse practitioner or a clinical nurse specialist had a face-to-face encounter with the beneficiary within a six-month period before the order was written. According to CMS, it is "critical that the face-to-face (encounter) be counted before the item is delivered to the beneficiary's home."

CMS also sought to reduce documentation requirements for DME by allowing the submission of the related portion of the medical record by the physician to suffice to document the face-to-face encounter.

"Documentation of the face-to-face encounter must include an evaluation of the beneficiary, needs assessment for the beneficiary, or treatment of the beneficiary for the medical condition that supports the need for each covered item of DME. A written order is still required for these covered items of DME," says the AAFP summary.

Other notable items in the 2013 Medicare physician fee schedule are: