Proposed 2015 Medicare Physician Fee Schedule

AAFP Summary Highlights Key Points Affecting Family Physicians

July 16, 2014 03:30 pm Sheri Porter

The wait is over for America's physicians anxious to see CMS' proposed 2015 Medicare physician fee schedule( The proposed schedule, which was published in the July 11 Federal Register, lays out the agency's initial take on what it might pay for health care services provided to Medicare patients in the coming year.

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To save members the time it would take to pore over the proposal for themselves and to help explain and prepare them for the potential changes, the AAFP has prepared a 12-page summary of the proposed schedule. Here's a look at some highlights.

Supporting Chronic Care Management Services

The AAFP first urged CMS to cover chronic care management (CCM) services in December 2012 because these services not only involve much skill and time, they also represent a large chunk of family physicians' everyday workload.

In the 2015 proposal, CMS reiterated its commitment to support primary care by, among other things, proposing a payment rate of $41.92 for the CCM code. The agency proposed that beginning next year, the code could be billed one time per month per qualified Medicare patient, and physicians would have to meet other requirements, including a proposal that CCM services be furnished using certified health information technology that would make the patient's care plan available electronically to all health care team members inside and outside the practice.

Another significant requirement the agency proposed is that for a physician to be able to offer the CCM services, the practice would need to offer access to care management services 24-hours-a-day, seven-days-a-week and ensure continuity of care with a designated member of the care team so the patient could schedule successive routine appointments.

Managing Misvalued Codes

The Patient Protection and Affordable Care Act (ACA) requires CMS to periodically identify, review and adjust values for potentially misvalued codes, placing emphasis on certain groups of codes that have, for example, grown the most or were recently established for new technologies or services. The Protecting Access to Medicare Act further expanded the list of codes CMS must examine.

Story Highlights
  • The AAFP has prepared a summary document highlighting key points in the proposed 2015 Medicare physician fee schedule.
  • The summary covers areas of the fee schedule that hold high interest for family physicians, such as chronic care management, the Medicare Shared Savings Program and the value-based payment modifier.
  • The Academy will respond to CMS' proposals before the Sept. 2 deadline.

Accordingly, among proposed changes in this area, CMS suggested adding almost 80 codes to the list of potentially misvalued codes. The majority of these, according Kevin Burke, director of the AAFP's Division of Government Relations, are rarely are used by family physicians.

Even so, there could be an upside to adding more suspect codes, Burke observed. "If payment for these overvalued codes was reduced, then that money could be reallocated to codes that family physicians do use," he noted.

In an effort to enhance transparency in setting Medicare Part B rates, CMS also proposed that all revisions to payment inputs be "subjected to public comment prior to being used for payment."

Accounting for Hospital Acquisition of Physician Practices

A growing concern about how to account for practice expenses of hospital-owned practices led CMS to propose to start collecting data on services furnished in "off-campus provider-based departments" beginning in 2015.

Hospitals and physicians would be required to report a CPT code modifier for services provided in those settings on both hospital and physician claims.

"CMS believes the most efficient and equitable means of gathering this important information across two different payment systems would be to create a HCPCS (health care common procedure coding system) modifier to be reported with every code for physician and hospital services furnished in an off-campus, provider-based department of a hospital," said the AAFP summary.

Refining PQRS

The Physician Quality Reporting System (PQRS) is defined as a "pay-for-reporting system" that uses a combination of incentive payments and penalties to encourage physicians to report quality information. Physicians can earn incentive payments throughout 2014 for successfully reporting data on quality measures and participating in a qualified clinical data registry.

Beginning in 2015, however, physicians who do not report data on quality measures or participate in a qualified registry will face a penalty.

CMS proposed adding 28 new individual measures and two measures groups; the agency also proposed removing 73 measures from reporting for the PQRS. If finalized, the summary noted, the changes would bring the total number of PQRS individual measures to 240.

The fee schedule also proposed several other changes that are specific to the PQRS reporting method.

AAFP Summarizes Open Payments Provisions

In tandem with its summary of the payment provisions in CMS' proposed 2015 Medicare physician fee schedule, the AAFP also prepared a two-page summary of proposed changes to the agency's Open Payments program that were also included in the proposed rule.

Commonly referred to as the "Sunshine Act," the Open Payments program was designed to make information about payments or other transfers of value from certain manufacturers of drugs, medical devices, biological products and medical supplies to physicians and teaching hospitals publicly available.

In its summary, the AAFP noted that CMS had "unexpectedly proposed these changes to the Open Payments program. Specifically, the agency proposed to

  • delete the definition of "covered device,"
  • require, with one stated exception, reporting of the marketed name of the related covered and noncovered drugs, devices, biologicals or medical supplies, and
  • require certain manufacturers to report stocks, stock options and any other ownership interest as "distinct categories."

In an interview with AAFP News, Kevin Burke, director of the AAFP's Division of Government Relations, called one final change pertaining to the Sunshine Act "a major source of contention among physicians." Case in point: CMS proposed deleting the continuing education exclusion entirely -- including the existing exemption for payments to speakers at certain accredited or certifying CME events.

According to Burke, the AAFP will respond to CMS by letter to note its concern with this particular proposal.

Updating Medicare Shared Savings

The Medicare Shared Savings Program relies on physician participation in ACOs to facilitate coordination and cooperation among Medicare-enrolled providers and suppliers, improve the health care quality provided to Medicare patients, and reduce health care costs.

In the 2015 proposed rule, CMS would revise the quality scoring strategy "to recognize and reward ACOs that make year-to-year improvements in quality performance scores on individual measures," for example, by adding bonus points to each of the four quality measure domains based on improvement, according to the summary.

CMS also would make revisions to "reflect up-to-date clinical guidelines and practice, reduce duplicative measures, increase focus on claims-based outcome measures, and reduce ACO reporting burden(s)." In addition, the agency proposed increasing the total number of measures for quality reporting from 33 to 37.

Improving Value-based Payment Modifier Policies

The value-based payment modifier established by the ACA provides for "differential payment" to a physician or group of physicians based on the quality of care provided to their Medicare patients compared to the cost of that care during a specific performance period.

CMS proposed beginning to apply the value-based modifier to specific physicians and groups on Jan. 1, 2015, and expanding the application to all physicians and physician groups on Jan. 1, 2017. The modifier must be implemented in a budget-neutral manner -- "generally meaning that upward payment adjustments for high performance must balance the downward payment adjustments applied for poor performance," according to the summary.

For example, CMS would increase the penalty associated with the value-based modifier from a negative 2 percent downward pay adjustment in 2016 to a negative 4 percent downward adjustment in 2017. And, in an effort to align the value-based modifier with the PQRS, CMS would classify physician groups and solo physicians subject to the 2017 modifier "using a two-category approach that is based on whether and how groups and solo practitioners participate in the PQRS."

CMS proposed applying the value modifier beginning in 2017 to physicians in groups with two or more eligible professionals, as well as to physicians in solo practice. That would result in about 815,000 physicians and 315,000 nonphysicians being affected. But perhaps most importantly, the agency proposed that medical groups with between two and nine eligible professionals and solo practitioners in Category 1 would be held harmless from any downward adjustments derived from the quality-tiering methodology for the 2017 value modifier.

In addition to a slew of other proposed changes in this section, CMS proposed continuing to use annual quality and resource use reports to explain how the value-based modifier would affect payment. The agency will disseminate those reports -- based on 2013 data -- to all physicians late in the third quarter of 2014 and encouraged all physicians to access their reports when they become available.

Finally, the AAFP fee schedule summary also covered Medicare payment proposals related to

  • add-ons to the list of covered telehealth services,
  • valuations of global surgery,
  • adjustments to malpractice relative value units,
  • revisions to geographic practice cost indices, and
  • expansions to the Physician Compare website.

The AAFP plans to submit extensive comments about the proposed regulation before the Sept. 2 deadline.