Proposed Medicare Fee Schedule Emphasizes Primary Care's Value

AAFP Summarizes Elements Critical to Family Physicians

July 18, 2016 02:29 pm News Staff
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The wait for the proposed 2017 Medicare physician fee schedule is over. On July 7, CMS released its annual document that provides insight into how Medicare plans to pay physicians in the coming year.

Family physicians, in particular, will appreciate the agency's visible efforts to more accurately value primary care services in general and, specifically, the care management and patient-centered services that are hallmarks of family medicine.

The proposed rule is available for review in the July 15 Federal Register.(

In a July 7 press release,( CMS Acting Administrator Andy Slavitt touted the positive implications for primary care.

He said CMS was proposing changes to the fee schedule that reflect a new focus on care management and behavioral health issues, and that with that focus should come enhanced payment that recognizes the level of care primary care physicians provide to their patients with multiple chronic conditions.

Story Highlights
  • The AAFP has summarized for family physicians key points of the recently released 2017 proposed Medicare physician fee schedule.
  • In a press release about the proposed rule, CMS emphasized its new focus on care management and behavioral health issues, along with enhanced payment for primary care physicians who care for patients with multiple chronic conditions.
  • The proposed rule was released on July 7; the AAFP will submit recommendations to CMS by Sept. 6 on how the fee schedule can be improved.

"Today's proposals are intended to give a significant lift to the practice of primary care," said Slavitt. If adopted, he added, they will give physicians more time to spend with their patients "listening, advising and coordinating their care -- both for physical and mental health."

"If this rule is finalized, it will put our nation's money where its mouth is by continuing to recognize the importance of prevention, wellness, and mental health and chronic disease management."

Knowing members' high level of interest in Medicare payment decisions, the AAFP immediately set about crafting a summary(13 page PDF) of details that matter most to family physicians.

A formal comment letter to CMS -- complete with specific AAFP recommendations on how the fee schedule can be improved -- will be sent to the agency before its Sept. 6 comment deadline.

Care Management Services

According to the AAFP summary, CMS has proposed increased payments for a number of care management services that could directly affect family physicians. For instance, CMS recommended making separate payments for

  • certain existing CPT codes that cover prolonged evaluation and management (E/M) services not provided face-to-face;
  • the use of new codes that describe the detailed assessment of and care planning for patients with cognitive impairment, such as dementia;
  • the use of new codes to pay primary care practices that use interprofessional care management resources to treat patients with behavioral health conditions;
  • the use of new codes to cover the increased cost of resources needed to provide medical care to patients with mobility issues; and
  • codes that describe chronic care management for patients with great complexity.

Additionally, the regulation proposes revaluing CPT codes that describe prolonged face-to-face services and recommends a reduction in administrative burdens associated with chronic care management codes to remove barriers physicians may face when providing and billing for these services.

Medicare Diabetes Prevention Program

Family physicians care for a huge share of the nation's patients with diabetes and, therefore, should welcome news about pending expansion of the Medicare Diabetes Prevention Program( -- a model of care that has been tested by CMS' Center for Medicare & Medicaid Innovation and certified for expansion based on the program's track record in reducing Medicare spending.

CMS wants to expand the diabetes prevention program model within Medicare beginning Jan. 1, 2018, and is seeking comments on how the program should, for example,

  • reimburse entities that implement the model for patient attendance at diabetes prevention sessions and for achieving and maintaining a minimum weight loss,
  • define prediabetic beneficiaries based on body mass index plus hemoglobin A1c or plasma glucose levels, and
  • establish site-of-service requirements.

Conversion Factor

The AAFP summary also provides an explanation of how Medicare utilizes a conversion factor to calculate variations in the costs of furnishing health care services across the country.

The summary notes that the proposed conversion factor for 2017 ($35.7751) is a bit lower than in 2016 ($35.8043). For more details, see table 41 at the end of the summary.

Physicians will also want to look at table 43, which lists, by specialty, the estimated impact the proposed rule would have on allowed charges.

The summary points out that in 2017, family physicians are projected to receive an estimated 3 percent increase in Medicare-allowed charges -- a larger increase than that for any other specialty.

Additional Topic Areas

Also included in the summary are explanations of proposed changes related to, among other things,

  • identification and review of potentially misvalued services,
  • addition of services eligible to be furnished using telehealth,
  • screening and enrollment of physicians and providers who want to contract with a Medicare Advantage organization,
  • updated geographic practice cost indices,
  • the Medicare Shared Savings Program,
  • the value-based payment modifier and
  • application of appropriate use criteria (AUC) for advanced diagnostic imaging services.

Regarding the last point, CMS anticipates physician AUC reporting won't be required until Jan. 1, 2018.

Furthermore, the agency proposed three exceptions to the AUC consultation and reporting requirements. Those exceptions would cover situations in which

  • an applicable imaging service is ordered because of an emergency medical condition,
  • applicable imaging services are ordered for an inpatient covered by Medicare Part A, and
  • meeting AUC requirements would result in a significant hardship, such as when a rural practice is unable to procure reliable Internet access.

More From AAFP
MACRA Ready: The Shift to Value-Based Payment

Additional Resources
CMS Blog: Focusing on Primary Care for Better Health(

CMS Fact Sheet: 2017 Proposed Medicare Physician Fee Schedule(