Incentive Program Offers 10 Percent Bonus

Provision in Health Care Reform Law Gives Primary Care Financial Boost

September 03, 2010 03:40 pm Sheri Porter

Although the recently enacted health care reform legislation contains a number of provisions designed to make primary care the foundation of health care reform in the United States, one of those provisions is generating a lot of family physician interest because it calls for incentive payments for physicians who provide primary care services.

Section 5501 (a) of the Patient Protection and Affordable Care Act( creates an incentive payment program for primary care providers that calls for incentive payments equal to 10 percent of a "primary care practitioner's" allowed charges under Medicare Part B for primary care services provided on or after Jan. 1, 2011, and before Jan. 1, 2016.

Many AAFP leaders see this provision as evidence of the government's realization that primary care is the engine that will drive successful health care reform.

Hashing Out the Details

The law defines the term "primary care practitioner" as a physician who has a primary specialty designation of family medicine, internal medicine, geriatric medicine or pediatric medicine. The definition also includes nurse practitioners, clinical nurse specialists and physician assistants.

According to the legislation, eligible primary care services are identified by specific Healthcare Common Procedure Coding System, or HCPCS, codes that cover office visits, nursing home visits and home health care visits. Although the legislation gives the secretary of HHS some authority to modify the code list that defines primary care services, the codes spelled out in the law include

  • 99201 through 99215,
  • 99304 through 99340, and
  • 99341 through 99350.

Read a complete list of all pertinent codes included in the Patient Protection and Affordable Care Act, along with descriptions of the individual codes.

To qualify for the bonus, primary care services must account for at least 60 percent of an individual professional's allowed charges under Medicare Part B. CMS is required to make payments to qualifying physicians on a quarterly basis.

In addition, the law specifies that eligibility for the primary care incentive payment is not related to any other payment Congress has authorized. For example, family physicians practicing in federally designated Health Professional Shortage Areas are eligible for a separate 10 percent bonus payment, as well as the primary care incentive payment.

CMS initially will identify primary care professionals eligible for the 10 percent incentive payment based on each professional's 2009 claims data and national provider identifier number.

The AAFP Weighs In

According to AAFP Board Chair Ted Epperly, M.D., of Boise, Idaho, the legislation is a "strong step" in the right direction. The future of America's primary care workforce will look brighter thanks to the efforts of Congress and the administration, said Epperly. "It's important that medical students see that the payment inequities between primary care physicians and subspecialists are being addressed if we expect students to choose family medicine as their specialty.

"The Academy would like for that bonus to be higher, but this legislation creates a starting point that signals the intent of Congress and the administration to start rebuilding the health care system around family medicine," said Epperly.

Primary Care Was Ripe for a Boost

The groundwork for a primary care incentive payment in the Patient Protection and Affordable Care Act dates back to at least 2008, when the Medicare Payment Advisory Commission submitted a report to Congress( that recommended Congress "establish a budget-neutral payment adjustment for primary care services billed under the physician fee schedule and furnished by primary-care-focused practitioners."

According to research from the AAFP's Robert Graham Center, members of the Senate Finance Committee appeared willing to consider payment reform in support of primary care. In fact, a 2009 Graham Center white paper( quotes committee chair Sen. Max Baucus, D-Mont., as saying, "We need to take a hard look at the way that we pay health care providers. As part of that examination, we should ask, 'Do today's payment systems properly reward providers who offer high-quality care? Do these payment systems encourage medical students to choose careers in critical fields, like primary care?'"

Kevin Burke, director of the AAFP's Division of Government Relations, said that the incentive payment likely would not require family physicians to jump through any bureaucratic hoops. "The payment is automatic," he said. "CMS will determine a physician's specialty and then look at a full-year's data to see if 60 percent of the allowable charges were for primary care services."

Burke added that family physicians who qualify should receive their first checks from CMS sometime after March 31, 2011. That check from CMS will represent 10 percent of the physician's allowable charges for primary care services that were submitted to Medicare in January, February and March.

"This process will be repeated the next quarter and each quarter throughout the year," explained Burke.

Epperly noted, however, that the Academy is concerned about the qualifying threshold for the bonus. Setting the threshold as high as 60 percent could have unintentional consequences. "It may well exclude many family physicians who are providing primary care services, especially in rural areas," said Epperly.

The Academy highlighted this concern and others -- as well as recommended fixes -- in a comment letter on the 2011 proposed Medicare Physician Fee Schedule(38 page PDF) it recently sent to CMS Administrator Donald Berwick, M.D.

The AAFP's letter included a table of code sets that the Academy would like CMS to add to the numerator used to qualify primary care physicians for the incentive payment.

NRHA Supported Incentive Payment

The 60 percent threshold also is causing concern for other entities. The National Rural Health Association, or NRHA, actively advocated for the primary care incentive payment, but according to Danny Fernandez, the NRHA's manager of government affairs, the eligibility limitations are a setback.

"We're greatly concerned about the ability of rural physicians to qualify for this provision," said Fernandez. Obviously, rural health care professional provide a greater array of services than do their urban counterparts. Rural physicians step in and fill gaps in coverage in emergency departments and nursing homes and by providing necessary medical procedures to their patients, he said.

Unfortunately, by providing those much-needed services, rural health care professionals could dilute the qualifying equation and end up without an incentive check to show for their efforts.

Although no one knows how many rural physicians might be affected by the 60 percent qualifier, the AAFP's Robert Graham Center concluded in a May 2009 white paper( that the application of a 60 percent incentive threshold "would capture nearly 60 percent of family physicians, but a lower proportion of rural physicians, likely due to their naturally broader scope of practice."

According to NRHA CEO Alan Morgan, however, by having included this provision in the health care reform legislation, Congress' good intent is clear, and the creation of the primary care incentive dovetails with the aims of his organization. "We want to do what we can to ensure access to primary care in rural areas," said Morgan. "We're all on the same page." He added that he looks forward to working with CMS to achieve a "technical fix" to ensure that the intent of the legislation is carried out.