Medicare previews pay increases and cuts for 2013

The program’s physician fee schedule details a new care coordination service but also outlines potential additional reductions through a quality payment modifier.

By Charles Fiegl amednews staff — Posted July 16, 2012

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The Medicare program would pay doctors to coordinate patient care following a discharge from a hospital starting in 2013, according to a proposal from the Centers for Medicare & Medicaid Services.

The service would include payments for phone calls and other related care management activities that currently are not compensated, the Medicare agency stated in its proposed 2013 physician fee schedule, released July 6. If adopted, the provision would mark the first time CMS covered a physician service specifically designed to help patients transition from a hospital or nursing facility setting and to pilot their care as they move back into the community.

While the proposed fee schedule moves toward improving care coordination in Medicare, CMS also outlined a series of cuts to pay rates next year over which the agency has less control. The sustainable growth rate that helps calculate Medicare payments would cut fees by a projected 27% next year, which is slightly lower than some past projections. But CMS stated that figure is an estimate that will be finalized when a final rule comes out by Nov. 1. Congress has passed legislation to stop similar cuts over the last decade by freezing or raising physician rates.

Congress also has authorized a value-based payment modifier that could penalize doctors practicing in groups of 25 physicians or more that do not report quality-of-care measures or who are deemed to provide lower-quality care than their peers. Certain cardiovascular and ophthalmology diagnostic services also could be subject to rate cuts by the expansion of a multiple procedure payment reduction policy under Medicare.

The American Medical Association and specialty physician organizations said they were reviewing the 765-page proposed rule. The AMA will examine all proposals, including those aimed at improving care coordination in the Medicare program, said AMA President Jeremy A. Lazarus, MD.

“It is critically important that proposed policies for 2013 support physicians’ efforts to improve the quality of care for patients while eliminating barriers to successful physician participation in new delivery and payment models,” Dr. Lazarus said.

How pay modifications could work

CMS has proposed creating a “postdischarge transitional care management” service to its fee schedule. The service would include telephone or electronic communication with a patient within two business days of discharge, medical decision-making of moderate or high complexity, and a face-to-face visit with the patient 30 days prior to the transition of care or 14 business days following the transition.

The Medicare agency compared the new service to hospital discharge and high-level evaluation and management care that the program currently covers. The service would pay practices roughly $95 if current rates were implemented in 2013.

CMS also outlined how it intends to adjust Medicare payments using its value-based payment modifier beginning in 2015. The modifier would apply only to physician groups consisting of 25 or more eligible doctors. Negative and positive payment adjustments would be based on physician performance on cost and quality measures during 2013.

Physician groups can prevent automatic negative adjustments to their pay under the modifier by participating in the Medicare physician quality reporting system, CMS said. Physicians who do not report quality measures under PQRS will have their pay cut by 1.5% in 2015, and the larger practices also subject to the modifier would see an additional 1% cut if they didn’t report measures.

Larger physician groups that participate in PQRS could elect to have their pay adjusted by the modifier under a quality-tiering approach. Doctors who meet certain quality minimums and contain patient health spending could be eligible for payment increases of 2%, but those who are linked to lower quality and higher costs per patient could see their pay reduced by 1%. Larger practices that participate in PQRS but do not sign up for the quality tiering will not see their pay adjusted by the quality modifier.

CMS also is proposing lower reporting thresholds, a move that would make it easier for physicians to meet PQRS requirements. For instance, the minimum number of patients needed to report PQRS measures groups through an approved registry would be lowered to 20 in 2013 from 30 in 2012.

Reporting quality measures using an electronic health record system would be aligned with clinical quality measures in CMS’s EHR incentive program under the proposed fee schedule.

“The AMA has strongly recommended that CMS synchronize Medicare quality reporting requirements and minimize new regulatory burdens for physicians, and we will carefully evaluate the policies proposed in this rule with that important goal in mind,” Dr. Lazarus said. “The AMA will continue to work with CMS to encourage successful physician participation in programs aimed at increasing value and accountability and moving Medicare forward to a more effective health care delivery system.”

Imaging to take another pay hit

The Medicare agency plans to lower fees for multiple cardiovascular and ophthalmology diagnostic services provided to the same patient on the same day. Physicians providing the services subject to the policy would receive full rates for the highest-paid service. But pay for the technical component of the other services provided to the same patient on the same day as the initial service would be lowered by 25%.

American College of Cardiology President William Zoghbi, MD, said the proposal would damage patient care. “This policy disadvantages physicians who aim for efficiency, and reduces payments based on a misguided understanding of how different services, such as echocardiography and SPECT imaging, are from one another. Furthermore, it would lead to a major inconvenience to patients.”

“These cuts affect primarily those suffering from multiple trauma or heart attacks, stroke patients and those with widespread cancer — all of whom often require multiple imaging scans to survive,” said Paul Ellenbogen, MD, chair of the American College of Radiology’s board of chancellors.

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Additional changes in Medicare fee schedule

The proposed 2013 Medicare physician fee schedule includes several new policies that could impact physician practices next year. The rule will be open for public comment until Sept. 4 and finalized by Nov. 1. The agency’s proposed policy revisions include:

  • Allowing contractors to continue complex prepayment medical review when health professionals fail to reduce claims error rates for certain services.
  • Permitting payment for portable x-rays ordered by nonphysician practitioners.
  • Paying for interventional pain management services provided by certified registered nurse anesthetists when permitted by state law.

Source: “Proposed policy and payment changes to the Medicare physician fee schedule for calendar year 2013,” Centers for Medicare & Medicaid Services fact sheet, July 6 (link)

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Medicare pay changes differ by specialty

Relative value changes proposed in the 2013 Medicare fee schedule would affect physician specialties differently. For instance, the effect of new policies on services that primary care physicians tend to bill would increase overall pay to family physicians by 7%. Other changes to services billed by radiation oncologists would result in overall payments for that specialty dropping by 14%. The projections do not take into account an across-the-board pay reduction mandated by the sustainable growth rate formula in 2013.

Specialty Estimated 2013 charges
(in millions)
Change from 2012
Allergy/Immunology $198 0%
Anesthesiology $1,970 -3%
Cardiac surgery $366 -2%
Cardiology $6,568 -3%
Colon and rectal surgery $153 1%
Critical care $261 0%
Dermatology $3,008 0%
Emergency medicine $2,819 -1%
Endocrinology $434 1%
Family practice $5,879 7%
Gastroenterology $1,885 0%
General practice $579 0%
General surgery $2,261 0%
Geriatrics $217 4%
Hand surgery $134 0%
Hematology/oncology $1,900 -1%
Infectious disease $623 0%
Internal medicine $11,058 5%
Interventional pain management $534 -1%
Interventional radiology $203 -3%
Nephrology $2,065 -1%
Neurology $1,601 1%
Neurosurgery $681 -1%
Nuclear medicine $49 -3%
Obstetrics-gynecology $698 1%
Ophthalmology $5,621 1%
Orthopedic surgery $3,622 -1%
Otolaryngology $1,070 0%
Pathology $1,185 -2%
Pediatrics $64 5%
Physical medicine $990 1%
Plastic surgery $351 0%
Psychiatry $1,149 0%
Pulmonary disease $1,691 0%
Radiation oncology $1,983 -14%
Radiology $4,791 -4%
Rheumatology $545 0%
Thoracic surgery $340 -2%
Urology $1,909 -2%
Vascular surgery $882 -3%

Source: Proposed 2013 Medicare physician fee schedule, Centers for Medicare & Medicaid Services (link)

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