Medicare proposes doctor pay for complex chronic care management

CMS' 2014 fee schedule shows the sustainable growth rate formula would cut physician payments by 24.4%, giving Congress until Jan. 1 to override it.

By Charles Fiegl amednews staff — Posted July 22, 2013

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Medicare soon could cover new physician services for managing patients with multiple chronic conditions in an effort to avoid further injury or illness.

The Centers for Medicare & Medicaid Services detailed the tentative new services and other payment changes in its proposed 2014 Medicare physician fee schedule, published July 8. The annual CMS regulation also proposed changes that would phase in more physicians to a pay-for-performance initiative and showed the projected impact of the sustainable growth rate formula on doctor pay.

In the 2013 final fee schedule, Medicare launched a new care coordination service to pay for physician practices' work to guide patients from facilities to their homes. The latest regulation floated a plan to create two additional services that could be billed separately from patient visits. The services would be billed for managing care for a patient with two or more chronic conditions expected to last at least 12 months, or until death, and that place the patient at risk. The first complex chronic care management service would be billed for an initial visit and the second would be available for subsequent work.

“We are making this proposal to establish codes and separate payment for complex chronic care management services in the context of the broader multiyear strategy to appropriately recognize and value primary care and care management services,” CMS stated in the proposal.

If finalized later in 2013, the new services would not be available for doctors to bill until 2015, CMS said. The Medicare agency wants to allow sufficient time for public comment. A physician could not provide the service unless he or she meets several prerequisites that include investments in technology and staff training.

Under the proposal, a patient must have had an annual Medicare wellness visit within the last 12 months. The practice must use an electronic health record and achieve CMS standards to demonstrate meaningful use of an EHR. The practice also must have one or more advanced practice registered nurses or physician assistants whose job descriptions include care for beneficiaries with complex chronic conditions.

CMS is accepting comments from the public until Sept. 6. The agency is expected to finalize any new payment policies in November.

Initial feedback on the proposal to create new patient care opportunities was positive. The Medicare services would be a good development for internal medicine and patient care in general, said American College of Physicians President Molly Cooke, MD.

“The new proposal from CMS is an important and welcome step in recognizing the full breadth of primary care, and of complex chronic care management in particular,” Dr. Cooke said. “The proposal … demonstrates the importance that the agency places on primary care, cognitive services and the patient-centered medical home model.”

Family physicians also viewed the discussion about creating the service as beneficial to patient care. “If the United States is going to achieve meaningful health system reform, we must have meaningful Medicare physician payment reform,” said Jeffrey Cain, MD, president of the American Academy of Family Physicians. “In its proposed 2014 Medicare physician fee schedule, CMS made good steps toward that goal by adjusting misvalued codes and proposing two new codes for complex chronic care management.”

SGR still the chief concern

As has been the case in recent years, the proposed fee schedule shows the devastating impact of the sustainable growth rate formula on payment rates unless Congress overrides it. The SGR is set to cut physician pay for Medicare services by 24.4% in January 2014, but lawmakers have replaced scheduled decreases with modest increases or freezes on a nearly annual basis since 2003.

The 2014 fee schedule would raise the payment for common evaluation and management services by 2% to 3%, but those gains would be more than wiped out by the SGR, Dr. Cain said.

“Such changes demonstrate CMS' intent to support primary care through policies that promote comprehensive and continuous care,” he said. “But, in light of the SGR's mandate that CMS slash Medicare physician payment by 24.4%, these incremental increases do nothing to sustain primary medical care, much less build the primary care physician work force. The SGR-required payment cut shines a bright light on the need for Congress to replace this dysfunctional system.”

The American Medical Association, along with the ACP, AAFP and other organized medicine groups, has called for the SGR to be repealed and replaced with a period of stable payment rates and a variety of alternative pay models. The AMA is working with lawmakers to achieve permanent reforms to the payment system.

Quality-based pay expands its reach

Programs aimed at improving quality in Medicare would continue to evolve in 2014. CMS proposed expanding the Physician Compare website with more information on physician group and individual performances. For instance, data collected from medical groups through the Medicare physician quality reporting system would appear on the website in 2014, if technically feasible, CMS stated.

The agency also proposed tripling the minimum number of individual PQRS measures physicians must report to earn incentives, from three to nine. The claims-based reporting option for measures groups would be eliminated, leaving registry reporting as the only pathway for using the measures groups option.

Physicians meeting PQRS criteria can earn a 0.5% bonus in 2014. The 2014 PQRS reporting period also will be used to assess a 2016 penalty of 2% for physicians who don't successfully report the minimum number of measures.

In addition, CMS has proposed that the 2016 value-based payment modifier — Medicare's pay-for-performance effort — use 2014 PQRS reporting to determine if groups with 10 or more physicians and other eligible professionals will have their pay adjusted up or down. Eligible groups can stop the penalty by reporting PQRS measures as a group successfully or by having at least 70% of physicians in the group meet reporting requirements as individuals.

The 2013 PQRS reporting period is being used as the basis for the first iteration of the value-based modifier in 2015, but only for physicians in groups of 100 or more professionals. Congress required Medicare to phase in the modifier program, which will apply to all physicians starting in 2017.

The AMA strongly opposes the modifier and has called on Congress to eliminate or roll back the initiative.

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Medicare fee changes by specialty for 2014

The proposed 2014 Medicare fee schedule projects changes in payment for physician services. Budget-neutral adjustments to relative value units for the physician work, medical liability and practice expense components for services would lead to some specialties receiving net increases while others would see decreases.

Specialty Allowed charges (in millions) Work and malpractice RVU changes Practice RVU changes Combined impact
Allergy/immunology $213 1% -4% -3%
Anesthesiology $1,862 4% -1% 3%
Cardiac surgery $355 3% -1% 2%
Cardiology $6,425 2% 0% 2%
Colon and rectal surgery $158 2% -2% 0%
Critical care $273 3% -1% 2%
Dermatology $3,113 2% -4% -2%
Emergency medicine $2,929 3% 0% 3%
Endocrinology $447 2% -2% 0%
Family practice $6,358 2% -1% 1%
Gastroenterology $1,901 3% -2% 1%
General practice $528 2% -2% 0%
General surgery $2,236 3% -2% 1%
Geriatrics $231 3% -1% 2%
Hand surgery $151 2% -2% 0%
Hematology/oncology $1,890 2% -3% -1%
Infectious disease $635 3% -1% 2%
Internal medicine $11,416 3% -2% 1%
Interventional pain management $640 2% -3% -1%
Interventional radiology $219 2% -6% -4%
Nephrology $2,123 3% -2% 1%
Neurology $1,498 2% -4% -2%
Neurosurgery $712 2% -1% 1%
Nuclear medicine $51 2% -1% 1%
Obstetrics-gynecology $688 2% -2% 0%
Ophthalmology $5,592 2% -2% 0%
Oral/maxillofacial surgery $44 2% -4% -2%
Orthopedic surgery $3,683 2% -2% 0%
Otolaryngology $1,128 2% -4% -2%
Pathology $1,134 3% -8% -5%
Pediatrics $63 3% -3% 0%
Physical medicine $999 3% -3% 0%
Plastic surgery $367 2% -2% 0%
Psychiatry $1,165 3% -1% 2%
Pulmonary disease $1,775 3% -2% 1%
Radiation oncology $1,783 1% -6% -5%
Radiology $4,635 2% -3% -1%
Rheumatology $551 2% -5% -3%
Thoracic surgery $332 3% -1% 2%
Urology $1,858 2% -4% -2%
Vascular surgery $925 2% -4% -2%
Total* $86,995 2% -2% 0%

*Note: Total includes amounts from other health care professionals.

Source: “Medicare Program; Revisions to Payment Policies under the Physician Fee Schedule, Clinical Laboratory Fee Schedule & Other Revisions to Part B for CY 2014,” Centers for Medicare & Medicaid Services, July (link)

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How many physicians will receive value-based pay?

The Medicare value-based payment modifier soon could be applicable to nearly 60% of medical doctors. The Centers for Medicare & Medicaid Services proposed applying the modifier, which adjusts each eligible physician's payment somewhere between an estimated -2% to 2%, to groups of physicians with 10 or more eligible professionals in 2016. Below is a breakdown of current group sizes.

Group size Number of groups Eligible professionals Physicians Percent of physicians Cumulative percentage
100 or more 1,132 311,094 215,936 25.7% 25.7%
50-99 1,622 110,862 76,318 9.1% 34.8%
25-49 3,729 126,596 88,065 10.5% 45.3%
20-24 1,890 41,334 28,756 3.4% 48.7%
10-19 8,653 116,379 81,829 9.7% 58.4%
2-9 68,702 241,732 174,758 20.8% 79.2%
1 222,097 222,097 175,115 20.8% 100%
Total 307,825 1,170,094 840,777 100%

Note: The number of eligible professionals includes physicians and other health care professionals, such as physician assistants and nurse practitioners.

Source: “Medicare Program; Revisions to Payment Policies under the Physician Fee Schedule, Clinical Laboratory Fee Schedule & Other Revisions to Part B for CY 2014,” Centers for Medicare & Medicaid Services, July (link)

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