Physician Payment and Reimbursement

Medicare Physician Pay Rule Targets Reporting Burden

July 18, 2018 8:54 am

MIPS participation in FY19 could grow to more than 650,000, while APM participation was expected to stagnate at 160,000 to 215,000 clinicians.

July 17—Physician advocates are hailing a range of Medicare policy changes that were included in a recently proposed payment rule and are aimed at reducing clinicians’ administrative burden.

Among the highest-profile changes in the Medicare physician payment proposed rule were those to evaluation and management (E&M) payments, including the introduction of a single blended payment rate for both new and established patients for office/outpatient E&M level 2 through 5 visits. Medicare also would implement a series of add-on codes to reflect resources involved in providing complex primary care and non-procedural services.

The American College of Physicians (ACP) backed the proposed reduction in E&M documentation requirements, which would allow such “documentation to focus on medical decision making, as ACP has strongly advocated for in the past,” the group said in a written statement.

Specifically, “determining the ’level of service’ to code and bill for is overly complex and time-consuming because of ambiguity among the 5 levels of service defined in the E&M documentation,”  a 2017 ACP policy paper concluded.

However, ACP noted the proposed E&M payment structure may adversely impact internal medicine specialists and subspecialists, who care for more patients with multiple chronic conditions and more elderly patients.

“While we acknowledge the potential benefit of simplifying billing and associated documentation of E&M services by bundling levels 2-5 together, ACP will be assessing whether this change will have the unintended impact of undervaluing the work associated with caring for more complex and frail patients,” Ana María López, MD, MPH, FACP, president of ACP, said in a written statement.

The payment update—minus a budget-neutrality adjustment—would increase the proposed FY19 Physician Fee Schedule conversion factor from $35.99 to $36.05.

Other policy changes backed by physician advocates included proposals to reduce documentation burdens by no longer requiring physicians to document unchanged information for established patients and by allowing them to sign off on basic information documented by practice staff—rather than reentering it.

The proposed rule also aimed to lighten documentation requirements by eliminating the need to justify the medical necessity of a home visit in lieu of an office visit.

Telehealth and virtual care payment would be expanded by adding new payment codes for virtual check-ins and evaluation of patient-submitted photos or recorded videos, as well as for Medicare-covered telehealth services for prolonged preventive care.

The proposed rule also would create a bundled episode of care for management and counseling treatment of substance use disorders.

MACRA Provisions

Various changes were proposed to physician payment under the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), which includes the Merit-based Incentive Payment System (MIPS) and advanced alternative payment models (APMs).

Physician advocates backed the proposed rule’s MIPS adjustments, which would remove 34 measures, add 10 new measures, increase the cost component’s calculation weight from 10 to 15 percent, and double the performance threshold to 30 points.

The payment rule also would increase reporting flexibility in APMs by allowing clinicians to be determined as “qualified APM participants” at the tax identification number level. However, Medicare would continue to allow quality data reporting at the APM and individual-clinician level.

The rule also would consolidate the low-volume threshold determination period with the determination period for identifying a small practice. Both are used to exempt physicians from MIPS requirements.

Although the vast majority of Medicare physicians were exempt from MIPS for the first two years as the Centers for Medicare & Medicaid Services (CMS) sought to ease the new payment system’s implementation by reducing the number likely to face payment cuts, MIPS participation in FY19 could reach more than 650,000. That would be an incremental increase from FY18, when 591,000 physicians participated, according to the information in the rule.

Payment Models

For accountable care organizations (ACOs) in the Medicare Shared Savings Program (MSSP), the proposed rule would reduce the number of required quality measures from 31 to 24. Additionally, it would shift the measure set to be more outcome-based, including assessments of the patient experience of care.

The rule also would waive MIPS requirements for participants in a pilot called the Medicare Advantage Qualifying Payment Arrangement Incentive (MAQI) demonstration, which would examine their participation in Medicare Advantage (MA) arrangements that are similar to APMs.

“Some MA plans are developing innovative arrangements that resemble advanced APMs, a CMS fact sheet stated. “However, without this demonstration, physicians are still subject to MIPS even if they participate extensively in advanced APM-like arrangements under Medicare Advantage.”

In a written statement, hospital convener Premier said the pilot gives more options to clinicians who want to participate in APMs. And others also hailed the importance of MAQI. 

“We fought hard for this important step in the value movement and will continue to work to make this demonstration a success, including advocating for MAQI participants to receive proper bonus incentive payments,” Don Crane, president and CEO of America’s Physician Groups, said in a written statement.

CMS estimated that between 160,000 and 215,000 clinicians will earn APM bonuses of 5 percent of their Part B payments in FY19. That range was lower than projections for FY18 of 180,000 to 250,000, as cited by a CMS official in June.

Other changes would increase flexibility for the new all-payer combination option and Other Payer APMs to ease non-Medicare payer participation.

Hospital Issues

Hospital advocates were disappointed in some provisions, such as the proposal to maintain the relativity adjustment of 40 percent for payments of items and services provided in certain off-campus hospital outpatient provider-based departments

“These ‘site-neutral’ policies ignore the need for hospitals to modernize existing facilities so that they can provide the most up-to-date, high-quality services to their patients and communities,” Tom Nickels, executive vice president of the American Hospital Association (AHA) said in a written statement.

The proposed rule also would reduce drug payment add-ons for wholesale acquisition cost-based (WAC) payments for new Part B drugs from 6 percent to 3 percent.

Nickels urged CMS to instead target “skyrocketing list prices of drugs directly with pharmaceutical manufacturers.”

Among provisions favorable to hospitals was the proposed rule’s modification of the MIPS electronic health record performance category to align with proposed changes to requirements for hospitals.

Comments on the proposed rule are due to CMS by Sept. 10, 2018.

Rich Daly is a senior writer/editor in HFMA’s Washington, D.C., office. Follow Rich on Twitter: @rdalyhealthcare


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