A Topical Rundown

On July 8, 2015, CMS released its calendar year (CY) 2016 proposed Medicare physician payment rule in prepublication form; the rule will be formally published in the July 15 Federal Register. Comments on the proposed rule are due on September 8, 2015.

The prepublication version of the proposed rule can be found at https://s3.amazonaws.com/public-inspection.federalregister.gov/2015-16875.pdf.  A CMS fact sheet on the proposed rule is available at http://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2015-Fact-sheets-items/2015-07-08.html.

The proposed rule implements statutory requirements set forth in the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), the legislation that permanently repealed the sustainable growth rate (SGR) formula; the Protecting Access to Medicare Act of 2014 (PAMA); the Achieving Better Life Experience Act of 2014 (ABLE); and other statutory directives impacting upon the Medicare physician fee-for-service payment system (PFS). With this rulemaking, CMS proposes and builds upon several policies and programs that move toward implementation of MACRA’s Merit-based Incentive Payment System for Medicare physician payment in CY 2019.

As directed by MACRA, physician payment in CY 2016 will be increased by 0.5%. The proposed rule estimates a conversion factor of $36.1096; the estimated conversion factor for anesthesia services is $22.6296. The final CY 2016 conversion factors, however, likely will vary somewhat from these estimates.

Several changes are proposed for Medicare’s quality reporting initiatives, including the Physician Quality Reporting System (PQRS), the Physician-Value-Based Payment Modifier (Value Modifier), and the Medicare Electronic Health Record (EHR) Incentive Program. As proposed, there would be 300 PQRS measures in CY 2016 and a proposed reporting option would allow groups to report quality measures data through a qualified clinical data registry (QCDR). CMS also proposes several new policies affecting the Physician Compare public reporting program, including incorporation of a benchmark reporting methodology.

Considerable discussion in the proposed rule is dedicated to proposed adjustments to relative values in codes identified as “misvalued.” ABLE directs a CY 2016 1% target reduction in Medicare physician fee-for-service (PFS) expenditures through adjustments to relative values of misvalued codes; if CMS cannot achieve the full 1% reduction through adjustments to misvalued codes, then the balance in reductions must be spread out among all PFS codes. CMS estimates a net expenditure reduction of 0.25% if RVU misvalued code adjustments are made as proposed in this rule, noting, however, that it may make further misvalued codes adjustments in the final rule. As such, CMS did not incorporate this 0.25% target reduction into the proposed rule’s estimated CY 2016 conversion factors.

To help interested readers to walk through this massive rulemaking, the following is a listing of major topics and the pages in the prepublication version of the rule where those topics can be found. Note: the format and pagination of the proposed rule changes upon July 15 publication in the Federal Register but the content remains the same.

  • Determination of practice expense (PE) RVUs (pp.23-55)
  • Determination of malpractice RVUs (pp. 55-63)
  • Potentially misvalued services under PFS (pp.64-83)
  • Refinement panel (proposed elimination) (pp. 84-85)
  • Improving payment accuracy for primary care and care management services (pp.86-96)
  • Target for RVU adjustments for misvalued services (pp. 97-105)
  • Phase-in of significant RVU reductions (pp.106-111)
  • Changes for (CT) computerized tomography (CY 2016 only) (pp. 112-113)
  • Valuation of specific codes (pp. 114-276), including proposed codes for advance care planning services subject to local coverage decisions (pp. 246-247)
  • Medicare telehealth services, adding codes 99356-57 and 90933-36, rejecting others, including CRNAs as distant site providers who can furnish Medicare telehealth services) (pp. 277-288)
  • Incident-to proposals, including clarification that the billing physician also must be the supervising physician (pp. 289-294)
  • Portable x-ray: billing for transportation services (pp. 295-296)
  • Waiver of deductibles for anesthesia services furnished on the same day as a planned colorectal cancer test (pp.297-298)
  • Proposed provisions re: ambulance fee schedule (pp. 299-319)
  • Chronic care management (CCM) services for rural health clinics (RHC) and federally qualified health centers (FQHC) (pp. 319-334)
  • HCPS coding for RHCs (pp. 334-338)
  • Payment to grandfathered tribal FQHCs (338-346)
  • Part B drugs – biosimilars (pp. 346-350)
  • Productivity adjustments for ambulance, clinical laboratory, and DMEPOS fee schedules (pp. 350-351)
  • Appropriate use criteria for advance diagnostic imaging services (pp. 352-369)
  • Physician Compare Website (pp. 370-396)
  • Physician Quality Reporting System (PQRS) (pp. 397-504)
  • Electronic Clinical Quality Measures (ECQM) and certification criteria and EHR incentive program – comprehensive primary care (CPC) initiative and Medicare meaningful use (MU) aligned reporting (pp. 505-510)
  • Potential expansion of the comprehensive primary care (CPC) initiative (pp. 511-520)
  • Medicare Shared Savings Program (MSSP) (pp. 521-545)
  • Value-based payment modifier and physician feedback program (pp. 546-605)
  • Physician self-referral updates (pp. 606-679)
  • Private contracting opt-out (pp. 680-681)
  • CY 2016 PFS proposed estimated impact on total allowed charges by specialty (Table 45, pp. 711-712)
  • CY 2016 PFS proposed payment impact for selected procedures (facility and non-facility), Table 46 (pp. 715-716)

Several specific issues are addressed within each of these broad topics requiring review and impact analyses prior to the September 8 comment deadline.