Centers for Medicare and Medicaid Services-CMS

Medicare/Medicaid Reform and ACA Repeal on the Horizon, MACRA Moves Forward for Now

The new administration’s agenda for health care may have come into clearer focus with President-Elect Donald Trump’s nomination of House Representative Tom Price, MD, a Republican from Georgia, as Secretary of Health and Human Services (HHS) and Seema Verma, MPH, as CMS Administrator. The American Medical Association (AMA) released a statement of strong support for Congressman Price, encouraging a swift confirmation vote. “Dr. Price,” the AMA said, “has been a leader in the development of health policies to advance patient choice and market-based solutions as well as reduce excessive regulatory burdens that diminish time devoted to patient care and increase costs.”

Continue Reading President-Elect Trump Names Rep. Tom Price, MD (R-GA) as HHS Secretary, Seema Verma, Health Care Consultant, as CMS Administrator

QRUR Informal Review Also Available.

Physicians and other eligible professionals and practices who failed to meet criteria for satisfactory PQRS reporting in calendar year (CY) 2015 now face a negative 2% adjustment in Medicare Part B payments for CY 2017. Physicians who believe CMS has inappropriately determined that a negative PQRS payment adjustment applies to them have until November 30* to request an informal review.  CMS set forth the following instructions for requesting an informal review.  *Deadline for requesting informal review of VM calculations now extended to December 7, 2016.

Continue Reading Time Remains to File a request for Informal Review of CY 2017 PQRS Negative Payment Adjustment

On October 14, 2016, the Centers for Medicare & Medicaid Services (CMS) released its final rule implementing the new Quality Payment Program for physicians in lieu of the repealed sustainable growth rate factor (SGR). Rather than facing substantial annual reductions in Medicare payment fees as a result of the SGR, physicians now have two interrelated pathways to earn quality-based, cost efficient incentive payments under Medicare:  the Merit-based Incentive Payment System (MIPS) or Advanced Alternative Payment Models (Advanced APMs). MIPS consolidates three existing quality-based incentives programs – the Physician Quality Reporting System (PQRS), the Physician Value-based Payment Modifier (VM), and the Medicare Electronic Health Record (EHR) Incentive Program – while maintaining an ongoing focus on achieving quality and cost efficiencies through use of certified EHR technology (CEHRT).

Continue Reading CMS publishes Final MACRA Rule for MIPS and APM Incentives

CMS proposed rule details Medicare’s new physician “Quality Payment Program”

Reporting under new measures slated to begin in 2017

The Centers for Medicare & Medicaid Services (CMS), the federal agency responsible for Medicare payment to physicians, released a proposed rule on April 27, 2016, setting forth key provisions of its Quality Payment Program for physicians, implementing key provisions in the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). MACRA repealed the Sustainable Growth Rate (SGR) formula for annually adjusting Medicare payment to the nation’s physicians, replacing the SGR with a value-based payment system to be developed by CMS consistent with MACRA’s directives. The proposed rule has been published in the May 9, 2016 Federal Register. Comments are due by June 27, 2016.

Continue Reading MACRA on the Move!

The billing physician must be the supervising physician.

The final CY (calendar year) 2016 Medicare physician payment rule is out and published in the November 16, 2015 Federal Register. In that rule, CMS (Centers for Medicare & Medicaid Services) made two changes clarifying Medicare’s Part B “incident to” billing rule found at 42 CFR 410.26. The amended regulatory language becomes effective on January 1, 2016.

Continue Reading Medicare “Incident To” Billing – CY 2016 Clarifications

State plans must consider impact of provider rates on beneficiary access

US Supreme Court says providers cannot challenge Medicaid payment rates in a court of law

Physicians under Iowa’s Medicaid program consistently provide quality medical care to our State’s 560,000 Medicaid beneficiaries despite payment rates that, according to the Iowa Medical Society, are nearly the same as rates paid to physicians in 2000. IA Health Link requires Medicaid’s four contracted managed care organizations (MCOs) to pay physicians no less than the Medicaid fee-for-service rates in effect on July 1, 2015; Medicaid-enrolled providers who do not sign with an MCO suffer a 10% out-of-network reduction in payment rates. In 2016, physicians again will petition the Iowa General Assembly for a Medicaid rate increase, an ask that may be at odds with the substantial cost-savings goal of IA Health Link.


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  A CMS fact sheet on the proposed rule is available at

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.

Some time ago, we were asked by a reader, “Is an employer self-funded medical plan required to have a Health Plan Identifier (HPID)?”

We thought this general information might be helpful. Please remember this information and blog is NOT LEGAL ADVICE, and you should consult with your own attorney. The inquirer correctly notes that the underlying question is whether an employer-sponsored self-funded plan is a controlling health plan (CHP) required to obtain an HPID. CMS regulations and guidance indicate that employer-sponsored self-funded health plans are CHPs and must obtain a HPID.

Before providing support for this response, please note that on October 31, 2014, CMS issued an enforcement delay on its HPID rule “until further notice.” There is a reasonable chance that the HPID, as now defined, may be eliminated. CHPs need not obtain a HPID until further notice from CMS.

Here is the background re: regulatory need for an employer-sponsored self-funded health plan to obtain a HPID.

CMS published its final regulations setting forth requirements for health plan receipt of an HPID on September 5, 2012. CMS also developed frequently asked questions (FAQs) giving guidance on compliance with its HPID requirements. One FAQ specifically addresses whether a self-insured health plan must obtain an HPID.

To determine the answer, a self-insured health plan must ask if it meets the HIPAA regulatory definition of a “health plan.” A health plan is an individual or group health plan that provides or pays the cost of medical care. Assuming that the employer self-funded medical plan does so, the next question is whether that self-funded plan meets the regulatory definition for a “controlling health plan” (CHP). A CHP is a health plan that controls its own business activities, actions, or policies, or is controlled by an entity that is not a health plan. An employer’s self-funded medical plan generally would satisfy this definition of a CHP.

It can be confusing because most self-funded plans work with third party administrators (TPAs) which sometimes, themselves, are health plans. TPAs, however, are not CHPs when acting in their roles as TPAs (i.e., providing eligibility, claims administration, and other administrative services). The sponsor of the self-insured plan is responsible for obtaining the plan’s HPID. The sponsor could ask that its TPA obtain a HPID on the plan’s behalf, but the HPID would belong to the sponsored self-funded health plan.

Advisors to the industry also say that employer-sponsored health plans are HIPAA-covered entities and that employers with self-funded health plans are required under the final regulations to obtain an HPID.

HPID compliance deadlines set forth in the September 5, 2012 rule are as follows –

• CHPs are required under the regulation to obtain their HPIDs by November 7, 2014.
• Small CHPs, however, have until November 7, 2015, to obtain a HPID. A CHP is a “small” CHP if its annual receipts are $5 million or less. CMS advises CHPs on processes to utilize in determining whether its receipts are $5 million or less.
• HIPAA-covered entities are required to use HPIDs in HIPAA-covered transactions effective November 7, 2016.

Now, about the delay identified above.

As noted above, shortly before the first HPID regulatory deadline, CMS issued a “discretionary delay” in enforcement of the HPID rule “until further notice.” This delay has been read by the field as putting on hold not only enforcement actions CMS might have taken against health plans that failed to timely obtain their HPIDs, but also putting on hold the need for a health plan to obtain a HPID until further directed by CMS to do so. The HIPAA statute requires CMS, in adopting HPID regulations, to obtain and consider the advice of the National Committee on Vital and Health Statistics (NCVHS). CMS did so in finalizing its HPID rule and, further, in issuing this indefinite delay. NCVHS has advised CMS against use of the HPID in HIPAA standard transactions. It is possible, according to some industry commentators, that the HPID will be done away with in favor of some other form or processes of unique health plan identification.

One other HIPAA regulatory requirement for health plans to be aware of and to watch.

CMS issued regulations on January 2, 2014, requiring all HIPAA covered entity health plans to certify compliance with HIPAA standard transactions for eligibility, health claims status, and electronic payment/electronic remittance advice by December 31, 2015. In certifying compliance, this rule requires health plans to use their HPIDs. The rule’s certification deadline remains in effect. CMS will need to address the rule’s requirement for use of the HPID at some time.

We hope this response is helpful to the inquirer and to others.

The Senate passed H.R. 2, the Medicare Access and CHIP Reauthorization Act (MACRA), on a vote of 92-8. Iowa’s Senators Joni Ernst and Charles Grassley voted in favor of the bill. The Senate considered amendments to the bill as passed by the House, but none were adopted. The H.R. 2 now goes to the President who has said he will sign the bill.

The bill immediately repeals the SGR and, of interest to Iowa physicians, extends the 1.0 Work GPCI floor through 2017. Physicians will receive an annual update of 0.5% for the next five (5) years, with the first update slated for July 1, 2015, and annual 0.5% updates effective on January 1 in each year 2016-2109. A fuller explanation of the bill is available from an earlier posting: click here to read.

CMS had placed a 10-day hold on submitted claims for services provided on April 1 and after which otherwise would have been paid at a rate reflecting the 21% SGR cut and loss of the 1.0 Work GPCI floor, both of which were effective as of April 1. Those claims, however, now can be paid at the same rate as in effect on March 31. Any claims that may have been paid at a rate reflecting the 21% SGR cut will be reprocessed by CMS and do not require further action by providers who submitted the claims.


Senate to Vote When It Returns – CMS Issues Payment Advisory

The House of Representatives took what the House of Medicine rightfully can call a historic vote late in the evening of March 26 to really, truly repeal the SGR and to provide the nation’s physicians with minimal but predictable 0.5% Medicare physician payment increases beginning July 1, 2015, and continuing for each year through calendar year 2019.

H.R. 2, the Medicare Access and CHIP Reauthorization Act (MACRA), passed the House on a strong bipartisan vote of 392-37. Iowa’s congressional delegation split. Iowa Representatives David Loebsack and David Young voted in favor of the bill; Representatives Rod Blum and Steve King voted against it.

H.R.2 moved to the Senate on the heels of the congressional April recess. The Senate took no action but Senate leadership indicated the likelihood of passage of SGR repeal upon the Senate’s April 13 return. It is not clear whether the Senate will support all other provisions now in H.R. 2 or seek to amend the bill. The President has indicated his support for permanent SGR repeal.

The 21% SGR payment reduction will go into effect on April 1. CMS issued a payment advisory on March 24 in light of the looming April 1 date, clarifying that all claims for services rendered on or before March 31 would not be affected if the SGR went into effect on April 1; those claims would be paid under the physician fee schedule now in effect. Under current payment processes, CMS would not pay claims for services rendered on or after April 1 until 14 calendar days after electronic receipt or 29 calendar days after paper receipt of such claims. In light of the Senate’s decision to not take a vote on H.R. 2 prior to recess, CMS has advised Medicare carriers to hold claims for services provided on or after April 1 for 10 days to avoid any need to make payment adjustments in this interim time period. The Iowa Medical Society’s website ( provides billing guidance to its physician members for services provided on April 1 and onward until repeal legislation is finally approved.

H.R. 2, the MACRA bill, is a “bill within a bill,” incorporating Medicare physician payment reform provisions set forth in H.R. 1470, a bipartisan, bicameral committee bill, and including provisions of its own addressing Medicare extenders and payment offsets. Key provisions of H.R. 1470/H.R. 2 include the following:

  • Immediate and permanent SGR repeal.
  • A positive 0.5% annual physician Medicare payment update, with the first update to occur on July 1, 2015, and then in each of calendar years 2016-2019. MedPAC must submit reports to Congress in 2019 evaluating the impact of the 2015-19 updates on beneficiary access and quality care and making recommendations on further updates. Medicare rates in effect in 2019 would be maintained through 2025, shifting focus to payment increases through incentives for achieving identified quality program goals.
  • Consolidation of three current Medicare quality reporting programs – the Physician Quality Reporting System (PQRS), the Value-Based Modifier (VBM), and Meaningful Use for EHRs (EHR MU) – into a simplified, merit-based incentive payment system (MIPS), effective in calendar year 2019. Eligible professionals, including physicians and several other health professionals, will be measured on four areas of performance: quality; resource use; EHR meaningful use; and clinical practice improvement. Public reporting of results is addressed.
  • A 5% incentive payment to those physicians who participate in alternative payment models and meet certain performance thresholds.
  • The 1.0 Work GPCI floor is extended through December 2017, a provision of benefit to Medicare Part B payment localities like Iowa with labor costs set by CMS at lower than the national average.
  • The therapy cap exceptions process is extended through December 2017, allowing patients who exceed Medicare’s annual per-patient therapy expenditure limit to ask for an exception based on medical necessity.
  • Funding for Community Health Centers (CHC) and National Health Service Corps Fund (NHSC) and Teaching Health Centers is extended through fiscal year 2017.
  • The Children’s Health Insurance Program (CHIP) program and funding for it is extended through fiscal year 2017. While CHIP has been authorized through 2019, current funding for CHIP is slated to end at the close of the 2015 fiscal year. H.R. 2 also extends funding support for several CHIP-related programs.
  • Guidelines or standards developed and/or implemented under any Federal health care provision, including Medicare, cannot be construed on their own as standards or duties of care owed by a health care professional to a patient in any medical malpractice action or claim. This provision is not meant to preempt any state or common law governing medical malpractice actions or claims.
  • Electronic health records must be interoperable by 2018.
  • The Government Accounting Office (GAO) shall issue a report on barriers to expanded use of telemedicine and remote patient monitoring.
  • Funding offsets to meet the $140 billion estimated costs of this legislation require, among other things, that effective with new plans sold in 2020, beneficiaries new to Medicare must have the same deductible under their private Medigap insurance policies as they have under Medicare Part B; currently that amount is $147 per year. In addition, beginning in 2018, bump-up Part B and Part D premium amounts that Medicare beneficiaries with higher annual incomes now must pay would be increased. Too, a scheduled one-time 3.2% hospital payment increase in fiscal year 2018 would instead by phased-in at 0.5% increases each year over 6 years beginning in fiscal year 2018.

H.R. 2 does not extend the October 1, 2015 effective date for implementation of ICD-10. The ICD-10 Coalition, with membership including the American Hospital Association (AHA), American’s Health Insurance Plans (AHIP), the American Health Information Management Association (AHIMA), and the BlueCross and Blue Shield Association (BCBSA) – hailed the lack of extension, claiming that ICD-10 coding will assure the availability of data needed to accurately assess quality and value.

Further details about H.R. 2 and incorporated provisions of H.R. 1470 can be found in summaries prepared by staff of the House Committees on Energy and Commerce and Ways and Means.

The text of the bill is available at