CMS Payment Policy Update: AAHKS Efforts to Avert Cuts

1. CMS Payment Policy Update:AAHKS Efforts to Avert Cuts  November 10, 2013 Mark Froimson, MD, MBA AAHKS, Health Policy Committee Chair

2. What is happening with Medicare Payment for TKA, THA? • The RUC, In brief • Current Threats for cuts to payment • AAHKS Response • Potential Scenarios/Future Directions

3. Medicare RBRVS • Medicare implemented the Resource-Based Relative Value Scale (RBRVS) on January 1, 1992 • Payments determined by the resource costs needed to provide them • Most public and private payers utilize the Medicare RBRVS • AMA RUC has been delegated by CMS to advise on appropriate relative values for procedures

4. The RUC: a secret societyAmerican Medical AssociationCPT Editorial PanelAmerican Osteopathic AssociationPractice Expense Review CommitteeHealth Care Professionals Advisory Committee Neurology Neurosurgery Obstetrics/Gynecology Ophthalmology Orthopaedic Surgery Otolaryngology Pathology Pediatrics Plastic Surgery Anesthesiology Cardiology Dermatology Emergency Medicine Family Medicine General Surgery Geriatric Medicine Infectious Diseases* Internal Medicine * indicates rotating seatt Primary Care* Psychiatry Radiology Rheumatology* Thoracic Surgery Urology Vascular Surgery*

5. RUC Cycle CPT Editorial Panel or CMS Requests Level of Interest Medicare Payment Schedule Specialty Society Survey Specialty RVS Committee CMS The RUC

6. Medicare RBRVS • The cost of providing each service is divided into three components • Physician Work • Practice Expense • Professional Liability Insurance With geographic modifiers to reflect costs associated with different regions

7. Physician Work • Determined by: • The time it takes to perform the service • Prep/positioning time • OR time • Post op in hospital and office visits • IWPUT (intensity)= RVU/time • The technical skill and physical effort • The required mental effort and judgment • Stress due to the potential risk to the patient

8. The Survey • Sent by specialty society (AAOS) to wide array of surgeons • Specialists, generalists • Standardized instrument with Vignette/patient • Surgeons are to self report • How much time they spend during • Prep for surgery • Surgical time—the entire case • Waiting time/positioning • Post op discussion with family/Dictation • Hospital and Office visits • What procedures can it be compared to?

9. RUC Cycle CPT Editorial Panel or CMS Requests Level of Interest Medicare Payment Schedule Specialty Society Survey Specialty RVS Committee CMS The RUC

10. Confidentiality • All RUC materials are confidential • Cannot publish RVU recommendations until CMS publishes Federal Register • CMS publishes in interim final Rule (November 27th) and goes into effect for one year with comment period • CMS issues an interim proposed rule in June • did not include TJR values

11. Medicare High Expediture Procedures trigger review: 2011 • TKA > $3.5 billion • the largest CMS expenditure for a single procedure. • Heart Failure $3.4 billion • PCI with stent $2.0 billion • Spinal fusion $3.2 billion

12. CMS targets TJR, tasks RUC to review codes • Combined Medicare volume: 450,000 • Significant cost to CMS • CMS identified four key orthopedic codes for RUC review • Review of the 70 most high expenditure non-E/M services billed to Medicare, considered outside the normal 5 year cycle

13. TJR Review timeline • 2011 Identified as High Expenditure Procedures • 2012 Sent to RUC for review • AAHKS, AAOS advocate delay in consideration • need to establish values for TSA, TEA as comparators • 2012 TSA, TEA, Hemiarthroplasty codes valued • All increased in value • 2012 Surveys sent to members for THA, TKA • 2013 TKA, UKA, THA values debated by RUC • January 2013 RUC recommends significant cuts

14. RUC Review AAHKS and AAOS surveyed family of codes and presented at the January 2013 RUC meeting* *27236 presented at October 2012 RUC meeting

15. RUC rationale • Surgical time on surveys for TKA and THA showed significant reduction from historic • 100 minutes from 135 of surgical time in RUC database from 2005 • Hospital LOS reduced • 3 days from 4 • Post operative office visits reduced • 3 visits in 90 days, from 4 • Intensity of procedure not increased significantly to make up for reduced time

16. AAHKS Concerns with RUC Recommendations • RUC’s recommended times and RVUs incorrectly undervalued these procedures • RUC values create rank-order anomalies • Only 10 minutes more for THA vs. hemi • AAHKS/AAOS recommended times and RVUs more appropriate relative to other musculoskeletal codes • TSA

17. AAHKS/AAOS argument • Surgical time on surveys showed significant reduction from historic • 100 minutes from 135 of surgical time • But historic RUC value based on NSQIP data, not survey • Survey data from 2005 was identical • NSQIP data identical • Anesthesia data showed only 2% decrease • There has been no real change in operative work

19. AAHKS/AAOS argument • Hospital LOS reduced • 3 days from 4 • But intensity of services increases • 99231 to 99232 • Post operative office visits reduced • 3 visits in 90 days, from 4 • But intensity of service increased • 99212 to 99213 • Patients have more comorbidities, obesity, chronic disease and intensity of care is higher

20. AAHKS Advocacy • Meeting with key CMS staff with AAOS • June and August • Presentation on RUC valuation flaws • Written description of better methods for valuation • “Leave behind” • An alternative method for valuation • “building block methodology” • Ongoing dialogue with CMS

21. AAHKS Advocacy:Key Messages • No or minimal change in work of procedure • “a mature procedure by 2005” • Request release of proposed values in interim proposed rule in July • Surgeons need to know what to expect well in advance of the effective date • (July vs. November for 2014 go live date) • Access to care may be in jeopardy

22. Decrease in RVUs May Impact Medicare Beneficiary Access: AAHKS Survey by EBM committee • If Medicare cuts payment 15%-20% • Negative impact on beneficiary access • Surgeons will increasingly provide care to non-Medicare patients first • 57% will decrease # of Medicare patients they see • 22% will leave Medicare • 6% will quit doing joints • 7% will retire early

23. Summary Recommendations • AAOS & AAHKS support the RUC recommendations for codes 27236 and 27446 and these should be maintained by CMS • AAOS & AAHKS believe the RUC recommendations for Total Hip Arthroplasty (27130) and Total Knee Arthroplasty (27447) are incorrect • We urge CMS to accept the AAOS/AAHKS recommended times and RVUs for these codes to maintain the appropriate relativity and rank order

24. CMS Meetings Left CMS with lack of promise that they would consider our recommendation vs. RUC

25. Advocacy Efforts: The Message • Members, BOTG, Patients, Lobbyists contact: • CMS • No valid reason for decrease • Alternative methods proposed more valid • Congress • CMS is threatening access to care • Through non validated method to revalue/ reduce physician payment for TJA • CMS needs to be transparent as a public agency

26. Advocacy Efforts • Letters to CMS from patients • Letters from Congress to Director Tavenner • Congressman Price, GA • Congressman Ruppersberger, MD • Congressman Buchanan, FL • Congressman Stutzman, IN • Congressman, Kind, WI • Congressman, Neugeberger, TX

27. Advocacy Efforts • Letters to congress, visits and calls from frommembers and patients • Letters from Senate to Director Tavenner • Senators Kaine and Cantor, VA • Senators Pryor and Boozman, AK • Senator Cardin, MD • Senator Burr, NC • Senator Cornyn, TX • Calls to Director Tavenner • Georgia congressman Tom Price • Arkansas Senators Pryor and Boozman

28. Advocacy Efforts • CQ Roll Call • Easy method to generate letters • Database of prepopulated letters • Database of legislative contacts • Accessible to Members • Available from link on new AAHKS website • Industry Support: Biomet letter campaign • AARP, AHA—not helpful

29. Will the RUC change? • Significant negative Press • Recent article in Washington Post • Recent press release from AMA • Secretive nature of process under fire • Survey methodology questioned • Proposal to use extant databases and other methods • Promise to allow public disclosure

30. What’s Next? • CMS will come out with Interim Final Rule on or by November 27, 2013 • It may: • Include cuts at RUC recommended level • Include more modest cuts between RUC and AAOS/AAHKS recommended • Accept AAOS/AAHKS recommended levels • Be silent on THA, TKA • CMS may or may not return this to RUC or other method for further review

31. Future Directions • Continued erosion based on FFS payment • SGR repeal with VBP modifiers • ?opt out or reduce medicare patients? • Alternate Payment models • BPCI • ACO • Shared Savings • Pursue strategies to align compensation with true value of surgeon’s contribution to the value chain

32. Thank You