CMS Releases 2014 Medicare Physician Fee Schedule Rule

1. CMS Releases 2014 Medicare Physician Fee Schedule Rule

2. Medicare Physician Fee Schedule Final Rule Released • Nov. 27, 2013, CMS released the final rule updating payment policies and rates for services furnished to fee-for-service beneficiaries under the Medicare PFS • Text of rule in Federal Register on Dec. 10, 2013; schedules on-line • New payment rates become effective Jan. 1, 2014 • Comments to be accepted on most rate issues through Jan. 27, 2014

3. Medicare Physician Fee Schedule Final Rule Released • Certain revised regulations become effective Jan. 27, 2014: • Regulations extending time period for waiver of overpayments due to finding of lack of medical necessity from 3 to 5 years • Regulations making compliance with all state laws relating to qualifications/licensure of auxiliary personal involved in provision of “incident-to” services a condition of payment • Regulation allowing technology-based updates to clinical lab fee schedule • E-Rxing regulation requiring NCPDP version 3.0 for exchange of formulary/ benefit data with Part D plans becomes effective Jan. 1, 2015

4. Oncology/Urology-Specific Impact of Payment Rate Changes SpecialtyProposedFinal Hematology/Oncology – 1% – 2% Radiation Oncology – 5% + 1% Radiation Therapy Centers – 13% – 1% Urology – 2% – 1% • Key factors underlying payment rate changes: • Elimination of proposed OPPS/ASC cap • Prevented drastic proposed cuts to flow cytometry of 72% (88184) and 75% (88185) • Rescaling of RVUs to match weights assigned to work, PE, MP in revised MEI • Service level changes to RVUs for new, revised and misvalued codes, with interim updates to work RVUs for ~200 codes • Total RVUs for 96413 fell from 4.21 to 3.72 and for 96415 from 0.9 to 0.78, further exacerbating underpayment for chemotherapy administration • Change to 90% utilization assumption for expensive Dx imaging equipment

5. Other Key Provisions of Final PFS Rule • Implements statutorily mandated across-the-board SGR cut of 20.1%, making conversion factor $27.2006 for 2014 (absent Congressional action) • 2013 CF = $34.0230 (would have been $25.0070 without Congressional action) • Proposed Rule projected SGR cut of 24.4% • Rescaling of RVUs to reflect revised MEI work, PE and MP weights reduces Medicare expenditures and blunted projected impact of SGR • Rule reiterates CMS’ intent to work with Congress on permanent SGR “fix” • Implements statutorily mandated expiration of 1.00 work GPCI floor and updates all GPCIs based on new data, with 2 year update phase-in

6. Other Key Provisions of Final PFS Rule • Aligns quality measures across incentive programs and allows clinical data registry reporting for PQRS and EHR incentive programs • Expands Physicians Compare reporting: all measures reported using GPRO for groups of all sizes; certain measures for groups using registry and EHR reporting; CG-CAHPs for groups of >100, all based on 2014 participation • Continues implementation of value-based payment modifier, expanding program to groups of >10 in 2016

7. Payment for Complex Chronic Care Management • Separate reimbursement for non-face-to-face complex chronic care management services to begin Jan. 1, 2015 • New G Code available to PCPs or specialists who bill under PFS • Only one professional a month may bill for any given patient • Code to cover >20 minutes of care coordination management every 30 days; services many be furnished “incident-to” ; no Annual Wellness Visit link • Eligible patients to have >2 chronic conditions projected to last >12 months or to death and of type that place patient at significant risk of death, acute exacerbation/decompensation or functional decline • Patient to agree in writing to receive service because of co-pay • Services to be furnished in accordance with standards established by regulation in 2015 PFS rule. Standards likely to require: • 24/7 access • Development and maintenance of treatment plan • Coordinate with other providers • Evaluation of medication regimes