Revenue Cycle Management Blog | GroupOne Health Source

15 Things to Know About the 2016 Medicare Physician Fee Schedule

Written by Kaitlyn Houseman | November 12, 2015
On Friday, the Obama administration issued its final rule for the 2016 Medicare Physician Fee Schedule that includes several health IT provisions. The fee schedule – the first since repeal of the Sustainable Growth Rate (SGR) formula and enactment of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) – includes changes to payment policies, modifications to misvalued codes, and updates to quality performance metrics under the PQRS, the Medicare Shared Savings Program, and Physician Compare, among others. (Internal Medicine News, 10/31)

Last week CMS finalized payment rules for 2016, which include the first steps in implementing what is known as the Merit-Based Incentive Payment System. The Merit-Based Incentive Payment System was approved by Congress in April and will replace the Medicare formula for physician payments that has been used since 1997.

“Medicare has traditionally relied on a fee-for-service model, which has been criticized for offering economic incentives for providers to offer a greater volume of care without regard to outcomes,” said Jeffrey Bechtel, the senior vice president of health economics and policy for the Hospital & Health system Association of Pennsylvania.

By shifting from a fee-for-service model to a pay-for-performance model that emphasize the importance of quality healthcare, CMS is anticipating reduced costs, improved population health, and a better patient experience.

Here is a roundup of the top 15 takeaways from the finalized 2016 Medicare Physician Fee Schedule:

  1. There is a new exception to the physician self-referral law permitting hospitals, federally qualified health centers and rural health clinics to pay physicians for compensating nonphysician practitioners under some conditions.
  2. There is a new exception to Stark Law permitting timeshare arrangements for office space, equipment, personnel, items, supplies and other services used.
  3. The date of service for transitional care management (TCM) codes will now be the date of the visit, versus the end of the month. CMS revealed that the claim can be released on that date as well, thus streamlining the billing process. (Woodcock and Associates, 10/30)
  4. CMS is holding off on implementing “appropriate use criteria” that will eventually require physicians to consult clinical decision support software about the necessity of certain services before providing them. The agency needs to establish a process for specifying "appropriate use" criteria before the technology can be developed. CMS hopes to do that in next year’s physician fee schedule.
  5. CMS finalized two new advance care planning codes (99497 and 99498) that will pay physicians for time spent discussing patient options for advance directives. The first code will cover an initial 30 minutes of the physicians’ time, and the second code will cover additional 30-minute blocks as necessary. "Establishing separate payment for advance care planning codes provides beneficiaries and practitioners greater opportunity and flexibility to utilize these planning sessions at the most appropriate time for patients and their families," said CMS. If billed at the time of the patient’s AWV, the ACP services should be billed with a modifier -33 and are separately payable.
  6. CMS created four new telemedicine billing codes, including prolonged service inpatient CPT codes, 99356 and 99357, and end stage renal disease (ESRD)-related services 90963 through 90966, with the originating telehealth site reimbursed a $25.10 facility fee for each patient. However, telemedicine services must still be provided at a health care facility, as a patient’s home is not an originating site under federal law, CMS said. ("Morning eHealth," Politico, 11/2).
  1. Physicians are able to receive payment incentives for high-quality, efficient care under the Value-Based Payment Modifier program. Underperformers are subject to payment adjustments.
  2. Modifications to quality programs include a new reporting option under the PQRS that will allow group practices to report quality measure data using a Qualified Clinical Data Registry. In 2016, there will be 281 measures in the PQRS measure set and 18 measures in the Group Practice Reporting Option (GPRO) Web Interface, according to the final rule.
  3. Rural health clinics and federally qualified health centers are eligible to bill for Medicare’s chronic care management code, provided they use the most up-to-date certified EHR.
  4.  CMS will apply the quality-tiering methodology to all groups and solo practitioners that meet the criteria to avoid the downward adjustment under the PQRS. Groups and solo practitioners would be subject to upward, neutral, or downward adjustments derived under the quality-tiering methodology.
  5. CMS will continue to set the maximum upward adjustment under the quality-tiering methodology for the CY 2018 value modifier at four times an adjustment factor for groups of physicians with 10 or more eligible professionals, and two times an adjustment factor for groups of physicians with between two and nine eligible professionals and physician solo practitioners.
  6. CMS will use calendar year 2016 as the performance period for the calendar 2018 value modifier and continue to apply the 2018 value modifier based on participation in the PQRS by groups and solo practitioners.
  7. Although there are specific parameters to follow, CMS is allowing hospitals to provide financial assistance to physicians in hiring advanced practice providers (APPs) as a new exception to the physician self-referral law. Social workers and clinical psychologists are also included, with CMS revealing that subsidies are limited to situations in which the APP is providing primary care or mental health care services (Woodcock and Associates, 10/30).
  8. Under the final rule, CMS also adds certified registered nurse anesthetists to Medicare's list of qualified telehealth providers for health care services (CMS final rule, 10/30).
  1. CMS said it plans to continue to expand data publicly available on its Physician Compare website. CMS also reiterated its commitment to "moving to a star rating system on Physician Compare" (CMS final rule, 10/30). "Benchmarks are important to ensuring that the quality data published on Physician Compare are accurately understood," said CMS. However, CMS said it will not publish 2014 EHR data to its Physician Compare website, citing "inaccuracies, specifically given the number of errors in the (electronic Clinical Quality Measure) submission data" ("Morning eHealth," Politico, 11/2).