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November 10, 2009:

If the final changes to policies and payment rates for the 2010 Medicare physician fee schedule go through as they are, physicians are looking at a negative 21.2 percent update to payments unless Congress takes action. The negative update is the result of the sustainable growth rate (SGR) update formula. This update has resulted in negative updates since 2003, but Congress has prevented the negative update legislatively since 2004.

According to Jonathan Blum, director of the Center for Medicare Management at the Centers for Medicare and Medicaid Services (CMS), “the administration tried to avert the pending fee schedule cut in the FY 2010 budget proposal that it submitted to Congress and remains committed to repealing the SGR.” Blum also said, “In the meantime, CMS is finalizing its proposal to remove physician-administered drugs from the definition of ‘physicians’ services’ for purposes of computing the physician fee schedule update. While this decision will not affect payments for services during CY 2010, CMS projects it will have a positive effect on future payment updates.”

Outlined in the final rule are other actions that CMS is taking, including:

  • Refine Medicare payments to physicians that will improve payment rates for primary care services relative to other services
  • Include data about physicians’ practice costs from a new survey, the Physician Practice Information Survey (PPIS), designed and conducted by the American Medical Association when computing practice expense relative value units was finalized with a four-year phase-in period
  • Finalize the proposal to stop paying for consultation codes other than the G codes that are used to bill for telehealth consultations, and to redistribute the resulting savings to increase payments for the existing evaluation and management (E/M) services
  • Increase payment for the initial preventive physical exam (IPPE), also called the “welcome to Medicare” visit, to be more in line with payment rates for higher complexity services
  • Add new Medicare benefit categories for cardiac and pulmonary rehabilitation services and for chronic kidney disease (CKD) education beginning January 1, 2010. The final rule with comment period outlines what these programs will entail, how they will be paid under the MPFS and the criteria for covering these services.
  • Increase the Medicare share of payments for outpatient mental health services to 55 percent from 50 percent, beginning a gradual transition to eliminate the Medicare outpatient mental health treatment limit
  • Implement a requirement that suppliers of the technical component of advanced imaging services be accredited beginning January 1, 2012. The accreditation requirement will apply to mobile units, physicians’ offices, and independent diagnostic testing facilities that create the images but will not apply to the physician who interprets them. CMS will address suppliers’ accountability, business integrity, physician and technician training, service quality, and performance management through additional guidance.

The final rule with comment period may be viewed at: www.federalregister.gov/inspection.aspx#special.

Deborah C. Hall
Clinical/Technical Editor


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