Doctors’ groups are still digesting the 1,473-page proposed federal rule updating the Medicare physician fee schedule and outlining changes for year three of the physician payment program implemented under MACRA.
But in their preliminary review of the proposal released by the Centers for Medicare & Medicaid Services last Thursday, they’ve already found plenty to fault, including changes that would slow the move of physician practices to value-based payment and a failure to lower drug costs.
That, even as CMS Administrator Seema Verma sent out a “Dear Doctor” letter on Monday to various clinician groups saying the proposed final rule is aimed at restoring the doctor-patient relationship and reducing “burdensome and often mindless administrative tasks.”
“CMS’s focus is on putting patients first, and that means protecting the doctor-patient relationship. We believe that you should be able to focus on delivering care to patients, not sitting in front of a computer screen,” Verma wrote in the letter that describes changes CMS is proposing.
What exactly do these groups representing physicians find problematic? Here are some of the changes the groups pointed out:
It could slow the move to value-based payment. The AMGA, a trade association that is pushing for the transformation of healthcare, said in a statement that the agency “missed the opportunity” to move Medicare provider payments to a value-based system.
The group said it was disappointing that CMS kept a high low-volume threshold for providers to participate in MIPS, one of two payment tracks under the Medicare Access and CHIP Reauthorization Act (MACRA). That will continue to reduce the payment adjustments for providers that are invested in value-based care, the AMGA said.
As authorized by MACRA, providers can earn an adjustment of up to 7% on their Medicare Part B payments in 2021 based on their 2019 performance. However, as indicated in the proposed rule, CMS estimates the overall payment adjustment will be 2%. “We are concerned that CMS has again opted not to recognize the efforts of high-performing AMGA members. As we enter the program’s third year, it is time for CMS to honor congressional intent and use MIPS to create value for Medicare,” said Jerry Penso, M.D., AMGA president and CEO.
Not everyone held that viewpoint. America’s Physician Groups President and CEO Donald Crane said the group is cautiously optimistic that CMS has taken real action to advance the value movement. In particular, he cited the reaffirmation of the recently announced Medicare Advantage Qualifying Payment Arrangement Incentive (MAQI) demonstration.
It could raise, not lower, drug prices. The Community Oncology Alliance, a nonprofit association of independent oncology centers, said CMS’ proposal to cut a 6% fee doctors get for drugs dispensed in their offices to 3%, which would apply to new drugs during their introductory period, will not lower drug prices as the government indicated. The proposal was likely to trigger pushback, and it did.
“COA believes that this payment cut for new cancer therapies will result in drug manufacturers actually increasing WAC [wholesale acquisition cost] list prices so that their new products will not be at a competitive disadvantage to existing products which are reimbursed at average sales price (ASP) plus 6%,” the group said in a statement.
“No words can adequately describe how puzzling the CMS proposals are,” said Ted Okon, executive director of COA. “At a time when the Trump administration is floating its blueprint to bring down drug prices, they are proposing a move that will actually fuel list prices of chemotherapy and other lifesaving drugs.”
It could cut payments for evaluating complex cases. While CMS is proposing to overhaul the Evaluation and Management (E&M) documentation and coding system to dramatically reduce the amount of time doctors must spend on documentation, the COA was worried about the impact.
Under the proposal, CMS would drastically cut payment for the critical evaluation and management of more complex cancer cases from $172 to $135 (a 22% payment cut) for a new patient and from $148 to $93 (a 37% payment cut) for an existing patient, the group said. While the intent is to streamline reporting, it will severely undervalue the thorough and critical evaluation and management of seniors with cancer, especially life-threatening complex cases, the group said.
“Their scheme to pay a physician the same amount for evaluating a case of sniffles and a complex brain cancer simply defies all logic. It is the antithesis of value-based healthcare and cheapens the medical care seniors are entitled to under Medicare,” said Okon.
In her letter to doctors, Verma said most specialties will see changes in their overall Medicare payments in the range of 1% to 2% up or down from the new E&M policy, but she said any small negative payment adjustments would be outweighed by the significant reduction in documentation burden.
It could increase costs, keep reporting burden. The Medical Group Management Association (MGMA) said it was disappointed that CMS decided to continue its policy requiring physicians to document a full 365 days of quality measures rather than 90 consecutive days.
The proposed rule would also require physicians to upgrade to 2015 Edition Certified Electronic Health Record Technology beginning in 2019. The MGMA was also unhappy that the rule would require physicians to make costly upgrades to their electronic health records for 2019 and take further steps toward implementing burdensome appropriate use criteria.
“At first glance, the rule doesn’t meet MGMA’s definition of administrative simplification,” said Anders Gilberg, senior vice president of government affairs.
An avalanche of new pay proposals from the CMS seeks to reduce provider burden, so much so that it could undermine efforts to shift Medicare to a value-based system, doctors warned.
The agency released a 1,400-page proposed rule July 12 that for the first time combined the annual physician fee schedule and the Medicare Quality Payment Program rules, which implements sections of MACRA each year.
Reducing burden on providers was the key goal of the document, according to the CMS, but doctors wonder if the agency went too far in some instances.
For instance, the agency estimated that 42% of physicians participating in Medicare in 2019—roughly 1.5 million doctors—will actually need to comply with one of MACRA’s two payment tracks: the Merit-based Incentive Payment System, or advanced alternative payment models like accountable care organizations.
The CMS estimated that between 160,000 and 215,000 eligible clinicians would be part of an alternative pay model and that 650,000 clinicians will participate in MIPS.
Officials at a major physician-group association, the AMGA, called the rule “a missed opportunity to move Medicare provider payments to value.”
At issue is that for the second year in a row, physician practices with less than $90,000 in Medicare revenue or fewer than 200 unique Medicare patients per year would be exempt from MIPS.
Under MIPS, doctors must hit certain quality thresholds. Those who don’t must pay a penalty that is redistributed to the high performers.
So as more doctors get a pass, the size of the incentive pool has shriveled substantially. Practices were initially eligible for $833 million in incentive payments under MIPS in 2019, but it could fall to $118 million in 2020. For 2021, practices are eligible for up to $372 million in incentive payments. That spike is partly because more clinicians, including physical therapists, occupational therapists, clinical social workers and clinical psychologists would be eligible for MIPS.
Because of the opt-outs, MIPS participants can expect a potential pay increase of just 2% if they perform well, according to Darryl Drevna, director of regulatory and policy at the AMGA. That’s well below the 7% envisioned by lawmakers who drafted MACRA, he said.
“As we enter the program’s third year, it is time for CMS to honor congressional intent and use MIPS to create value for Medicare,” Dr. Jerry Penso, CEO of the AMGA, said in a statement.
In hopes of driving more participation in MIPS, the CMS proposed that exempted doctors could voluntarily opt in to the program. It estimated that as many as 42,000 physicians would do so.
“I’m not sure how many clinicians will take advantage of it, but it’s good to give them the choice, especially for those on the cusp of eligibility who may otherwise churn in and out of MIPS over the years,” said Anders Gilberg, senior vice president of government affairs at the Medical Group Management Association.
CMS Administrator Seema Verma said the proposed changes not only address physician concerns about being overburdened by regulatory requirements, but will allow them to focus more squarely on patient care. Included in that push is a move to focus more on outcomes.
The agency proposed removing 34 quality measures from MIPS, but adding 10 that emphasize outcomes over process.
An ongoing criticism of the program is that it focuses too much on how doctors do things rather than if the patient is getting better.
“The streamlined measures signify that CMS is listening to clinicians and acknowledging the need to lessen their administrative burden by focusing on the measures that will make the most tangible impact on care delivery and patient outcomes,” said Dr. Gerald Maccioli, chief quality officer at Envision Healthcare, a Nashville-based physician practice management company.
Elsewhere in the rulemaking, the CMS proposed overhauling a set of generic codes that most doctors use to distinguish the level of complexity and site of care. The evaluation and management visit codes have been in place since 1995. The proposal would cut pay for the evaluation and management of more complex cancer cases from $172 to $135, which is a 22% decrease. It also aims to reduce pay for exams for new oncology patients from $148 to $93, a 37% reduction.
The pay changes undervalue care visits for seniors with cancer, especially life-threatening complex cases, according to the Community Oncology Alliance.
“Their scheme to pay a physician the same amount for evaluating a case of sniffles and a complex brain cancer simply defies all logic,” Ted Okon, executive director of the alliance, said in a statement. “It is the antithesis of value-based healthcare and cheapens the medical care seniors are entitled to under Medicare.”
The American Hospital Association is also concerned about some of the proposed pay tweaks for patient evaluation visits.
Physicians who provide care for a disproportionate number of high-acuity patients would consistently, and unfairly, receive underpayment, according to Tom Nickels, executive vice president at the AHA.
In addition, the agency is proposing to cut payments to doctors for administering new drugs to Medicare patients.
The CMS now pays for drugs new to the market at the wholesale acquisition cost plus 6%. It is now proposing a 3% cut.
The agency believes this proposal will help curb excessive spending in Medicare Part B and lower out-of-pocket costs by better aligning payments and drug acquisition costs, especially for drugs with high launch prices.
Launch prices for single doses for some new drugs may range from tens to hundreds of thousands of dollars, so a 3% reduction could reduce a patient’s Medicare Part B copayment by as much as 20%, according to a CMS spokesman.
Nickels was against the idea and feels that the agency is inappropriately targeting providers.
“CMS should instead address the skyrocketing list prices of drugs directly with pharmaceutical manufacturers,” Nickels said in a statement.
An analyst note from Leerink Partners agreed that doctors, not drug companies, would be hurt by the proposal.
“This change may reduce some reimbursement rates to physicians but we do not view the change as being overly negative for the drug distributors,” the note said.
HHS and the CMS released its proposed changes to the 2019 physician fee schedule in a 1,473-page proposed rule on July 12. The modifications included some indications of where the agencies are headed with future Medicare regulations. Here, Modern Healthcare highlights seven ways the physician fee schedule could change.
1) Targeting high-cost procedures
Some CPT code procedures are in line for a possible drop in reimbursement. The CMS identified seven procedures that appear to be over-reimbursed and asked for a review.
- Total hip arthroplasty
- Total knee arthroplasty
- Esophagogastroduodenoscopy biopsy single and multiple
- Colonoscopy with lesion removal
- CT imaging of head without contrast
- Electrocardiogram, complete
- Transthoracic echocardiogram with doppler, complete
2) Considering opioid bundles
The rule says it all: “We are seeking comment on creating a bundled episode of care for management and counseling treatment for substance use disorders. We are also seeking comment for regulatory and subregulatory changes to help prevent opioid use disorder and improve access to treatment under the Medicare program. We seek comment on methods for identifying non-opioid alternatives for pain treatment and management, along with identifying barriers that may inhibit access to these non-opioid alternatives including barriers related to payment or coverage.”
3) Changing MIPS measures drastically
CMS proposed 10 new quality measures, four of which are patient reported, seven are high-priority and one that replaces an existing measure. The agency would like to remove 34 measures.
4) Allowing small reimbursement for e-visits
But that reimbursement is meager. The rule says: “Medicare would pay $14 per visit in the first year for these communication technology-based services, compared with $92 per visit for the corresponding established patient visits.” In addition, the CMS expects the change to increase payments to the industry by 0.2%, so it reduced the total payments in the physician fee schedule by that amount.
5) Adding EHRs to the Physician Compare tool
The CMS wants to know how they might add EHR utilization performance to the Physician Compare tool on the CMS website
6) Eliminating chargemasters
Amid concerns about insufficient price transparency, which includes the surprise billing from anesthesiologists and radiologists that hospitals are becoming known for, the rule says the agency would like input on how to potentially overhaul and maybe standardize the often-maligned, yet still unchanged chargemaster pricing system.
7) Encouraging more price transparency
Also in the transparency section, one of the questions the agency asks in the rule is, “Can we require providers and suppliers to provide patients with information on what Medicare pays for a particular service performed by that provider or supplier?” Hospital industry executives are likely to respond to this query.
Bonus note: Among v. amongst
Is there a U.K. native on the CMS’ rule-writing staff? After zero appearances in the 2018 physician fee schedule final rule, the word “amongst” shows up five times in the current proposed rule, though still far behind the 110 uses of “among.”
The Trump administration is halting billions of dollars of payments to insurers under the Affordable Care Act’s risk-adjustment program, a move that further disrupts the insurance market and could lead to more premium increases next year.
Citing conflicting federal court decisions on the program, the CMS said it cannot collect or disburse funds under the risk-adjustment program. All in all, the program was slated to shift $10.4 billion among insurers in 2017, according to the agency.
The permanent program was meant to reduce the incentive for health insurers to cherry-pick healthy members. It shuffles money from plans with healthier-than-average members to those with larger numbers of sicker, higher-cost members. The program is based on a patient’s risk score, which is determined by a person’s demographic information and health condition.
But U.S. District Judge James Browning of New Mexico ruled in February that HHS couldn’t use statewide average premiums to come up with its risk-adjustment formula because the agency wrongly assumed the ACA required the program to be budget-neutral.
“CMS has asked the court to reconsider its ruling, and hopes for a prompt resolution that allows CMS to prevent more adverse impacts on Americans who receive their insurance in the individual and small group markets,” CMS Administrator Seema Verma said in a July 7 statement.
America’s Health Insurance Plans said it was “very discouraged” by the CMS’ decision, which comes as insurers determine their premiums for 2019 and states review those proposals.
“The decision will have serious consequences for millions of consumers who get their coverage through small businesses or buy coverage on their own,” the group said. “It will create more market uncertainty and increase premiums for many health plans—putting a heavier burden on small businesses and consumers, and reducing coverage options. And costs for taxpayers will rise as the federal government spends more on premium subsidies.”
The risk-adjustment program has been a source of frustration for small insurers and ACA co-ops that claim the formula makes their membership bases look healthier than they are. One reason could be that newer insurers have limited information on their members’ health status and claims history. Legacy insurers that have a wealth of patient data may have a leg up on coding. Small health plans also have far less capital than more established insurers to comfortably make large risk-adjustment payments.
The CMS has asked Judge Browning to reconsider his ruling and is awaiting a decision. The agency said it will release additional guidance for insurers on issues related to the risk-adjustment program, including appeals and how this will affect medical loss ratios.
Data from the Medicare Part D program show fewer beneficiaries are receiving high amounts of opioids, but a watchdog agency says usage “remains concerning,” while urging insurers to further restrict at-risk patients with lock-in programs.
The number of beneficiaries receiving high amounts of opioids through Part D coverage declined 8% in 2017 from just over 500,000 in 2016 to nearly 459,000, according to a report (PDF) by the Office of Inspector General.
The number of beneficiaries that received an “extreme” amount of opioids—defined as a daily dose more than two-and-a-half times the CDC’s recommendation for chronic pain patients over the course of the year—dropped 17% in the last year, from 69,500 to 57,600.
Doctor shopping declined even more precipitously, with 14,800 beneficiaries receiving excessive amounts of opioids at from multiple prescribers or pharmacies in 2017 compared to 22,300 the previous year.
However, 1 in 3 Part D beneficiaries still received at least one prescription opioid, and the overall level of opioid use “continues to raise concerns,” the OIG said.
While OIG has ramped up efforts to identify instances of inappropriate prescribing by partnering with states to identify instances of fraud, the agency called on insurers to implement new lock-in authority under the Comprehensive Addiction and Recovery Act of 2016, which allows Part D sponsors to restrict at-risk beneficiaries to select pharmacies and prescribers.
“We also call on Part D sponsors to work with pharmacies to ensure that the new point-of-sale care coordination alerts are implemented and effective,” the OIG wrote. “Specifically, sponsors should ensure that when these controls are triggered, the pharmacists consult with the prescribers before dispensing additional opioids.”
On the enforcement side, this week the OIG along with the Department of Justice announced charges against 601 individuals with fraud crimes totaling $2 billion. A sizable portion of that national takedown was devoted to opioid fraud, with 76 doctors charged for their role in diversion schemes.
The CMS wants to launch an experiment that allows doctors in Medicare Advantage plans to qualify as participating in an alternative pay model.
To comply with MACRA, clinicians have two tracks to choose from: MIPS, which requires clinicians to report and meet quality goals, and advanced alternative payment models, which require clinicians to take on financial risk as part of efforts to improve care and lower costs. If goals are met under an APM they’re eligible for bonuses.
Clinicians in Medicare Advantage plans have urged the CMS to consider those plans as APMs since some are offering risk-based contracts.
The White House’s Office of Management and Budget must approve any experiment. It is now collecting comments on documentation that providers will need to fill out before participating in the demonstration. Comments on these forms are due Sept. 3.
In order to get credit as participating in an APM, doctors must receive a certain amount of Medicare fee-for-service revenue, but that threshold is too high for some providers who may primarily see Medicare Advantage patients. For doctors in Advantage plans to get credit, a demonstration must be launched, according to the CMS. Otherwise, physicians are still subject to MIPS.
The CMS hopes to launch the five-year demonstration this year. The CMS will ask providers about the payment arrangements they have with Medicare Advantage plans and about the number of patients covered in such arrangements. That information will determine whether the payment arrangements meet the risk standards to count as an APM.
The American Medical Association, America’s Essential Hospitals and the Medical Group Management Association urged the CMS to take this step in a joint letter sent last year.
“Leading-edge clinicians who take risk under APMs within these MA contracts will not get credit for their efforts,” the letter said. “Our proposal would encourage broader participation in risk arrangements by clinicians from the start, creating synergies that will reinforce their population-based strategies and translate into higher quality and more efficient care within Medicare.”
An AMA spokesman said it appreciates that HHS took its concerns into consideration and said the demonstration will especially benefit practices in communities where there is a disproportionately high number of Medicare Advantage patients.
Medicare Advantage enrollment is projected to grow by 9% to 20.4 million in 2018. The CMS estimated that more than one-third of all Medicare enrollees, or 34%, will be in a Medicare Advantage plan in 2018.