Senate, House Health Leaders Release Draſt Plan to Repeal, Replace SGR On October 30, the Senate Finance and House Ways and Means commiees released a discussion draſt outlining a plan to permanently repeal and replace the sustainable growth rate (SGR). Key provisions outlined in the draſt include: The SGR formula would be repealed. Annual fee schedule payment updates would be frozen for 10 years through 2023. Beyond 2023, professionals parcipang in an alternave payment models "APMs" would receive annual updates of two percent, while all other professionals would receive annual updates of one percent. A new "value-based performance (VBP) payment program" would be used to adjust payments beginning in 2017. The new VBP program would combine all current incenve and penalty programs (e.g., value-based modifier, meaningful use, PQRS) into one budget-neutral program. Physician payments would be adjusted based on how well a physician scores relave to others on a composite performance score. Physicians parcipang in APMs, such as the paent-centered medical home, would be exempt from the VBP program. Revenue thresholds, two-sided risk and a quality component would be established to qualify as an APM (other than the medical home model). APMs would be eligible for a 5% bonus each year for 2016-2021. Over a three-year period, misvalued codes would have to be adjusted to achieve 1% in total fee schedule savings to avoid reducons in the total physician payment pool. The Secretary of HHS would iniate a data collecon effort on resource use requiring selected physicians to submit data (CMS may provide some compensaon to physician for doing this) or face a one -year, 10% payment reducon. Appropriate use criteria would be applied to certain imaging services Prior authorizaon requirements would be imposed on outliers. HHS would publish ulizaon and payment data for physicians on the Physician Compare web site. Senate Finance Commiee Chairman Max Baucus (D-MT) stated, "For years, Medicare payments to doctors have been at risk of geng slashed, liming seniors' access to high quality care. Enough with the quick fixes. Our proposal is for a new physician payment system that rewards value over volume. It will go a long way in improving the efficiency and quality of care for America's seniors." House Ways and Means Commiee Chairman Dave Camp (R-MI) said, "Providing a permanent soluon to the broken SGR formula is vital to ensuring that seniors connue to have access to high quality care. This discussion draſt is an important step in a long-term soluon to this failed policy. Creang a policy that rewards providers for delivering high-quality, efficient health care is the ulmate goal, and this draſt brings us one step closer to that reality." NOVEMBER 2013
Transcript
Senate, House Health Leaders Release Draft Plan to Repeal, Replace SGR
On October 30, the Senate Finance and House Ways and Means committees released a discussion draft outlining a plan to permanently repeal and replace the sustainable growth rate (SGR).
Key provisions outlined in the draft include:
The SGR formula would be repealed.
Annual fee schedule payment updates would be frozen for 10 years through 2023. Beyond 2023, professionals participating in an alternative payment models "APMs" would receive annual updates of two percent, while all other professionals would receive annual updates of one percent.
A new "value-based performance (VBP) payment program" would be used to adjust payments beginning in 2017.
The new VBP program would combine all current incentive and penalty programs (e.g., value-based modifier, meaningful use, PQRS) into one budget-neutral program.
Physician payments would be adjusted based on how well a physician scores relative to others on a composite performance score.
Physicians participating in APMs, such as the patient-centered medical home, would be exempt from the VBP program.
Revenue thresholds, two-sided risk and a quality component would be established to qualify as an APM (other than the medical home model).
APMs would be eligible for a 5% bonus each year for 2016-2021.
Over a three-year period, misvalued codes would have to be adjusted to achieve 1% in total fee schedule savings to avoid reductions in the total physician payment pool.
The Secretary of HHS would initiate a data collection effort on resource use requiring selected physicians to submit data (CMS may provide some compensation to physician for doing this) or face a one-year, 10% payment reduction.
Appropriate use criteria would be applied to certain imaging services
Prior authorization requirements would be imposed on outliers.
HHS would publish utilization and payment data for physicians on the Physician Compare web site.
Senate Finance Committee Chairman Max Baucus (D-MT) stated, "For years, Medicare payments to doctors have been at risk of getting slashed, limiting seniors' access to high quality care. Enough with the quick fixes. Our proposal is for a new physician payment system that rewards value over volume. It will go a long way in improving the efficiency and quality of care for America's seniors." House Ways and Means Committee Chairman Dave Camp (R-MI) said, "Providing a permanent solution to the broken SGR formula is vital to ensuring that seniors continue to have access to high quality care. This discussion draft is an important step in a long-term solution to this failed policy. Creating a policy that rewards providers for delivering high-quality, efficient health care is the ultimate goal, and this draft brings us one step closer to that reality."
As noted in the discussion draft, the Senate Finance Committee and House Ways and Means Committee have requested comments on the proposal be sent to [email protected] and [email protected], respectively, by no later than November 12, 2013.
Congress Ends Government Shutdown
On October 17, President Obama signed, HR 2775, a bill passed by the House (285-144) and Senate (81-18), to end the 16-day government shutdown. The bill continues appropriations through January 15, 2014 and raises the debt limit through February 7, 2014.
As part of the agreement, the House and Senate also agreed to proceed with a conference committee on the budget resolution. The agreement instructs conferees to report a conference report by December 13, 2013.
Tonko-Nunes Letter Sent to CMS Opposing Cuts to Community Cancer Clinics
On October 23, Congressmen Paul Tonko (D-NY) and Devin Nunes (R-CA), along with 112 bipartisan House members, sent a letter to CMS opposing cuts to community cancer clinics in the 2014 Medicare Physician Fee Schedule (PFS) proposed rule. CMS is proposing to cap 2014 payments to community cancer clinics at 2013 hospital payment rates. According to the letter, under the proposed 2014 Medicare payment rules, community cancer clinics would be paid 50% less than hospital rates for a representative mix of chemotherapy administration services and 35% less than hospital rates for a representative mix of radiation therapy services.
The letter urged Medicare officials to reconsider its proposal to cap reimbursement rates for codes related to chemotherapy administration, diagnostic imaging and therapeutic radiation. According to the letter, "Community cancer clinics across the country are struggling to keep their doors open due to inadequate reimbursements...this has resulted in seniors losing access to cancer care close to home — particularly in rural areas."
Senate Republicans Sent Letter to CMS
On November 1, Senators John Cornyn (R-TX), Richard Burr (R-NC), Michael Enzi (R-WY) and Pat Roberts (R-KS) sent a letter to CMS opposing proposed caps to certain 2014 Medicare Physician Fee Schedule (PFS) payments at 2013 OPPS rates. The letter states, "We are especially concerned that this proposal could adversely impact senor's access to community-based cancer care and lead to increased costs, both for beneficiaries and the Medicare program."
Lawmakers Oppose Pathology Cuts
On October 7, a bipartisan group of 113 lawmakers sent a letter to CMS expressing their opposition to a proposal in the 2014 Medicare Physician Fee Schedule that would cut payments to independent labs for pathology services that help diagnose different forms of cancer. According to the letter spearheaded by Reps. Jim Gerlach (R-Pa.) and Bill Pascrell (D-N.J.), this proposal would reduce payments to independent labs by an average of 26 percent, and some services could see cuts of more than 75 percent.
A main concern of these lawmakers is the methodology in determining the proposed cuts. According to the letter, "The recommendation to compare PFS data to the OPPS data diverges from the requirements set forth by statute and regulation. Current law requires CMS to use a resource-based methodology to determine payment for physician services on the PFS, not OPPS....As such, the actual cost for providing anatomic pathology are not necessarily reflected in the OPPS data set."
Milliman Report: Comparing Episode of Cancer Care Costs in Different Settings: An Actuarial Analysis of Patients Receiving Chemotherapy
An October 9 report from Milliman compared episode of cancer care costs in hospital outpatient (HOP) and physician office (POV) settings. Recent reports indicate chemotherapy is increasingly delivered in HOP settings and less in POV settings, which increases cost for employers.
The study focused specifically on patients with non-small cell lung cancer (NSCLC), colorectal cancer (CRC) and breast cancer (which account for 54% of patients receiving chemotherapy) as well as patients receiving adjuvant chemotherapy or chemotherapy for metastatic disease. Among these patients, HOP payments were 28% to 53% higher than the POV setting, depending on the type and stage of cancer. The study noted that radiation oncology and radiation high tech imaging have a significantly higher per-episode payment in the HOP setting.
The payment per episode for NSCLC metastatic cancer patients receiving care in a POV setting was $9,608 versus $11,832 in the HOP setting. For NSCLC adjuvant cancer patients receiving care in a POV setting, the payment was $4,835 compared to $7,063 in the HOP setting. For breast metastatic cancer patients, the payment per episode in a POV setting was $4,326 and in the HOP setting was $5,710. The payment per episode for breast adjuvant cancer patients in a POV setting was $5,568 and $7,067 in a HOP setting.
The study states, "Future shifts from the POV setting to the HOP setting could be a noticeable contributor to future health benefits trends unless costs are controlled in the HOP setting. Alternatively, future shifts of patients from HOP to POV could help control costs."
NEJM IMRT Study
On October 24, the New England Journal of Medicine published an article regarding the association between ownership of Intensity Modulated Radiation Therapy (IMRT) services and its use to treat prostate cancer. The study, authored by Dr. Jean Mitchell, claims that IMRT use is 2.5 times greater when self-referral financial incentives are involved. The report studied Medicare claims for more than 45,000 patients from 2005 to 2010 and concluded "Urologists who acquired ownership of IMRT services increased their use of IMRT substantially more than urologists who did not own such services."
A statement from the Large Urology Group Practice Association (LUGPA), which represents more than 2,000 urologists across the nation, said the study was flawed and "provides no compelling reason to legislatively prohibit integrated practices from providing radiation and other treatment modalities to their patients...Dr. Mitchell's work appears to be specifically designed to produce talking points for the sponsor's political agenda."
The American Urological Association (AUA) also released a statement condemning the study. "There are serious concerns about the author's selection of control groups that may not be representative of general practice trends... As the methods used to select the control groups are poorly described, one cannot help but wonder whether Dr. Mitchell chose the control groups to arrive at results that were acceptable to the study's sponsors."
The Medical Imaging & Technology Alliance (MITA) released a statement that the NEJM report "confirms appropriate utilization of intensity-modulated radiation therapy (IMRT) by urologists regardless of site of service." Gail Rodriguez, executive director of MITA, stated, "This study provides evidence of growth in IMRT treatment which is in keeping with national trends based on physician decision-making, appropriate use criteria, patient choice and evidence-based medical guidelines."
Physician Fee Schedule (PFS) RULE DELAYED
On October 23, CMS announced that it plans to issue the final version of its proposed 2014 Physician Fee Schedule (PFS) rule by November 27. The rule was originally scheduled to be released on or around November 1, but has been delayed due to effects from the partial government shutdown. The impacted regulations include:
Medicare Program; End-Stage Renal Disease Prospective Payment System, Quality Incentive Program, and Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (CMS-1526-F)
CY 2014 Changes to the Hospital Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System (CMS-1601-FC)
CY 2014 Home Health Prospective Payment System Final Rule (CMS-1450-F)
Revisions to Payment Policies under the Physician Fee Schedule and Other Revisions to Part B for CY 2014 Final Rule with Comment Period (CMS-1600-FC)
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