6 Points on the Medicare Physician Fee Schedule Proposed Rule for 2013

CMS recently issued its proposed rule for the Medicare physician fee schedule (pdf) for the 2013 calendar year, and many initiatives from the Physician Quality Reporting System to new primary care payment rates were addressed.

Here are six of the most pertinent points from CMS' proposed rule.

•    Sustainable growth rate. The proposed rule assumes the SGR, which is the formula used to adjust Medicare physician payment rates, will cut all physician payment rates by 27 percent, a figure lower than last year's projection of 27.4 percent. The 27 percent rate cut is based on March 2012 (pdf) analysis from CMS. However, every year since 2003, Congress has temporarily bypassed the SGR to ensure there would be no cuts to physician Medicare payments. The current CMS administration has endorsed a full repeal of the SGR, which would cost more than $300 billion but would eliminate the yearly patch fixes, and an updated physician payment cut is expected to be released in the final rule.

•    Primary care emphasis. Long-term investment in primary care and care coordination services has been a theme of the healthcare reform law as well as the most recent proposed rule. Included among the proposed rule's initiatives were a 7 percent increase in payments to family physicians, a 3 to 5 percent payment increase to other primary care practitioners and a new procedure code to recognize additional resources community physicians must utilize on behalf of patients as they monitor patients more closely in the 30 days following a discharge.

"Helping primary care doctors will help improve patient care and lower healthcare costs long term," CMS Acting Administrator Marilyn Tavenner, RN, said in a news release.

•    Specialist physician payment cuts. Specialists would take a cut in order to pay for the payment boost for primary care physicians, nurse practitioners and physician assistants. Specialties that would receive payment reductions include radiology (4 percent), anesthesiology (3 percent), cardiology (3 percent), interventional radiology (3 percent), vascular surgery (3 percent), urology (2 percent) and neurosurgery (1 percent), among others.

•    Potentially misvalued codes. CMS has taken several steps to ensure all codes are valued appropriately and to take action in case codes need to be revised. CMS proposed two new categories of potentially misvalued codes for review: "Harvard-valued" CPT codes that involve Medicare annual allowed charges of $10 million or more and services with standalone practice expense procedure times. CMS said there are more than 1,000 potentially misvalued codes, and the agency has completed its review of 450 surgical codes.

•    Physician Quality Reporting System. The value-based payment modifier, which affects physician payments according to cost and quality of care starting in 2015, will not affect groups with 25 or more physicians. In addition, CMS proposed that physicians who do not meet the PQRS criteria can set their value-based payment modifier at -1 percent.

•    Prepayment medical review. As part of the Patient Protection and Affordable Care Act, CMS proposed to remove a limitation placed on private contractors, allowing them to continue complex prepayment medical reviews if a provider or supplier has failed to reduce its individual error rate. This is also part of the administration's increased focus on eliminating fraud and abuse in Medicare.

CMS will accept comments on the proposed rule through September 4, with a final rule issued around November 1.

More Articles on the Medicare Physician Fee Schedule:

House Legislation Would Permanently Repeal Sustainable Growth Rate

December's Payroll Tax Bill Alters Medicare Physician Payment Final Rule

CMS Releases Physician Fee Schedule, Includes 27.4% Cut to Physician Payments

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