July 15th, 2016

CMS Proposes Medicare 2017 Reimbursement

The proposed 2017 Medicare Physician Fee Schedule asserts myriad changes likely to affect physician reimbursement in the coming year. As in previous years, the impact of the 2017 schedule varies based on specialty, with primary care physicians seeing modest gains while certain specialists experience flat or declining payments. Here’s what the proposed fee schedule has in store for physicians in 2017:

Conversion Factor. Adjustments to the fee schedule’s conversion factor next year will be somewhat of a wash. Counterbalancing a mandated 0.5% update to the conversion factor in 2017 are the proposed downward adjustment of 0.07% for imaging and a relative value unit (RVU) adjustment of 0.51% for budget neutrality. As a result, the 2017 Medicare physician fee schedule conversion factor drops ever so slightly, from 35.8043 to 35.7551.

Looking at the combined impacts of other proposed adjustments, Family Medicine would see a 3% gain ­–– the most accorded to any specialty in 2017. The news isn’t so cheery for Interventional Radiology, which would take a 7% hit, the most of any single physician specialty. Pathology and Vascular Surgery also face fee schedule setbacks of a negative 2% each overall.

Telehealth. The Centers for Medicare & Medicaid Services (CMS) intends to expand covered telehealth services in 2017 by proposing to pay for end-stage renal disease (ESRD)-related services, advanced care planning and critical care consultations. The latter group of services— the critical care consultations via telehealth —would be paid through new codes, GTTT1 and GTTT2. The agency also announced plans to create a new place of service (POS) code to clarify reporting of the location of a telehealth service.

Under Scrutiny. Zero-day global services, which are commonly billed alongside an evaluation and management (E/M) service code appended with modifier 25, come onto CMS’ radar screen in 2017. In its research, the agency reports that nearly one in five – 19% – of codes with a 0-day global service were billed more half the time with an E/M code that had been appended with modifier 25. Although many of the 83 codes that CMS has placed under review are for dermatologic services, this list also includes simple pulmonary, otolaryngology, and orthopaedic procedures. Home dialysis is also cited as a target for assessment.

Also under examination are global surgical packages, which the government has committed to review to “improve the accuracy of valuation of surgical services.” Due to be completed by January 1, 2019, this potential revaluation would have an impact on the 4,200 CPT® codes with a 10- or 90-day global period. The government has proposed gathering data about the frequency and input of global surgical codes by establishing eight new G codes in 2017 that are intended to measure pre- and post-operative care, as well as non-face-to-face services. Although usage of the codes on claims will be for informational purposes only, CMS is seeking feedback about the potential burden of this approach to data collection, as well as the impact of an additional proposal to withhold up to 5% of payments from surgeons who choose not to participate in the research.

Care Management. In 2017, CMS proposes to introduce a series of new care management codes for primary care, behavioral health and care coordination services. These additions include code GPPP6 for assessment and care planning of patients with cognitive impairment; GPPP1, GPPP2 and GPPP3 for behavioral health integration services in the Psychiatric Collaborative Care Model used in the primary care setting; and GPPPX for general behavioral health integration provided outside of the Model.

Two more G codes proposed for introduction in 2017 are likely to pique the interest of all physicians: GDDD1, an add-on code for patients using mobility-assistive technology, and GPPP7 for comprehensive assessment of and care planning by a physician or other qualified health care professional for patients requiring chronic care management services. These add-on codes are meant to boost pay when providing these services during a patient’s visit.

To address what it sees as the under-utilization of chronic care management (CCM) code 99490, which can be reported once per month when providing 20 or more minutes of non-face-to-face care to a patient, CMS proposes to ease certain requirements for using the code. These steps include the removal of the current requirement that physicians furnishing CCM after hours must have 24/7 electronic access to the patient’s care plan. Other welcomed changes relax requirements for initiating visits, formatting and sharing care plans and clinical summaries, and obtaining the patient’s consent.

The government also intends to cover the codes, 99487 and 99489, for complex CCM. These two new CCM codes, as well as GPPP1, GPPP2, GPPP3 and GPPPX, will require only general supervision by the physician or advanced practice provider when providing these complex and, often, time-consuming services. The proposal also would lift the burden of direct supervision—replacing it with general supervision—for the use of these codes in rural health clinics (RHCs) and federally qualified health centers (FQHCs).

Prolonged Care. Prolonged care codes 99358 and 99359 for extended non-face-to-face E/M services before or after an in-person office visit have existed for a number of years, but have never been reimbursed. In 2017, CMS will begin paying for the codes when the services are rendered to Medicare patients.

Diabetes Self-Management Training. The government is proposing an expansion of opportunities to be paid for diabetes self-management training (DSMT), G0108 and G0109 – and has introduced the framework for an entirely new initiative – the Medicare Diabetes Prevention Program (MDPP). CMS proposed reimbursement method focuses on paying for patients who experience weight loss.

Imaging. Effective beginning January 1, 2017, federal law reduces payment by 20% for the technical component (TC) (including the TC portion of a global service) for X-rays taken using film. CMS will require a new modifier on claims for the technical component of the X-ray service, including when the service is billed globally.  In subsequent years, computed radiology (CR) takes a hit with a mandated 7% reduction in payments for imaging services that are X-rays (including the X-ray component of a packaged service) taken using CR. The payment hit for CR commences in 2018.

Data Reporting. Accountable care organization (ACO) participants have not been required to submit data for the Physician Quality Reporting System (PQRS). While that sounds favorable to physicians, it can prove disadvantageous if and when the ACO is poorly managed. In response, CMS proposes to allow eligible professionals (EPs) billing under the tax identification number (TIN) of an ACO the option of reporting separately as individual EPs or as group practices for PQRS, beginning in 2016. ACO participants also would have the option of reporting quality data outside of the ACO to meet PQRS requirements in 2017 and 2018. The agency intends to exempt these groups from the group reporting registration process for the current calendar year, since the deadline was June 30, 2016.

Informal Review. In another welcomed move, the informal review for penalties for failure to successfully report to PQRS will be eased for affected physicians. The informal review process for the Value-based Payment Modifier (VBPM) also will be restructured. CMS proposes to revise the informal review policies, creating a protocol for how VBPM quality and cost composites would be affected for the 2017 and 2018 payment years should unexpected issues arise, such as an error by CMS in its calculations or a mistake by a vendor or other third party.

While most of the changes would not become effective until January 1, 2017, CMS is currently seeking comment about its recommendations in advance of issuing its final rule in early November. Read the complete proposed rule in the Federal Register at

On a final note, through a separate rulemaking process, CMS proposed to shorten the reporting period for attesting to meaningful use (MU) in the electronic health record (EHR) Incentive Program. The reporting period would be any continuous 90-day period between January 1, 2016, and December 31, 2016, instead of a full year of use as currently required. The final rule regarding MU reporting is expected to be released in October; this may be the best news of all!

Woodcock & Associates, July 15,2016,