Medicare Physician Fee Schedule Final Rule

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By AHRA Regulatory Affairs Committee

On October 30th, the Centers for Medicare and Medicaid Services (CMS) issued the 2016 Medicare Physician Fee Schedule Final Rule, solidifying Medicare Part B payment policy changes for the coming year. Unless otherwise noted, these changes become effective January 1, 2016.

The rule responds to comments made by AHRA and others in the radiology community on XR-29 compliance, Appropriate Use Criteria, and other issues. The following is a summary of relevant sections of the final rule.

Conversion Factor

First and foremost, the final rule implements the 0.5 percent payment update for 2016 which was established by the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). HOWEVER, even though Congress mandated a 0.5 percent increase for 2016, this is offset by a Misvalued Code negative adjustment of .77%.

CMS estimates that the CY 2016 net reduction in physician fee schedule expenditures due to misvalued codes will only be 0.23 percent. As a result, the conversion factor for 2016 must be reduced by 0.77%. 






(Click image for a larger version)

XR-29 Compliance Not Delayed 

CMS has determined that it will not delay the implementation of section 1834(p) of the Protecting Access to Medicare Act of 2014 (PAMA) which would establish a modifier on CT services furnished on equipment that does not meet the NEMA Standard XR-29-2013 (XR-29). CMS noted that several commenters requested a delay but they argued that “the statute requires that we apply the payment adjustment for computed tomography services furnished on or after January 1, 2016.”

CMS reiterated in a response to a separate comment that the statute authorized the Secretary to apply new “successor standards” but declined to do so this year. However, CMS stated they may consider doing so in future rulemaking. They did not address our comment that any future standards be finalized well in advance of their implementation to allow imaging departments to prepare.

CMS also finalized the modifier code for non-compliant scans as “CT.” This modifier code will be added on January 1, 2016. Claims submitted for CT scans with the modifier “CT” will receive a 5% reduction in 2016 and a 15% beginning January 1, 2017.

Appropriate Use Criteria Will Not Be Developed Before 2017 

Despite the language in PAMA requiring physician to use Clinical Decision Support (CDS) to consult an Appropriate Use Criteria (AUC) for all Medicare claims beginning on January 1, 2017, CMS will not implement this requirement and does not expect AUC to be finalized until the summer of 2017. CMS did not indicate a new CDS implementation date.

CMS is also proposing to alter the definition of Provider-Led Entity (PLE) to “refer to organization comprised primarily of providers or practitioners, who either within the organization or outside of the organization, predominately provide direct patient care.” This new definition of PLE will allow for health care collaborative and other similar organizations so be considered PLEs.

Lung Cancer Screening Consultation for Low Dose Computer Tomography (LDCT) 

CMS recognized our concerns that despite the fact that the National Coverage Determination for this benefit was issued in February of 2015, no billing instructions have been released for services performed prior to 2016. CMS promises that they are in the processing of developing said instructions and that information “is forthcoming.”

Phase-in of Significant RVU Reductions 

CMS is finalizing their proposed policy to phase in 19 percent of a RVU reduction in the first year and the remainder of the reduction in the second year. This is despite a call from AHRA and others to consider a more even distribution of RVU reductions over the two-year period.

Practice Expense Inputs for Digital Imaging Services

CMS agreed with the AHRA and other commenters that the “computer workstation, 3D reconstruction CT-MR” equipment should be restored to the equipment list and assigned to CPT code 76377 with an equipment time of 38 minutes.


AHRA’s Regulatory Affairs Committee:

Chair: Sheila Sferrella, CRA, FAHRA
Luann Culbreth, CRA, FAHRA
Jim Miller, CRA
Melody Mulaik, CRA, FAHRA
Penny Olivi, CRA, FAHRA
Jacqui Rose, CRA, FAHRA
Carlos Vasquez, CRA, FAHRA
Bill Finerfrock, Capitol Associates
Nathan Baugh, Capitol Associates

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