November 2009: Healthcare Reform Part 2 - CMS Proposes Rule Changes for 2010

Pete S. Batra, MD, FACS

On October 30th, 2009, CMS filed the proposed Medicare rule changes for the Physician Fee Schedule, Hospital Outpatient Prospective Payment System, and Ambulatory Surgical Center for CY 2010. The 2 documents contained over 2600 pages of rule changes highlighting the remarkable complexity of the healthcare reform faced by physicians today. In Part 2 of this discussion, specific proposed changes that will impact delivery of care are outlined.
  1. Sustainable Growth Rate (SGR) Update: The estimated Physician Fee Schedule update for 2010 is -21.2%. This SGR deficit has accrued for over a decade with the estimated difference between cumulative target and actual spending from 1997 through December 2009 of $69.7 billion. Physician administered drugs have outpaced all other spending with average annual growth of 22% compared to 6% for all other services. CMS has proposed to remove physician-administered drugs from the calculation of the SGR beginning in 2010. Furthermore, all allowed and actual expenditures of drugs will be retrospectively removed to the 1996/1997 base year. Nonetheless, a cut of this magnitude is unprecedented. The AMA, ACS, and other physician professional organizations are aggressively pursuing repeal of the SGR as part of the health system reform.
  2. New Practice Expense Survey: The new survey for calculating practice expense (PE) RVUs will be introduced in 2010. This was a joint effort by the AMA and 72 specialty societies and was conducted between 2007 and 2008. Data was purchased by CMS for $2.4 million to offset costs. Significant changes in PE RVUs for many services are expected. The combined impact to otolaryngology will be -2%, while specialties like cardiology and radiology will face cuts of 8% and 5%, respectively.
  3. Elimination of Consultation Codes: Beginning January 1, 2010, CMS has proposed to budget neutrally eliminate the use of all inpatient and office/ outpatient consultation codes. This will result in increase of work RVUs for new and established office visits by approximately 6%. Initial hospital and facility visits will be see work RVU increases by approximately 2%.
  4. Misvalued Codes: CMS has accepted the RUC recommendations for nearly 200 physician services that were identified as potentially misvalued. Savings will be redistributed within the payment schedule through a positive adjustment to the 2010 conversion factor.
  5. E-prescribing: CMS has authorized an incentive payment equal to 2.0% of the total estimated allowed charges for all covered professional services furnished during the 2010 reporting period for successful e-prescribers. Physicians will only have to report the code 25 times instead of reporting it for 50 percent of visits in order to qualify for the incentive payment.
  6. Physician Quality Reporting Initiative (PQRI): Successful 2010 PQRI participants may earn an incentive payment of 2% of the total Part B allowed charges. An eligible professional may choose to report data through claims, qualified registry, or qualified EHR product. Of 186 PQRI measures currently reportable, the following should be considered in a rhinologic practice:
    • Perioperative Care: Timing of antibiotic prophylaxis
    • Perioperative Care: Selection of prophylactic antibiotic – first or second generation cephalosporin
    • Perioperative Care: Discontinuation of prophylactic antibiotics (non-cardiac procedures)
    • Perioperative Care: Venous thromboembolism prophylaxis
    • Asthma: Pharmacologic therapy
    • Asthma: Asthma assessment
    • Preventive Care and Screening: Influenza immunization for patients ≥ 50 years old
    • Preventive Care and Screening: Pneumonia vaccination for patients ≥ 65 years old
  1. Medicare Program; Payment Policies Under the Physician Fee Schedule and Other Revisions to Part B for CY 2010. Filed October 30th, 2009.
  2. Medicare Program: Proposed Changes to the Hospital Outpatient Prospective Payment System; Proposed Changes to the Ambulatory Surgical Center Payment System for CY 2010. Filed October 30, 2009.

Revised 11/2009
©American Rhinologic Society

PDF CMS Changes for 2010
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