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The Devil’s in the Details: ASCO Examines the Proposed Physician Fee Schedule

Aug 18, 2010

August 2010: ASCO In Action: Policy and Practice

When the Centers for Medicare and Medicaid Services (CMS) issued its proposed rule for the Medicare Physician Fee Schedule for 2011, ASCO identified the following areas of concern for members:

Changes arising from the PPIS

CMS proposes to implement the second phase of a four-year plan to revise practice expense relative value units (RVUs) for all medical specialties based on the American Medical Association’s Physician Practice Information Survey (PPIS). This proposed change has a negative impact on medical oncology practices, especially with respect to the reimbursement for chemotherapy administration codes. CMS estimates that this change would decrease overall Medicare reimbursement for medical oncology practices by approximately 2% in 2011.

Rebasing and revising the MEI

The impacts of the PPIS survey are partially mitigated for oncology practices by the CMS proposal to revise and rebase its use of the Medicare economic index (MEI). This proposed change would provide greater weight to the practice expense and malpractice components of the RVUs assigned to individual codes, which would benefit codes with high practice expense or small work RVUs (such as the chemotherapy administration codes). CMS estimates that this change would increase overall Medicare reimbursement for medical oncology practices by approximately 1% in 2011.

Aggregate impacts on medical oncology

Taken in aggregate, CMS estimates that the overall impact on medical oncology practices would be a decrease of 1% relative to other medical specialties. The actual impact on individual physician practices will depend on the mix of services provided.

Sustainable growth rate

CMS indicates that in the absence of action by Congress to address the sustainable growth rate (SGR) issue, the cut in reimbursement will be approximately 28% for all medical specialties. This is an increase of the 21.2% SGR reduction that has loomed over the physician community during 2010. The latest temporary patch enacted by Congress for SGR will expire after November 30, 2010.

Reimbursement for drugs and biologics

When Congress enacted legislation establishing the average sales price (ASP) payment methodology for prescription drugs in 2003, Congress also directed CMS to use several other pricing standards to provide additional methods for adjusting drug payment levels. Although CMS has been hesitant to use these alternative methodologies in the past, CMS now appears to be nearing an exercise of its authority to substitute average manufacturer price (AMP) for ASP in some situations where ASP exceeds AMP by the threshold amount of 5%. CMS does propose to limit the situations in which it will exercise the substitution authority. CMS also addresses payment for additional free product provided within drug packaging and the establishment of reimbursement rates for biosimilars.

Bonuses and penalties

CMS proposes several changes and updates to the patchwork of incentives and penalties for reporting performance measures, participating in a maintenance of certification program, showing meaningful use of EHRs, and using e-prescribing technology.

Miscellaneous issues

The proposed rule also addresses changes in reimbursement for radiation oncology, imaging services, and bone density testing, as well as changes in the rules governing physician self-referrals, among other issues.

ASCO submitted detailed comments on the proposed Medicare Physician Fee Schedule to CMS in August. For more information on all sections of the proposed rule, visit asco.org/ascoaction, or send an e-mail to publicpolicy@asco.org. You are also invited to share your thoughts on this topic in the Forums section of ASCOconnection.org.

Defining “Meaningful Use”
The Centers for Medicare and Medicaid Services (CMS) released the Final Rule on “meaningful use,” specifying the initial criteria that eligible professionals, eligible hospitals, and critical access hospitals must meet in order to qualify for federal incentive payments. In a departure from the proposed rule, which suggested 25 meaningful-use measures to qualify for funds, the Final Rule specifies a core set of 15 measures that must be met, along with a menu set of 10 measures, five of which must be selected. For a complete summary, visit asco.org/ascoaction, and share your thoughts on meaningful use in the Forums section of ASCOconnection.org.

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