Medicare program; revisions to payment policies under the physician fee schedule, DME face-to-face encounters, elimination of the requirement for termination of non-random prepayment complex medical review and other revisions to Part B for CY 2013. Final rule with comment period

This major final rule with comment period addresses changes to the physician fee schedule, payments for Part B drugs, and other Medicare Part B payment policies to ensure that our payment systems are updated to reflect changes in medical practice and the relative value of services. It also implements provisions of the Affordable Care Act by establishing a face-to-face encounter as a condition of payment for certain durable medical equipment (DME) items. In addition, it implements statutory changes regarding the termination of non-random prepayment review. This final rule with comment period also includes a discussion in the Supplementary Information regarding various programs . (See the Table of Contents for a listing of the specific issues addressed in this final rule with comment period.)

Inpatient vs. observation: get it right the first time

It's often a balancing act to determine if patients should be admitted to the hospital or receive observation services as an outpatient, but it's critical to get it right the first time so the hospital will get appropriate reimbursement and avoid having money taken away following audits. Reimbursement is much lower for observation services, but if a patient is admitted inappropriately, Medicare or other payers can take back the reimbursement. Patients receiving observation services as outpatients are subject to Medicare Part B co-pays. If the patient is later admitted, the time in observation doesn't count toward the three-midnight inpatient stay requirement for Medicare to pay for a skilled nursing home admission. One-, two-, and three-day stays are often targets of auditors. Case managers must work closely with physicians to help them determine the appropriate level of care. In certain circumstances, Condition Code 44 can be used to change a patient's level of care from inpatient to observation.

SGR reform and nephrology: difficult problems, potential solutions

In light of the massive uncertainty with both the federal government in general and health policy priorities specifically, it is probably constructive to focus on the things we know for sure. In Medicare Part B reimbursement, the SGR system is fundamentally flawed, and must be replaced. All of Congress has recognized this fact, and there is legislation in the House that would move the ball forward on SGR repeal and replacement. Likewise, coordinated care models like ACOs offer a logical process for achieving a triple aim: improving individual health care, improving population health, and promoting cost efficiency in health care. Hopefully, policy makers in Washington will recognize and act on these truths as well.

Geographic variations in availability and use of chiropractic under medicare

OBJECTIVE

The purpose of this study was to measure geographic variations in the availability and use of chiropractic under Medicare.

METHODS

A cross-sectional design was used to analyze a large nationally representative sample of Medicare data. Data from a 20% representative sample of all paid Medicare Part B fee-for-service claims for 2007 were merged with files containing beneficiary and provider data. The sample was restricted to adults aged 65 to 99 years. Measures of chiropractic availability and use were described and selectively mapped by state. Geographic variations were quantified. Spearman test was used to evaluate for correlation between chiropractic availability and use.

RESULTS

The average number of doctors of chiropractic (DC) by state was 1135; average DC per 1000 beneficiaries was 2.5 (SD, 1.1). The average number of chiropractic users by state was 34,502 (SD, 30,844); average chiropractic users per 1000 beneficiaries was 76 (SD, 41). Chiropractic availability by state varied 6-fold, and chiropractic use varied nearly 30-fold. Availability was strongly correlated with use (Spearman ρ, 0.86; P < .001). Expenditures per DC were highest in the upper Midwest and lowest in the far West; expenditures per user were highest in New England and New York, and lowest in the West.

CONCLUSION

Chiropractic availability and use by older adults under Medicare predominated in rural states in the North Central United States. Expenditures were higher in the East and Midwest and lower in the far West. Chiropractic availability and use by state were highly correlated. Future analyses should use small-area analysis and statistical modeling to identify factors predictive of chiropractic use.

Self-referral in medical imaging: a meta-analysis of the literature

PURPOSE

In the current political and economic climate, there is a desire to reduce health care costs; diagnostic imaging expenditure is one area of particular interest. The authors present a meta-analysis of the relative frequency of imaging utilization in the setting of self-referral compared with that of non-self-referral and a simulation of increased cost to Medicare Part B on the basis of this relative frequency.

METHODS

The MEDLINE database was searched systematically. Specific inclusion criteria for relative frequency calculations were a numerator (number of patients imaged) and denominator (number of total patients seen) in each group (self-referrers and radiologist referrers). The relative risk of self-referral was determined for each group and is defined by the "relative frequency" of imaging utilization for the self-referrers divided by the frequency for the radiologist referrers. Relative frequency represents the increased (if >1) or decreased (if <1) chance of imaging by self-referrers over radiologist referrers. The meta-analysis was used to combine imaging frequencies for each referral condition of the individual studies that met inclusion criteria for an overall estimate of relative frequency, using a random-effects model to account for the variations among the studies. Relative frequency data were then used to perform a cost simulation to Medicare Part B using 2006 data.

RESULTS

The initial search yielded 334 articles, 5 of which met the threshold for inclusion. In these 5 studies, 76,905,162 total episodes of care were analyzed. The individual relative frequency of imaging in the setting of self-referral ranged from 1.60 to 4.50. The combined relative frequency was 2.16 (95% confidence interval, 2.15-2.16) using the fixed-effects model and 2.48 (95% confidence interval, 1.90-3.24) using the random-effects model. For 2006 Government Accountability Office (GAO) data, the estimated cost of increased imaging in the setting of self-referral was $3.6 billion, but a range of costs was also provided to account for potential inaccuracies in the GAO data.

CONCLUSIONS

The existing literature yields a combined relative frequency of imaging of 2.48 (95% confidence interval, 1.90-3.24) for self-referrers compared with non-self-referrers. Precise extrapolation of Medicare Part B costs attributable to self-referral would require changes in reporting requirements for imaging equipment ownership. Cost simulation results total billions of dollars annually and may be irrespective of potential inaccuracies in the GAO data as a result of Current Procedural Terminology(®) coding ambiguity and nontransparent reporting of equipment ownership.

Medicare program; payment policies under the physician fee schedule, five-year review of work relative value units, clinical laboratory fee schedule: signature on requisition, and other revisions to part B for CY 2012. Final rule with comment period

This final rule with comment period addresses changes to the physician fee schedule and other Medicare Part B payment policies to ensure that our payment systems are updated to reflect changes in medical practice and the relative value of services. It also addresses, implements or discusses certain statutory provisions including provisions of the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010 (collectively known as the Affordable Care Act) and the Medicare Improvements for Patients and Providers Act (MIPPA) of 2008. In addition, this final rule with comment period discusses payments for Part B drugs; Clinical Laboratory Fee Schedule: Signature on Requisition; Physician Quality Reporting System; the Electronic Prescribing (eRx) Incentive Program; the Physician Resource-Use Feedback Program and the value modifier; productivity adjustment for ambulatory surgical center payment system and the ambulance, clinical laboratory, and durable medical equipment prosthetics orthotics and supplies (DMEPOS) fee schedules; and other Part B related issues.

CPT fee differentials and visit upcoding under Medicare Part B

Medicare Part B pays outpatient physicians according to the billed Current Procedural Terminology (CPT) codes, which differ in procedure and intensity. Since many performed services merely differ by intensity, physicians have an incentive to upcode services to increase profitability of a visit. Using nationally representative data from the 2001 to 2003 Medicare Current Beneficiary Survey, this paper explores the effect of Medicare Part B fee differentials on the upcoding of general office visits (i.e. for established patient visits with CPT codes of 99212-99215). It finds strong evidence that these fee differentials influence physician's coding choice for billing purposes across a variety of specialties. For general office visits, Medicare outlays attributable to upcoding may sum to as much as 15% of total expenditures for such visits. Medicare has much to gain financially by clarifying its classification rules. Until the distinctions between types of Medicare visits are redefined in a way that eliminates ambiguity, upcoding under Medicare Part B is likely to continue.

Labor supply responses to government subsidized health insurance: evidence from kidney transplant patients

Between 1993 and 1995 Medicare increased the coverage of immunosuppression medication for kidney transplant recipients from 1 to 3 years following transplantation. The universal Medicare eligibility among kidney transplant patients provides a unique opportunity to explore labor supply responses to public insurance provision among a large number of men and women of prime working age and of all income levels. Although these patients are likely to be less healthy than the general population, upon receiving a kidney transplant, the main health problem of an individual with kidney failure, the lack of functioning kidneys, is removed. The income effects associated with the large transfer payment may discourage labor supply, while the potential health benefits of the coverage extension may promote labor supply. Results indicate that Medicare's increased medication coverage led to decreases in labor force participation among part time workers. These results suggest that potential labor supply reducing income effects should be taken into account when discussing the possibility of expanded public health insurance coverage, particularly for other groups of individuals with high expected medical expenditures, such as the elderly, or those with chronic conditions, such as diabetes. These results are useful considering the forthcoming expansion of government aid to purchase health insurance.

Regulations regarding income-related monthly adjustment amounts to Medicare beneficiaries' prescription drug coverage premiums. Interim final rule with request for comments

We are adding a new subpart to our regulations, which contains the rules we will apply to determine the income-related monthly adjustment amount for Medicare prescription drug coverage premiums. This new subpart implements changes made to the Social Security Act (Act) by the Affordable Care Act. These rules parallel the rules in subpart B of this part, which describes the rules we apply when we determine the income-related monthly adjustment amount for certain Medicare Part B (medical insurance) beneficiaries. These rules describe the new subpart; what information we will use to determine whether you will pay an income-related monthly adjustment amount and the amount of the adjustment when applicable; when we will consider a major life-changing event that results in a significant reduction in your modified adjusted gross income; and how you can appeal our determination about your income-related monthly adjustment amount. These rules will allow us to implement the provisions of the Affordable Care Act on time that relate to the income-related monthly adjustment amount for Medicare prescription drug coverage premiums, when they go into effect on January 1, 2011.

Medicare program; payment policies under the physician fee schedule and other revisions to Part B for CY 2011. Final rule with comment period

This final rule with comment period addresses changes to the physician fee schedule and other Medicare Part B payment policies to ensure that our payment systems are updated to reflect changes in medical practice and the relative value of services. It finalizes the calendar year (CY) 2010 interim relative value units (RVUs) and issues interim RVUs for new and revised procedure codes for CY 2011. It also addresses, implements, or discusses certain provisions of both the Affordable Care Act (ACA) and the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA). In addition, this final rule with comment period discusses payments under the Ambulance Fee Schedule (AFS), the Ambulatory Surgical Center (ASC) payment system, and the Clinical Laboratory Fee Schedule (CLFS), payments to end-stage renal disease (ESRD) facilities, and payments for Part B drugs. Finally, this final rule with comment period also includes a discussion regarding the Chiropractic Services Demonstration program, the Competitive Bidding Program for durable medical equipment, prosthetics, orthotics, and supplies (CBP DMEPOS), and provider and supplier enrollment issues associated with air ambulances.

Medicare part B claims for chiropractic spinal manipulation, 1998 to 2004

OBJECTIVE

The objective of this study was to examine the volume and rate of Medicare Part B claims for chiropractic spinal manipulation longitudinally from 1998 to 2004.

METHODS

A descriptive retrospective analysis was performed on Medicare part B claims from 1998 to 2004 using the Medicare Part B Standard Analytical Variable Length File. Using a 5% random sample of Medicare part B claims, the total number of claims were determined for chiropractic spinal manipulation procedures, and the rate of chiropractic spinal manipulation procedures per 1000 beneficiaries.

RESULTS

From 1998 through 2003, the number of chiropractic spinal manipulation claims increased by 38% (from 824,249 total claims in 1998 to 1,133,872 in 2003) followed by a 24% decline from 2003 to 2004. The rate of total chiropractic spinal manipulation claims rose 29% from 649 claims per 1000 beneficiaries per year in 1998 to a high of 839 claims per 1000 beneficiaries per year in 2003 and then declined by 25% to 632 claims per 1000 beneficiaries per year in 2004.

CONCLUSION

Medicare Part B claims for chiropractic spinal manipulation increased significantly from 1998 to 2003 and then abruptly declined from 2003 to 2004. Estimates for 2004 are at variance with earlier published estimates.

Increases in primary care physician income due to the Patient Protection and Affordable Care Act of 2010 - continued tweaking of physician payment

The Patient Protection and Affordable Care Act (ACA) authorizes several changes to the Resource-Based Relative Value Scale (RBRVS) system that are designed to increase primary care physician personal income and reduce geographic variation in primary care payment. In this brief, the ACA-authorized primary care payment adjustments are modeled in a prototypical rural primary care practice to assess both the potential impact on physician personal income and the likelihood that the changes will achieve the desired policy outcome. Key Findings. (1) The Patient Protection and Affordable Care Act (ACA) increases physician personal income in a prototypical primary care practice an average of $3,537 (1.9%) in 2010 compared to baseline income as if the ACA were not enacted. In 2011, physician personal income in a prototypical primary care practice increases by an average of $12,013 (9.3%) compared to baseline. (2) Due to Geographic Practice Cost Index (GPCI) changes legislated by the ACA, physician personal income increases are greater in entire-state Medicare payment localities than in states with multiple Medicare payment localities. (3) The requirement that at least 60% of a practice's furnished services must be specific "primary care services" to receive the ACA primary care bonus may eliminate eligibility for rural primary care practices that tend to offer more procedures (thus proportionally fewer primary care services) than urban/suburban practices. (4) The ACA primary care payment increases may be too small to have a significant impact on primary care and rural physician shortages. Targeted and significant primary care payment bonuses may be a more effective policy to reduce specific physician shortages.