Reducing patient financial liability for hospitalizations: the physician role

With increasingly strict guidelines for insurance coverage, hospitals have adopted meticulous resource utilization review and management processes. It is important for physicians to appreciate that careful documentation of certain patient parameters may not only optimize the facility's reimbursement but have profound impact on the patient's out-of-pocket expenses. Hospital utilization teams have access to the frequently changing national payor guidelines for policy benefits, usually revolving around whether the patient meets medical necessity criteria for being classified as an "inpatient" vs. an "observation" outpatient. Those statuses are not merely time-based, and lead to marked differences in patient deductibles and coverage for medication, room, procedure, laboratory, and ancillary charges. There are nationally-recognized guidelines for classification, based on severity of illness and intensity of services provided. By participating in case management activities, physicians can have an important patient advocate role, and thereby minimize the financial burden to these individuals and their families.

Medicare program; payment policies under the physician fee schedule and other revisions to Part B for CY 2010. Final rule with comment period

This final rule with comment period implements 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 implements or discusses certain provisions of the Medicare Improvements for Patients and Providers Act of 2008. (See the Table of Contents for a listing of the specific issues addressed in this rule.) This final rule with comment period also finalizes the calendar year (CY) 2009 interim relative value units (RVUs) and issues interim RVUs for new and revised codes for CY 2010. In addition, in accordance with the statute, it announces that the update to the physician fee schedule conversion factor is -21.2 percent for CY 2010, the preliminary estimate for the sustainable growth rate for CY 2010 is -8.8 percent, and the conversion factor (CF) for CY 2010 is $28.4061.

Costs and state-specific rates of thoracic and lumbar vertebroplasty, 2001-2005

STUDY DESIGN

Sequential cross-sectional analysis.

OBJECTIVE

To document vertebroplasty rates and costs.

SUMMARY OF BACKGROUND DATA

Little is known about interstate variation in rates or about nation-wide costs associated with the growing use of percutaneous vertebroplasty.

METHODS

Using specific CPT-4 billing codes, we reviewed aggregate Medicare Part B fee-for-service claims data (cross-stratified by physician specialty and treatment setting) on thoracolumbar vertebroplasties performed from 2001-2005. Vertebroplasty rates for individual states were expressed per 100,000 Part B fee-for-service enrollees. Nation-wide facility and physician charges (combining expected contributions from all sources) allowed by Medicare for vertebroplasties and associated imaging guidance procedures were applied to observed vertebroplasty volumes. These charges (reflecting direct medical costs from an all-payer perspective) were expressed in 2005 dollars using the Producer Price Index.

RESULTS

Vertebroplasty rates for individual states rose but varied considerably, ranging from 0.0 to 515.6/100,000 Medicare Part B fee-for-service enrollees in 2001 (median state rate = 35.4), and from 9.8 to 849.5 in 2005 (median state rate = 75.0). On average, 1.3 vertebral levels were treated per procedure, varying by treatment site and physician specialty. Fluoroscopic rather than computed tomography guidance was used in 98.7% of cases. Total nation-wide inflation-adjusted charges rose from $76.0 million for 14,142 cases performed in 2001 to $152.3 million for 29,090 cases in 2005. While vertebroplasty was predominantly an outpatient procedure, inpatient cases generated most of the charges. Increasing volumes and costs were associated with cases performed in ambulatory surgery centers and physicians' offices.

CONCLUSION

Nation-wide vertebroplasty volumes and inflation-adjusted charges doubled from 2001 to 2005 in this Medicare population. Procedure rates varied considerablyby state. Almost all cases involved fluoroscopic guidance; procedures treating multiple vertebral levels were not uncommon. Procedures performed in free-standing facilities are of growing importance. Given the issues surrounding appropriate vertebroplasty use, future practice patterns and outcomes should be closely tracked.

Evidence-based imaging guidelines and Medicare payment policy

OBJECTIVE

This study examines the relationship between evidence-based appropriateness criteria for neurologic imaging procedures and Medicare payment determinations. The primary research question is whether Medicare is more likely to pay for imaging procedures as the level of appropriateness increases.

DATA SOURCES

The American College of Radiology Appropriateness Criteria (ACRAC) for neurological imaging, ICD-9-CM codes, CPT codes, and payment determinations by the Medicare Part B carrier for Florida and Connecticut.

STUDY DESIGN

Cross-sectional study of appropriateness criteria and Medicare Part B payment policy for neurological imaging. In addition to descriptive and bivariate statistics, multivariate logistic regression on payment determination (yes or no) was performed.

DATA COLLECTION METHODS

The American College of Radiology Appropriateness Criteria (ACRAC) documents specific to neurological imaging, ICD-9-CM codes, and CPT codes were used to create 2,510 medical condition/imaging procedure combinations, with associated appropriateness scores (coded as low/middle/high).

PRINCIPAL FINDINGS

As the level of appropriateness increased, more medical condition/imaging procedure combinations were payable (low = 61 percent, middle = 70 percent, and high = 74 percent). Logistic regression indicated that the odds of a medical condition/imaging procedure combination with a middle level of appropriateness being payable was 48 percent higher than for an otherwise similar combination with a low appropriateness score (95 percent CI on odds ratio=1.19-1.84). The odds ratio for being payable between high and low levels of appropriateness was 2.25 (95 percent CI: 1.66-3.04).

CONCLUSIONS

Medicare could improve its payment determinations by taking advantage of existing clinical guidelines, appropriateness criteria, and other authoritative resources for evidence-based practice. Such an approach would give providers a financial incentive that is aligned with best-practice medicine. In particular, Medicare should review and update its payment policies to reflect current information on the appropriateness of alternative imaging procedures for the same medical condition.

Lessons learned from advanced practice nursing payment

For more than 25 years, advanced practice nurses have been incrementally included as a part of the health care financing structure. Following physician payment revisions at the federal level, advanced practice nurses were overtly recognized as Medicare providers and have participated in the establishment of current procedural terminology codes and the subsequent relative work values associated with payment. Success in this regard has been the result of business, political, and policy savvy that has important lessons for moving forward in any health care restructuring for both nurses and advanced practice nurses. Principles of valuing nurse work, time, and intensity in the Resource-Based Relative Value Scale are discussed with implications for future opportunities of measuring nursing work and any potential relationship to quality outcomes of care.

Medicare program; revisions to payment policies under the Physician Fee Schedule, and other part B payment policies for CY 2008; delay of the date of applicability of the revised anti-markup provisions for certain services furnished in certain locations (Sec. 414.50). Final rule

This final rule delays until January 1, 2009 the applicability of the anti-markup provisions in Sec. 414.50, as revised at 72 FR 66222, except with respect to the technical component of a purchased diagnostic test and with respect to any anatomic pathology diagnostic testing services furnished in space that: Is utilized by a physician group practice as a "centralized building" (as defined at Sec. 411.351 of this chapter) for purposes of complying with the physician self-referral rules; and does not qualify as a "same building" under Sec. 411.355(b)(2)(i) of this chapter.

Eye-Related Medicare Costs for Patients with Age-Related Macular Degeneration from 1995 to 1999

OBJECTIVE

Age-related macular degeneration (AMD) is the leading cause of blindness and severe visual impairment among the elderly in the United States. This study aims to assess eye-related Medicare costs from 1995 to 1999 in patients with both nonneovascular and neovascular AMD as compared with controls, and to delineate whether variations exist across demographic and clinical subgroups in eye-related Medicare costs over 5 years.

DESIGN

Retrospective, observational, population-based analysis.

PARTICIPANTS

Five percent random sample of Medicare beneficiaries.

METHODS

Data were obtained from the 5% random sample of Medicare beneficiaries with diagnoses of nonneovascular and neovascular AMD. A control group was selected based on diagnoses of blepharitis, chronic conjunctivitis, or blepharoconjuctivitis and no diagnosis of AMD. Eye-related claims were totaled and compared for each group over the 5-year study period. Demographic and clinical factors potentially influencing eye-related costs were also examined.

MAIN OUTCOME MEASURES

Eye-related Medicare costs during the 5-year study period.

RESULTS

Median eye-related Medicare costs were estimated at $1607 for neovascular AMD patients, $832 for nonneovascular AMD patients, and $658 for controls. Cost differences across groups were significant based on univariate and multivariate analyses (P<0.001). In linear regression analysis, males and blacks had significantly lower eye-related Medicare costs than females and whites, respectively (P<0.001).

CONCLUSIONS

Age-related macular degeneration represented a significant economic burden to the U.S. health care system for a single ophthalmic disease entity based on Medicare reimbursed eye-related costs before the availability of photodynamic therapy and anti-vascular endothelial growth factor therapy. Given that direct eye-related costs associated with the treatment of neovascular AMD are estimated at $569 million annually before the availability of therapy for subfoveal lesions, effective therapeutic measures may be associated with substantial cost offsets.

Medicare program; revisions to payment policies under the physician fee schedule, and other Part B payment policies for CY 2008; revisions to the payment policies of ambulance services under the ambulance fee schedule for CY 2008; and the amendment of the e-prescribing exemption for computer generated facsimile transmissions. Final rule with comment period

This final rule with comment period addresses certain provisions of the Tax Relief and Health Care Act of 2006, as well as making other proposed changes to Medicare Part B payment policy. We are making these changes to ensure that our payment systems are updated to reflect changes in medical practice and the relative value of services. This final rule with comment period also discusses refinements to resource-based practice expense (PE) relative value units (RVUs); geographic practice cost indices (GPCI) changes; malpractice RVUs; requests for additions to the list of telehealth services; several coding issues including additional codes from the 5-Year Review; payment for covered outpatient drugs and biologicals; the competitive acquisition program (CAP); clinical lab fee schedule issues; payment for renal dialysis services; performance standards for independent diagnostic testing facilities; expiration of the physician scarcity area (PSA) bonus payment; conforming and clarifying changes for comprehensive outpatient rehabilitation facilities (CORFs); a process for updating the drug compendia; physician self referral issues; beneficiary signature for ambulance transport services; durable medical equipment (DME) update; the chiropractic services demonstration; a Medicare economic index (MEI) data change; technical corrections; standards and requirements related to therapy services under Medicare Parts A and B; revisions to the ambulance fee schedule; the ambulance inflation factor for CY 2008; and amending the e-prescribing exemption for computer-generated facsimile transmissions. We are also finalizing the calendar year (CY) 2007 interim RVUs and are issuing interim RVUs for new and revised procedure codes for CY 2008. As required by the statute, we are announcing that the physician fee schedule update for CY 2008 is -10.1 percent, the initial estimate for the sustainable growth rate for CY 2008 is -0.1 percent, and the conversion factor (CF) for CY 2008 is $34.0682.

Medicare challenges and solutions--reimbursement issues in treating the patient with colorectal cancer

BACKGROUND

Medicare covers costs far more than 50% of all cancer patients, and most private payers follow Medicare's lead on coverage and benefits for cancer care. Medicare and private payers are legally required by federal statute to cover anticancer chemotherapeutic products based on U.S. Food and drug administration-approved labeling and indicate how off-label uses are covered.

OBJECTIVE

To review reimbursement issues unique to Medicare with regard to oncology drugs.

SUMMARY

Currently, the Centers for Medicare & Medicaid Services (CMS) recognizes 2 compendia for purposes of evaluating off-label uses of drugs. Coverage determinations can be pursued nationally, locally, and case by case. Because of the impact and scope of colorectal cancer on the national budget, CMS initiated a process to establish national coverage determinations. This and other such Medicare reforms will have significant repercussions for clinicians who work with oncology patients. Major administrative and access challenges for both health care providers and beneficiaries include a diverse array of plan choices. In terms of Medicare Part d, the 25% of patients who are chronically ill and prescribed expensive therapies (including antineoplastics and supportive care agents) may find the coverage gap ("donut hole") challenging and even prohibitive in their access to appropriate care. Lack of coverage could potentially affect therapy compliance, and managed care must pursue additional payment or coverage support mechanisms. Evaluating formularies will be critical for cancer patients and those who use specialty drugs as they select their Part d plans in the future.

CONCLUSION

Oncologists and their patients are left with difficult choices regarding not only the clinical efficacy of a treatment but also the financial considerations of the treatment.

Evolving Trends in the Use of Echocardiography

OBJECTIVES

We studied the use of echocardiography among Medicare beneficiaries between 1999 and 2004 to determine the rate of growth in these services and evaluate the drivers of growth.

BACKGROUND

Concerned about increasing health care costs, federal and private payers have highlighted growth in diagnostic imaging studies and begun to develop approaches to curb this growth.

METHODS

Medicare Part B Physician/Supplier Procedure Summary Master File and enrollment data from 1999 to 2004 were reviewed. Total Medicare carrier-paid spending for echocardiography services was determined from procedure volumes and allowed charges. The 5% standard analytic file of physician claims was used to evaluate geographic variations in use and to document the specialties of physicians who request and those who interpret echocardiograms.

RESULTS

Between 1999 and 2004, echocardiography services grew at a rate similar to that for all medical services subject to Medicare's sustainable growth rate (SGR) calculation. Increasing provision of echocardiograms in physicians' offices contributed to increased spending under the SGR. Accounting for this shift, actual annualized per capita growth in echocardiography was 7.7%. Variations in the prevalence of heart disease contributed to geographic variations in use. Although cardiologists were the most common providers of echocardiographic services, primary care physicians ordered the majority of these diagnostic procedures.

CONCLUSIONS

Growth in the use of echocardiography is in keeping with the general growth in medical services. Nonetheless, physicians who order echocardiograms and those who provide them must work together to ensure that in the future these diagnostic services are used appropriately and not excessively.

Medicare program; competitive acquisition for certain durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) and other issues. Final rule

This final rule establishes competitive bidding programs for certain Medicare Part B covered items of durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) throughout the United States in accordance with sections 1847(a) and (b) of the Social Security Act. These competitive bidding programs, which will be phased in over several years, utilize bids submitted by DMEPOS suppliers to establish applicable payment amounts under Medicare Part B.