CMS would pay Medicare participating physicians 5.1 percent less in fiscal year (FY) 2007 than it did in 2006, under a Proposed rule that will be published in the Federal Register on August 22. The payment decrease is required by a statutory formula that compares the actual rate of growth in spending to a target rate, which is based on such factors as the growth in number of Medicare fee-for-service beneficiaries and statutory or regulatory changes in benefits. If the actual rate of growth exceeds the target rate, the update is decreased; if it is less, the update is increased. Under the rule, CMS would pay approximately $61.5 billion to 875,000 physicians and other healthcare professionals in 2007.
These proposals are in addition to the proposed revisions to the work relative value units (RVUs) and proposed changes in the methodology for calculating practice expense RVUs released in a proposed notice in the June 29 Federal Register (see ¶261,238).
The proposed rule would refine the RVUs and would make other changes to Medicare Part B policy. In addition to the proposals described below, the policy changes would affect: (1) proposals for direct practice expense (PE) inputs, including clinical labor, medical supples and medical equipment; (2) updated geographic practice cost indices for physician work and practice expense; and (3) coding issues, including expanding the list of Medicare telehealth services to include nursing facility care, speech language pathology, audiology, and physical therapy services.
Deficit Reduction Act. As required by the Deficit Reduction Act of 2005 (DRA) (PubLNo 109-171), the proposed rule would remove from the PE relative values the 0.3 percent increase previously made to these relative values in 2006 to ensure budget neutrality despite reductions in payment for multiple imaging services. The proposed rule would also cap payment for the technical component of certain imaging services at the amount that is paid under the hospital outpatient payment system, which is required by the DRA.
The proposed rule would not increase the multiple imaging payment adjustment to 50 percent, but would maintain the adjustment at the 25 percent level. For imaging services subject to both the multiple imaging reduction policy and the outpatient hospital cap, the proposed rule would first apply the multiple imaging adjustment and then apply the outpatient cap. This approach results in higher payments than if the cap were applied first.
Preventive services. The proposed rule would implement provisions in the DRA that add abdominal aortic aneurysm (AAA) screening to the list of preventive services covered by Medicare. As required by the DRA, the screening benefit will include a one-time only ultrasound screening for individuals who take advantage of the Initial Preventive Physical Examination (“Welcome to Medicare”) benefit, as well as appropriate education, counseling and referral services. The screening benefit is limited to individuals who are at risk for AAAs.
The proposed rule also implements a provision in the DRA that exempts the colorectal cancer screening benefit from the Part B deductible. The proposed rule would also expand the number of beneficiaries who qualify for bone mass measurement due to long-time steroid therapy and would codify a DRA provision that adds diabetes outpatient self-management training and medical nutrition therapy services to the list of covered and separately payable services included in the Federally Qualified Health Center benefit.
Additional provisions. The proposed rule includes more guidance on how drug manufacturers should address particular issues related to their reporting requirements. The proposed rule also addresses the treatment of bona fide service fees in the context of the average sales price calculation, the definition of nominal sales, and the bundling of discounts on drugs.
Additional provisions in the proposed rule address: (1) policies related to independent diagnostic testing facilities and the physician self-referral prohibition; (2) laboratory billing for the technical component of physician pathology services; (3) the clinical laboratory schedule; (4) the wage index and drug add-on adjustments applied to the composite payment rate for dialysis services provided by end-stage renal disease facilities; (5) certification of advanced practice nurses; (6) private contracts and Medicare opt-out provisions; (7) supplier access to claims billed on reassignment; and (8) health information technology and the health care information transparency initiative.
CMS will accept comments on this proposed rule until October 10, 2006. The proposed rule as published in the Federal Register will be sent to subscribers in print as part of a future Report. The text is available to online subscribers at ¶51,447.
SOURCE: CCH Chicago Bureau, August 9, 2006.
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