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On February 23, 2022, a federal district court judge in Texas agreed with the Texas Medical Association that some provisions of the interim final rules implementing the No Surprises Act were promulgated in violation of the provisions of the Administrative Procedures Act (“APA”). As a remedy, the court ordered those provisions vacated and remanded the affected rules back to the federal agencies for further consideration.

In a memorandum issued February 28, the Centers for Medicare & Medicaid Services, one of the federal agencies that promulgated the rule (along with the Employee Benefits Security Administration and the Internal Revenue Service) indicated that it was still reviewing the court’s decision and considering next steps, which could include an appeal to the U.S. Court of Appeals for the Fifth Circuit. Additionally, CMS said that it was withdrawing any guidance documents based on the invalidated sections and will launch revised guidance and training for certified independent dispute resolution (“IDR”) entities and parties subject to the process. Those guidance documents will be edited to conform to the court’s decision and republished. Important to providers, CMS emphasized that the court’s order does not affect its other rulemaking related to the No Surprises Act.
Continue Reading Portion of No Surprises Act IDR rule procedures set aside by federal district court

As technology has advanced over the years, there has been a corresponding push for virtual visits with health care providers.  In fact, many state boards of medicine and other regulatory agencies have sought to amend regulations and guidances to make telehealth a reality for patients across the U.S.  However, despite the technical allowance for telehealth,…

The Medicare Payment Advisory Commission (MedPAC) released its 2021 Medicare provider rate update recommendations on March 13, 2020 – the same day President Trump declared a national emergency due to COVID-19.  MedPAC’s recommendations were based on an assessment of various Medicare “payment adequacy indicators” that are unlikely to reflect the state of the health…

The Centers for Medicare & Medicaid Services (CMS) has issued a “payment advisory” alerting approximately 1,400 clinicians who are Qualifying APM participants based on their 2017 performance that CMS does not have the participants’ banking information.  This banking information is necessary for CMS to disburse their 5% Advanced APM Incentive Payments for 2019. …

The Centers for Medicare & Medicaid Services (CMS) has issued its final Medicare physician fee schedule (PFS) rule for calendar year (CY) 2019.  In addition to updating rates for physician services, the rule adopts changes to numerous other Medicare Part B policies.  Highlights of the final rule include the following:

  • The final 2019 conversion factor (CF) is $36.0391, up slightly from the 2018 CF of $35.9996.  This rate is based on a statutory update of 0.25%, offset by a -0.14% relative value unit (RVU) budget neutrality adjustment.
  • The rule reduces from 6% to 3% the “add-on” payment for new, separately-payable Part B drugs and biologicals that are paid based on wholesale acquisition cost when average sales price during first quarter of sales is unavailable.
  • The rule makes a number of changes to the Appropriate Use Criteria (AUC) program, which requires that physicians who order outpatient advanced diagnostic imaging (ADI) services (diagnostic magnetic resonance imaging, computed tomography, and positron emission tomography/nuclear medicine) for a Medicare beneficiary consult with AUC developed by provider-led organizations approved by CMS via a qualified clinical decision support mechanism (CDSM).  Specifically, the final rule:
    • Extends the requirements to independent diagnostic testing facilities (joining physician offices, hospital outpatient departments, and ambulatory surgical centers).
    • Clarifies that AUC consultation information must be reported on all applicable technical component and professional component claims (i.e., not just reported on claims by furnishing facilities).
    • Provides that when delegated by the ordering professional, clinical staff under the direction of the ordering professional may perform the AUC consultation with a qualified CDSM (a modification to the proposed rule, which would have specified that AUC consultations may be performed by auxiliary personnel under the direction of the ordering professional and incident to the ordering professional’s services).
    • Uses established coding methods (e.g., G-codes and modifiers) to report required information.
    • Revises the significant hardship exception criteria to include (1) insufficient internet access; (2) electronic health record or CDSM vendor issues; (3) extreme and uncontrollable circumstances; and (4) self-attestation of hardship status for ordering professionals.

For information regarding the AUC implementation schedule, see our previous post.
Continue Reading CMS Publishes Final CY 2019 Medicare Physician Fee Schedule Rates and Policies

The Medicare Payment Advisory Commission (MedPAC) has released its annual report to Congress on “Medicare and the Health Care Delivery System.” This year’s report includes recommendations for changes to emergency department services policies, along with analyses of potential changes that would impact physicians, medical equipment suppliers, post-acute care providers, and others.  Highlights include the following:…

CMS is hosting a call on March 21, 2018 to get feedback from physicians and non-physician practitioners on Evaluation and Management (E/M) services. According to the CMS announcement, the agency is looking for information from stakeholders on how the E/M guidelines can be updated “to reduce burden and better align coding and documentation with the…

The Medicare Payment Advisory Commission (MedPAC) has released recommendations to Congress regarding how Medicare fee-for-service payment system rates should be adjusted in 2018. One of the focus areas for MedPAC is post-acute care (PAC), which includes skilled nursing facility (SNF), home health agency (HHA), inpatient rehabilitation facility (IRF), and long-term care hospital (LTCH) services.  According to MedPAC, the “unnecessarily high level of spending and the inequity of payments across different types of patients” necessitate changes to both payment levels and overall system design.  MedPAC therefore reiterates its previous recommendation for a uniform Medicare PAC prospective payment system (PPS) that bases payments on patient characteristics; MedPAC believes that transition to the PAC PPS could begin as early as 2021. In the meantime, MedPAC recommends that Congress:
Continue Reading Post-Acute Care Providers Targeted for Cuts in MedPAC’s Latest Report to Congress

CMS has opened the application period for physician practices interested in participating in its new primary care model, Comprehensive Primary Care Plus (CPC+), which is intended to improve how primary care is delivered and reimbursed. CMS also announced that the following 14 regions have been selected to participate in CPC+ (statewide unless otherwise noted): Arkansas;…

The House Energy and Commerce Committee is seeking input on Section 603 of the Bipartisan Budget Act of 2015, which established a site-neutral payment policy for newly-acquired, provider-based, off campus hospital outpatient departments (HOPD) after November 2, 2016.  In an open letter to the health care community, the Committee explains the origins of the policy, noting that it was enacted as a result of concerns that the Medicare hospital outpatient prospective payment system paid more for the same services provided at HOPDs than in other settings, such as an ambulatory surgery center, physician office, or community outpatient facility.   The letter discusses evidence the Committee considered in establishing this policy, but notes that the Committee has received significant feedback on this provision since enactment, with concerns raised about the provision’s potential impact on hospitals, beneficiaries, and providers.  The Committee has received a range of recommendations from the public, with stakeholders urging the Committee to:
Continue Reading House Energy & Commerce Committee Seeks Comments on Medicare Site-Neutral Payment Policies

The Government Accountability Office (GAO) has issued a report examining trends in “vertical consolidation” — hospital acquisition of physician practices or hiring of physicians as salaried employees – and the impact on Medicare spending. According to the GAO, the number of vertically consolidated hospitals increased from about 1,400 to 1,700 from 2007 through 2013, while…

Today the Centers for Medicare & Medicaid Services (CMS) published the final rule to update the Medicare physician fee schedule (MPFS) for calendar year (CY) 2016. Despite the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) establishing a 0.5% conversion factor (CF) update for 2016, the final 2016 CF of $35.8279 actually is a decrease compared to the 2015 CF of $35.9335. This is because CMS has more than offset the 0.5% MACRA update with a -0.02% budget neutrality adjustment in addition to a -0.77% “target recapture amount” to reach a statutory target for savings achieved from misvalued code adjustments (discussed below). Final rates and policies are effective January 1, 2016, with certain exceptions. CMS is accepting comments until December 29, 2015 on a limited number of provisions of the rule (e.g., interim final work, practice expense, and malpractice RVUs; interim final new, revised, potentially misvalued HCPCS codes; and changes to the physician self-referral list of codes). The sweeping rule includes numerous policy provisions, including the following:
Continue Reading CMS Finalizes Medicare Physician Fee Schedule Rates, Policies for 2016

The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) requires CMS to establish care episode groups and patient condition groups, which will be used to measure resource use under the new Merit-Based Incentive Payment System (MIPS) and alternative payment models (APMs). Care episode groups describe the patient’s clinical problems at the time items and …

In a continuation of the Administration’s efforts to make Medicare spending data more transparent, CMS has released detailed payment information regarding physicians and other providers who order durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) for Medicare beneficiaries.  The new “Referring Provider DMEPOS Public Use File” includes provider-specific Medicare Part B DMEPOS utilization,…

The Centers for Medicare & Medicaid Services (CMS) has proposed regulations “to reduce burden and to facilitate compliance” under the physician self-referral law known as the Stark Law.  The proposed changes, which are included in the annual proposed update to the Medicare physician fee schedule, are a summarized in a new Reed Smith Client…

On July 15, 2015, the Centers for Medicare & Medicaid Services (CMS) published its proposed rule to update the Medicare physician fee schedule (MPFS) for CY 2016 – the first rulemaking since the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) repealed the sustainable growth rate (SGR) formula.  Under the proposed rule, the 2016 MPFS conversion factor (CF) would be $36.1096, compared with the 2015 CF of $35.9335, reflecting a 0.5% update factor specified under MACRA and a budget neutrality adjustment of 0.9999.  Note that the CF is subject to change in the final rule, however, if CMS does not meet a statutory target for expenditure reductions related to its review of misvalued procedures (discussed below). The proposed rule addresses numerous aspects of Medicare Part B and other CMS program policies.  Highlights include the following: 
Continue Reading Proposed CY 2016 MPFS Rule Takes First Steps in Implementing MACRA Reforms

On June 9, 2015, the Office of the Inspector General of the Department of Health and Human Services (OIG) released a fraud alert warning physicians to scrutinize carefully the conditions and terms of any medical director or other compensation arrangement they enter into with potential recipients of Federal health care program business. The risks associated with these arrangements under the anti-kickback statute are not new. However, the fraud alert signals  the OIG’s current focus on physicians, which reportedly has also included hiring additional attorneys to handle investigative and enforcement activity involving physicians. Moreover, the government now has access to unprecedented amounts of data regarding financial arrangements between physicians and drug and device manufacturers.

The fraud alert follows on the heels of a dozen recent settlements between the OIG and individual physicians who allegedly received kickbacks disguised as medical directorships and other office staff arrangements. In those settlements, the OIG determined the physicians played an integral role in the schemes and specifically alleged that the agreements:Continue Reading An Apple a Day Keeps the OIG Away: Practical Guidelines for Structuring Physician Compensation Arrangements to Avoid Kickback Allegations

CMS has released detailed Medicare inpatient hospital, outpatient hospital, and physician utilization and payment data for 2013, including data analysis such as spending breakdowns by specialty and region. The hospital data set includes average hospital charges, Medicare payment, and utilization statistics for the 100 most common Medicare inpatient diagnosis related groups (DRGs). CMS also released…