2018 Medicare Reimbursement Updates

The final rules for the 2018 Medicare Physician Fee Schedule (MPFS) and Quality Payment Program (QPP) published in November contain decidedly mixed results for Medicare physician reimbursement, coding rules and other policies.

Join me for my upcoming webinar covering this and other key topics that will affect independent medical practice revenue in the coming year.

Getting Paid in 2018: What Independent Medical Practices Need to Know

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Reimbursement Rate Changes

As a result of efforts by the Centers for Medicare and Medicaid Services (CMS) to recapture mis-valued service codes and spending for new services, the 2018 MPFS conversion factor nudges up by only $0.10 to $35.99 in 2018.

While adjustments to payments for services may add about 1% or so to reimbursement for many specialties, several others face declines of between -1% to -3%, including Allergy, Anesthesiology, Pathology, Urology, Otolaryngology, Oral/Maxillofacial Surgery, and Vascular Surgery. Certified registered nurse anesthetists and physical and occupational therapists are estimated to decrease by 2%. Diagnostic testing facilities face the greatest estimated cut, at -4%.

Coding Changes

Some coding changes of note include:

  • Permanent status for the use of behavioral health care management codes, formerly Medicare-only codes including G0502, in primary care;
  • Two new codes for prolonged services — G0513 and G0514 — for clinicians who provide an extended (30-plus minutes) Medicare-covered preventive service; and
  • New coverage for chronic care management, behavioral health, and psychiatric collaborative care for use exclusively by Rural Health Clinics (RHCs) and Federally Qualified Health Centers (FQHCs) in addition to their standard visit rates.

Softened Penalties for Smaller Practices

Beneficiaries of the Final Rule also will include clinicians slated for Value-based Payment Modifier (VBPM) program penalties in 2018 for failing to report to PQRS in 2016. The new rule halves the originally proposed penalties to -2% for practices of 10 or more eligible clinicians and -1% for smaller practices. In addition to reducing penalties, the negative information won’t be reported to the public via Physician Compare.

Furthermore, those that reported to PQRS in 2016, but didn’t comply with all of the requirements, including the number of measures, will be exempt from downward adjustments. Retrospectively, CMS is reducing the required measures from nine to six, and eliminating the requirement for the cross-cutting measure in 2016. Collectively, these efforts will soften the penalties that were slated to be imposed on many clinicians in 2018.

Move Toward Rate Parity Between Independent and Hospital-Owned Practices

The news was less bright for hospitals operating off-campus clinics: a 20% decrease in reimbursement in 2018 with more cuts to come in subsequent years. The decrease is aimed at off-campus, provider-based departments that bill under place of service (POS) code 19; however, on-campus clinics billing under POS 22 will not be affected. All the same, this effort by CMS to bring rate parity between privately owned and hospital-owned practices may tamp down the rate of practice acquisition by hospitals in the future.

Telehealth and Mobile Health - More Reimbursements!

Telehealth continued its advance in the Final Rule with several new CPT and G codes added to the list of Medicare-covered services, including:

  • G0296 - Visit to determine low-dose computed tomography eligibility
  • 90785 - Interactive Complexity
  • 96160 and 96161 - Health Risk Assessment
  • G0506 - Care Planning for Chronic Care Management
  • 90839 and 90840 - Psychotherapy for Crisis)

Mobile health also gets a boost from a pledge by CMS to pay separately for CPT 99091 (collecting and reviewing patient data). Historically considered bundled, this code, which incorporates “remote patient monitoring,” is now valued at 1.1 work relative value units. CMS policies for using 99091 include documentation of patient consent; a requirement that a face-to-face service was provided to the patient within the previous year; and allowing the service to bill only once in a 30-day period.

Quality Payment Program (QPP) Changes

New language in the Final Rule for Medicare’s Quality Payment Program (QPP) for 2018 raises the QPP participation threshold to $90,000 in Medicare Part B total allowed charges or 200 Medicare patient encounters annually. As a result, approximately 123,000 physicians and other eligible clinicians will slip under the new limits and no longer be required to take part. The thousands of other clinicians who meet the threshold will still face a choice between joining an Advanced Alternative Payment Model (APM) or becoming an active participant in CMS’ Merit-based Incentive Payment System (MIPS).

Speaking of MIPS, the federal program sets its measures and their relative contributions in 2018 to participating clinicians’ MIPS scores as follows:

  • Quality (50%)
  • Advancing care information (ACI) (25%)
  • Improvement activities (15%)
  • Cost (10%)

Further adjustments are in store in 2019 when CMS promises to increase the cost score to a 30% weighting.

Other QPP-related changes will allow practices to continue using their 2014-certified electronic health record (EHR) systems although bonus points are available to those reporting exclusively on the 2015 edition. Quality and cost measures must be reported for a period of 12 months in 2018, though the ACI and improvement activity categories remain at 90 days.

Additional adjustments in the QPP Final Rule:

  • Practices with 15 or fewer clinicians get a bonus of 5 points, plus a guaranteed minimum of 3 points per quality measure, which eliminates their need to stress over data completeness in quality measures next year.
  • CMS also will allow small practices to apply for exemption from the ACI category for natural disasters.
  • Five bonus points will be given to the “treatment of complex patients” based on the practice’s dual eligibility ratio and average Hierarchical Condition Categories (CMS-HCC) risk score.
  • Physicians based at ambulatory surgical centers are exempt from ACI, retroactive to the current (2017) reporting year.
  • CMS added 21 new improvement activities and revised 27 previously adopted improvement activities for 2018.
  • Additional welcome news for QPP participants next year is that CMS will allow virtual groups to form by linking with other practices in order to participate in MIPS.
  • The final rule also allows practices that join an advanced APM in the middle of the reporting year or later to be officially incorporated into the entity, as long as the practice was able to participate for at least 60 continuous days during the performance period.

Of course, there’s plenty more to peruse in both final rules but suffice it to say that 2018 shapes up to be another year of change in what already is a most challenging reimbursement environment for many independent practices. We’ll talk more about this in my upcoming webinar. Please join in!

Getting Paid in 2018What Independent Medical Practices Need to Know



Final Rule for the Physician Fee Schedule: (11/15)

Final Rule for the Quality Payment Program: (11/16)

About the Author

Elizabeth Woodcock, MBA, FACMPE, CPC is a professional speaker, trainer and author specializing in medical practice management. She has focused on medical practice...

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