Tag Archive | Medicare

Income-Affecting Changes Coming in 2015 for Physicians

According to Medscape (login required), a dozen changes coming in 2015 could affect physician income and practice workflows. Here’s the list:

  1. Rise of High-Deductible Health Plans – According to the Kaiser Family Foundation, 18% of insured patients have at least a $2,000 deductible.   Higher deductibles often mean more paperwork for practices, the need to provide cost estimates in advance, and increasing involvement with collection agencies.
  2. Declining Malpractice Premiums– For three benchmark specialties, ob/gyns, internists, and general surgeons, malpractice insurance premiums decreased by 13% since 2008. Some experts attribute the declines to tort reforms that were enacted many years ago, but most expect that premiums, which have proven to be cyclical, will start rising again.
  3. ICD-10 Really Coming– Many experts are saying the Oct. 1, 2015 deadline for the new ICD-10 coding system is for real this time, after repeated implementation delays. Although ICD-10 is supposed to cut down on errors and speed reimbursement, many physicians are skeptical that the technology will work.
  4. ACOs Enter a Crucial Year – 2015 marks the end of the 3- year shared-savings Medicare ACO contract, which shielded ACOs from losing money. Those that stay in the program will face financial penalties if they don’t hit certain targets. The Centers for Medicare & Medicaid Services (CMS) said that only one quarter existing Medicare ACOs received a shared-savings bonus.
  5. Concerns about Telemedicine– More patients may start using web- and phone-based physician services in 2015. The three largest telemedicine companies more than doubled their volume from 2011 to 2013 and continue to grow. Telemedicine does seem to be siphoning some patients from traditional practices, but the main concern is the quality of telemedicine-based diagnoses and treatments.
  6. Competition from Retail Clinics– Visits to walk-in, retail clinics skyrocketed by 400% from 2007 to 2009. Consultant Thomas Charland advises doctors to forge reciprocal referral relationships with retail clinics, rather than fighting them.
  7. PCPs to Lose Enhanced Medicaid Payments – At the beginning of 2015, Medicaid reimbursements for PCPs will fall back to their pre-“enhanced” levels, which average 40% below Medicare. Unless Congress extends the funding, some PCPs may be forced to reconsider how many Medicaid patients their practices can afford to take.
  8. Meaningful Use: Carrot Becomes Stick – In 2015, penalties for not entering the Medicare Meaningful Use program begin, starting at 1% of Medicare payments and moving to 3% in 2017. A survey by Medscape shows that 3 out of 4 doctors who have an EHR are attesting to Meaningful Use.
  9. Penalties Start under PQRS– In 2015. The Physician Quality Reporting System turns from voluntary to penalty-eligible. The penalty for not reporting quality data is 1.5% in 2015 and rises to 2% in 2016.
  10. New Physician-Payment Websites– Open Payment and Medicare payment websites report payments made to doctors either from Medicare or from drug and device manufacturers. Both websites have had technical glitches and have posted inaccurate information.
  11. Medicare Will Pay for Chronic Care Outreach –Medicare will pay physicians in 2015 for managing patients with two or more chronic conditions by phone or email. Doctors will receive $40.39 per patient per month for providing a minimum of 20 minutes of care. To qualify, doctors need to have an EHR system and be able to exchange patient information with other caregivers.
  12. New CPT Modifiers for Greater Specificity – Starting in January, instead of the catch-all, amorphous modifier 59, CMS will implement four new subset modifiers – XE, XS, XP and XU. The intention is to increase efficiency of payments to doctors.

Healthcare Spending Growth Hits 50-Year Low

Healthcare spending in 2013 grew at the slowest rate since 1960, according to a recent article in Modern Healthcare. According to federal data, the nation spent $2.9 trillion on healthcare last year, which was an increase of 3.6% from the prior year—and the weakest spending growth since 1960. Reasons cited for the slowdown include aftermath from the Great Recession, changes in health benefits, and federal healthcare spending rollbacks triggered by the Affordable Care Act. For example, Medicare spending increased in 2013 by 3.4%, down from 4% growth in 2012. Spending on technology and construction to upgrade or expand healthcare services dropped during the recession and still has not rebounded. Most analysts don’t expect this growth slowdown to carry into 2014, although quarterly national estimates for 2014 suggest spending growth below 4%. While some of the slowdown in healthcare spending growth may be attributed to doctors and other healthcare professionals running more efficient practices, health spending in 2013 still consumed 17.4% of the US gross domestic product.

Will the New Congress Repeal SGR?

Whether their political persuasions lie left, right, or center, almost all physicians agree that something permanent needs to be done about the sustainable growth rate (SGR) formula used for physician reimbursement under Medicare. Unless some legislative action is taken between now and March 31, 2015, a 21 percent cut in physician Medicare reimbursements will take effect on April 1. So, is the newly constituted Congress ready and willing to act?

Not surprisingly, the answer to that question depends on whom you talk to, according to a recent MedPage Today article. Douglas Holtz-Eakin, PhD, former director of the Congressional Budget Office and current president of the American Action Forum, says “all eyes should be pointed toward 2015” for action on SGR, because the current lame-duck session is unlikely to take much action on health care. However, after the lame ducks hobble home, Holtz-Eakin predicts movement in Congress toward answering the $180 billion question: how to pay for an SGR repeal.

Caroline Pearson, vice president of the healthcare consultancy Avalere, isn’t so optimistic. “I don’t think the SGR will have a permanent fix…until after the 2016 election,” she told MedPage Today, adding that “the ‘pay-fors’ are everything.” Hoping for a Republican president to work with beginning in 2017, GOP members of Congress will fight for entitlement reform that will include an SGR fix, Pearson predicts, opining further that “an SGR fix is unlikely as a standalone [bill].”

If Congress approves another one-year “patch” of the current SGR-based system in early 2015 instead of a repeal, it will be the 18th time over 12 years that legislators have passed such temporary stopgaps. In recent years, both the AMA and the AAOS have staunchly opposed short-term “doc fixes” in favor of a once-and-for-all scrapping of the SGR.

What do you think—will Congress repeal the SGR during 2015?

Links to previous OrthoBuzz coverage of SGR:

https://orthobuzz.jbjs.org/2014/02/13/bipartisan-step-forward-on-sgr-repeal/

https://orthobuzz.jbjs.org/2014/04/03/an-icd-10-win-and-sgr-loss-for-orthopaedists-in-latest-congressional-action/

The True Value of Hip-Fracture Surgery

Currently, each year more than 300,000 Americans sustain a hip fracture, and that number is expected to rise to more than 500,000 within the next 20 to 30 years. A new study– based on a literature review, analysis of Medicare claims, and input from clinical experts–finds that the average lifetime societal benefit from surgery to repair hip fractures reduced the direct medical costs of the surgery by $65,000 per patient. Collectively, that results in an estimated $16 billion lifetime societal savings. These savings include reductions in length of and intensity of postinjury care, and the amount of required long-term medical care and assistance required by surgery patients relative to those whose fractures are treated nonsurgically. The study, published in Clinical Orthopaedics and Related Research, also found that the quality-adjusted life years in people with surgically treated hip fractures increased 2.5 years for patients with intracapsular fractures and 1.9 years for those with extracapsular fractures. To view a summary of the article, read here.

Bipartisan Step Forward on SGR Repeal

Up against an April 1 deadline that would see Medicare payments to physicians plunge by nearly 24%, a bipartisan group of Congressional negotiators introduced legislation that would repeal Medicare’s sustainable growth rate (SGR) formula and replace it with an annual 0.5% pay increase for five years. The proposed legislation contains additional provisions designed to transition Medicare from a pay-per-procedure system to one that promotes value through alternative payment methods (APMs) and rewards physicians for engaging with APMs. Those provisions include:

  • A consolidation of three existing Medicare quality programs into one
  • Incentives for care coordination
  • Involvement by physicians in developing clinical guidelines, performance measures, and APMs
  • Making provider-specific quality and utilization data more publicly accessible

Before we hail this as the epitome of bipartisan success, it should be noted that the legislation in its current form does not detail how Congress would pay for a permanent SGR repeal, which is estimated to cost between $120 billion and $150 billion. That significant detail will be debated if and when the full membership of both chambers considers the bill. Congress has been at similar SGR crossroads before and ended up passing short-term “patches” without permanently revising what everyone agrees is a failed formula.

MedPAC Proposal Could Detract from Physician Employment by Hospitals

David Glaser, JD, alerts us to proposed changes in the healthcare reimbursement model that would make employing physicians less appealing for hospitals. MedPAC, the Medicare Payment Advisory Commission, issued a report that details a discrepancy between higher reimbursements for services rendered in hospitals relative to those for the same services provided in clinics. Simply put, more Medicare money is available to compensate physicians when they are in a hospital outpatient setting. This MedPAC report proposes an end to the added “facility fee” that drives the discrepancy by leveling reimbursements across the board in all settings. MedPAC recommendations are not binding, and Congress has the final say about Medicare reimbursements. But in Glaser’s opinion, “the days of additional facility fee payments are numbered.”
Read more here