CMS Releases Final Rule for 2010 Physician Fee Schedule

ASA is extremely pleased to report that in the recently-released final rule for the 2010 Physician Fee Schedule, the Centers for Medicare and Medicaid Services (CMS) will fully implement Medicare anesthesiology teaching rule reforms beginning Jan. 2010 as intended by Congress and advocated by ASA.

The final rule represents a culmination of many years of work by ASA members, leadership and legislative and regulatory staffers in the Washington, D.C. office, to rectify the 50 percent payment penalty for anesthesiology teaching programs. The newly-released rule will correct this payment inequity, strengthening residency programs in the process.

“This is a huge triumph for the medical specialty of anesthesiology, and ASA members are to be commended for their dedication to this legislative and regulatory priority,” said ASA President Alexander A. Hannenberg, M.D. “After a long- and hard-fought battle, academic programs will finally receive full Medicare payment for the expert anesthesiology medical care they provide to patients. This victory proves what ASA can achieve through unrelenting advocacy efforts.”

Due in large part to the overwhelming response to the ASA calls to action to submit comments to CMS, the Agency did not formally address the issue of anesthesia “handoffs” in its final rule. Thus, different anesthesiologists in the same anesthesia group practice can be considered the teaching physician when fulfilling the statutory requirement that the teaching anesthesiologist be present at the key or critical portions of the anesthesia service. ASA is pleased that the Agency followed legislative intent and did not focus on unrelated topics.

So what does this mean for a teaching anesthesiologist? Here are some scenarios to break down the impact for your program.

A. The teaching anesthesiologist receives 100% of the fee schedule amount for the following cases:

• The teaching anesthesiologist is involved in one resident physician case (which is not concurrent to any other anesthesia case);
• The teaching anesthesiologist is involved in each of two concurrent resident cases (which are not concurrent to any other anesthesia case); or
• The teaching anesthesiologist is involved in one resident physician case that is concurrent to another case paid under medical direction payment rules.

B. The teaching anesthesiologist receives 50% of the fee schedule amount if medical direction applies. Examples will include cases where the anesthesiologist is teaching a student registered nurse anesthetist (SRNA), or directing a CRNA or AA.

Other key provisions of the proposed rule include:

• Removal of Physician-Administered Drugs for Purposes of Computing Update – CMS is finalizing its proposal to remove physician-administered drugs from the definition of “physician services” for purposes of computing the Medicare physician fee schedule update. While the proposal will not change the projected update for services during CY 2010, CMS projects that it would reduce the number of years in which physicians are projected to experience a negative update.
  
  
• Physician Payment Refinements to Practice Expense – In its final rule with comment period, CMS adopted several refinements to Medicare payments to physicians, which are expected to increase payment rates for primary care services. For 2010, for purposes of establishing the practice expense (PE) relative value units (RVUs), CMS had proposed to include data about physicians’ practice costs from a new survey, the Physician Practice Information Survey (PPIS), designed and conducted by the American Medical Association (AMA). While CMS is finalizing the proposal, it will phase it in over a 4-year period.

The impact to the PE relative value units for anesthesiologists and pain medicine physicians, as estimated by CMS is as follows:

• Physician Quality Reporting Initiative (PQRI) – CMS finalized the incorporation of the new Perioperative Temperature Management measure in PQRI. Technical specifications for the measure can be expected in December 2009. In addition to the new measure, some significant issues for anesthesia include:
  
  
• In response to public comments, including comments submitted by ASA, CMS changed from the proposed rule and elected to provide a 6-month reporting option for participating in PQRI via claims-based reporting. The time period for this alternative reporting period will be July 1, 2010 through December 31, 2010. This is especially important for anesthesiologists because registry-based reporting is not yet afforded for anesthesiologists due to the lack of measures and lack of registries capable of reporting anesthesia measures.
  
  
  
• CMS is contemplating two anesthesia clusters for purposes of the Measure Applicability Process (MAV), which is the method CMS typically uses to validate whether physicians are appropriately submitting PQRI codes for all applicable measures. This process has only been applied to providers reporting fewer than 3 PQRI measures; however, anesthesiologists have essentially been exempt from the MAV to date due to the exemption of Measures 30 and 76. Development of two anesthesia clusters will potentially subject anesthesiologists to the MAV beginning in 2010. The contemplated clusters are as follows:
  
  
• Measures 30 and 76
• Measures 76 and the new Perioperative Temperature Management measure

The MAV would apply if a provider submitted either Measure 30 or the new Perioperative Temperature Management measure (and require Measure 76 also be reported). However, reporting of Measure 76 only would not subject the provider to the MAV process. Additional details will be posted by December 31, 2009.

• CMS finalized its plans to publicly report eligible providers who successfully participate in PQRI during 2010. The list will be made public sometime in 2011 after 2010 PQRI payments are distributed and will include appropriate disclaimers on the intended use and limits of the information and that satisfactory participation does not equate to higher quality care.
  
  

• Consultations

CMS finalized its proposal to eliminate the use of Office or Other Outpatient Consultation codes 99241-99245 and Inpatient Consultation codes 99251-99255, and redistribute the work RVUs to new/established office visit codes 99201-99215, initial hospital visit codes 99221-99223 and initial nursing facility visit codes 99304-99306. The rationale behind this change is that consults have been paid at a higher rate than visits because of the documentation requirements associated with a consultation. The agency states that these requirements are now similar across all Evaluation and Management (E/M) services and the payment differential is no longer warranted. The work values assigned to the consultation codes will be redistributed to the new/established office visit codes and to the initial hospital and nursing visit codes.

• Site of Service Anomalies –CMS did not finalize its proposal to apply a new valuation methodology to several codes that had been reviewed by the AMA/Specialty Society RVS Update Committee (RUC) due a site of service anomaly. An example of a site of service anomaly is when a service was originally valued as typically performed in an inpatient setting but utilization data shows it is typically performed in an outpatient setting. Some codes that describe work associated with spinal pumps and stimulators would have been negatively impacted by this proposal. In response to comments that expressed serious concerns about the methodology CMS applied to these codes (which would have resulted in negative work values for some services), CMS will continue to use the RUC-recommended values for these services (some of which will see slight increases due to increases in the E/M work included in the 10 or 90 day global period resulting from CMS’s decision to discontinue use of the consultation codes.

• Physician Payment Update – Under the final rule, and consistent with current law, CMS will move forward in implementing the slated rate reduction of -21.2% for CY 2010 (rather than the 21.5% projected in the proposed rule – the difference attributed to the most recent data available to CMS). Since 2003, however, Congress has acted to avert significant reductions in Medicare physician payments, with the latest of these interventions occurring last July via the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA). MIPPA provided physicians with a 0.5% update for the remainder of 2008 followed by a 1.1% update through December 31, 2009, thereby preventing what was at the time a projected 10.6% Medicare payment reduction. ASA is committed to continuing its work with Congress to support SGR reform legislation.

  In addition to this slated rate reduction, the work Geographic Practice Cost Indices (GPCIs) used to adjust the Medicare conversion factors for regional cost differences will no longer have a floor of 1.0. In fact, 54 of 80 localities are receiving reductions in their relevant work GPCI for 2010 relative to 2009. The most significant decreases occur in Puerto Rico (9.6%), South Dakota (5.8%), North Dakota (5.3%), rest of Missouri (5.1%) and Montana (5.0%).

• Overall Impact to changes to Work, PE and Professional Liability The Rule includes an estimate of the impact the changes to Work, PE and PLI will have on allowed charges by specialty. These estimates do not include the negative SGR update. As excepted from Table 49 of the Final Rule:

	Allowed Charges (mil $)	Impact of Work RVU Changes	Impact of PE RVU Changes		Impact of MP RVU Changes	Combined Impact
			Full	Transition		Full	Transition
Anesthesiology	1,744	0%	4%	1%	0%	3%	0%
Interventional Pain Management	356	-2%	3%	-1%	0%	0%	-3%

ASA will continue to analyze the final rule. In the meantime, please use the following links for additional information:

• CMS press release
• CMS fact sheet