More than one million providers of healthcare services to Medicare beneficiaries must prepare for a significant pay cut due to the final rule released by the Centers for Medicare & Medicaid Services (CMS).
Physicians and non-physician practitioners who receive reimbursements under the Medicare Physician Fee Schedule (MPFS) will have payments slashed by 27.4 percent starting in 2012, unless Congress intervenes.
“This payment rate cut would have dire consequences that should not be allowed to happen,” said a statement from Donald M. Berwick, MD, CMS administrator. “We need a permanent SGR fix to solve this problem once and for all.”
Providers face steep cuts under the current law based on the Sustainable Growth Rate (SGR) formula, but have avoided the SGR’s reduction of payments through legislation every year except 2002.
“The release of the Medicare physician fee schedule rule serves as a reminder to Congress that there is a looming crisis in the Medicare program only they can stop, and the clock is ticking,” according to a statement released by American Medical Association President Peter W. Carmel, MD.
“Without swift action by Congress, on January 1 physicians who care for Medicare patients will be hit with a 27.4 percent cut caused by the broken Medicare physician payment formula.”
This extreme pay cut could not only jeopardize the quality of care for seniors — who may see providers opt out of the program — but the livelihood of physicians, therapists and nurse practitioners who provide these services to Medicare beneficiaries as well.
“Many physicians are already struggling with inadequate Medicare payment rates and the ongoing threat of future cuts from this broken physician payment formula,” said Dr. Carmel.
“Payments for Medicare physician services have fallen so far below increases in medical practice costs that there is a 20 percent gap between Medicare payment updates and the cost of caring for seniors.”
The drastic drop in Medicare payments is the most controversial element of the final rule, but other changes were also outlined in the plan.
CMS Final Rule Changes
Payments for Medicare beneficiaries’ Annual Wellness Visits will be increased to reflect the additional staff requirements.
Covered telehealth services like smoking cessation will be expanded.
CMS’s “misvalued code initiative” will be expanded to help ensure accurate payments for physician services and enhanced management of the payment system.
The “multiple procedure payment reduction policy” will be expanded to recognize overlapping activities in advanced imaging services.
Aspects of physician incentive programs like Physician Quality Reporting System, the ePrescribing Incentive Program, and the Electronic Health Records Incentive Program will be updated or modified.
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