2018 MPFS Proposed Rule and the 2018 HOPPS Proposed Rule

Thursday, July 13, 2017, the Centers for Medicare and Medicaid Services (CMS) released the 2018 Medicare Physician Fee Schedule (MPFS) Proposed Rule and the 2018 Hospital Outpatient Perspective Payment System (HOPPS) Proposed Rule.

CMS is proposing a slight increase in the 2018 MPFS conversion factor from 35.8887 to 35.9903. This annual update to MPFS payment policy includes proposed changes to the relative value units (RVU) for specific medical services and identifies potentially misvalued codes for future revaluation. The proposed rule also features a delay of the requirement for the use of Appropriate Use Criteria/Clinical Decision Support for advanced imaging orders and CMS’ proposal for the use of patient relationship category codes in the Medicare Quality Payment Program (QPP).

We will publish a more detailed review in the coming weeks.

'Telemedicine' gets a boost in N.J.

A state Senate committee approved legislation regulating telemedicine, a growing tool allowing people to connect with doctors remotely. The St. Luke's University Health Network service will allow patients to be seen by a health-care provider through an app that can be used on smartphones.

By Susan K. Livio | NJ Advance Media for 
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on September 26, 2016 at 5:32 PM

TRENTON — A state Senate panel Monday unanimously approved legislation that would regulate the growing field of telemedicine, the virtual interaction between a patient and a doctor.

Telemedicine is not new and is available already. But the popularity and interest in this alternative form of a doctor visit is growing for the convenience it provides for people who do not live near a doctor or cannot get to a doctor's office because of health limitations or a lack of transportation.

Telemedicine is "expanding the universe of care for millions of Americans. In New Jersey, we have an opportunity to get this working the right way," said Sen. Joseph Vitale (D-Middlesex), one of the bill's sponsors and chairman of the Senate Health Human Services and Senior Citizens Committee.

The bill (S291) would require:

  • Insurance companies to reimburse telemedicine services at the same rate as in-person visits;
  • Doctors to meet with a patient in person before a prescription is written for potentially addictive substances;
  • The State Board of Medical Examiners to write and adopt the specific rules for practicing telemedicine.

"Telemedicine is especially vital for patients who suffer from chronic illness, seniors who are homebound, and families who live in rural areas where they would have to travel very far to receive medical care," said Sen. Diane Allen (R-Burlington), one of the bill's sponsors. "No one should have to choose between paying for groceries and traveling to see a doctor. By legalizing telemedicine, we can bring the cost of healthcare down and expand access to a variety of health services for millions of new patients."

Telepsychiatry: the latest in mental-health services

A patient arrives in an emergency room talking of suicide or exhibiting other symptoms of mental illness. In the past, that patient could have waited for hours before a staff psychiatrist would be available to perform an evaluation. But increasingly, that patient is likely to be placed in front of a monitor, where he or she can receive a faster evaluation.

Wardell Sanders, president of New Jersey Association of Health Plans, agreed telemedicine is an important development in medicine, but disagreed with how the bill would regulate it. Virtual appointments should not be reimbursed at the same rate as in-person visits, he said.

"We would argue there should be flexibility to allow for different pay structures," Sanders said.

Of the 31 states which have passed telemedicine legislation, Sanders added, "only seven states require reimbursement for telemedicine services to the same extent as for in-person treatments and consultations."

Vitale said after the hearing he doesn't think he can be swayed on the reimbursement issue because he wants more doctors to use virtual medicine, and reimbursing them less would be a deterrent.

Infants and toddlers born with developmental delays who are enrolled in the state's Early Intervention therapeutic program will benefit greatly from telemedicine, Karen Olanrewaju, program director for Sunny Days Early Childhood Developmental Services in Manalapan, told the committee.

Therapists in several South Jersey counties are experimenting with the technology, which provides a "secure platform" for these confidential transmissions, said Olanrewaju, speaking on behalf of other licensed therapists who are affiliated with the Alliance for the Betterment of Citizens with Disabilities, am industry group.

"We can eliminate the concerns about the spread of infection, travel issues, and significant practitioner shortages in certain regions of the state," she said.

Susan K. Livio may be reached at [email protected]. Follow her on Twitter @SusanKLivio. Find Politics on Facebook.

Live From the State Capital

Andrew Musick, Director of Taxation and Economic Development
Michael Wallace, Director of Employment and Labor Policy
July 13, 2016

DOJ nearly doubles False Claims Act penalties

Written by Ayla Ellison (Twitter | Google+) | July 05, 2016

Penalties under the False Claims Act presently range from $5,500 to $11,000 per claim. However, those amounts will nearly double Aug. 1.

Signed into law by President Barack Obama last November, the Bipartisan Budget Act of 2015 requires federal agencies to increase civil monetary penalties awardable under the False Claims Act. One of the law's provisions includes a "catch up adjustment," which requires agencies to update penalties to account for inflation. The initial adjustment would be implemented through interim final rulemaking, like that recently promulgated by the Department of Justice.

On June 30, the DOJ published an interim final rule, raising the penalties authorized under the False Claims Act to a range of $10,781 to $21,563. The increased penalties will apply to violations that occurred after Nov. 2, 2015.

According to the National Law Review, False Claims Act penalties have not been adjusted for inflation since 1996.

The DOJ's adjustment has been expected since May, when the Railroad Retirement Board published its increased False Claims Act penalties in accordance with the Bipartisan Budget Act.

Public comments on the DOJ's interim final rule must be submitted by Aug. 29. 

Bills limiting use of Tiered Networks in State Health Plans Opposed by Pension and Benefits Commission

May 27, 2016

The State's Pension and Health Benefits Review Commission, recently voted against four bills restricting the use of tiered networks in health benefits plans for state employees. The Commission noted that including tiered network plans as an option represents a significant savings for New Jersey taxpayers, public employees, and their employers. These bills would also restrict the use of tiered networks in health benefits plans purchased by New Jersey employers, depriving them of cost savings as well. NJBIA submitted a statement opposing the bills because the cost of health insurance is consistently a top challenge for our members. View our statement here<>.

Two of the bills, S-296 (Vitale, Gill)/A-2329 (Vainieri Huttle, Wisniewski, Muoio, Gusciora), mandate the cost sharing amount associated with the lowest tier of the health benefits plan, and require any tiered network plan to include University Hospital in the highest or preferred tier of the network.

The other bills, A-3558 (Wisniewski, Gusciora, Holley, Muoio)/S-1934 (Weinberg, Allen), freeze future enrollment in tiered network health benefits plans until new legislation and accompanying regulations to govern those plans are in effect. This legislation would result in increased costs for employers and their employees by preventing them from purchasing and enrolling in a health benefits plan with a reduced premium and lower cost sharing.

You can view the Commission vote here: click here


March 11, 2016

CMS said Tuesday it would test new models to improve how Medicare Part B pays for prescription drugs in order to encourage physicians to select the most effective treatments for patients and to slow Medicare spending.

Here are eight things to know about CMS' proposal:

1. Medicare Part B covers prescription drugs administered in a physician's office or hospital outpatient department. Physicians and outpatient departments are typically paid the average sales price of a drug, plus a 6 percent add-on.

2. CMS has proposed changing the add-on payment to 2.5 percent plus a flat fee payment of $16.80 per drug per day. These changes would begin in late 2016.

3. CMS intends for the proposed model to result in savings and improved quality by changing prescribing incentives.

"Physicians often can choose among several drugs to treat a patient, and the current Medicare Part B drug payment methodology can penalize doctors for selecting lower-cost drugs, even when these drugs are as good or better for patients based on the evidence," said CMS.

4. The proposed rule also includes several value-based pricing strategies. One of those is to discount or eliminate patient cost-sharing to improve Medicare beneficiaries' access to effective drugs.

5. Under another proposal, Medicare would set a standard payment rate for a group of "therapeutically similar" drugs. Pharmaceutical companies have opposed this practice, known as reference pricing, according to The New York Times. They argue this method of pricing is flawed because patients with the same condition may respond differently to the same drug.

6. CMS also proposed paying drug companies based on the clinical effectiveness of a drug. "For example, a medication might be used to treat one condition with high levels of success but an unrelated condition with less effectiveness, or for a longer duration of time," said CMS.

7. Commenting on the proposals, Andy Slavitt, acting administrator for CMS, said, "First and foremost, our job is to get beneficiaries the medication they need. These proposals would allow us to test different ways to help Medicare beneficiaries get the right medications and right care while supporting physicians in the process."

8. CMS is accepting public comments on the proposed rule through May 9.

March 11, 2016 by NJBIZ

CMS Extends Hardship Exemption Deadline
Mar 02, 2016 by Steve Gray in Medical Compliance

The Centers for Medicare and Medicaid Services (CMS) has extended the deadline for providers to file for hardship exemption from the Meaningful Use requirements for its electronic health record incentive payment program to July 1, 2016 instead of March 15, 2016. Here’s what you need to know:

Who can file an application for Hardship Exemption?

Hospitals, Critical-access hospitals (CAHs), physicians and other eligible professionals (EPs) can file their applications. The exemption has been granted so providers have enough time to submit their applications to avoid adjustments to Medicare payments in 2017.

What are the criteria for Hardship Exemption?

Hardship exemption is granted for reasons such as unavailability of federally tested and certified software capable of meeting government requirements such as lack of control over the Certified EHR Technology (“CEHRT”), or EHR certification/vendor issues or lack of face-to-face patient interaction or follow-up.

It can be granted if providers have problems of internet connectivity or suffer natural disasters. That’s not all, closures of practice or hospital due to extreme and uncontrollable conditions, and bankruptcy and debt restructuring also due to extreme and uncontrollable situations could also ensure Hardship exemptions are granted.

What’s the new application process like?

CMS has published new application forms that are more streamlined and reduce the amount of information that must be supplied to apply for an exception. You may download the new instructions and application forms at the CMS payment adjustment and hardship information page.

The new streamlined application process is a result of Patient Access and Medicare Protection Act (PAMPA), which was signed into law in Jan, 2016. CMS claimed that the new law would ensure flexibility in applying the hardship exception for meaningful use for the 2015 EHR reporting period – affecting Medicare payment penalties in 2017.

For more information on Stage 3 of the EHR Meaningful Use standards and the Hardship Exemption and Rules, you may like to attend this On-demand webinar by expert speaker Wayne J. Miller, a founding member of the Compliance Law Group, Los Angeles, a law firm focused on health care industry legal compliance for clients nationwide.

 Multi-Payer Agreement Establishes Common Physician Quality Measures

Rich Daly, HFMA Senior Writer/Editor

Although the issue of process versus outcome measures will remain contentious, providers anticipate the reduction in the number and variety of quality measures to result in savings.

Feb. 16—The first common quality measures that will span traditional Medicare and insurers of 70 percent of privately insured Americans were introduced this week.

The physician quality measures were the first results of the Core Quality Measures Collaborative, which was started in 2014 and includes the Centers for Medicare & Medicaid Services (CMS), America’s Health Insurance Plans (AHIP), Medicare and Medicaid managed care plans, purchasers, physician and other care provider organizations, and consumers.

The group produced seven sets of clinical quality measures in an effort to support first-time multi-payer alignment on core measures in physician quality programs.

The initiative aimed to combine the large and growing number of quality measures that providers report to different entities and that have produced confusion and complexity for the reporting providers.

The participating payers have committed to using the core sets of quality measures for reporting “as soon as feasible,” according to a CMS fact sheet.

“In the U.S. healthcare system, where we are moving to measure and pay for quality, patients and care providers deserve a uniform approach to measure quality,” Andy Slavitt, acting administrator for CMS, said in a release. “This agreement today will reduce unnecessary burden for physicians and accelerate the country's movement to better quality.”

The Collaborative plans to add more measure sets and update the current sets over time.

“It’s very encouraging to have alignment from CMS and health plans on this, and it will be important that they continue to seek input from physicians in the development and refinement of these core measures to ensure the measures are meaningful,” said Katie Gilfillan, director of healthcare finance policy, physician and clinical practice, for HFMA.

The core consensus measures were organized into seven sets:

  • Accountable Care Organizations, Patient-Centered Medical Homes, and Primary Care
  • Cardiology
  • Gastroenterology
  • HIV and Hepatitis C
  • Medical Oncology
  • Obstetrics and Gynecology
  • Orthopedics

Healthcare Impacts

The initial measures apply to the specialties aligned with the involved physician organizations, with the measures eventually expanding to other specialties and stakeholder groups, according to a 2015 Health Affairs blog post by Patrick Conway, chief medical officer for CMS.

“This phase-in approach will allow payers to evaluate the timing of adoption of these core measures through the procedures used in their programs and contracts over time,” Conway wrote.

The new measures will improve the quality of care while making family physicians’ lives easier by simplifying the information they are being asked to provide to payers, according to physician advocates.

Physician practices’ quality measurement burden was described as a “measurement tsunami” by participants in a 2015 study by the American Medical Association (AMA) and the RAND Corporation. A CMS measure inventory has catalogued nearly 1,700 quality measures.

That AMA-RAND study found some practices lack the management capacity to keep track of payment program details that vary between payers. In response, larger physician practices and hospital systems tried to simplify those incentives for their physicians. But those efforts were time-consuming and costly, and sometimes resulted in penalties because the simplification missed the specific details sought by some payers, Mark Friedberg, one of the authors of the RAND research, said in an interview.

The agreement “is really important because there has been a huge challenge in balancing the need to have robust information with the burden on providers for data collection,” Josh Seidman, senior vice president for healthcare consultancy Avalere, said in an interview. “Additionally, when plans and purchasers are collecting information in slightly different ways, it makes it very hard for providers to actually drive quality improvement because it is hard for them to make apples-to-apples comparisons.”

The agreement could save providers money if they are also able to streamline data collection, for instance, through greater use of electronic data for measurement collection and reporting, according to Seidman.

Staged Implementation

Implementation of the measures will occur in several stages.

CMS plans to expand its use of some measures from the each of the core sets through the rule-making process, implement new core measures across applicable Medicare quality programs, and eliminate redundant measures that are not part of the core set.

Additionally, CMS aims to align the quality measures across the Department of Defense, the Department of Veterans Affairs, and state Medicaid plans.

Commercial health plans will implement these core sets of measures as contracts come up for renewal or if existing contracts allow for modification of the performance measure set.

The Collaborative described the upcoming year as a transitional period, wherein the adoption and harmonization of the measures begins. The Collaborative plans to conduct ongoing monitoring of measure utilization, and will allow modifications of measure sets as needed.

The Collaborative will continue to convene to monitor progress, invite broader participation, and add additional measures and measure sets. That future work is important to many providers.

“We are supportive of the collaborative efforts of CMS and others to streamline quality measures for physicians and other professionals, but that’s just the beginning,” Ashley Thompson, a senior vice president for AHA, said in a written statement. “Reviewing the measures used across the healthcare field, including at hospitals and other healthcare facilities, is important to ensure we are measuring what matters in an aligned and coordinated fashion.”

Separate Efforts

Formation of the Collaborative comes on top of other quality efforts. For instance, the Institute of Medicine recommended a core set of 15 standard metrics in a 2015 report. Additionally, several state payment and delivery transformation initiatives feature multi-stakeholder alignment as a key principle.

How those initiatives will interact with the new measure sets still needs to be determined.

“There is still a lot of question as to how much measurement should be condition-specific and disease-focused versus whole person-oriented, and that is something that is still a work in progress,” Seidman said.

The 2015 Medicare Access and CHIP Reauthorization Act (MACRA) is consolidating major CMS physician payment programs into the merit-based incentive payment system (MIPS) program. MACRA also requires the U.S. Department of Health and Human Services to develop, publish, and report to Congress on a quality measure development plan for provider participation in MIPS and qualifying alternative payment models (APMs).

CMS plans to issue a proposed rule on MIPS and APMs in the spring, according to policy observers. Providers are keeping a wary eye on how those provisions of the new law will be implemented.

Rich Daly is a senior writer/editor in HFMA’s Washington, D.C., office. Follow Rich on Twitter: @rdalyhealthcare