Medicare Fee Schedule Update

December 7, 2007

On November 1, CMS published its final physician payment rule reducing physician payments by 10.

On November 1, CMS published its final physician payment rule reducing physician payments by 10.1 percent.

Many providers have taken this news with a certain degree of ennui. In recent past years, CMS announced equally distressing regulations, only to have its rule reversed by last-minute legislation.

Will the same thing happen this year?

Maybe, maybe not. Keep your fingers crossed. The Senate Finance Committee is expected to meet today or early next week to take the issue up. But it's not clear what they will recommend.

"We're hearing mixed reports," says Robert Bennett, government affairs representative with the Medical Group Management Association, who is spending his days on the Hill waiting for news. "It's still rumor-mill time right now. Until everything is put down on paper, it's hard to know."

The Committee is likely to propose just a one-year fix, Bennett says, rather than tackling the tougher issue of how the fee schedule gets set in the first place. That fix could be a freeze to 2007 rates or an update -- or nothing much at all that affects physicians' bottom lines.

Apart from fee schedule issues, senators might also put in place new accreditation requirements for imaging centers and set down new rules concerning physician ownership of hospitals. Regardless, their proposal still needs to pass a Senate vote and then there are negotiations with the House. Of course, any final bill can be vetoed by the president, and indeed the current administration has threatened to veto any legislation that would have a negative impact on funds available for Medicare Advantage plans (cutting there is one way to fund a payment increase to physicians).

All this, and we are running out of time. Congress optimistically plans to break on December 14. Last year, a freeze passed on December 20. In previous years, revisions have come as late as February and March, after physicians already started getting paid in the New Year. "It's pretty bleak out there," Bennett says.

So, patience and planning are the only options. Here's what you can do:

1. Track updates online at www.PhysiciansPractice.com.

2. Update your budgets to reflect the final rule pricing. You can get all the RVUs at the CMS Web site. Using a Budget Neutrality Adjustor (BNA) of 0.8806, plug the numbers into the calculation to figure out what that means in dollars:

Work RVU x BNA = _____; Round to 2 decimal places = _____ x Work GPCI =____
+
Transitioned Non-Facility PE RVU x PE GPCI = _____
+
MP RVU x MP GPCI = _____

Subtotal: _____
x
Conversion Factor_____
=
_____

3.

Contact your senators,

and let them know where you stand.

Pamela L. Moore, PhD, CPC, is senior editor of Physicians Practice. She can be reached at pmoore@physicianspractice.com.