It’s all too easy to get caught up in all the concerns and questions circling around the Affordable Care Act, but don’t overlook the significant factors that soon will influence your reimbursement in the coming year regardless of the government’s new health care plan. Here’s a lowdown on what will directly impact physician reimbursement in 2014:
- Sequestration, the controversial cuts to federal programs applied to Medicare reimbursement in April 2013, will continue through 2021. These mandated cuts will shave off two percent from reimbursement in 2014 – even incentive payments earned through the EHR Incentive Program will be affected.
- For eligible professionals who chose not to participate in Medicare’s Electronic Prescribing (eRx) Incentive Program (or those who failed to successfully do so and do not have a hardship exemption), reimbursement of all Medicare Part B claims will be adjusted downward by two percent in 2014. To determine if your claims are taking that hit, look for the following remittance advice codes from your Medicare carrier:
- Indicator “LE” (for all Medicare Part B services rendered from January 1–December 31, 2014);
- Claim Adjustment Reason Code (CARC) 237 – Legislated/Regulatory Penalty; and
- Remittance Advice Remark Code (RARC) N545 (or NCPDP Reject Reason Code) – “Payment reduced based on status as an unsuccessful e-prescriber per the Electronic Prescribing (eRx) Incentive Program.”
For more information, please click on this link.
- While payment adjustments won’t yet be applied for the EHR Incentive Program, 2014 is the final year to circumvent them. Attest in 2013 – or, at the very latest, by October 1, 2014, and you’ll avoid the 2015 cuts of one percent to Medicare reimbursement.
- The Physician Quality Reporting System (PQRS) will impose its initial penalties of a 1.5 percent reduction in Medicare Part B reimbursement in 2015 based on performance in 2013.
These cuts seem paltry in comparison with the cuts of 24.4 percent projected in 2014 that are a function of the flawed formula used to develop the annual Medicare physician fee schedule. These cuts, which were confirmed in the July 19 Federal Register issued by the Centers for Medicare & Medicaid Services (CMS), will likely be reversed, as they have for the past 10 years, but they also mean that the industry spends a lot of its energy each year merely to roll the adjustment back to zero. Lost in the hubbub is the need for actual increases in rates for physicians treating Medicare patients.
These are all adjustments of which you may be aware, but there are other initiatives in the works. The Value-Based Modifier Program, for example, is evaluating the performance of medical groups of 100 or more eligible professionals this year. (Please note that these large groups must register for the program; click on this link for more information.) Penalties (and bonuses, if chosen and earned) will be applied in 2016 to this group of participants, but CMS is proposing to expand the program to groups of 10 to 99 physicians in 2014 – this, in advance of the mandated expansion of the program to all physicians in 2017, based on 2015 data.
Given the flux of changes to the Medicare program, consider untying any contracts that you have with commercial payers that hinge on Medicare rates. Otherwise, you could find that the federal government’s sequestration cuts – and other adjustments – have extended to your commercial business. In markets throughout the U.S., commercial payers and even Medicaid plans are developing new reimbursement models as well, including pay-for-performance programs that reward physicians for meeting stipulated performance measures.
On the positive side, primary care physicians as well as general surgeons practicing in designated healthcare professional shortage areas will continue to garner the Primary Care Incentive Program (PCIP) and General Surgery Incentive Program (GSIP) bonuses through the end of 2015. These programs provide eligible physicians and advanced practice providers with a quarterly payment equal to 10 percent of the reimbursement for select services provided to Medicare beneficiaries.
In addition to the PCIP, primary care physicians are just now seeing the significantly anticipated raise in Medicaid rates to Medicare levels for specific services – the so-called “rate parity” program for office visits and vaccine administration. While the program commenced in 2013, most Medicaid agencies are just now releasing those funds. The payments, however, will be retroactive to dates of service beginning on January 1, 2013, and continue through December 31, 2014. Notably, some states require a registration process for this program, so if you are a qualifying physician or advanced practice provider, contact your state Medicaid agency to enroll if you have not already done so. (Click this link for the information about Tennessee’s program, for example, or check out this summary of all states compiled by the American Academy of Pediatrics – with links to more information.)
While it used to be good enough to download and scan the Medicare fee schedule, there are many factors that could affect your reimbursement in 2014. Medicare never was easy to understand, and now it becomes an even more complex program to navigate.