Medicare Physician Fee Schedule Updated with SGR Methodology
By - Medicare’s Physician Fee Schedule (MPFS) is associated with an inflation algorithm that has been criticized for not paying physicians enough to be able to effectively administer quality care to Medicare beneficiaries.
MPFS was updated using the Sustainable Growth Rate (SGR) methodology on April 1, 2015 per required law, according to an eNews announcement from the Centers for Medicare & Medicaid Services (CMS)/Medicare Learning Network.
According to the SGR methodology, a 21 percent decrease in all MPFS payments would occur beginning on April 1.
CMS held claims paid under the MPFS for services dated within the month of April. CMS’ intention of doing so was to regulate the financial impact on Medicare providers and beneficiaries.
Medicare is additionally holding therapy claims that do not qualify for therapy cap exceptions – annual limitations on per beneficiary incurred expenses for outpatient services under Medicare Part B. These therapy cap exceptions include claims with a KX modifier. Since the therapy cap exceptions process expired on April 1, without the implementation of supplementary legislation in place to prevent a negative update, CMS will mandatorily update payment systems in accordance with the law’s requirements.
CMS confirms it will release held MPFS claims on April 15. CMS will pay at a reduced rate based upon the negative update on a first-in, first-out basis. CMS states it will simultaneously hold receipts for ten compiled days of total claims, including those from April 15, to avoid an interruption in providers’ cash flow. The objective of this “rolling hold,” says CMS, is to actively decrease claims reprocessing in the event Congress passes legislation to modify the negative update.
CMS emphasizes providers should especially consider claims for services provided on or prior to March 31, 2015 are unaffected by the payment cut. Such categorized claims will be processed and paid according to conventional time frames.
Says CMS, “We are working to limit any impact to Medicare providers and beneficiaries as must as possible.”
The Medicare Administrative Contracts (MACS) will automatically reprocess claims paid at a reduced rate following alleged Congressional action to prevent a negative update, says CMS.
CMS additionally confirms providers who have already submitted claims for impacted dates of services do not need to take further action.
“The Administration urges Congress to take action to ensure these cuts do not take effect,” states CMS in an advisory to patients. “However, until that happens, CMS must take steps to implement the negative update.”
The aforementioned updates from CMS follow its November 13, 2014 announcement to correct a variety of technical errors discovered after the final rules were formerly published.
In addition to the Medicare Physician Fee Schedule adjustment, the onset of April 1 meant several other conditions affecting providers were also due to expire. The provisions included add-on payments for ambulance services, payments for low volume hospitals, and payments for Medicare dependent hospitals.
Perhaps a strong push towards compensating physicians appropriately via incentives will help advance and improve quality of care as the healthcare industry proceeds through April so true progress can become a tangible resolution.
