Halloween Announcement of CMS Payment Changes

Faegre Drinker Biddle & Reath LLP
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Maybe it was a coincidence, but CMS waited until Halloween to announce its final 2015 payment policies for physicians and hospital outpatient departments.  While the announced changes are not really scary, one evoked sharp and immediate criticism from the American Medical Association.

Generally, overall pay will increase 2.3% under the announcement—up from the 2.1% proposed last July.  There will be “comprehensive,” or bundled, payments for 25 specified high-cost, device-related outpatient procedures.  Three of the original 28 proposed procedures were dropped from the list.

The announcement also finalized payments to physicians for chronic care management of sicker patients, but at $40.39 a month rather than the $41.92 figure proposed earlier.

So why is the AMA upset?  Because the announcement establishes a new billing code—voluntary in 2015 but mandatory in 2016—known as an HCPCS (for Healthcare Common Procedure Coding System) modifier to identify procedures performed in hospital-owned physician practices.  The point of the modifier is to assist CMS in determining whether higher, hospital rates—as compared to regular physician office rates—are justified simply because a practice is hospital-owned.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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