Medicare 2010 Physician Fee Schedule Answers to Frequently-Asked

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1 Medicare 2010 Physician Fee Schedule Answers to Frequently-Asked-Questions Overview The Centers for Medicare and Medicaid Services (CMS) released the 2010 Medicare physician fee schedule final rule on October 30, 2009 in the form of a cfinal rule. d The final rule addresses the feedback CMS received from stakeholders on the proposed 2010 Medicare fee schedule that it released in July 2009, known as the cproposed rule. d ACP, like many other organizations and individuals, submitted comments to CMS during the public comment period. The College submitted detailed comments in an August 31, 2009 letter to the agency. The 2010 fee schedule includes many issues important to internal medicine and its subspecialties.

The CMS decisions on these key issues have an impact on the relative value units (RVU) assigned to each individual physician service. CMS assigns an RVU that represents the relative resource costs associated with the physician work, practice expense (overhead), and professional liability insurance for each individual physician service. After the RVU for each of these three components is adjusted for geographic cost differences, the total RVU for each service is multiplied by a dollar conversion factor, which is $36.07 in 2009, to convert it into a payment amount.

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the impact of the changes in the 2010 final rule on an individual physician depends on the mix of services he or she furnishes, CMS provides an estimate of the impact on each physician specialty. In addition to providing a total impact estimate, CMS provides an estimated impact for each of the three main fee schedule components of: work, practice expense, and professional liability insurance. Because the agency decided to implement a high-impact change to the practice expense RVUs over a four-year period (a description of this change and the explanation of the phase-in decision appear later in this document), CMS also provides an estimate of the impact for 2010 had this change been fully implemented in 2010. As a result, CMS provides cfull impact d and ctransition impact d estimates for both the practice expense component and for the 2010 total that reflects all three components. CMS estimates that all the changes in the final rule will collectively increase, on average, the aggregate Medicare allowed charges to general internal medicine by 2% in 2010 4the gain would have been 5% without the four-year transition of the high-impact practice expense change. Some internal medicine subspecialties, on average, also gain in 2010, with a 3% increase in allowed charges to geriatrics being the largest estimated bump. CMS estimates that the allowed charges for some internal medicine subspecialties, on average, will be unchanged in 2010 from their 2009 level. Some internal medicine subspecialties, on average, see a decline in allowed charges in 2010, with the 8% estimated decrease to cardiology being the largest. The CMS specialty impact estimates indicate the change in the total amount of allowed charges paid to all physicians identified by Medicare as practicing each particular specialty. Because the estimated impact per specialty ultimately results from changes in the payments for all of the services performed by physicians in that specialty, the impact can be highly variable within a specialty depending on an individual physician 9s mix of services. For instance, office visits and some other evaluation and management services gain substantially from the changes, while some procedures, such as many imaging procedures, would get reduced payments. An internist or internist-subspecialist who provides predominantly office visits will fare better than an internist or internist-subspecialist who furnishes more of the procedures that will receive reductions. Also, it is important to emphasize that the specialty impact estimates are not the result of a deliberate decision by CMS to help one specialty at the expense of another. Rather, it is the consequence of the use of new, more current data and other policy decisions. The CMS change to the practice expense component illustrates this point. Even though primary care physicians, on average, gain while some subspecialties, like cardiology, see reductions, this is because of a CMS decision to use data from a recent national survey to determine the practice expense RVUs. It is not a policy decision to increase payments to primary care at the expense of some subspecialists. Many other non-primary care specialties, on average, will also see gains over the course of the four-year phase-in, if not in 2010. Also, these changes have nothing to do with the health reform legislation being considered by Congress. In fact, more than 70 physician specialty organizations joined the American Medical Association in calling for a national survey intended to update the data used to determine practice expense RVUs in 2006 4long before the current health reform process began, Click here to view the complete specialty impact table that CMS published in the final rule. The CMS impact estimates do not include the 21.2% cut to the conversion factor that is scheduled for 2010 as a result of the flawed Sustainable Growth Rate (SGR) formula. The House of Representatives is expected to vote during the week of November 16 on a bill to repeal the SGR and replace it with a new update system that will yield higher updates than the current flawed SGR. While only Congress has the authority to override, modify, or replace the SGR formula, CMS took a significant, positive step using its regulatory authority by removing the costs associated with drugs that a physician-administers in the office setting from past and future SGR calculations. The details of this change, which has long been advocated by ACP and others, are unimportant. The long-term impact of the change, however, is extremely significant. Under the arcane rules that determine the amount that Congressional changes expend money from the U.S. Treasury, this change substantially lowers the cost of a Congressional fix to the long-standing SGR problem. This is a CMS change for 2010 that benefits all physicians. Changes to Practice Expense Payments Why did CMS decide to use data from a recent survey of physician practice costs to update practice expense payments for 2010? As background, CMS uses data on the cost of operating a physician practice to establish a practice expense per hour (PE/hr) figure for each Medicare-recognized physician specialty. The PE/hr figure plays a large role in determining the practice expense RVU assigned to each service. The practice expense RVU plays a large role in determining the payment amount as it accounts for, on average, about 44% of the total RVU assigned to each service. In the 2010 final rule, CMS stated its decision to use the PE/hr figures derived from the results of the recent practice cost survey conducted through the American Medical Association (AMA) to update practice payments. This AMA survey is referred to as the Physician Practice Information Survey (PPIS). The PPIS collected practice cost data from physicians in all specialties (and from non-physician practitioners). The AMA, with the assistance of a contractor, used the data from each specialty to calculate a PE/hr figure for each specialty. CMS showed confidence in the PPIS by purchasing the data and then stating its intent to use the PE/hr figures that resulted from it in the July 2009 proposed rule. The PE/hr figures help determine the pool of practice expense dollars available to be spread across the services that physicians of that specialty furnish. Thus, the PE/hr figures ultimately manifest in the form of changes to the practice expense RVU assigned to individual physician services. CMS cited the support and rationale from numerous specialties, including internal medicine, in explaining its decision to use the PE/hr figures. In responding to comments from those in opposition that there was a lack of transparency, the agency cited the AMA, the Lewin Group (a contractor), and CMS analytical work as it had done in July 2009 when it proposed to accept the PE/hr figures. In addition, the agency stated that AMA continues to conduct further analysis as requested by specialty organizations and that additional analysis has been conducted by CMS and is available on the agency 9s Web site. CMS concluded that it has found nothing to dissuade it from using the PPIS. While CMS did finalize its proposal to use the PE/hr figures from the PPIS; the agency decided to transition the changes over a four-year period: 25% in 2010; 50% in 2011; 75% in 2012; and 100% in 2013. The rationale for its transition decision is that there is precedent for phasing-in practice expense methodology changes and that the significant impact on individual physician services and, thus, specialties, warrants it. The comments that the agency received opposing use of the PE/hr figures played a role in the decision to phase-in the results. What does ACP think about the CMS decision to use and phase-in the PPIS PE/hr figures? ACP supports use of the PPIS PE/hr figures because we believe that data on physician practice expenses should be collected consistently across all specialties and be as up-to-date as possible. We also have called on CMS to have an open and transparent process to address concerns from specialty organizations, about the application of such data to the services provided by their members. The College support for use of the PPIS data is based on: " The practice cost data that CMS is using in 2009 are dated and were collected from multiple sources. CMS is using cost data collected in the mid-to-late 1990s for most physician specialties that were collected from a since-discontinued AMA survey. The agency is using data for 13 specialties that were collected through a survey conducted by the specialty organization for each. The data from these csupplemental surveys d were collected from 1999 through 2004. " Long-standing ACP support for an all-specialty survey of practice costs to update the data that CMS uses in its practice expense payment methodology. The College established this as an official policy statement in 2006. Also in 2006, more than 70 physician specialty organizations, including ACP, called for a new multi-specialty physician practice cost survey to be used to update the data used in the practice expense methodology. " ACP and other physician specialty societies had substantial input into the survey, through representation on a committee of physicians appointed by major specialty organizations. This organization, which is maintained by the AMA in conjunction with physician specialty organizations, advises CMS on RVU recommendations, and is known as the Relative-value Update Committee (RUC). The RUC has stated that the PPIS process was conducted in a cfair and consistent manner for all specialties. d In addition to indicating its support for using the PPIS PE/hr figures in 2010 in comments on the proposed rule, the College urged CMS to: " Be open to comments that individual specialties have about the application of the PPIS to their specialty; " Provide additional information, in a transparent and collaborative manner, to address such concerns; " Consider appropriate refinements in the practice expense RVUs that are derived from the PPIS, when justified based on further review of such comments from individual specialties; and " Provide a more robust discussion of the agency 9s decision-making regarding use of the PPIS survey data to enable all stakeholders to have a more complete understanding and confidence in the accuracy of the updated practice expense RVUs. Although ACP called on CMS to fully implement the PE/hr changes in 2010, CMS 9s decision to spread out the impact of the resulting payment changes, over a four-year transition, will ease the immediate adverse impact on some subspecialists, allowing them more time to plan for the impact on their practices. Such a transition could also provide those subspecialties with additional opportunities to continue a dialogue with CMS about the application of the PPIS to their subspecialty. Such a process potentially could result in further refinements during the transition, if supported by further analysis of the data, but ACP would be concerned if the transition resulted in changes that undermine the reasons for using the multi-specialty survey in the first place. It must also be acknowledged that the transition will delay and reduce the estimated average gains for some specialists, including general internists, even as it eases the immediate adverse impact on other specialists. Overall, ACP is pleased that CMS is using more current practice cost data in its methodology for determining practice expense RVUs as called for by College policy. Although ACP recognizes that the estimated 4% increase in general internal medicine aggregate allowed Medicare charges from the PPIS will be helpful to many ACP members, ACP 9s support for using the more current practice cost data (PPIS) was solely based on the need for the data for all specialties to be collected in a consistent and uniform manner and be as up-to-date as possible, not to ctake d money from one specialty or subspecialty for the benefit of another. When ACP joined with other specialties to call for the PPIS, it did so without knowing who would gain or lose as a result or what the impact would be on payments for specific services. Why did AMA conduct the PPIS survey in the first place? Recognizing the fact that not all specialties conducted supplemental surveys results in some data being more current than others and that data are from mixed sources, the RUC (which is described earlier) began petitioning for the survey to be conducted in 2005. In 2006, more than 70 specialty organizations, including the ACP and all of the internal medicine subspecialty organizations, told CMS that it was cimperative d to conduct such a survey as a basis for updating practice expense payments. Also in 2006, the Medicare Payment Advisory Commission (MedPAC), which advises the Congress on issues related to the Medicare program, indicated support for the need to update practice cost data for all specialties. After CMS expressed interest and nearly all specialty organizations agreed to contribute financially, the AMA decided to conduct the survey. Does ACP believe that the PPIS was conducted appropriately and produced valid data? ACP believes that the AMA took great care to design, test, and field the PPIS. Specialty organizations 4primarily through the RUC and its expansive Advisory Committee 4provided input and received updates throughout. The RUC, in its comment letter to CMS on the proposed rule, stated that the PPIS was conducted in a cfair and consistent manner for all specialties. d ACP agrees with this sentiment. CMS and an expert contractor, the Lewin Group, assisted with: the survey design, the methodology used to conduct the survey, and the programming to translate the survey data into the PE/hour figure for each specialty. We appreciate that CMS has shown great confidence by purchasing and using the PPIS PE/hr figures. Further, CMS cited the rigor of the process and reiterated that the PPIS is the best available data source in final rule. ACP recognizes, though, that a survey project of this inherent complexity can result in concerns regarding some data elements. This is why we urged CMS to address data concerns in an open and transparent manner in our comments on the proposed rule. The four-year transition period may create additional opportunities for CMS to engage in an open and transparent dialogue with some specialty societies that have raised concerns about the data as it applies to their specialty. What is the impact on internists? As noted above, the impact on internists is highly variable based on each physician 9s own mix of services. Because the law requires that CMS roughly maintain its expenditures on physician services consistent from one year to the next, using the PPIS data to update practice expense methodology redistributes payments within the physician payment pool. It does not increase the overall amount devoted to payment for physician services. While the PPIS-derived all-physician average practice costs increased from the all-physician amount derived from the data CMS uses in 2009, the PPIS PE/hour for some specialties increased significantly more than it did for others. While the PPIS is used to calculate the per-specialty PE/hour and CMS estimates impact of the updated PE/hour in the form of aggregate payments to each specialty, individual physicians experience the impact in the form of how the use of the PE/hr data affects payments for the individual services that they furnish. Use of the PE/hr figures increases the practice expense RVU, and, thus, the total payment, for many evaluation and management (E/M) services that are furnished by all physicians. Payments for some procedures and tests do decrease as a result of the data. Accordingly, the mix of services that a physician provides determines the precise impact. CMS includes an estimate of the 2010 impact of use of the new PE/hr figures for each specialty. Because CMS decided to implement changes that result from use of the PE/hr figures over a four-year period, the agency also provides the estimate of the impact for 2010 had this change been fully implemented in 2010. The remaining 75% of the change that results from the use of the PE/hr figures will be phased in over the period 2011-2013. CMS does not provide a specific estimate for the impact on specialties in each of these subsequent three years but the agency 9s estimate of the amount of the change in allowed charges if the changes were fully implemented in 2010 is a solid indication. The table below lists the CMS-estimated impact of the practice expense changes for 2010 for selected internal medicine specialties. Specialty Impact in 2010 of Practice Expense Change Transition Impact if Change Was Fully Implemented in 2010 General Internal Medicine 1% 4% Geriatrics 2% 6% Infectious Disease 0% 3% Pulmonary Medicine 0% 2% Hematology/Oncology -1% -5% Cardiology -5% -10% Did CMS make adjustments to its proposal in addition to the decision to phase-in the changes over four years? Yes. While these adjustments have a relatively small impact considering the magnitude of the updates to the PE/hr figures, they can have a significant impact on the RVUs assigned to specific services and, thus, on specific specialties. The CMS modification most relevant to internal medicine is directly related to hematology/oncology. CMS agreed with a comment from the American Society for Clinical Oncology (ASCO) that a law enacted in 2003 requires CMS to use the supplemental survey data from hematology/oncology. Accordingly, CMS will continue to use the PE/hr figure for hematology/oncology from the supplementary survey, instead of using the PE/hr from the PPIS. This slightly mitigates the decrease in practice expense payments to services commonly furnished by hematologists and oncologists, with CMS estimating that those 2010 aggregate payments to hematology/oncology will decrease 1% as a result of practice-expense changes. CMS estimates that hematology/oncology aggregate payments would have decreased 5% in 2010 if the agency did not phase in the new PE/hr figures over four years. Does that mean that ACP supports cuts in practice expense payments to some subspecialists, like cardiology? No, the ACP policies relating to practice expenses are not based on an intention to redistribute payments from one subspecialty to another, but on the need to have the practice expense RVUs based on the most recent data available, collected consistently across specialties. ACP has a responsibility to all internists, regardless of subspecialty. On issues where the impact varies so widely across our various internal medicine disciplines, we cannot advocate for one subspecialty over another. Instead, our responsibility is to ensure that payment changes are based on the most recent data available, developed with physician input, and that there is an open and transparent process to address any concerns about the data as it relates to any discipline. The position ACP took on the CMS implementation of supplemental survey data that it accepted from internal medicine subspecialty organizations demonstrates ACP adherence to the above principles. As background, a 1999 law directed CMS to consider practice cost data submitted by a specialty organization that supplements the data being used at that time. CMS established criteria that supplemental survey data must meet for the agency to accept them in 2000 and accepted data submitted by specialties for consideration until March 1, 2005. CMS considered the supplemental survey data that was submitted by specialty organizations on a rolling basis. The agency decided that the data submitted by each of the 13 specialty organizations met its criteria and moved to incorporate these data into its practice expense methodology at various points in time. CMS began to use the supplemental survey data submitted by the following internal medicine subspecialty organizations in 2007: allergy/immunology; cardiology; gastroenterology; and hematology/oncology. CMS use of these data increased the PE/hr for these specialties. ACP stated that it is reasonable for CMS to use these data beginning in 2007 in the College 9s comment letter in response to the agency 9s 2006 proposal. ACP took this position knowing that the gain experienced by specialties that benefited from the use of their supplemental survey data came at the expense of all other specialties, including general internal medicine and other internal medicine subspecialties, in the system that requires that aggregate practice expense payments remain stable from year-to-year. At this same time, the College also noted that use of the data from these and the other specialties from which CMS accepted supplemental survey data affirmed the need to conduct a single, all-specialty survey to update data in a comprehensive manner. ACP has confidence in the PPIS process and supports CMS use the PE/hour figures that resulted from it. At the same time, ACP recognizes that individual specialty organizations have concerns about the application of specific data elements from the PPIS to services provided by their members and how this will affect total Medicare payments for such services. While indicating support for the CMS proposal to use the PPIS data, the College also urged the agency to create an open and transparent process to address individual specialty organization 9s concerns about the application of the data to services furnished by their members. Did CMS change the rate at which the agency assumes that high-cost equipment, such as MRI or CT machines, is used? Yes. CMS decided to finalize its July 2009 proposal and increase the utilization rate that it assumes that equipment involved in furnishing services that costs more than $1 million to 90% in 2010, up from the 50% rate assumed in 2009. The use of a higher assumed use rate lowers the practice expense RVU for the services involving expensive equipment as it spreads the lifetime cost of the equipment over more units of service. Physicians who own expensive equipment will receive lower payments for these services. The csavings d that result from the lower payment for the affected services are redistributed in the form of a slight increase in payment for all other services. CMS states that the impact of this change is minimal on each specialty except for the negative impact on the few that commonly furnish services involving expensive equipment. ACP commented to CMS in support of an increase in the assumed utilization rate for equipment priced over $1 million. The College stated that it agrees that the current 50% assumption is far too low but noted that ACP had no way to independently assess the precision of the proposed 90% utilization rate. CMS cites work by MedPAC, including a survey of use of expensive equipment in selected markets, in support of its proposed 90% rate. The agency established the current 50% rate in 1997 without any specific equipment use information. ACP has long-standing policy urging CMS to review the equipment utilization assumption rate, with an emphasis on reassessing the rate pertaining to high-cost equipment. MedPAC and the RUC also consistently recommended an increase in the assumed rate to more accurately reflect the use of expensive equipment. MedPAC and other experts have documented how inaccurate payment rates impact the availability of services and affect utilization. The non-partisan Congressional Budget Office (CBO) has stated that the high acquisition cost for advanced imaging equipment, which is generally more than $1 million, provides a strong incentive to optimize the amount of time it is in use. ACP has believed it necessary to increase beyond the 50% as it distorts payments and incentives for services involving expensive equipment. ACP encouraged CMS to create mutually exclusive categories of equipment with different utilization rates after it takes this initial step of increasing the rate for high-cost equipment. The College also urged the agency to address whether equipment use varies by geographic area, especially for less expensive equipment. The College believes these steps would increase the accuracy of payments for all services that involve equipment. CMS did not address these ACP recommendations in its 2010 final rule. Sustainable Growth Rate Formula Issues What is the physician fee schedule update for 2010 required by the Sustainable Growth Rate formula? CMS states that it will reduce the 2010 conversion factor, which translates RVUs assigned to individual physician services into payment amounts, by 21.2% as a result of the flawed Sustainable Growth Rate (SGR) formula. ACP remains optimistic that Congress will replace this scheduled 2010 cut with a positive 2010 update while also providing a more lasting fix to the SGR problem. Did CMS take any steps toward fixing the flawed Sustainable Growth Rate formula system? While CMS is unable to eliminate the SGR, as that would take an act of Congress, the agency did make a technical change to the formula that is within its regulatory authority that represents a significant, positive step toward a lasting solution to the SGR problem. This technical change entails removing the expenditures on drugs that physicians administer in the office-setting going back to the inception of the SGR formula and for the future. Although this would not eliminate the untenable 21.2% SGR-induced payment cut slated for 2010 and only reduce the projected cuts in future years, it dramatically reduces the cost for the Congress to fix the SGR based on arcane rules used to determine the cost of Congressional actions. ACP commends CMS for this action 4which the AMA estimates restores $122 billion for physician services over the next 10 years. In addition, the College urges the agency to continue to work with the Congress to realize an enduring fix to the dire SGR problem. Payment to Physicians for Furnishing Consultation Services I understand that CMS went ahead with its proposal to no longer pay for consultation services? How can it do that? CMS finalized its proposal to no longer recognize the Current Procedural Terminology (CPT) codes describing office/outpatient and inpatient consultations starting January 2010 A physician will continue to be paid for a service during which he or she provides an opinion or advice back to a requesting physician, but will need to bill differently and, thus, will be paid differently. CMS instructs that physicians bill office consultations using the CPT office visit codes, 99201- 99215, and inpatient consultations using the CPT initial hospital care codes, 99221-99223. The money that CMS spent in 2009 to pay the CPT consultation service codes will be used to increase payment for office and initial hospital visit services 4the component of payment attributed to physician work has been increased by 6% for each office visit service and by 2% for each initial hospital visit service. While the impact on an individual physician depends on the mix of services he or she furnishes, CMS provides an estimate of the aggregate 2010 impact for each specialty that results from the agency no longer paying for the consultation service codes and modestly increasing the physician work RVUs for the office and initial hospital care services. CMS estimates that Medicare-allowed charges to general internal medicine will increase by 1%. Geriatrics, with an estimated 1% increase in allowed charges, is the other internal medicine specialty to gain. CMS estimates that a few internal medicine subspecialties will experience no aggregate change in allowed charges: allergy/immunology; hematology/oncology; and rheumatology. The agency estimates that the remaining subspecialties will experience a 1% decrease in allowed charges; gastroenterology is estimated to lose 2%. What position did ACP take on the CMS proposal? In its comment on the July 2009 proposal, ACP indicated that it could conditionally support CMS 9s concept of paying for consultations through the office and initial hospital care visits, with the increase in the work RVU assigned to these services resulting from no longer recognizing the consultation service codes, provided that CMS takes action to ensure that the physician work and complexity associated with consultative services is recognized through other E/M service codes and that the agency provides guidance on how to ensure such recognition occurs. As explained below, ACP 9s conditional support for the CMS proposal was based on evidence that confusion, inaccuracies, and lack of precision on coding for consultations was exposing internists to a high risk of audits and recovery, not based on an intention by ACP to redistribute payments from subspecialists to primary care. Regrettably, the final rule does not provide the guidance requested by ACP and, as a result, the College, in consultation with the internal medicine subspecialty organizations, is evaluating how best to achieve an outcome that ensures appropriate recognition of the work involved in consultative services, while reducing the risks of audits and recovery. That internists were at substantial risk of audits and recovery if CMS and its contractors determined that they were billing for the consultation codes incorrectly is the primary reason that ACP provided conditional support to CMS 9s proposal. Currently, internists and internist- subspecialists are facing a high degree of anxiety generated by threat of audit that stem from the inherent difficulty in accurately coding for consultation services and from a 2006 CMS policy cclarification. d The College has repeatedly urged CMS to rescind its policy clarification 4which expanded the agency 9s definition of when one physician transferred care to another 4as it overly restricts the ability to bill consultations. The College and others view this CMS policy as being at odds with common medical practice. ACP has sent multiple letters urging CMS to change the policy and limit the new audit exposure it generated. In addition, ACP worked with the AMA and other physician organizations as well as the Committee that maintains the CPT code book to engage CMS to resolve the situation in a manner acceptable to the agency and the physician community. These extensive efforts, which have spanned multiple years, have all failed to break the impasse. What clarifications and actions did ACP recommend to CMS? The guidance ACP provided to CMS in its comment letter on the proposal for addressing the important issues related to no longer recognizing the consultation service codes for payment purposes took the form of the specific recommended clarifications and actions described below. " ACP urges CMS to clearly articulate that the proposal would resolve the on-going discord between the agency and the physician community. " CMS should not increase the work RVUs assigned to procedures with 10- and 90-day global periods to reflect the higher work RVUs assigned to the office-visit service codes that results from the redistribution of RVUs that were assigned to the no-longer- recognized consultation services. " ACP urges CMS to publish the RVUs assigned to the CPT consultation codes because private payers may continue to use them. " CMS should clarify the following coding issues that result from its proposed change: o The expectation regarding the selection of a level of service for an inpatient consultation service to be billed using the initial hospital care service codes. o How to mitigate problems 4e.g. payment delays, record requests, denials 4 related to the submission of multiple, initial hospital care claims (from multiple physicians) when the admitting-physician does not use the new modifier that is required. o The uncertainty related to how Medicare would interact with other payers. " ACP recommends that CMS explore how to best recognize physician provision of high- end cognitive work, including by: o Educating physicians on when it is appropriate to bill critical care. o Educating physicians on appropriate use of the prolonged service codes. o Considering a mechanism that allows physicians to be paid a higher rate for some outpatient consultative services that involve a patient known to them. o Ensuring continued emphasis on optimal patient care through communication among physicians and providers caring for a patient, e.g. handoffs/handshakes; transitions. How did CMS respond to those who opposed its proposal to no longer recognize the consultation service codes for payment purposes? CMS vigorously defended its decision in the final rule. Responding to comments from those opposed to the proposal, the agency cited the long experience that shows inaccurate physician- billing of consultation services. It again cited that the disagreement between the agency and the physician community about what constitutes a consultation versus a transfer of care and stated that no solution is likely on the horizon. The agency elaborated on its statement that the work associated with office/initial hospital visits and consultations is cclinically similar. d It stated that the work involved for a specialist to treat a condition for which he or she is specifically trained and has experience is similar to work by physicians for office and initial hospital visits. To what extent did CMS address the ACP-recommended clarifications and actions? CMS failed to address the majority of ACP recommendations in the final rule. CMS stated that physicians will bill consultations as office and initial hospital visits using the CPT descriptions and Medicare documentation guidelines. The agency states that this is relatively straightforward. It infers that this will resolve audit concerns, but states that it generally does not discuss audit approaches and priorities as they are to promote program integrity. CMS decided to increase the work RVU for the office and initial hospital visits into 10- and 90- day global surgical period payments, essentially stating that it had to do so for consistency. It noted that the relative impact of this action is minimal. CMS stated that it has no control over the policy of other payers pertaining to the billing of consultations and essentially indicated that it is not the agency 9s concern. It stated that physicians need to know the policy of other payers and handle billing as they see fit. For instance, it stated that a physician would have to decide whether to bill a private primary payer an office visit instead of a CPT consultation service code so that Medicare would make a payment as a secondary payer. The agency noted that Medicare would deny secondary payment if the physician billed a consultation code to a private primary payer because Medicare does not recognize the consultation codes. CMS did not address the ACP recommendations for ensuring appropriate payment for high-end cognitive work. This does not preclude the agency from engaging in the educational efforts the College recommends, and ACP intends to reiterate these recommendations independent of the rulemaking process. CMS responded to comments expressing concern that the lack of requirement that the consultant submit a written report to the requesting physician, which is a byproduct of the policy to no longer recognize the consultation service codes, will adversely affect care coordination. The agency stated that it has seen no evidence that its past loosening of documentation requirements pertaining to consultations has harmed care coordination. It indicated that it would take any concerns that arise in the future as a result of its policy seriously. Is ACP concerned about how this proposal affects both internal medicine subspecialists and general internists? ACP strongly advocates for payment policies to ensure that all internal medicine disciplines, generalists and subspecialists alike, be adequately compensated for consultation and other services. Although all internists will benefit from the modest increase in payment for the non- consultative office and initial hospital visit services they furnish, ACP recognizes that this modest increase in revenue may not offset the reduction that results from CMS no longer paying for the higher-paid CPT consultation service codes for physicians who frequently furnish consultations. The actual impact of CMS policy change on each physician depends on the mix of services he or she provides. ACP shares the concerns by internists, generalists and subspecialists alike, that the final rule 4 which failed to address most of ACP 9s recommendations 4may not provide sufficient recognition of the physician work and complexity associated with consultative and other high- end cognitive services The College believes that the ability of physicians to be adequately paid for high-end cognitive work was limited prior to this CMS consultation service policy change and is now even more constrained in light of it. The College expressed this view to CMS 4and recommended actions to address it 4in the portion of its comment letter to CMS that identified actions the agency should take before implementing its proposal. Given that CMS did not accept many of ACP 9s recommendations, the College is committed to working with internal medicine subspecialty societies to determine how best to respond to the CMS policy. How is ACP working with internal medicine subspecialty organizations? ACP has put the issue of the CMS change to the consultation billing policy established through the final rule on the agenda for a College-convened advisory body of subspecialty organizations that meets on Nov. 20. ACP will be seeking ideas from the internal medicine subspecialty societies on how to respond to the CMS policy in a way that ensures appropriate recognition of high end consultations and other evaluation and management services yet reduces the exposure of internists to audit and recovery associated with billing for consultations. Other Issues in the 2010 Fee Schedule What decisions did CMS make on other issues that ACP deemed important enough on which to comment in the proposal rule? The information below provides a snapshot of the status of other issues addressed in the final rule: " CMS asked whether it should establish a panel of experts that the agency would use to help maintain the accuracy of RVUs assigned to services paid in the physician fee schedule in the proposed rule. The idea is that such a panel would supplement the work of the AMA/specialty society RUC. ACP urged CMS to establish such an expert panel as it is consistent with long-standing College policy. CMS declined to take any action toward establishing an expert panel in the final rule, noting that it will consider the comments it received 4which supported and opposed the concept 4as it continues to explore this issue. " CMS made numerous proposals to maintain and further the evolution of the Medicare pay-for-reporting incentive program, the Physicians Quality Reporting Initiative (PQRI), and the e-prescribing incentive program. ACP recommended a number of measures to improve each program. CMS incorporated some of the ACP recommendations into its final 2010 rules for these respective incentive programs. The College will provide materials to inform members about these changes and to facilitate their successful participation. " ACP supported the CMS proposal to increase payment for the cWelcome to Medicare d visit, a comprehensive preventive-oriented examination available to beneficiaries within 12 months of enrolling in Part B. CMS finalized its proposal and increased the payment for this under-used service by more than 40% from its 2009 payment level. " ACP supported the CMS proposal to implement the directive from Congress to gradually eliminate the punitive limitation on what Medicare pays for a physician service justified by a beneficiary 9s psychiatric diagnosis 4which results in higher beneficiary co- payments and, thus, out-of-pocket costs. CMS finalized this proposal consistent with its required implementation of the law. As a result, in 2010, the Medicare program will pay 55% for each service and the beneficiary will be responsible for 45%. The beneficiary is responsible for 50% in 2009 (and in the past). Complete Information on CMS Final Rule Decisions I am interested in reviewing the CMS final rule document. Where can I find it? The document 4an extremely lengthy 1,459 pages in the format in which CMS has initially released it 4is at http://federalregister.gov/OFRUpload/OFRData/2009-26502_PI.pdf . ACP Policy Making Process How did ACP develop its positions on the CMS proposed rule? How will it decide how to respond to the final rule decisions? The large amount of policy maintained by the organization plays a large role in determining the ACP positions. The ACP policy-development process, which involves a committee of College members with expertise in a certain area making recommendations on which the Board of Regents takes action, is referenced in more detail below. In some cases, it will fall to the ACP committee(s) with jurisdiction in an area to apply the College policy to specific proposals. An ACP Subcommittee with expertise on the physician fee schedule that is intended to be representative of College membership played a primary role in developing College positions in response to the CMS-proposed rule. The Subcommittee deliberations were informed by input from the ACP-convened advisory body of subspecialty organization representatives who have similar expertise. The parent Committee, which has expertise on payment policy issues, established the final ACP positions working from the recommendations of its Subcommittee. The Board of Regents is asked to make a final decision on issues for which a lack of sufficient policy basis exists. The College will invoke this same process in responding to the CMS decisions in the final rule. You make multiple references to how ACP policy dictated the position the College takes on an issue. How does the College develop policy? ACP policy is developed through the College Governance. The composition of the Committees, Board of Governors, and Board of Regents that comprise the Governance is largely reflective of the ACP membership. A detailed description of how ACP develops policy related to health reform legislation, available at http://blogs.acponline.org/advocacy/2009/08/how-acp- determines-its-positions-on.html , provides insight into the College policy development process.

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