CANCERSCAPE Session to Demystify Site-Neutral Payment Policy

By Amanda Patton, ACCC Communications

In recent months MedPAC, the Centers for Medicare & Medicaid Services (CMS), Congress, and the GAO have ramped up attention on the impact of consolidation and integration, shifts in sites of service, and how unequal payment rates across settings of care are affecting Medicare costs.

Adding to the controversy (and confusion) around site-neutral payment as a solution to reducing the Medicare “spend” is the recently passed Bipartisan Budget Act of 2015 at Section 603, “Treatment of Off-Campus Outpatient Departments of a Provider.”

Although the issues surrounding site neutral payment policy are complex, “Section 603 is pretty straight forward,” says Ronald Barkley, MS, JD, of the CCBD Group. “It’s the downstream unintended consequences that cancer programs need to understand.” In a session at the upcoming ACCC Annual National meeting in Washington, D.C., March 2-4, Barkley will demystify site neutral payment policies, lay out pros and cons, and provide a realistic assessment of the potential impact of Section 603. Attendees will leave with a 360-degree understanding of the issues and a “knowledge base to work from” going forward, Barkley said.

Site-neutral payment policies have the potential to affect revenue and budgeting, strategic planning, pro forma development, and 340B Drug Program participation. Thus, a thorough understanding of Section 603 is critical for today’s cancer program leadership.

Time is of the essence, according to Barkley. “There is a window of opportunity to take your message to CMS before [the agency] translates the [Section 603] legislation into regulation.”

Attend the ACCC 42nd Annual Meeting, CANCERSCAPE, from March 2—4, 2016, in Washington, D.C., and gain strategic insight into key drivers of change impacting our evolving oncology care delivery system in sessions focused on Policy, Value, and Quality. Learn more here.  Want to discuss this issue with your elected representatives on Capitol Hill? See what’s planned for ACCC Capitol Hill Day on March 2.

 

2016 Medicare Payment Rules Finalized

By Maureen Leddy, JD, Manager, Policy and Strategic Alliances, ACCC

The Centers for Medicare & Medicaid Services (CMS) on Oct. 30, 2015, released the final 2016 Physician Fee Schedule and Outpatient Prospective Payment System rules. With the exception of radiation therapy codes, the final rules align quite a bit with the proposed rules. A preliminary summary is included below. Stay tuned for detailed summaries and analysis on an upcoming ACCC members-only conference call on these 2016 final rules.

Highlights of 2016 PFS Final Rule

Radiation Oncology

In a noteworthy departure from the proposed 2016 PFS rule, CMS did not finalize new radiation therapy treatment payment codes. CMS responded to concerns expressed by ACCC and other stakeholder groups and delayed implementation of new radiation oncology codes, continuing use of current G-codes and values for 2016. However, the agency did finalize its proposal to increase the linear accelerator equipment utilization rate assumption from 50 percent to 70 percent over two years. CMS continues to seek empirical data on costs and usage of capital equipment, including linear accelerators.

Advance Care Planning

For 2016, CMS finalizes its proposal to establish separate payment for advance care planning services, consistent with the recommendations of the American Medical Association and other stakeholders, including ACCC. These new codes compensate providers for shared decision-making conversations at various stages of a patient’s illness.

Biosimilars

For 2016, CMS finalized its proposal to include all biosimilars of a reference biological product within the same billing and payment code. ACCC had commented against this proposal, raising concerns regarding traceability and administrative burdens expected with the use of a single code. While ACCC supports efforts to increase patient access to biologics, ACCC maintains that a system must be in place to track the specific biosimilar product used for each patient.

“Incident To”

CMS finalized its proposal to clarify requirements for billing for “incident to” services. CMS now formally requires that the physician or practitioner billing for “incident to” services must have directly supervised the auxiliary personnel providing these services. Addressing stakeholder concerns about the treating physician’s supervisory role in “incident to” services, the final rule clarifies that the supervising physician need not be the treating physician for billing purposes.

Highlights of 2016 OPPS Final Rule

CMS finalized its proposed cut in hospital outpatient payment rates of – 0.3 percent. Within this calculated –0.3 percent rate update is a –2 percent cut, applied due to the agency’s calculation of excess packaged payment for laboratory services in 2014. As a result of this year’s rate cut due to miscalculations in packaging policies, ACCC urged CMS to proceed cautiously with any additional packaging proposals to ensure future negative adjustments would not be necessary. However, CMS finalized its proposal to expand conditionally packaged services to include three new APCs: level 4 minor procedures, and level 3 and 4 pathology services. CMS notes that packaging of these services is consistent with the agency’s overall packaging policy.

Advance Care Planning

ACCC had also advocated for separate payment under advance care planning codes in the hospital outpatient setting. The 2016 OPPS final rule calls for conditionally packaging payment for these services, permitting separate payment in the hospital outpatient setting in limited circumstances.

Biosimilars

In the 2016 OPPS final rule, CMS finalized its proposals to pay biosimilars based on ASP+ 6% of the reference biologic product, and to allow biosimilars to be eligible for pass-through status. ACCC supported these proposals, noting that providing equivalent payment rates in the physician office and outpatient setting for biosimilars removes incentives to select one setting over another.

Two-Midnight Rule

CMS also finalized proposed changes to its two-midnight rule regarding hospitalization payment status. CMS will now allow certain patients not expected to meet the two-midnight stay requirement for inpatient status to still be classified as inpatient. CMS indicates that qualifying patients are those that require inpatient hospital care, as determined by the admitting physician and supported by the medical record, despite the expectation that their stay will last less than two midnights.

ACCC continues to analyze the 2016 payment rules and will update its members in the coming weeks.

 

Key Takeaways from NCCN Summit on Value, Access, & Cost of Cancer Care

By Maureen Leddy, JD, Manager, Policy and Strategic Alliances, ACCC

On September 11, 2015, the National Comprehensive Cancer Network (NCCN) convened healthcare experts for a policy summit on “Value, Access, and Cost of Cancer Care.” ACCC policy staff was in attendance, along with a host of provider and patient organizations. The summit explored methods to achieve optimum cancer patient care while considering rising care costs, and NCCN’s work groups on Value, Access and Cost also reported their findings. Some key takeaways follow.

Views on Value

The discussion on value centered on appropriate measures for value from the patient, provider, and payer perspectives. Panelists generally agreed that a broader view of healthcare is necessary to assess value. This includes consideration of the continuum of care, rather than just a specific episode of care. The full cost burden of cancer care on patients must also be addressed, and may include employment, caregiver, and housing and transportation issues.

Access Issues

Panelists explored access issues, focusing on the growing demand for cancer care services and its impact on access. Health exchange plans were identified as a source of disparate care, in that enrollees choose plans based on cost and then, upon cancer diagnosis, are faced with inadequate provider networks and prescription drug coverage. The discussion also touched on recent legislation driving providers to value-based reimbursement, and projected impacts on patient access to academic cancer centers. For the employer-insured population, one panelist commented on a shift to contracts with specific hospitals for second opinion and potential treatment of specific malignancies.

Cost Control

Among potential methods for curbing costs, panelists cited caution in use of high-cost diagnostics, treatments and therapies; avoidance of hospitalizations and emergency room use; and increased emphasis on palliative and end-of-life care. The panel noted that savings in provider care costs are possible, particularly through increased care planning and patient navigator uptake.

In discussing the cost of anti-cancer therapies, panelists pointed out that oncology is unique in that there is currently maximum use of generics with little opportunity for shifting to lower-cost prescription drugs until the further introduction of biosimilars. While drug costs make up just 15% of cancer care costs, they represent the fastest rising cost in cancer care. The panel acknowledged the challenges to containing prescription drug costs, and noted that some pharmacy benefit managers (PBMs) are looking to employ an indication-based formula for drug pricing, reimbursing for drugs by value and differentiating claims by condition. In the context of biologics, greater approval and high usage rates of biosimilars will be important to cost containment in the coming years.

The policy team at ACCC will continue to engage in this discussion of rising cancer costs and challenges in patient access to care.

Continue the Conversation

Join ACCC in Portland, Oregon, Oct. 21-23, at the 32nd National Oncology Conference and continue the conversation in sessions that will explore issues of value, cost, and patient access to care including:

Patient Access and the Cost of Cancer Care Across Specialties
Peter B. Bach, MD, MAPP, Center for Health Policy and Outcomes,
Memorial Sloan Kettering Cancer Center

What Will It Take? Must-Haves for Alternative Payment Models
Erich Mounce, MSHA, The West Clinic, PC

Palliative Care Models: Solutions for Programs of All Sizes
Moderator: Michael Kolodziej, MD, FACP, Aetna; Amy J. Berman, BS, RN, The John A. Hartford Foundation;
Sibel Blau, MD, Northwest Medical Specialties; and Brad Smith, Aspire Health

The full conference agenda and registration information is available here.

 

ACCC Responds to CMS on Proposed 2016 PFS Rule

By Leah Ralph, Manager, Provider Economics and Public Policy, ACCC

On September 8th, ACCC submitted comments on CMS’ proposed 2016 Physician Fee Schedule rule. This year, the proposed PFS was released later than usual and contained a number of provisions that ACCC will be watching closely in the coming months.

Read on for a quick roundup of major provisions and ACCC recommendations to CMS:

Radiation Oncology Cuts

CMS proposes several significant changes to payment for radiation oncology procedures that would collectively result in drastic cuts for radiation oncology providers – an estimated 3% for radiation oncology and 9% for freestanding radiation therapy centers. CMS is proposing payment rates for new CPT codes that would effectively reduce Medicare reimbursement for IMRT and other radiation treatment delivery services. The agency also proposes to remove several essential direct practice expense inputs from the new radiation treatment delivery codes, including the on-boarding imaging equipment that is essential to providing safe and accurate radiation treatment. Finally, CMS proposes to adjust the equipment utilization rate assumption for the linear accelerator used in image guidance from 50% of available time to 70% of available time over two years, reducing reimbursement for services that make use of that equipment.

In our comments, ACCC expressed significant concern to CMS that these deep, simultaneous cuts in radiation oncology reimbursement will have the effect of forcing some cancer care providers, particularly those operating in rural and underserved areas, to close their doors. ACCC urges CMS to take the necessary steps to mitigate this threat, for example, by not implementing the proposed increase in the equipment utilization rate. ACCC will be monitoring this closely and stands ready to work with CMS to find ways to implement any appropriate changes over a period sufficient to allow providers to absorb the changes while not compromising access to critical radiation oncology services.

 Biosimilar Reimbursement

CMS proposes a payment methodology for biosimilar products in which all biosimilars with the same reference product would be assigned a single HCPCS code and reimbursed based on the volume-weighted average sales price (ASP) for all products under the code plus 6% of the reference product’s ASP.

ACCC asks CMS not to finalize this proposal. We expressed concern that assigning multiple biosimilar products a single HCPCS code would create new and unnecessary administrative burdens for physicians and other providers when treating patients with biosimilar products, as they would not only need to enter the HCPCS code into the medical record, as they do now, but also the specific biosimilar therapy used for the patient. Additionally, this approach could significantly impede effective tracking of safety information and other information about the patient experience with specific biosimilar products—after these enter the market. We urge CMS to promote effective tracing of safety information and to minimize administrative burdens on providers who prescribe biosimilars.

 Advance Care Planning

CMS proposes to establish payment rates for the two CPT codes adopted by the AMA CPT Editorial Panel to describe advance care planning services. ACCC strongly supports this proposal and asks that the payment rates for these services adequately reflect the cost to physicians of providing advance care planning.

As ACCC believes advance care planning services are equally important in the hospital outpatient setting, where they also take substantial time and resources and contribute significantly to the quality of patient care. In our comments to the proposed 2016 Outpatient Prospective Payment System rule, we urged CMS to pay separately for these two CPT codes in the outpatient setting as well.

Chronic Care Management

CMS recognizes that Medicare’s payment rates for the CPT codes for transitional care management (TCM) and chronic care management (CCM) do not fully account for the cognitive work that primary care physicians and other practitioners perform in managing and delivering care, particularly to chronically ill beneficiaries. CMS identifies add-on codes as one potential means of establishing payment rates that appropriately value the additional time and intensity of physicians’ cognitive work often involved in delivering care management services. ACCC encourages CMS to develop such codes, and to work with ACCC and other provider organizations to ensure that any new add-on codes are structured and valued appropriately.

ACCC also has concerns related to CMS’ proposal for chronic care management in the 2016 OPPS proposed rule. On the hospital outpatient side, CMS is proposing to permit only one hospital to bill for CCM services during a calendar month. ACCC points out to CMS that because cancer care is highly multidisciplinary, it can be difficult to agree upon who should be the designated CCM physician, and we are concerned that CMS’ rules for these services already make it very difficult for hospitals to seek payment for them. We urge CMS to continue to consult with hospitals and physicians on the best way to determine which entities should bill for these services.

“Incident To” Services

CMS proposes to require that the physician or other provider who bills for an “incident to” service must also be the physician or other provider who directly supervises the auxiliary personnel in providing that service. If CMS were to finalize this proposal, ACCC urges the agency to provide education to physicians and other providers on the revised requirement to ensure providers do not experience unwarranted disruption in billing for appropriate “incident to” services.

CMS is expected to finalize the 2016 Physician Fee Schedule rule in late October. Stay tuned, as ACCC will keep members updated as CMS revises and finalizes these important proposals.

Proposed 2016 Medicare Rules

By Leah Ralph, Manager, Provider Economics and Public Policy, ACCC

The Centers for Medicare & Medicaid Services (CMS) 2016 proposed rules are out, and, not surprisingly, we continue to see the agency push outpatient payments toward more bundled services and move full steam ahead to tie Medicare payments at large to quality and value in the coming year.

2016 HOPPS Proposed Rule

Generally speaking, the proposed Hospital Outpatient Prospective Payment System (OPPS) rule includes few surprises, most notably CMS is proposing a -2% across-the-board reduction to compensate for “excessive” packaged payments for laboratory services in CY14. The rule also includes nine new comprehensive ambulatory payment classifications (C-APCs) to add to the 25 introduced last year and proposes consolidation and restructuring of nine APC clinical families. Importantly, CMS will continue to reimburse drugs at ASP+6% in the hospital outpatient department. The agency also provides some flexibility on the “two-midnight” rule. Currently the rule requires that a beneficiary to remain in the hospital for longer than two midnights in order for the stay to be reimbursed as an inpatient stay. Under the proposed rule, CMS would recognize some shorter stays as inpatient, and would evaluate on a “case-by-case” basis.

 2016 PFS Proposed Rule

The proposed Physician Fee Schedule (PFS) rule was released later than expected this year, perhaps due to slightly more contentious provisions. The good news – perhaps – is that, as proposed, the 2016 PFS would have no (0%) impact on Medicare payments in hematology/oncology. However, on the radiation oncology side the news is not so good. If all of the proposals in the rule are finalized, radiation oncology will face an estimated -3% cut and freestanding radiation therapy centers will see a -9% cut due to a combination of new code values and a change in assumption involving the overall use of linear accelerators. CMS also indicates how it will treat biosimilars for the purposes of Part B reimbursement, proposing to assign the same HCPCS code to all biosimilars that reference the same innovator drug. These would be paid based on their volume-weighted ASP+6% of the reference product’s ASP. If no ASP data is available, biosimilars would be reimbursed at 100% of their wholesale acquisition cost.

Under the PFS, CMS also proposes to create two new CPT codes for advanced care planning services, one to start the conversation with a patient and the other for continued discussion. The rule also begins the phasing out of the PQRS (the 2018 payment adjustment will be the last); adjustments for quality reporting will now be made under the new Merit-Based Incentive Program (MIPS), created by the legislation that repealed the Medicare Sustainable Growth Rate (SGR). CMS seeks comments on MIPS on issues like the definition of clinical practice improvement activities, how to define a physician-focused payment model, and more.

ACCC will be submitting comments on both rules, due August 31 and September 8, respectively. On Tuesday, July 21, 4:00-5:00 PM EST, ACCC is hosting a members-only conference call with a full rundown of both proposed rules. Stayed tuned.

 

2015 Proposed Rules: Not So Bad?

By Matt Farber, MA, Director of Provider Economics & Public Policy, ACCC

On July 3, 2014, the Centers for Medicare & Medicaid Services (CMS) released the 2015 proposed rules for the Hospital Outpatient Prospective Payment System (OPPS)  and the Physician Fee Schedule (PFS), and ACCC is busy poring through the documents in order to get the most pertinent information out to our members as soon as possible.  Look for complete summaries of both rules from ACCC shortly, and ACCC members be sure to dial in to our conference call on the proposed rules on Wednesday, July 23^rd at 2 pm ET.

At first glance, we can say the 2015 proposed rules do not appear to include as many drastic changes as in previous years.

For example, the proposed 2014 OPPS rule contained proposals to collapse all E&M codes, package drug administration services, and other packaging proposals, which–had they all been implemented—would have meant significant changes for oncology. In the end, while CMS did finalize the proposal to collapse E&M codes, the agency did not finalize all of the packaging proposals. Now, for 2015, the agency is proposing to increase packaging and composite APCs; however, drug administration is not included in that list. That being said, we know that CMS still wants to study drug administration, so we do not believe that changes to that area are necessarily off the table.

Another interesting proposal for 2015 has to do with off-campus departments of hospital outpatient departments (HOPDs).  Last year, CMS stated that it wanted to collect data to determine if payments made to “off-campus facilities,” often practices that have recently been purchased by a hospital and converted to a HOPD, are justified at different rates.  For 2015, CMS is proposing to require that all services rendered in these off-campus departments be billed with a modifier, so that the agency can study the issue and potentially make changes in the future.

Finally, in the 2015 proposed OPPS rule, drugs are still scheduled to be reimbursed at ASP+6% in the HOPD. So it appears that the ACCC’s years of hard work on this issue have continued to pay off.

On the Physician Fee Schedule side, there is the continuing issue of the sustainable growth rate (SGR)—but this is no surprise. Once again, under this flawed formula, there is a scheduled cut to physician reimbursement of 21%. And once again, this most likely will not go into effect, as Congress will step in later this year or early next year with yet another (hopefully long-term!) “doc fix.” Under the proposed PFS, medical oncology is slated to receive a 1% increase, which is always better than a negative number.  On the other hand, radiation oncology would not fare as well, with larger cuts scheduled for radiation oncology and radiology.

While at first look, it may appear that the 2015 proposed rules put forth less onerous issues than in prior years, ACCC will still be submitting comments to CMS with our concerns, and we encourage you to submit comments as well.  Once ACCC’s comments are completed, ACCC will post them in the Advocacy section of the website, and members can use these as a template, if desired. CMS is accepting comments on these rules until Sept. 2, 2014.

Meanwhile, ACCC encourages all members to join us with your questions on the July 23 members-only conference call.  For more information, please contact Matt Farber at mfarber@accc-cancer.org.

Will 90-Day Rule Leave Providers Holding the Bag?

By Sydney Abbott, JD, Manager, Provider Economics & Public Policy, ACCC

Implementation of the Affordable Care Act (ACA) is bringing many changes to the healthcare system, including the establishment of health insurance exchanges and new requirements for insurance coverage.

Health insurance exchanges (also known as health insurance marketplaces) provide an option for patients to purchase health insurance outside of employer-based plans and are a step toward the goal of universal coverage. However, because all plans offered through an exchange must meet minimum health benefits and satisfy other insurance reforms, such as a cap on annual benefits and coverage for young adults, individual plan premiums on the exchanges are often more expensive than patients expect. This could lead–and in some cases, has already led–to missed premium payments.

In the event of a lapsed premium payment for individuals enrolled in a federally facilitated exchange (FFE) plan, the ACA gives patients 90 days to become current on any past payments before insurance coverage is terminated. The ACA replaces all existing state laws with the 90 day rule. The rule applies to all consumers, in all states, who purchase subsidized coverage through the FFE health insurance marketplace.

How the 90-Day Rule Works

Here’s how the 90-day grace period works. After the first premium is made, patients have 90 days to pay the next premium. If the patient doesn’t pay the premium for the second month, the insurer can hold all claims. At the end of the third month, if the patient still has not paid, the insurer may terminate the policy.

Unfortunately, there is one wrinkle in the 90-day rule that is concerning for providers. This issue only applies to those individuals who receive tax subsidies to purchase insurance through the FFE insurance marketplace. In this instance, if a consumer still fails to make a payment after 90 days and his or her coverage is dropped, insurers are not required to pay for claims incurred during the last 60 days of the grace period. This means that if coverage for these patients is dropped for nonpayment, physicians must work directly with the patients to collect payments for the balance incurred during days 31-90 of the grace period.

While this issue only applies to individuals who receive tax subsidies to purchase insurance through the federally facilitated insurance exchanges, providers need to know that patients’ insurance cards will not include information on whether or not the patient is receiving subsidies. Claims unpaid the 31st through the 90th day may be pended by the insurer. If the enrollee never pays his or her share, the claim is not payable by the insurer.

Chilling Effect?

During a recent House Energy & Commerce Oversight and Investigations Subcommittee hearing, insurers were asked about health insurance marketplace enrollment and premium payment by enrollees. Representative Michael Burgess (R-TX) and other subcommittee members expressed concern over the 90-day grace period and the chilling effect it may have on provider participation in exchange plans.  Insurance company executives testifying at the hearing assured the subcommittee that adequate systems are in place to give physicians the ability to determine patient payment and eligibility status. Industry representatives said call centers, and in some instances online applications, are available for premium payment verification. However, premium status policies vary by company and so providers and their staff are left with a complex process for determining a patient’s status. At the conclusion of the hearing, the Oversight and Investigations Subcommittee remained concerned that this information is not readily available to healthcare providers  who might ultimately be left unreimbursed for care already provided.

ACCC agrees with the concerns expressed by House Energy and Commerce Subcommittee members and urges Congress and the Administration to work together to require more easily accessible and real-time patient status data to be available to providers. ACCC has submitted a letter to the Administration about this issue and continues to work with members of Congress to raise the volume.  We will keep members posted on any developments on the 90-day grace period.

School Is Out for the Holidays—But Cancer Programs Still Have Coding Homework

by Bonnie Kirschenbaum, MS, FASHP, FCSHP

This year, due to the federal government shutdown, the final Outpatient Prospective Payment System (OPPS) rule was released at the end of November—so cancer programs have less time than usual to prepare for changes that will go into effect on Jan. 1, 2014. Last week, ACCC held a conference call for members with analysis of the final 2014 OPPS and Physician Fee Schedule (PFS) rules. And it’s clear from the call that cancer programs have plenty of homework to do.

Here are 5 things to do for 2014, organized by OPPS payment category.

1. New drugs not yet assigned unique Healthcare Common Procedure Coding System (HCPCS) codes. When an injectable drug first comes to market and has pass-through status, it may not yet have a HCPCS code assigned to it. Instead, it will be paid for at 95% of average wholesale price (AWP) using code C9399, unclassified drugs or biologics, along with the National Drug Code (NDC) number of the drug.  Homework: This coding procedure and payment rate remains for 2014, but you must report the NDC to identify the drug.

2. New pass-through drugs with HCPCS codes. If a new drug is assigned a HCPCS code at or after FDA approval, it must be used. No payment will be made if the miscellaneous unclassified code persists in your system. Homework: Scour your files to remove and replace miscellaneous codes.

3. Specified covered outpatient drugs (SCODs) costing more than $90 per day. This reimbursement “basket” is where the majority of drug payment lies and where most drugs land once their pass-through status expires. Accurate billing is critical for these drugs. Homework: Make sure HCPCS codes, billing unit assignments, and conversions from actual dose given to billing units submitted are faultless!

4. Lower-cost packaged products costing less than $90 per day. There is no separate reimbursement for these products; payment for them is included in the bundled payment for the specific procedure or visit for which they were used. However, they must be billed as separate line items to ensure adequate payment for the bundle and, if they were administered as infusions, to ensure payment for drug administration (which is available separately from the bundle). Homework: Keep on documenting and billing for these drugs!

5. Drugs with pass-through status. The usual annual reworking of pass-through drugs resulted in 14 drugs and biologicals losing their pass-through status effective Dec. 31, 2013. Interestingly, only 9 of these products will be separately paid for in 2014, and 5 no longer will be separately reimbursed (see Table 32 in the final OPPS rule). Drugs and biologicals keeping or newly assigned pass-through status (see the list of 26 in Table 33 in the final OPPS rule) will have their pass-through payment rates reviewed on a quarterly basis with payment adjustment as needed. Homework: Several 2014 HCPCS codes have changed, as well as the status indicators which will indicate whether or not there is separate payment in 2014. Ensure that these HCPCS code changes are part of your IT systems.

Of course payments will be reduced by approximately 2% for as long as sequestration remains in effect. Counteract this by ensuring accuracy in the areas discussed above!

ACCC members can access an archived conference call and analysis of the 2014 Medicare rules here. Look for an in-depth discussion of the rules in your January/February Oncology Issues.

Bonnie Kirschenbaum, MS, FASHP, FCSHP, is a healthcare consultant and columnist, and serves on the editorial board for ACCC’s Oncology Drug Reference Guide.

Speaking Up: ACCC Expresses Concerns in Comments to Proposed Rules

By Matt Farber, MA, Director Provider Economics and Public Policy, ACCC

On Friday, September 6, ACCC formally submitted comments to the Centers for Medicare & Medicaid Services (CMS) on the 2014 Physician Fee Schedule and the Hospital Outpatient Prospective Payment System proposed rules. ACCC has numerous concerns about proposals included in each of the rules, and the public comment period is an important opportunity to voice those concerns.  If CMS does not hear from organizations such as ACCC, the agency may believe that its proposals will not adversely impact community oncology.  Some of the key issues we focused on in our comments are outlined below.

Physician Fee Schedule.  In its comments, ACCC asked that CMS:

• Work with Congress to develop a long-term fix to the Sustainable Growth Rate (SGR) formula and avert a 24.4 percent reduction to the conversion factor in 2014;
• Work with ACCC to study the issue of payment for services rendered in off-campus hospital-based departments;
• Apply adjustments to the work relative value units (RVUs) instead of the conversion factor to reflect changes in the Medicare Economic Index (MEI);
• Exercise caution when reviewing codes it identifies as potentially misvalued;
• Implement the proposal to create a new G-code for complex chronic care management services that meet certain standards; and
• Not implement the proposed cap on PFS non-facility payments using facility rates calculated under the Hospital Outpatient Prospective Payment System (OPPS) or Ambulatory Surgical Center (ASC) payment systems.

ACCC has great concern about the proposal to cap the PFS payments using rates from the hospital outpatient department  or ambulatory surgical center settings. Our concern is that, for some codes, CMS is reducing payments based on procedures that are rarely given in certain sites of service. CMS also proposes to apply the cap when as little as five percent of the total volume of services are furnished in the hospital outpatient setting. Analysis of the proposed rates indicates that CMS often set the cap using ASC rates, even though the volume of services in that setting was far below five percent. This extremely low threshold does not help ensure that the capped rates accurately reflect typical costs for providing the service in either the physician office or facility setting. Further, when the Medicare Payment Advisory Commission (MedPAC) recommended that CMS cap certain hospital outpatient payments at the rates applicable in physician offices or ASCs, it recommended a threshold of 50 percent of claims in the setting used to establish the cap to ensure that payment rates are sufficient to protect access to care.  ACCC believes that CMS’s proposal is unnecessary, and we are asking the agency to provide justification for its choice of site of service for setting payments.

OPPS Proposed Rule. ACCC asks that CMS:

• Implement the proposal to reimburse hospitals for the acquisition cost of separately payable drugs at ASP+ 6%;
• Make separate payment for all drugs with HCPCS codes, or, at a minimum, not increase the packaging threshold for drugs;
• Not implement the proposal to change the calculation for payment rates of computed tomography (CT) scans and magnetic resonance imaging (MRI);
• Not implement the proposal to consolidate clinic and emergency department evaluation and management (E&M) codes from five levels to one level; and
• Not implement the proposal to expand packaging for additional items and services until the agency corrects the significant errors and inconsistencies in the proposed rates, provides opportunity to comment on the corrections and clarifications, and reviews those comments.

In the 2014 proposed OPPS rule, CMS made some drastic moves to increase the amount of bundling in the hospital outpatient department. ACCC believes that the proposals will adversely impact cancer care. Of particular concern are proposals for the consolidation of E&M codes, changes to the calculation for payment rates of CT and MRI, and additional packaging of drug administration services. Added to these concerns is the fact that ACCC and other organizations believe there are significant errors in the proposed rates. We fear that these errors would further decrease reimbursement to critical areas of oncology care. Included with ACCC’s comments are memos from numerous experts that echo the same concerns about the validity of the data. The Hospital Payment Advisory Panel (HOP) agreed with ACCC and other stakeholders at its meeting last month, and recommended that CMS delay its proposals until the agency could verify these data. At a minimum, ACCC asks that CMS delay these proposals. Ultimately, however, it is our hope that CMS will listen to the stakeholders’ concerns and opt not to implement many of the packaging proposals.

We are reminded, once again, of the importance of public comments to these proposed rules. Unless ACCC and other organizations submit comments to CMS, these issues might never have come to light. If you are interested in learning more, or possibly submitting comments in the future, please contact me at mfarber@accc-cancer.org

Is SGR Replacement in Sight?

By Sydney Abbott, JD, Manager, Provider Economics and Public Policy, ACCC

It is a truth universally acknowledged that the sustainable growth rate (SGR) formula, which the Centers for Medicare & Medicaid Services (CMS) uses to determine annual physician reimbursement rates for services provided, is fundamentally flawed. Because the formula is designed to ensure that the annual increase in the expense per Medicare beneficiary does not exceed the growth in GDP, providers are facing a 25% reduction to reimbursement for 2014, unless Congress takes action.  Historically, Congress has stepped in at the last minute each year to avoid such enormous cuts.

This year, however, there are signs that the SGR may be on the way out—permanently.

In February the Congressional Budget Office (CBO), in its annual report on the federal budget and economy, drastically reduced the cost estimate to repeal the SGR formula—down from $245 billion to less than $140 billion over 10 years, a relative bargain in congressional terms. During the intervening months, Congress has been wrestling with legislation to replace the SGR formula. On July 31 the House Energy and Commerce Committee voted unanimously in favor of a bill that would do just that.

The Medicare Patient Access and Quality Improvement Act of 2013 (HR 2810), eliminates the current SGR formula and replaces it with a two-phase approach to physician reimbursement.  Phase one stabilizes reimbursement with a 0.5% update to the Medicare fee schedule conversion factor annually for five years. Starting in 2019, phase two begins with 0.5% updates to the conversion factor. In phase two, these updates could be positive or negative—depending on the ability of an individual provider or group of providers to reach pre-determined quality measures or clinical improvement activities.

While ACCC applauds the bill’s aim to replace the flawed SGR formula with stable payments and incentive updates, we are concerned that HR 2810 does not replenish the pool of available funds with savings realized annually by CMS.  HR 2810 requires CMS to identify services it overpays and reduce those payments by 1% each year from 2016 to 2018 (RVU reductions).  However, the bill contains no language calling for CMS to redirect that money back into services it designates as undervalued.  Without this direction, it could mean that the total payment pool would be smaller and planned reimbursement increases might never materialize.

HR 2810 currently awaits a full floor vote with 40 bi-partisan co-sponsors.  ACCC will continue to work with legislators to help ensure that legislation passed will appropriately reimburse physician services.  ACCC will keep members up to date on any developments.