Wednesday, July 8, 2009

CMS' proposed payment shift

It looks like a boost to primary-care physicians could come at a cost to their higher-paid specialist brethren. CMS’ proposed 2010 physician fee schedule released last week would cut rates for specialists and imaging services, shifting the pay to primary care.

Organizations have been parsing through the regulation to see just how deep the cut would be for each specialty (cardiology: 11 percent, for example), while CMS says the regulation would increase payments to general practitioners, family physicians, internists, and geriatric specialists by 6 percent to 8 percent.Read more
To do this, CMS would eliminate payment for consultation codes, which are billed by specialists and paid at a higher rate than E&M codes. CMS says “resulting savings would be redistributed to increase payments for existing E&M services.” CMS would also refine practice expenses and revise malpractice premiums.

Overall, physicians’ payments would be slashed by a whopping 21.5 percent under the proposed regulation.

That is, unless Congress enacts legislation reversing the cuts, a strong possibility. The rates are updated each year based on the sustainable growth rate, which has yielded reductions for the last eight years. But, Congress has stepped in to avoid the cuts each year. (Meanwhile, specialists’ groups say they will lobby lawmakers to stop the cuts, according to the Wall Street Journal.)

Our own Pamela Moore addressed the threat of cuts last year and what docs should do if they are considering reducing their Medicare mix.

What do you think? Is this an effective way to close the pay gap between primary-care docs and specialists? Is this another sign the Obama administration is serious about primary care?

The regulations also included perhaps some good news for all. CMS proposed removing physician-administered drugs from the formula used to calculate the fee schedule, which has been long advocated for by the AMA and MGMA. (Cost hikes for outpatient drugs in recent years have outpaced other services, pushing spending levels above the target, according to AMA.) It wouldn’t prevent the 2010 reductions, but it would mean fewer years of negative updates.

All of that said, CMS is accepting comments until Aug. 31 and a final rule will be issued by Nov. 1. Congress, your move.


  1. So interesting that CMS chooses to support preventive care this way (they did the same last year). Paying more for sick care (E&M visits) is one thing. But the real benefits would come from paying for preventive care.
    Right now, Medicare beneficiaries get their Intro to Medicare Exam and an occasional pap smear, prostrate exam, and vaccines.
    So many physicians also provide an annual exam but code it as a E&M visit since there are no annual exams under Medicare.
    Now, the actual clinical value of an annual exam merits an entire separate post. If we are to pay for it, it should do some good, based on clinical evidence.
    Still, the general perception is that Medicare doesn't really cover lots of basic services.

  2. Many physicians and managers alike are ignorant of the fact that evidenced based medicine, PQRI, preventive care and family centered home are all basically the same. They are trying to get physicians out of the habit of giving mediocre care so they will give GOOD care and get better medical outcomes. It's not complicated either. They know it's better to pay for an ABI today than to wait until the patient has to have a toe removed and pay for catastrophic care. Unfortunately, less than 5% of the primary care physicians are capturing the P.A.D. today. Ditto with Diabetic Autonomic Neuropathy and the fact that 22% of asymptomatic diabetics have silent ischemia. We can take it a step further and look at PQRI number 3 (physicians should routinely do orthostatic BPs) and we find that less than 5% routinely do them UNLESS there is a symptom the physician recognizes and most of the time - there isn't one. So - when the doctors and their managers realize that evidenced based medicine is here to stay and WILL be a part of any new health plan - maybe they'll wake up and also realize that this brings increases in the doc's annual net (profit) income of more than $200,000 per year for the average doc seeing 24 patients a day (if 40% are Medicare).

    Don Self

  3. Don- There is no evidence that seeking out silent ischemia in diabetics saves lives, nor that routine ABI's save legs. Don't confuse good EBM with bad.

    The way to pay for preventive care is to take the profiteering by insurance companies out of medicine. People are up in arms about Exxon's profits when they sell gasoline at a price cheaper than bottled water but don't flinch at the billions that Blue Cross/Aetna/UHC make by limiting care and denying insurance to needy people. What is wrong with that picture???