2014 Medicare Physician Fee Schedule Final Rule / 2014 Hospital Outpatient Prospective Payment System Final Rule
Overview: Final 2014 Rules for Medicare Physician Fee Schedule and Hospital Outpatient Prospective Payment System
The Centers for Medicare and Medicaid Services (CMS) has issued the Final Medicare Physician Fee Schedule (MPFS) rule for calendar year 2014. Under the rule, physicians would face a -24 percent cut in each and every service provided to Medicare beneficiaries beginning January 1, 2014, unless Congress acts by the end of this year to halt the cut.
Under the 2014 fee schedule, there will be a one percent overall payment increase for cardiovascular services. This increase is largely seen in echocardiography services while relative value units for other services are cut. There will be a -2 percent cut in overall payment for radiology services.
The final MPFS rule did not include any new multiple procedure payment reduction policies for imaging services. The final rule also did not include the CMS proposal to cap physician practice expense payment for procedures furnished in a non-facility setting, at the total payment rate for the service when furnished in an Ambulatory Surgery Center or hospital outpatient setting. However, it is likely CMS will re-visit this proposal.
Under the Hospital Outpatient Prospective Payment System (HOPPS) rule for 2014, CMS finalized its proposal to create separate cost centers for all CT and MR services, apart from the standard radiology cost center. These new cost centers, upon which payment rates will be based moving forward, will result in substantive cuts in technical component payments for Cardiac CT services. For example, the national average Ambulatory Payment Classification (APC) payment for cardiac CT services in APC 0383 will be $222.01 in 2014, down from $267.20 in 2013. This includes CPT Codes 75572, 75573 and 75574. The average national payment for calcium scoring (in APC 0340) will be $53.44, up slightly from the 2013 average payment of $49.64.
In addition, CMS will now pay the same for all outpatient clinic visits, no longer recognizing different levels for evaluation and management services. Instead, there will be a single code and payment for clinic visits. This consolidation of evaluation and management services into one level would not apply to emergency department visits, but CMS stated it will look further at coding and payment in the emergency department setting in future rulemakings.
For 2014, CMS finalized five new categories of supporting items and services that would be subject to packaged payments. For certain cases, a separate payment would be made if the item or service is furnished on a different date of service as the primary service. The five final categories are:
(1) Drugs, biologicals, and radiopharmaceuticals that function as supplies when used in a diagnostic test or procedure;
(2) Drugs and biologicals that function as supplies; when used in a surgical procedure;
(3) Certain clinical diagnostic laboratory tests;
(4) Certain procedures described by add-on codes;
(5) Device removal procedures.
CMS did not include packaging for diagnostic tests as originally proposed.
More information about the MPFS and HOPPS rule will be posted on the SCCT website pending further analysis of the payment impacts. We will also post an Issue Brief to provide more detail about CMS’ final proposal for the new CT cost center.
Medicare Payment Reform Developments
December 23, 2013
UPDATE - Medicare Payment Reform Legislation
The House Ways and Means Committee and the Senate Finance Committee have taken important steps in the move to repeal the flawed Sustainable Growth Rate (SGR) formula that serves as the underpinning of Medicare physician payment.
While the Ways and Means bill would provide a 0.5 percent positive payment update through 2016, with a freeze from 2017 – 2023, the Senate Finance Committee legislation would place a freeze on Medicare physician payment for 10 years.
As of now, there is no word on how the SGR repeal will be paid for, but there is always the potential for policy changes that would affect specific sectors of health care. SCCT will keep you apprised of action by the full House of Representatives and the full Senate when they convene in 2014 to consider these reform proposals. Be assured we will oppose any further reductions in imaging to pay for overall Medicare payment reforms.
Temporary Halt to Medicare Payment Cuts through March 2014
Before Congress adjourned for the year, both the House and Senate approved a 0.5 percent positive update to Medicare physician payment for the first three months of 2014. This action staves off the -24.1 percent cut that was slated to take effect on January 1, 2014, for each and every service provided to Medicare beneficiaries. This action allows the full House and Senate to complete consideration of pending Medicare reform legislation.