CMS Final Payment Rule: 1.2% Increase for ASCs, 20.1% Cut for Physicians

Capitol BuildingThe Centers for Medicare and Medicaid Services released the final payment rule for physicians and ambulatory surgical centers last week.

Ambulatory surgery centers
The final rule packages payment for multiple supporting items and services into a single payment for a primary service, according to a CMS report. This is similar to the way Medicare pays for hospital inpatient care, with supporting items including drugs, biologicals and radiopharmaceuticals functioning as supplies when used in a diagnostic test or procedure.

The final rule includes a 1.7 percent increase for hospital outpatient departments and 1.2 percent increase for ASCs. CMS projects the increase to ASCs will boost overall Medicare payments to ASCs by $143 million.

According to an ASCA News report, the 1.2 percent increase is based on a 1.7 percent projected rate of inflation minus a 0.5 percentage point productivity adjustment, which is required by the Patient Protection and Affordable Care Act.

"While we are pleased to see a slight increase in our payments over the proposed rule, sequestration will still result in a negative update for ASCs in 2014 unless Congress acts. As usual, we are extremely disappointed that CMS continues to undervalue ASC payments by using the CPI-U to update them, a factor that even their own actuaries believe is inappropriate," said ASCA CEO Bill Prentice in the report.

In addition to releasing the final payment rule, CMS also finalized three new quality measures in the proposed rule which will impact payment in 2016, with data being collected next year. The quality measures relate to endoscopy/polyp surveillance and cataract surgery.

Additionally, CMS now defines quality reporting exemptions for smaller facilities as ASCs with fewer than 240 Medicare claims per year.

Physicians
The final rule for Medicare's physician fee schedule will reduce payments to physicians by 20.1 percent for Medicare patients. The pay cut is based on the sustainable growth rate. The proposed rule, released in March 2013, slashed payments 24.4 percent to make up for previous overrides of the SGR.

Members of Congress are currently working on temporary and permanent fixes — and alternatives — to SGR. The American Medical Association has called to repeal the SGR.

The final rule will expand payments for physicians who use telehealth services, including sites designated as health professional shortage areas. Additionally, the final rule addresses physician quality reporting initiatives associated with Medicare payments. There are 57 new individual measures and two group measures for the Physician Quality Reporting System.

CMS expects to Medicare payments to physicians to total $87 billion in 2014 overall.

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