The new practice expense rates that were recently issued by CMS use accurate data from a rigorous survey supported by more than 70 medical and healthcare professional groups, and they begin a long-needed correction that should remain untouched by Congress. The new practice expense rates recognize that overhead costs differ among physician specialties and rely upon data that was independently corroborated by a respected third-party survey firm.
“For most specialties, CMS had been using practice cost data that was at least a decade old and does not accurately capture the relative costs faced by different physician practices today,” David W. Parke II, MD, CEO of the AAO, said in the release. “The new rates level the playing field by using sound data gathered from all specialties at the same time. We are pleased that CMS used strong, scientifically valid evidence to determine fair and accurate physician practice expense rates.”
The latest practice expense data are based on a new Physician Practice Information Survey conducted in 2008 under strict methodology as outlined by CMS. The results were validated by The Lewin Group, an independent survey firm. CMS’ implementation of reimbursement rates based on the new practice cost data ends four years of losses by many specialties that began in 2005, when CMS adopted external data from only a few specialties, according to the release.
CMS corrects the previous imbalances in its 2010 Final Fee Schedule rule but will phase in the new practice expense data over a four-year period. In their own words from the rule, CMS calls PPIS “the most comprehensive, multi-specialty, contemporaneous, consistently collected PE data source available.”
The data alone does not result in more payments to physicians, but a redistribution of the payment pool based in part on the practice expense data, according to the release.
The survey design and methodology had the wide support of medicine and other healthcare professional groups, including funding from CMS and the AMA. Medical and healthcare groups were not alone in calling for new practice expense data. The Medicare Payment Advisory Commission and the Government Accounting Office had called for CMS to update data for all specialties.
Read the release on CMS’s practice expense update.
