AANEM News Express

AANEM News Express

Yet Another Temporary Patch to SGR...and ICD-10 delay


Repeal SGR FormulaOn March 31, 2014, the Senate passed the House’s temporary patch to the SGR, the Protecting Access to Medicare Act of 2014. It passed despite a late effort by Senate Finance Committee Chairman Ron Wyden (D-Ore.) to pass a permanent fix to Medicare’s sustainable growth rate (SGR) formula funded by savings from the drawdown of the war in Afghanistan.

Assuming the President signs the legislation, this will be the 17th such patch to the SGR. The patch extends the current 0.5% update for Medicare payments to physicians through the end of 2014 and provides a freeze at 0.0% from January to March 2015.

The Protecting Access to Medicare Act also includes a delay in the implementation of the ICD-10 for “at least one year.” The inclusion of this provision has incensed many in the healthcare industry who have already completed or begun the process of preparing for the changeover.
However, other healthcare groups see this as a small victory. The American Medical Association and several other medical associations have been vocal about their concerns about the necessity, feasibility, and expense of ICD-10 implementation. It is unclear exactly why this provision was added to the bill, but there is speculation that it was a last-ditch effort by Congress to appease the groups opposed to ICD-10.
Finally, the bill also includes a partial, six-month delay of the enforcement of the “two-midnight rule,” which uses length of inpatient stay to determine whether a Medicare admission was legitimate.

Related News

SGR Repeal in Jeopardy

News item from 3/12/14

Following recent bi-partisan agreements, it seemed likely that the sustainable growth rate (SGR) would be repealed permanently. However, this week’s announcement from House leaders indicate their plan to instead vote on a bill that pays for SGR repeal by delaying the implementation of the Affordable Care Act’s “individual mandate” to purchase health insurance.* This approach is not supported by the Democratic majority in the Senate or President Obama.

In response to this, leaders in the Senate intend to vote on a bill similar to the original bi-partisan proposal to fully repeal the SGR formula agreed to by the House and Senate. This bill contains other provisions that are not supported by both parties, so it’s doubtful it will pass in its current form.

A congressional recess is scheduled for the week of March 17, leaving only one week of legislative action before the temporary SGR fix expires on April 1. If a compromise is not reached by then, it will automatically trigger the scheduled 23.7% physician reimbursement cut that was avoided by the three-month temporary patch.

If legislative leaders cannot reach agreement on a bill and payment mechanism to permanently repeal the flawed SGR formula by April 1, they will more than likely pass another temporary nine-month patch to stop the physician reimbursement cut from taking effect.

AANEM staff continues to monitor these developments, and will keep you updated as more information becomes available.

*The House leaders’ plan captures the savings needed to repeal SGR because the federal government will not have to pay its share of premium subsidies since individuals and families would not be required to purchase insurance.

Breaking News: SGR Agreement Reached

News item from 2/6/14

Later today, House and Senate leaders have signaled they will release details on a bipartisan proposal that will fix the Medicare physician payment formula for the next 5 years.

While full details have yet to be shared, AANEM staff has learned that the proposal includes a .5% positive payment update for Medicare payments and gives physicians more time to develop and implement alternative reimbursement models.  

“We are pleased that the original proposal to freeze physician payments for 10 years has been discarded in favor of this modest increase,” said Kathleen Micheletti, government relations director.  

Once the proposal has been released, AANEM staff will provide additional updates and analysis of the legislation.

Senate Passes Bipartisan Budget Deal

News item from 12/19/13

Late Wednesday afternoon, the Senate voted to pass the bipartisan budget deal approved last week by the House. As reported earlier, this legislation includes a temporary three-month Sustainable Growth Rate (SGR) fix that, if not passed, would have triggered an automatic 23.7% physician reimbursement cut on January 1, 2014. 
The legislation passed in the Senate is identical to the House language, and includes the 0.5% reimbursement increase for Medicare providers until March 31, 2014. This short time period gives Congress a small reprieve in order to pass a permanent repeal of the flawed SGR formula. The President is expected to sign the bill into law by the end of the week. 
AANEM will continue to monitor the progress of the proposed SGR legislation as it moves through the legislative process, and will provide updates as they become available.

House Passes Bipartisan Budget Deal

News item from 12/13/13
Late Thursday, the House of Representatives passed a bipartisan budget deal that sets overall maximum discretionary spending limits for 2014 and 2015. This deal averts another potential government shutdown and also includes a temporary three month sustainable growth rate (SGR) fix. 
This three month patch prevents the 23.7% reimbursement cut that would have gone into effect on January 1, 2014, and also gives a 0.5% reimbursement increase through March 31, 2014, to Medicare providers. This was done primarily to give Congress another three months to try and approve legislation in early 2014 that would permanently eliminate the current SGR funding formula. There has been momentum building to accomplish this--both the Senate Finance Committee and the House Ways & Means Committee approved their versions of SGR repeal legislation earlier this week. 
The Senate is expected to vote on this budget deal on Tuesday of next week.  

AANEM contintues to monitor these fast-moving developments, and will keep you updated as more information becomes available.

Budget Proposal and SGR Update

News item posted on 12/12/13
A bipartisan budget deal introduced this week includes an extension of the 2% Medicare payment reduction that went into effect as part of sequestration, extending these cuts two years or until 2023. If approved, the agreement would put the budget process back on track.
Lawmakers are considering using the budget deal as a means to extend the current Medicare sustainable growth rate (SGR) by three months, as well as extending the geographic price cost indices (GPCI), both of which determine Medicare reimbursement rates.  This plan would freeze the Medicare conversion factor at the 2013 rate of 34.0230 and will extend the current GPCI rates until a full repeal of the SGR can be further discussed in early 2014.
Both the Senate Finance and House Ways and Means Committees passed the SGR bill out of committee today. The full House is expected to vote on the budget deal, which includes a three month SGR fix, before Friday.  
Congress also has indicated a willingness to work with CMS to identify and implement processes to reduce the burden that multiple payment incentives and/or penalties are placing on physicians.  Identifying and testing alternatives to the Fee-For-Service reimbursement model, including proposals for specialty care, will be a top priority in 2014.
The proposed budget agreement comes at the end of an unproductive legislative year and, while bipartisan in nature, may face stiff opposition from party loyalists on both sides of the aisle.  The bill is set for House action this week with an anticipated vote in the Senate early next week.
AANEM expects the budget negotiations to remain fluid over the next several days and will provide updates as they become available.

SGR Repeal Update

News item posted on 12/9/13
AANEM has learned the Senate Finance Committee is scheduled to discuss repealing and replacing the Medicare SGR formula on December 12. No details about the meeting have been posted and representatives for Sen. Max Baucus (D-Mont.), the committee chairman, could not be reached for comment. Baucus and ranking minority committee member Sen. Orrin Hatch (R-Utah) have said that budgetary offsets for an SGR replacement would be addressed separately.

If no action is taken, the Congressional Budget Office has calculated that the physicians' Medicare payment will be slashed by 23.7% on Jan. 1.

Congressional Leaders’ Bipartisan Proposal to Repeal SGR

News item posted on 11/05/13
Last week leaders in the Senate and House released a draft bipartisan proposal to repeal the sustainable growth rate formula (SGR) and replace it with a new Medicare physician payment system that rewards quality and efficiency. It expands on existing value-based performance models that provide incentives or penalties to providers based on how well they perform compared to peers.
“We were concerned that the recent government shutdown, as well as other looming budget issues, may have sidelined discussions to permanently repeal the SGR,” said Kathleen Micheletti, government relations director. “This proposal is a positive sign that Congress is committed to fixing this problem once and for all.”
Deal Must be Reached by January 1
If a permanent solution is not reached by January 1, Medicare physician payments will be cut by approximately 24%. A key stumbling block in past attempts to repeal the formula has been the significant price tag. However, the Congressional Budget Office recently estimated the cost of replacing the program at $139 million, an amount much lower than in past budget cycles. (In comparison, Congress has spent almost $150 billion on short-term fixes to the formula over the past decade.)
Highlights of the Proposal
The proposal was released as a discussion draft, meaning specific legislative language is not yet available. However, here are some highlights of the bipartisan plan:
  • The SGR formula is permanently repealed. 
  • Physician payments are frozen at current levels until 2023. After that, positive payment updates will be available starting in 2024. Providers participating in alternative payment models would receive a 2% increase, with others receiving 1%.
  • New value-based performance models that build on current programs such as meaningful use and physician quality reporting systems (PQRS) will be available starting in 2017. Provider payment rates will be adjusted either up or down depending on how they score relative to others on a composite performance scale.
  • In an attempt to improve upon the accuracy of physician payments, specific codes that have been identified as “misvalued”  would be adjusted to reach 1% in total fee schedule savings. To help in gathering data to identify these codes, the Health & Human Services (HHS) Secretary can require selected physicians to submit data, or face a one-year, 10% payment reduction. Also, in response to recent media scrutiny, the Government Accountability Office is directed to study the AMA RUC process and how it reaches its recommendations on physician service values.
  • It requires appropriate use criteria in regards to advanced imaging and electrocardiogram services.  Prior authorization would apply to providers identified as outliers in compared to their peers.
  • It directs the HHS Secretary to publish utilization and payment data for physicians on the Physician Compare website. 
Proposal’s Impact on Physician Payments
One item of particular concern is the proposed 10-year freeze on physician payments.
“In light of the recent cuts to EMG and NCS reimbursement, we will need to carefully study the effects this proposal will have on our members,” said Catherine French, MAPL, senior analyst of medical economic affairs.
AANEM staff will continue to monitor all developments related to the SGR legislative debate, and will report new information as it becomes available.

Government Shutdown Affects Final Decision on Reimbursement Cuts

News item posted on 10/24/13
On Wednesday, October 23, the Centers for Medicare and Medicaid Services (CMS) announced that the partial government shutdown will impact its completion of the review of the 2014 Medicare fee-for-service payment regulations, which includes the final decision on the recent cuts to EMG and NCS services.

According to its news release, CMS intends to issue the final fee schedule rules on or before November 27, 2013. The original release date was scheduled for November 1. 
The impacted regulations include:

  • Revisions to the Physician Fee Scheule (Part B Medicare)
  • Changes to hospital outpatient payments (HOPPS)

AANEM staff will continue to monitor any further developments on the release of the Medicare Fee Schedule Final Rule and will report information as it becomes available.

Members Present at CMS Refinement Panel

News item posted on 8/21/13
On Tuesday, August 20, AANEM partnered with several other associations to present arguments to the Centers for Medicare & Medicaid Services’ (CMS) refinement panel in response to last year’s reimbursement cuts for EMG and NCS services. Peter Grant, MD, spoke on behalf of AANEM, and other participants included Neil Busis, MD (AAN); Marc Nuwer, MD (ACNS); and Scott Horn, MD (AAPMR).
“Our speakers did an excellent job describing the work and medical decision making that goes into performing EDX services,” stated Shirlyn A. Adkins, JD, executive director.
The speakers asked CMS to return the EMG and NCS codes being reviewed to the RUC-recommended RVUs. “We realize the RUC values are lower than what we believe is fair and adequate reimbursement, but it was unlikely CMS would consider higher values,” noted Adkins.
The refinement panel will submit a recommendation to CMS on whether or not to adjust the current value of EMG and NCS codes to the higher relative value units (RVUs) previously recommended. However, even if the panel makes a positive recommendation, any change in the values is left to the discretion of CMS. “Typically, CMS accepts the refinement panel’s decision about 30% of the time,” noted Catherine French, MAPL, senior analyst of medical economic affairs. “We will need to continue working with CMS on correctly valuing reimbursement rates for all EDX services.”
AANEM members are encouraged to join President Peter Grant, MD in an upcoming webinar, where he will share information about the refinement panel process. Time will be allotted for member questions. The details and webinar registration will be available soon.
CMS is expected to announce its final decision about the EMG and NCS codes’ values in the 2014 Medicare Fee Schedule Final Rule, which will be released on November 1, 2013.  AANEM staff will continue to monitor all proposed Medicare fee schedule discussions and share information as it becomes available.

AANEM Leaders Prepare for CMS Refinement Panel

News item posted on 8/13/13
On Tuesday, August 20, AANEM representatives will present arguments at the Center for Medicare & Medicaid Services’ (CMS) refinement panel on nerve conduction study (NCS) codes. Reimbursement for NCS and electromyography (EMG) codes was drastically reduced last year. The AANEM, in collaboration with several related organizations, has pushed to receive a refinement panel hearing since the cuts took effect.

“We are grateful to have a seat at the table and offer a voice in the conversation with CMS from our members,” said Shirlyn A. Adkins, JD, executive director.

However, AANEM will only be allowed to present arguments on the issue of NCSs. Per CMS procedure, it determines who the two presenting associations and two related societies will be that speak on each code.

“Despite the fact that AANEM is the premier society related to electrodiagnostic medicine and has met with CMS on several occasions, we were initially left off the list of both presenting and related groups for both EMG and NCSs,” stated Adkins. AANEM immediately contacted CMS to rectify the mistake.

Fortunately for the AANEM, the American College of Physicians declined CMS’ invitation to present on NCS, so AANEM secured that spot. President Peter Grant, MD, will represent AANEM on the NCS issue before the panel. (See list of the revised presenting societies.)

Despite not having an “official” seat at the table on the EMG codes, AANEM is still very involved in the process. The staff is working with AAN, AAPMR, ACNS, and the APTA to make the best argument for the panel. “AANEM will be well represented on the call,” noted Catherine French, MAPL, senior analyst of medical economic affairs. “Neil Busis, MD, former president, will speak on behalf of AAN for both EMG and NCSs, and Marc Nuwer, MD, member, will speak on the EMG codes representing ACNS.”

“We are not relying on the refinement panel to solve this issue," noted Kathleen Micheletti, government relations director. "Even if the panel recommends an increase, CMS can ignore the recommendations. We believe follow-up meetings with CMS will be the most important piece of our advocacy efforts.”

AANEM will inform members of the panel’s decision when it becomes available.

EMG Refinement Panel Participants
Presenter 1: American Academy of Neurology (AAN)
Presenter 2: American Clinical Neurophysiology Society (ACNS)
Related 1: American Academy of Physical Medicine & Rehabilitation (AAPMR)
Related 2: American Academy of Otolaryngology - Head and Neck Surgery (AOA)

NCS Refinement Panel Participants
Presenter 1: American Academy of Neurology (AAN)
Presenter 2: AANEM
Related 1: American Physical Therapy Association (APTA)
Related 2: American Academy of Physical Medicine & Rehabilitation (AAPMR)


Proposal to Repeal SGR Formula

News item posted on 7/29/13
This week the House Energy & Commerce Committee is expected to pass the “Medicare Patient Access & Quality Act.” This bipartisan legislation repeals the sustainable growth rate formula (SGR); provides for a five-year period of stable, positive physician payment updates; and, beginning in 2019, adds an additional performance payment based on the current physician quality reporting system (PQRS). Also contained in this draft are provisions for the development of different payment models that a physician could choose if they opted out of the new reporting requirements. We anticipate further changes to this proposal as it continues to move through the legislative process. 
After the anticipated full committee vote on Wednesday, July 31, Congress will begin its annual August recess. Further action on this legislation will not occur until later this fall. AANEM staff continues to monitor this issue closely, and will keep you updated on its progress. 

AANEM Submits Comments on Proposal to Repeal SGR

News item posted on 6/17/13
Recently, there has been a flurry of legislative activity around the proposed repeal of the sustainable growth rate (SGR) formula. Both the Senate Finance Committee and the House Subcommittee on Health have held recent hearings and have solicited feedback from the health care community on how to reform the physician payment system.
The AANEM submitted comments on these issues. Proposals include mandating that only trained neurologists or physical medicine and rehabilitation physicians perform EDX evaluations, while also considering using board certification or electrodiagnostic laboratory accreditation as a basis for Medicare reimbursement. 
View the Letters
AANEM Response to House Subcommittee on Health (PDF)
AANEM Response to Senate Finance Committee (PDF)

Hearing on June 5, 2013

News item posted on 5/31/13
As anticipated, Republican leaders in the House have released their plan to repeal the sustainable growth rate (SGR) formula. A hearing on this draft legislation is being held on June 5, 2013.

Their proposal builds on the feedback they have received from physicians and other health care community stakeholders over the past several months. It repeals the SGR formula and replaces it with a modified fee-for-service system. The new system eventually will develop quality measures intended to increase efficiency and improve the quality of patient care.  

Under this plan, providers could be eligible for bonuses above their fee-for-service payments if they meet certain quality-of-care and efficiency standards. This approach also will give added influence to medical societies, as they will be involved in the creation and monitoring of these measures.  

View the bill (PDF)

“We are pleased to see the continued momentum towards repealing the SGR formula,” said Kathleen Micheletti, government relations director. “We also appreciate the involvement of physicians and medical societies in the development of any future payment models.”

Repealing the SGR formula has been a top priority for Congress this session, and AANEM staff will continue to keep you updated on this legislation as it moves through the process. 

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