Incentives for primary-care doctors under Medicare's proposed physician fee schedule for 2011 won't be enough to offset larger reimbursement woes, industry members say.
Bonuses won't balance Medicare cuts: docs
With a potential 30% cut to their payments looming in January—contingent upon congressional intervention to prevent it—some doctors are skeptical about new bonuses the proposed rule has outlined. Any incentive the federal government can provide to doctors is worthwhile, but "the shortage of new primary doctors is so great that these increases alone cannot turn the tide,” says Fred Ralston, M.D., an internist in Fayetteville, Tenn., and president of the American College of Physicians.
The payment system as constructed “does not truly reflect the services provided by primary-care doctors," Ralston says. Individuals who have complex medical conditions "require a great deal of time and resources outside of the office visits, which are not compensated.”
Issued late last month, the rule seeks to implement a number of provisions in the new health reform law, such as eliminating out-of-pocket costs for most preventive services and establishing an incentive payment for primary-care providers and for surgeons practicing in health professional shortage areas. Public comment on the regulations ends Aug. 24.
For primary care, the reform statute “provides for incentive payments equal to 10% of a primary-care practitioner's allowed charges for primary-care services under Part B" of Medicare, the proposed rule stated. Surgeons in turn get a similar boost: Their incentive payment equals 10% of the fee schedule payment for surgical services provided by a general surgeon.
"Improving access to preventive services and primary care is a top priority for HHS," Secretary Kathleen Sebelius said in a written statement following the rule-making's release.
Some of the provisions show signs of progress, physician groups indicated in initial comments. The American Medical Association in particular was pleased that the CMS intended to update the Medicare Economic Index to reflect current costs, AMA chair Ardis Hoven, M.D., says in an e-mail. The MEI is a measure of inflation used in tandem with the sustainable growth-rate index to set physician payments.
The current MEI “is woefully outdated and understates the growing gap between Medicare payments and the cost of caring for seniors,” Hoven states.
The AAFP estimates the bonus program will assist at least 50% of its members but wishes the incentives had a broader reach. The incentive would apply only to primary-care or preventive codes, meaning that family doctors conducting lab work or minor surgery would not have their work properly valued or reimbursed, AAFP President Lori Heim, M.D., says. The AAFP plans to work with the CMS “to try to expand the list of codes so those doctors feel included,” she says.
Whatever bonuses the proposed rule is offering, however, some physicians feel the elephant in the room—a proposed 6.1% cut to Medicare payments starting Jan. 1, 2011—would crush whatever benefits those incentives provide. That reduction is in addition to a projected 23.5% cut that's scheduled to kick in on Dec. 1, provided that Congress doesn't act. Medicare's sustainable growth-rate index has been the catalyst for these cuts, with Congress stepping in over the years to stop the reductions.
Even the CMS is worried the impending cuts will force doctors to reduce the size of their Medicare patient pool. "We are very concerned about the impact the continuing uncertainty about payment rates and cash-flow disruptions may have on physician practices and on beneficiary access to physicians' services," says Jonathan Blum, deputy administrator and director of the CMS' Center for Medicare. Although more than 97% of physicians have chosen to participate in Medicare for 2010, “We are hearing more stories of physicians limiting the number of beneficiaries they will see,” Blum says.
Editor's Note: Watch an interview with Blum by Modern Physician Editor David Burda.
Although she says she's encouraged by Blum's acknowledgment of a Medicare access problem, Heim cautions that these practice patterns are likely to filter into Medicaid—especially when the reform law's Medicaid coverage expansions go into effect in 2014. Doctors won't trust the payment schedules enough to take any new patients covered by any of these public insurance programs, she predicts.
The rulemaking will affect not only the patient base in practices, but also the services doctors are providing, imaging services in particular.
Under a new provision in the proposed rule, equipment utilization rates for imaging services such as CT scans, MRIs and PET scans would be set at 75%. The CMS had previously set the equipment utilization rate for this equipment at 90%, “which assumes that if you own equipment priced at more than $1 million, you're going to be utilizing it 90% of the time,” says Pam Kassing, senior director of health policy with the American College of Radiology. Reducing the utilization rate means that per-scan reimbursement will decrease for providers, she says.
Another change involves the rules under which physicians can offer on-site imaging services. Physician practices that offer CT scans, MRIs or PET scans in their offices are currently exempted from physician self-referral laws. That exemption will stay intact; however, the proposed rule would require that doctors offering these services in-house notify patients that they may receive the same services from other suppliers in the area. The physician would also have to provide a list of alternative suppliers.
Send us a letter
Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.