On July 3, 2014, the Centers for Medicare and Medicaid Services (CMS) released proposed regulations updating the Medicare Physician Fee Schedule (PFS) for 2015. The proposed rule also covers quality reporting initiatives for physicians, including the Physician Quality Reporting System (PQRS) and the physician Value-Based Modifier program.

Finally, the rule contains several areas of particular interest to AAOS members, including the elimination of global payment periods for surgical services and expanded transparency programs.

SGR formula
The proposed rule explicitly declines to provide any guidance on the sustainable growth rate (SGR) formula for 2015, because this is prescribed by statute and outside the scope of CMS’authority. Based on the Protecting Access to Medicare Act of 2014, current Medicare payments are frozen through March 31, 2015.

At that time, however, and without a permanent repeal of the SGR formula, CMS estimates that a 20.9 percent negative payment adjustment to the PFS would go into effect for the remainder of 2015. The American Association of Orthopaedic Surgeons (AAOS) has dedicated much of its resources advocating for the permanent repeal of the SGR formula and will continue to work with Congress to avoid such a substantial cut in Medicare reimbursement.

Global payment periods
CMS is proposing to transform all 90-day and 10-day global surgery codes to 0-day global codes beginning in 2017. Under this proposal, physicians would bill for individual follow-up visits as they occurred in lieu of receiving a single payment that includes follow-up care for surgical services. Such a change would affect the way that orthopaedic surgeons bill for many surgical procedures.

In proposing this change, CMS cites a report from the Office of the Inspector General that identified many surgical procedures for which physicians furnished fewer follow-up visits than provided for under the global period payment.

PQRS program
The PQRS program calls for physicians to report on quality measures to earn a payment incentive for year 2014 and avoid negative payment adjustments in subsequent years. Participation requirements can be met through several methods, including a new Qualified Clinical Data Registry (QCDR) option. The American Joint Replacement Registry has been deemed a QCDR for year 2015.

For satisfactory participation in PQRS in year 2015, physicians are required to report on at least nine measures covering at least three domains of the National Quality Strategy to avoid a 2.0 percent negative payment adjustment in 2017. CMS is proposing to add 28 new individual measures and remove 73 measures from the program. Group practices with 25 or more eligible professionals (EPs) reporting through the Group Practice Reporting Option (GPRO) must now report data on at least 248 patients, a reduction for practices with 100 or more EPs and an increase for practices of 25 to 99 EPs. (For more information on the PQRS program and the GPRO in 2014, see “Group Must Register for 2014 PQRS.”)

CMS is also proposing to remove several quality measures from the PQRS program, including the Back Pain Measures Group and the Perioperative Care Measures Group. CMS indicates that physicians are consistently meeting extremely high performance rates in these areas. In addition, in the case of the back pain measures group, the activities being measured do not contribute to patient outcomes. CMS is proposing to include a new PQRS measure, examining the average functional status change in patients undergoing lumbar fusion surgery.

Lastly, CMS is proposing to no longer require that EPs ensure that their certified electronic health record (EHR) technology products are recertified to the most recent version of the electronic specifications for clinical quality measures (CQMs) for 2015. However, EPs would still be required to report on the most recent version of electronically specified CQMs.

Value-based modifier
As required by law, CMS will start applying the value-based modifier to certain EPs in 2015; the value-based modifier will be fully phased-in and applied to all solo and group EPs by 2017.

CMS is also proposing to increase the maximum potential negative payment adjustment in 2016 to 2.0 percent, increasing to 4.0 percent in 2017. To maintain budget-neutrality, the maximum upward payment adjustment is proposed to increase 2.0 percent in 2016 and 4.0 percent in 2017. Performance in the value-based modifier program is based in part on quality data submitted via the PQRS program, and thus physicians not participating in PQRS may be subject to the maximum negative payment adjustment.

Relatedly, CMS is planning to release Quality and Resource Use Reports (QRURs) based on 2013 data to all individual and group physicians. CMS will release QRURs based on 2014 data in the summer of 2015.

Physician Compare
In 2016, CMS is proposing to expand the data published on the Physician Compare website to include all 2015 PQRS data reported via the GPRO, registries, or EHRs by group practices of 2 or more EPs. To be published, data would need to include a minimum sample size of 20 patients and be deemed statistically reliable and valid.

As finalized in the 2014 PFS rule, CMS is planning to publish 2013 data from 20 PQRS measures in 2015. CMS is also proposing to include an indicator on Physician Compare profile pages to show which physicians have met reporting requirements in the PQRS program and participate in the EHR Incentive program. In the future, CMS proposes to publish data collected from QCDRs in 2015 at either the individual measure-level or a higher aggregated level on the Physician Compare website.

Open Payments Act
CMS is proposing to completely remove the Continuing Education Exclusion from the Open Payments (Sunshine Act) program to avoid an unintended appearance of endorsing commercial support of continuing medical education. Additionally, CMS is proposing to require reporting of stocks, options, or other ownership interests as individual categories and to include the marketed names of medical devices and drugs.

Changed policies in rate setting
To create a more transparent process in proposing changes to payment rates for individual services, CMS wants to publish all proposed rate changes for public comment before they are finalized. This expands on the previous policy of publishing only proposed rate changes for procedures with new or revised codes.

The ongoing misvalued codes initiative has resulted in an increased need for transparency in rate setting, in keeping with the increase in payment rate revisions for individual services. This change is proposed to take effect in 2016.

Medicare Shared Savings Program
In Medicare’s ongoing Shared Savings Program, also known as the accountable care organization (ACO) program, a new quality scoring strategy is being proposed to reward bonus points to ACOs that annually improve in four quality measure domains. To reduce the reporting burden on ACOs, the number of GPRO-reported measures required would decrease and the number of claims-based measures would increase. This would result in a slight increase in the overall number of measures being reported.

Chronic care management
Payment for non–face-to-face care of chronically ill patients is being proposed to begin in 2015 at a rate of $41.92 per patient and no more frequently than once per month. This payment would cover communications with other health professionals, medication management, and care for patients with two or more significant, chronic conditions who may be receiving services.

CMS is accepting comments from the public on the proposed regulatory changes until Sept. 2, 2014. AAOS staff are reviewing the Medicare PFS proposed rule in great detail and will be providing further news and analysis to members as needed. If you have questions about the Medicare PFS proposed rules, contact the AAOS office of government relations at DC@aaos.org

Anthony Wheeler, PhD, is the manager, payment policy; he can be reached at wheeler@aaos.org and Elizabeth Fassbender is the communications specialist in the AAOS office of government relations; she can be reached at fassbender@aaos.org

Additional Information
Physician Fee Schedule Proposed Rule Information:
CMS 2015 Physician Fee Schedule Proposed Rule with Comment Period

PQRS Information:
PQRS: How You Can Participate
PQRS: Transitioning from Reporting to Quality
AAOS Sends letter to CMS on Use of Registries to meet PQRS and EHR quality requirements
Orthopaedic Trauma Association Development of PQRS Group Measures [PDF]

QCDR reporting:
AJRR Designated as Approved QCDR

Open Payments (Sunshine Act) program

Shared savings program:
Shared Risk and Orthopaedic Surgeons
Accountable Care Organizations: A Primer for Orthopaedic Surgeons