Practicing Physicians Advisory Council (PPAC) Update for May 23, 2005I am pleased to send you this update on the May 23, 2005 meeting of the Practicing Physicians Advisory Council (PPAC), a group of 15 physicians appointed to advise the Secretary of HHS on the effects of Medicare and Medicaid regulations on the practice of medicine. CONTRACT REFORM FOR MEDICARE CARRIERS PPAC was reassured by CMS that the money used for incentives to the Medicare Administrative Contractors (MACs) is not derived from funds used to pay for the medical benefits, and will not contribute to the Sustainable Growth Rate (SGR). We had requested reassurance that the Carrier Advisory Committees will be continued, that Carrier Medical Directors maintain accessiblity to physicians, but we were told only that this is under review by the Office of Financial Management. PPAC felt that as part of contractor reform, that CMS should develop more integration of Parts A and B to allow the funds to follow the services moving from Part A to Part B. This would require legislation, which CMS is not prepared to advance, even though they endorse greater administrative integration of Parts A and B. At some point, CMS would favor the consolidation of Parts A and B with DME and Home Health /Hospice. CMS will include provider and beneficiary satisfaction levels in their evaluation of the MACs. PHYSICIAN FEE SCHEDULE In March, we had requested that CMS begin assessing the effect of the impending 26% decrease in the physician fee schedule on physician participation in Medicare, and to develop a plan to ensure Medicare patients access to physicians if the SGR based decrease is not avoided. CMS responded that they did not see a decline, as 73% of patients never experienced delays. We felt this answer was non-responsive, and wanted to monitor trends that might give a better early warning of impending access problems, citing AMA data. PPAC recommended that CMS develop a plan to monitor critical subsets or indicators of beneficiary access such as new Medicare patients versus established patients or those without medigap insurance, access to specialty versus primary care, and develop a plan to address declining access before the problem becomes widespread. CMS' response to our request to retrospectively remove drugs from the SGR was to state that it would just be a short term fix, and that Pay for Performance was a better option, and would work with organized medicine to that end. COMPETITIVE ACQUISITION PROCESS At the March meeting, PPAC made several recommendations regarding the Competitive Acquisition Process (CAP), which is an option for physicians to obtain the drugs administered incident to a physician's service through a vendor. This may prove to be useful for physicians who do not want to participate in the buy and bill mechanism for obtaining these drugs, now that the drugs are only reimbursed at Average Selling Price plus 6% (ASP). However, many concerns remain. In March, PPAC recommended that the CAP vendors absorb the cost of unused or returned drugs and their shipping and inventory costs, that CAP providers must fill all prescriptions, even for off label uses, and that the prices obtained by the CAP vendor not be used to calculate ASP, and pointed out that often physicians cannot actually acquire drugs at ASP. CMS stated that it could not reply directly to any of these issues, as the comments provided in answer to the proposed rule are still being considered. CMS said that the final rule should be published in early summer, and that we should be able to discuss it at the August meeting of PPAC. PPAC therefore reiterated all the recommendations on CAP that we made at the March meeting. PPAC recommended that CMS issue an interim final rule, and allow more public comment. During this meeting, PPAC recommended that CAPs must be fully implemented for all specialties, for all drugs, without limited formularies, and regardless of the patient's ability to pay a copay, and with no additional administrative duties or costs to the physicians. PPAC recommended that CAP vendors not be allowed to market directly to patients, or to sell the physician prescribing data without physician consent, that physicians be allowed 30 days for submission of claims for drug administration, and that the process of prescription submission and claim submission be limited to essential data based upon the recommendations of the specialty societies. Under the CAP program, physicians can, in an emergency, use drugs not provided through the CAP vendor without penalty. PPAC recommended that emergency be defined to include patient hardship in rescheduling an office visit due to a delay in delivering the therapy. RECOVERY AUDIT CONTRACTORS Recovery Audit Contractors (RACs) are a 3-year demonstration project in New York, Florida, and California where CMS hired independent private agencies to investigate claims for the purpose of recovering the 10% of claims which CMS believes to not be merited. The RAC then gets to keep some of the money recovered from a successful repayment. At this point, the RACs will focus on Part A, review three years of claims, and in California and Florida, on Medicare as a secondary payer. Evaluation and Management codes, even those generated in the hospital, will not be reviewed, unless they arise from an E&M service provided too soon after a surgical procedure and should have been billed globally. RACs are required to note underpayments as well as overpayments, but CMS data suggests that underpayments are almost entirely limited to Part B E&M codes, and are less than 1% of the claims. This did not fit well with our experience, and we sited the existence of companies that make reasonable money pointing out to doctors and others where they are underbilling. PPAC recommended that the CMS review the RACs, including monitoring the rate of underpayments, and be sure they are properly handled. RACs are required to notify the carrier of an underpayment, and the carrier is supposed to pay the correct fee. The RAC program intends to avoid the mistakes made in the CERT program, where physician notifications and requests for records were sent to the wrong address or were not identified as being official CMS business. PPAC recommended that the evaluation of the RAC demonstration project must weigh the costs of administration of the project by CMS, the costs expended by the RAC and by the hospitals and physicians in defending themselves against the allegation of improper coding, and measure this against the amount of money recouped by the RACs' successful actions. However, if a physician or provider successfully appeals the claim determination made by the RAC, PPAC recommended that the RAC should reimburse the provider for the expense of the appeal. CMS wondered if the converse should be true. [My own personal opinion is that the RAC should include this cost in its cost of doing business, and not be able to receive the money for its expenses from the physician.] The usual appeal processes will apply. PPAC also requested that issues related to teaching physician guidelines be excluded from RAC purview, as these guidelines were previously audited, and the academic (GC) modifier issues have already been resolved. We also recommended that CMS and the RACs notify providers of any new areas of review. We hope to be kept updated about the progress of these RACs. Detailed information can be downloaded from the government's Request for Proposals posting, or contact (RecoveryAuditDemo@cms.hhs.gov). NATIONAL PROVIDER IDENTIFIERS: IT WORKED! Several PPAC members now have their National Provider Identifier (NPI) number through an online demonstration by Kim Brandt, who came to CMS just as the PECOS re-enrollment problems were occurring. She has worked hard to avoid similar problems, and we were able to be "enumerated" by a 5 minute on line process, and receive an email confirmation and our new numbers. This number will overlap with the current numbers, but by May 23, 2007, the UPIN will not be used by anyone, and NPIs will be required. This will not replace the DEA or state license numbers, but should replace the Commercial payors identifying numbers. Get yours today online at the National Plan and Provider Enumeration System (NPPES). PPAC recommended that CMS develop a directory of NPIs to allow for ease of listing referring doctors, etc, and that CMS clarify exactly which numbers will be eliminated by the NPI. PAY FOR PERFORMANCE Trent Haywood, MD JD (thaywood@cms.hhs.gov) has the unenviable task of figuring out how CMS should pay for performance. He understands the issues of concern to PPAC, such as risk stratification of patients to avoid adverse effects on physicians who have non-compliant patients or patients with comorbidities, the difficulty of correctly defining a measure, and the fact that results often can be attributed to more than one physician. We are concerned that the goal of improving quality must be kept separate from the goal of reducing costs. We recommended that CMS describe the mechanism proposed to allocate dollars saved from improved performance to providers. We also discussed the fact that when a physician improves on those indicators, which improve patient health, it usually requires more office visits, therefore increasing the volume and intensity of physician services and triggers the SGR cap, resulting in lower payments. The savings occur from the prevention of hospitalizations, emergency room visits, etc, which lowers the Part A spending. PPAC recommends that CMS support legislation or otherwise devise a system that allows the transfer of money saved from Part A into Part B when the savings occur due to better outpatient management allowing avoidance of complications and hospitalization or ED use. We recognized that this requires legislation, but since legislation is needed to fix the current SGR system, and members of Congress have advocated Pay for Performance in the context of reforming physician payment, that removing the barriers between Part A and Part B should be on the table as well. CMS does plan to work with the specialty societies on this issue, and PPAC would like to be kept updated. MEDICARE PART D Dr. Jeffrey Kelman presented the current status of the implementation of Part D, the prescription drug benefit. People who have dual eligibility for Medicare and Medicaid will automatically be enrolled, with little cost sharing, but low-income patients must apply for the subsidy and must enroll. Others may voluntarily enroll. The formulary by law cannot include benzodiazepines or barbiturates, but the formulary will include multiple drugs in each narrowly defined class. Statins are a class, anti-hypertensives are not. Most companies applying to be a Part D carrier are listing multiple drugs in each class, even though only two are required. All FDA approved drugs must be available, even for off-label use. There is an appeal process. The benefit will use tiered copays, and the requirements for retail availability will be the same as for Tricare. CMS recognizes that patients will turn to their physicians for information on which program is their best choice, but physicians do not have the information or the time to respond adequately. PHYSICIAN REGULATORY ISSUES TEAM (PRIT) The PRIT has been working on several issues. The teaching physicians are working to determine how a facility may use and bill for voluntary faculty. One physician whose documentation did not merit a Level 3 visit was recoded as a 99499, and given a fee of a level 2.5 (which doesn't exist!) This concerned us significantly, as we felt it had the potential to undo the present coding system into something we could not predict, or defend ourselves against. PPAC recommended that CMS use the existing documentation guidelines for payment levels rather than arbitrarily assigning other payments or codes, and PRIT will come back to PPAC with more information on the half level payments at the next meeting. Physicians had concern over their inability to acquire drugs at ASP, and PRIT will bring more information on which drugs are "under water" to the next meeting. Use of computerized macros by physicians is still under discussion. States may now decide if podiatrists can do H&Ps, opening the door for more expansion of practice issues. Concern still exists over the requirement that dates and times be added to all notes, and PPAC recommended that time stamps should not be required for non ER visits. We had recommended previously that the chemotherapy symptom demonstration project be expanded to all specialties which administer chemotherapy, and extended indefinitely, but we received no follow up on this. At the next meeting we hope to hear about the Medicare plans to incorporate clinical trials into payment systems through the Coverage with Evidence Development process.
I hope this information is useful. I appreciate any feedback you care to share with me. Please use this covenient online form. I have continued to use many e-mailed comments in discussions with PPAC and find them to be extremely helpful in developing PPAC resolutions and comments. Thank you for your time in reading this. Respectfully submitted, Barbara L. McAneny, MD, FACP
Official CMS documents for this PPAC meeting: Zip Download |
