Government News
Medicare Fees to Increase an Average of 1.1%
Psychiatric News
Volume 43 Number 23 page 8-34

Physicians are slated next month to begin receiving a 1.1 percent across-the-board payment increase in Medicare.

The payment update is the result of a dramatic, last-minute vote by Congress earlier this year to reverse a scheduled 10.6 percent decrease that was to have gone into effect in July (Psychiatric News, August 1). Instead, Congress approved a 0.5 percent increase for the remainder of 2008 and the 1.1 percent increase for 2009.

The change was included in the historic Medicare Improvements for Patients and Providers Act (HR 6331), which reversed the government's 40-year-old discriminatory payment for outpatient psychiatric services.

In addition, the fee schedule for 2009 includes financial incentives for physicians who use electronic health records and who report quality measures. Two Centers for Medicare and Medicaid Services (CMS) quality-improvement programs—the Physician Quality Reporting Initiative (PQRI) and the Electronic Prescribing Incentive Program—will provide financial incentives of up to 4 percent of total Medicare allowed charges for participation. The e-prescribing program offers incentives to clinicians who use a qualified e-prescribing system. Participation in both programs involves the reporting of designated administrative codes on billing claims.

The PQRI program will continue in 2009 with 153 measures, including three on major depressive disorder, and a new measure on screening for unhealthy alcohol use. Physicians who report using at least three measures applicable to their practice between January 1 and December 31, 2009, will receive a bonus of up to 2 percent of their total Medicare allowed charges for that period.

The Electronic Prescribing Incentive Program is new for 2009. Clinicians who meet the requirements for being a successful e-prescriber will be eligible for an additional 2 percent bonus in 2009 and 2010, a 1 percent bonus in 2011 and 2012, and a 0.5 percent bonus in 2013. Clinicians who do not meet the requirements for being a successful e-prescriber will have their payments reduced by 1 percent in 2012, 1.5 percent in 2013, and 2 percent in 2014 and in each subsequent year.

Being a successful e-prescriber means reporting the availability and use of a qualified e-prescribing system in at least 50 percent of covered encounters between January 1, 2009 and December 31, 2009. Information about both programs and about what constitutes a qualified e-prescribing system is posted on APA's Web site at<www.psych.org/pqri>.


As in past years, the payment reduction reversal succeeded only in postponing the bad news: under current projections, physicians are slated to face a massive 21 percent payment cut in 2010. And APA, the AMA, and other physician groups remain committed to achieving a permanent reform of the Medicare payment formula, especially the so-called sustainable growth rate (SGR) component. The SGR mandates that increases in volume be balanced by reductions in payment, but does not account for increases in physician costs.

At last month's Interim Meeting of the AMA House of Delegates, delegates approved a report by the AMA's Council on Medical Services calling for a systematic discussion by organized medicine of options for reforming the Medicare payment system. The council has asked for input and feedback from states and specialty societies regarding options that were outlined in the report. CMS will be taking that feedback and finalizing the report for consideration by the house at the AMA's annual meeting in June 2009.

APA's Office of Health Systems and Financing, in collaboration with relevant councils, will be reviewing the report and forwarding comments to the AMA. For complete reporting on the CMS report, see the next issue of Psychiatric News.

"The American Medical Association supports rebasing the sustainable growth rate to move forward with a permanent fix," said AMA board member James Rohack, M.D., in a statement issued after last month's House of Delegates meeting in Orlando, Fla. "We agree that it is the best course to address the current Medicare payment crisis and ensure access to health care for America's seniors.

"The AMA continues to work with medical state and specialty societies in an effort to develop a broadly supported approach to reform. We are closely examining Medicare demonstration projects, including the patient-centered medical home and other payment reforms to improve care coordination. We hope to see additional projects so we can build a solid foundation for long-term reform.

"Our ultimate goal is to eliminate the SGR, and we are committed to working with Chairman [Pete] Stark and the... chairs and ranking members on the Senate Finance Committee and the House Energy and Commerce Committee to find the best solution."


At the AMA meeting last month, Medicare payment and other administrative problems associated with the program were prominent on the agenda. Delegates expressed special outrage about lengthy delays experienced in getting enrolled as a Medicare participatng physician, resulting in long periods of uncompensated care.

The House of Delegates easily approved a resolution calling on the AMA to seek legislation mandating that CMS impose a requirement on its carriers and Medicare administrative contractors that complete enrollment and re-enrollment applications must be processed within 30 days of receipt, with appropriate feedback to the applicant. The resolution also calls for imposing financial penalties on carriers for unjustified delays in enrollment and re-enrollment.

"We know how physicians are being imposed on by not getting their enrollment in a timely fashion and losing income," said AMA board member Peter Carmel, M.D., during reference committee hearings on the resolution." The board suggests that we urge Congress and CMS that they must put more resources into the CMS payment process so you get your reimbursement within 30 to 40 days."

For reports on other actions taken at the AMA meeting, see Parity Law to Be Focus of AMA Education Effort and the next issue of Psychiatric News.

Actions taken by the AMA House of Delegates at its November meeting are posted at<www.ama-assn.org/ama/pub/category/20272.html>.

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