American Speech-Language-Hearing Association
November 4, 2010

CMS Issues 2011 Medicare Physician Fee Schedule with Changes in Rehabilitation Payment Policy

On Tuesday, November 2, 2010, the Centers for Medicare and Medicaid Services (CMS) released the final rule for the 2011 Medicare Physician Fee Schedule (MPFS). Each year CMS establishes a conversion factor (CF) that is used as a multiplier of the total relative value units (RVUs) for each procedure. The current CF is $36.8729. Unless Congress acts, the CF is scheduled to be reduced to $28.4061, effective December 1, 2010, and $25.5217, effective January 1, 2011. This would represent about a 30 percent reduction from current payments and would affect all payments under the physician fee schedule. These reductions are due to the application of a statutory formula known as the Sustainable Growth Rate. Please note that there is every indication that Congress will enact legislation to prevent these reductions from occurring.

Multiple Procedure Payment Reduction

Medicare has a longstanding policy to reduce payment for the second and subsequent surgical and nuclear medicine procedures furnished to the same patient by the same practitioner on the same day. In the final rule, CMS expands the Multiple Procedure Payment Reduction (MPPR) to therapy services. Under MPPR, full payment will be made for the therapy service or unit with the highest practice expense value (MPFS reimbursement rates are based on professional work, practice expense, and malpractice components) and payment reductions will apply for any other therapy performed on the same day. For the additional procedures provided on the same day, the practice expense (i.e., support personnel time, supplies, equipment, and indirect costs) of each fee will be reduced by 25%, effective January 1, 2011. The professional work and malpractice expense components of the payment will not be affected.

MPPR will primarily affect physical therapists and occupational therapists, that is, professions that commonly bill multiple procedures or a timed procedure billed more than once per visit. Eight SLP procedures (92506 Speech/hearing evaluation, 92507 Speech/hearing therapy, 92508 Speech/hearing therapy, 92526 Oral function therapy, 92597 Oral speech device eval, 92607 Ex for speech device rx, 1hr, 92609 Use of speech device service, 96125 Cognitive test by hc pro) are designated as applicable to MPPR. It will be a per-day policy that would apply across disciplines and across settings. For example, if an SLP and a physical therapist both provided treatment to the same patient on the same day, the MPPR will apply to all codes billed that day, regardless of discipline. The following three MPPR scenarios illustrate full payment being made for the procedure with the higher practice expense. If there is a single speech-language pathology service daily it will usually be paid without a reduction because of consistently low physical therapy and occupational therapy procedure practice expense values.

Scenario 1

A patient is seen on the same day for a speech/language evaluation (92506) and a physical therapy evaluation (97001).

 

92506

97001

Total Payment w/o MPPR

2011 Total Payment w/MPPR

Work

$21.95

$30.63

$52.58

No Reduction = $52.58

Practice Expense

$57.68

$22.71

$80.39

$57.68 + (0.75 x $22.71) = $74.71

Malpractice

$1.28

$1.28

$2.56

No Reduction = $2.56

Total

$80.91

$54.62

$135.53

$52.58 + $74.71 + $2.56 = $129.85

Scenario 2

A patient is seen on the same day for speech/language treatment (92507) with a speech-language pathologist and 30 minutes of therapeutic exercises with a physical therapist (97110, each 15 minutes).

 

92507

97110 Unit 1

97110 Unit 2

Total Payment w/o MPPR

2011 Total Payment w/MPPR

Work

$33.18

$11.48

$11.48

$56.14

No Reduction = $56.14

Practice Expense

$26.80

$10.72

$10.72

$48.24

$26.80 + (0.75 x $10.72) + (0.75 x $10.72) = $42.88

Malpractice

$1.79

$0.26

$0.26

$2.31

No Reduction = $2.31

Total

$61.77

$22.46

$22.46

$106.69

$56.14 + $42.88 + $2.31 = $101.33

Scenario 3

A patient is seen on the same day for speech/language treatment (92507) and swallowing treatment (92526).

 

92526

92507

Total Payment w/o MPPR

2011 Total Payment w/MPPR

Work

$34.20

$33.18

$67.38

No Reduction = $67.38

Practice Expense

$34.71

$26.80

$61.51

$34.71 + (0.75 x $26.80) = $54.81

Malpractice

$1.79

$1.79

$3.58

No Reduction = $3.58

Total

$70.70

$61.77

$132.47

$67.38 + $54.81 + $3.58 = $125.77

The 25% reduction in practice expense is an improvement from the proposed physician fee schedule released by CMS in August. The proposed physician fee schedule had set a 50% cut in the practice expense.  Moreover, the proposed rule included CPT code 92608 (speech-generating device evaluation, each additional 30 minutes) as also applicable to MPPR, but CMS removed this code in the final rule due to ASHA advocacy efforts. ASHA also advocated against any cut in the practice expense and submitted comments on the proposed fee schedule.

Therapy Caps and Alternatives

CMS requested comments in the proposed physician fee schedule on three approaches for developing an alternative to the Medicare therapy caps. The alternatives under consideration were the following: modify the current exceptions process by capturing additional patient information about severity and complexity; develop edits regarding medical necessity; or create per-session bundled payments. ASHA has been working with CMS-contracted research projects to develop these proposals over the past two years and provided comments on these alternatives. In response to comments on the proposed rule, CMS concluded that none of the proposed alternatives are sufficiently developed to warrant immediate implementation. However, CMS stated that the first option (severity and complexity) may have the greatest potential for rapid implementation that could yield useful information in the short-term. Few comments preferred option two (medical necessity edits) over the other two options.

The final rule also reiterated that the current exceptions process for the therapy cap will expire on December 31, 2010, absent Congressional action. Most Capitol Hill observers anticipate that Congress will address both the sustainable growth rate (the underlying legislative formula for the conversion factor) and therapy caps during the 2010 lame duck session.

PQRI

CMS will continue the current speech-language pathology Physician Quality Reporting Initiative (PQRI) measures through 2011. The eight speech-language pathology measures are Functional Communication Measures for spoken language comprehension; attention; memory; motor speech; reading; spoken language expression; writing; and swallowing.

For 2010, the incentive payment for satisfactorily reporting on measures is 2% of all allowable Medicare charges for that reporting period. The final rule affirms the incentive payment structure set out in the Affordable Care Act (ACA):  an incentive payment of 1% for 2011 and .5% for 2012–2014. Starting in 2015, eligible professionals that do not satisfactorily report on quality measures will be subject to a payment adjustment.

The speech-language pathology measures are reported via registry. Providers reporting on registry-based 2011 PQRI measures will still need to report on 80% of patients that fit into a measure.

Any comments or questions should be addressed to reimbursement@asha.org.


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