Revisions to 2013 Medicare Fee Schedule Proposed

July 20, 2012

The Centers for Medicare and Medicaid Services (CMS) posted the proposed 2013 Medicare Physician Fee Schedule (MPFS) and associated rules for Medicare Part B services on July 6, 2012, and will publish it in the July 30, 2012, Federal Register. The proposal includes changes to reimbursement rates, therapy claims reporting, and the Physician Quality Reporting System (PQRS).

Reporting of Therapy Claims

Changes in therapy claims reporting were mandated by the Middle Class Tax Relief and Job Creation Action (MCTRJCA) of 2012. As a result, CMS is proposing the implementation of a claims-based data collection strategy for reporting patient condition and outcomes. It employs non-payable G-codes with modifiers that represent the patient status at admission, 10-day treatment intervals, and discharge, with additional codes for treatment goals and sessions where reporting is not required. The proposal uses a subjective interval reporting system, with little guidance or parameters, and the timing for reporting corresponds to the documentation requirements in the Medicare Benefit Policy Manual. Under this proposed rule, the claim form would include the CPT code for the therapy session, the -–GN modifier and continued use of the –KX modifier for services rendered over the $1,880 therapy cap, and potentially as many as four G-codes with modifiers for up to two “functional limitations.” Implementation is scheduled for January 1, 2013, with a “testing period” from January 1 through July 1, 2013. Required reporting would begin on July 1, 2013, when claims without the appropriate G-codes and modifiers would be returned unpaid.

Physician Quality Reporting System (PQRS)

CMS has also proposed changes to PQRS, a voluntary quality reporting program that began in 2007 as an incentive payment program. PQRS will remain an incentive program through 2014, but CMS is proposing changes to the deduction program that is set to begin in 2015. According to the proposal, a deduction of 1.5% will be taken from all 2015 Part B payments to health care providers, including audiologists and speech-language pathologists, who did not report on at least one measure in 2013 and a deduction of 2% on all 2016 claims when at least one measure was not reported in 2014.

Additionally, CMS proposes to retire 14 PQRS measures, including two audiology measures and one speech measure, as follows:

  • referral for otologic evaluation for patients with active drainage from the ear 
  • referral for otologic evaluation for patients with history of sudden or rapidly progressive hearing loss 
  • Functional Communication Measure for motor speech

ASHA will be requesting reconsideration on the retirement of these measures.

Proposed Fee Changes

A conversion factor (CF) is used to calculate the MPFS reimbursement rates. The proposed rule includes a projected 2013 CF of $24.8441, which is 27% less than the current $34.0376. Although this reduction is mandatory because of a statutory formula known as the Sustainable Growth Rate (SGR), it is anticipated that Congress will enact legislation to prevent this reduction as it has done almost every year since the SGR was implemented.

Furthermore, 2013 is the final year in a 4-year phase-in of practice expense value reductions that are used as part of the MPFS rate calculations. The reductions are based on practice cost surveys that reflect data for average practice expenses of each specialty and primarily affect the calculation of indirect practice costs. This system has had a negative effect on MPFS rates for many audiology and speech-language pathology procedures, mainly because the costs of operating an audiology or speech-language pathology practice are substantially less than those for a physician’s practice.

ASHA will be submitting comments, due September 4, 2012, to CMS. The final rules for 2013 are expected to be published by November 2012.

Please see the August 28, 2012, issue of The ASHA Leader for details. For more information, contact Mark Kander, director of health care regulatory analysis, at, or Lisa Satterfield, director of health care regulatory advocacy, at

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