Physician Fee Schedule: A Case Study

The Improving Medicare Post-Acute Care Transformation Act (IMPACT) standardizes data collection and data sharing among post-acute providers. The IMPACT Act is part of the Centers for Medicare and Medicaid services (CMS) effort on basing reimbursement on quality as it moves from voluntary reporting of quality measures to mandatory reporting, basing reimbursement on the data reported. Presently, post-acute providers are paid on a fee-for-service basis but with the IMPACT act, bundle payment will replace the fee-for-service. The bundle or value based payment pays for outcomes and not for the volume of services. The Act gives post-acute providers an incentive to work on

Now a statute, the physician/hospital pay for quality, not quantity, public law number: 114-10 signed April 16, 2015 also referenced as H.R.2 —1st Session of 114th Congress (2015-2016), sometimes called the “Permanent Doc Fix” 04/14/2015 : Passed Senate; 03/26/2015 : Passed House (Medicare Access and CHIP Reauthorization Act of 2015, 2015), which defines the payment and reimbursement reform to doctors treating patients with Medicare. This extensive reform includes the CHIP program insuring children and those families that don’t qualify for Medicare but are unable to afford private insurance and is funded by the federal government and individual states.

Since the late 1980s, Medicare has reimbursed physician services using the Medicare Physician Fee Schedule (MPFS), which encompasses 10,000 procedure codes. Each code is assigned resource-based relative value units (RVUs), which are designed to reflect physician work, practice expense, and malpractice expense. To adjust for local differences in cost of living, each RVU is modified using geographic practice cost indexes (GPCIs) and then converted to dollars using a “conversion factor.” This system rewards physicians who produce a high volume of services; not surprisingly, Medicare Part B expenditures have grown rapidly.

Obtaining reimbursement for services provided is a necessity for the survival of many health care organizations. This paper will explain, in my opinion, why the Centers for Medicare and Medicaid Services (CMS) are involved in this development and how it affects the American public. I will offer a suggestion to ensure meeting policy and procedure. I will finish by discussing three ideas listed on the CMS website.

There is a growing trend in the United States called pay-for-performance. Pay-for-performance is a system that is used where providers are compensated by payers for meeting certain pre-established measures for quality and efficiency (What is Pay-for-Performance, n.a.). We are going to be discussing what pay-for-performance is. There are different aspects of pay-for-performance which include; the effects of reimbursement by this approach, the impact cost reductions has on quality and efficiency of health care, the affects to the providers and patients, and the effects on the future of health care.

Health care in the United States (U.S.) is driven by a makeshift of services and financing. Americans access health care services in diverse ways, from private doctors’ offices, to hospitals, and to insurance providers. The effects of the ACA will have numerous changes impacting hospitals and physicians practices. One of the main goals of healthcare reform is to reduce Medicare expenses by combining payment for services provided by hospitals, doctors, and nursing homes into one lump sum, which will effect

Per our conversation: When the provider bills an amount, we don’t always pay that billed charges. Providers tend not to change the amount they are bill with different insurances. Amerigroup pays 100% of the Medicaid Fee Schedule. The claims that your referencing below paid code 20160RT at $66.09 per the Medicaid Fee Schedule. However, code J7324 denied for authorization. I understand that authorization was waived for April, I will have this claims reprocessed. Once the auth. wavier is put in place, code J7324 pays $223.39 of the Medicaid Fee Schedule. This bring the amount of the claim to $289.48 of the $473.00 the provider is billing.

Centers for Medicare and Medicaid services has tied payment to quality standards, invested in patient

Under the Affordable Care Act, traditional fee for service reimbursement will be methodically phased out over time and be replaced by quality of care reimbursement; therefore, the focus of primary care will be shifted from the actual treatment of patients

In recent years, emphasis has been placed on improving the quality of health care services and the overall patient experience. Innovative measures are needed to meet these expectations, while also containing the rising costs of health care. The government has enacted new laws in attempts to provide incentives that base Medicare payments in part on quality. In fact, the Patient Protection and Affordable Care Act of 2010, requires the implementation of value-based purchasing (VBP), which bases Medicare reimbursement rates on the quality of care (Kennedy, Wetzel & Wright, 2013). Hospitals may experience a decrease in revenue initially, however, it is theorized that the increase of transparency and accountability will serve as an incentive for improvements in the overall quality of care provided in the United States.

The state of California is active in the payment and delivery system reform. Of the 38 million residents in California, more than 15 million receive care through delegated arrangements with provider organizations in the commercial market, or through Medi-Cal (California’s Medicaid program), Healthy Families (California’s implementation of Children’s Health Insurance Program (CHIP)), and Medicare Advantage plans (California Health Care Almanac, 2015). For the past decade, California’s reimbursement has been through shared risk pool, pay-for-performance quality incentive programs, and full and partial capitation (Pegany & Connolly, 2014). Pegany & Connolly (2014) state that under the Accountable Care Collaborative (ACO) programs, providers and hospitals don’t want assume additional risk, and reward does not outweigh the risk and investments costs. To increase the potential and impact of ACA reform, California policymakers should take advantage of the ACA delivery and payment reforms, and do so will require careful attention.

CMS intends to work with BPCI participants to assess the effectiveness of the payment models on improvement of patient care and reduction of the healthcare costs. “All models include provider-led care redesign and enhancements, such as reengineered care pathways using evidence-based medicine, standardized operating protocols, improved care transitions, and care coordination. Awardee Agreements may also include proposals for gainsharing among provider partners.” (Center for Medicare and Medicaid Services,

Capitation and fee-for-service has been an important part of managed health care for reimbursement for several years. The background history of capitation involves determining the patients’ eligibility, the density of geographic areas of PCP’s and payment amounts from sub-specialists. On the other hand, fee-for-service involves high costs, and more manipulation occurs with the fee-for-service (FFS). There are tangible reasons behind both payment services and the disadvantages surrounding them. Various authors offer insight and valuable opinions of the pros and cons of fee-for-service and capitation that need to be addressed.

“Hospital and physician group leaders long have cited the difficulty of crafting physician payment models that encourage quality processes and outcomes while maintaining the incentive for high productivity. Experts are concerned that any new Medicare value-based system for paying doctors, which must be developed under recent legislation, will run into those same challenges, given the fledgling state of measuring the performance of individual physicians.” (Rice, 2015, para.

The positive outcomes that have resulted due to value base programs have caused the model to gain traction and ignite one of the largest changes in history in the health care marketplace. By linking reimbursements to service quality, insurers such as the Centers for Medicare and Medicaid Services have facilitated a massive leap forward in the performance of United States health care providers. This achievement is a considerable accomplishment in the face of an institution that has received reimbursement from insurers via a fee-for-service model during the last 75 years. Soon, valued based payment models will represent the norm as more insurers support initiatives such as shared savings program, integrated clinical care, and accountable care payment models.