Medicare Part B Reform Measure
LeadingAge NY provided members with a detailed analysis of the “Doc Fix” measure passed by the House on Fri., March 27 (H.R. 2 The Medicare Access and CHIP Reauthorization Act of 2015). Among other things, this measure repeals the current Sustainable Growth Rate (SGR) formula based methodology for determining annual updates to the Medicare Physician Fee Schedule (MPFS). The MPFS determines Medicare Part B rates paid to physicians and other practioners, along with the rates paid to nursing homes and home care providers for ancillary services.
As expected the Senate passed their version of the bill late on Tues., April 14 by a vote of 98 to 2, and President Obama has officially signed the measure into law.
Without this measure in place, providers would have incurred a 21.2 percent reduction in Medicare Part B claims along with the elimination of the therapy caps exceptions process. Part B rates for the first half of April are expected to now stay level with rates during the first quarter of 2015 and remain so through Tues., June 30, 2015.
During this interim period the Centers for Medicare and Medicaid Services (CMS) has been holding off on processing April claims for 14 days and was hoping to avoid having to reflect the negative rate adjustment in its billing systems. As noted below, however, CMS would have just started implementing the negative adjustment on Wed., April 15. Our recommendation had been to hold off submitting April claims until the later in the month. This is probably the best course of action to follow pending official guidance.
A more complicated matter is the temporary expiration of the therapy caps exceptions process. Remember that the caps apply on a calendar year basis at the level of $1,940 for occupational therapy and $1,940 for speech and physical therapy combined for 2015. Here again our previous advice had been to hold off submitting claims and issue Advance Beneficiary Notices in order to ensure proper payment liability. This is likely still the best route to follow as we await further word from CMS and National Government Services (NGS), and we anticipate the exceptions process will be reinstated for this interim period.
Providers should be checking news and alerts from NGS for further details. The most recent update from NGS and CMS predates the Senate passage and is as follows:
On April 1, 2015, the Medicare Physician Fee Schedule (MPFS) was updated using the Sustainable Growth Rate (SGR) methodology as required by current law. The SGR methodology required a 21% decrease in all MPFS payments beginning April 1, 2015.
The Centers for Medicare & Medicaid Services (CMS) took steps to limit the impact on Medicare providers and beneficiaries by holding claims paid under the MPFS with dates of service on and after April 1, 2015. Additionally, Medicare is also holding all therapy claims that would no longer qualify for the therapy cap exceptions (those therapy claims with the ‘KX’ modifier), due to the expiration of the therapy cap exceptions process on April 1, 2015. In the absence of additional legislation to avert the negative update, CMS must update payment systems to comply with the law, and implement the negative update.
Beginning on April 15th, 2015, CMS will release held MPFS claims, paying at the reduced rate, based on the negative update, on a first-in, first-out basis, while continuing to hold new claims as they are received. CMS will release one day's worth of held claims, processing and paying at the rate that reflects the negative update. At the same time, CMS will hold the receipts for that day, thus, continuing to hold 10 days' worth of claims in total. This is to provide continuing cash flow to providers, albeit at the rate that reflects the negative update. This “rolling hold” will help minimize the number of claims requiring reprocessing should Congress pass legislation changing the negative update.
Providers should remember that claims for services furnished on or before March 31, 2015 are not affected by the payment cut and will be processed and paid under normal time frames. We are working to limit any impact to Medicare providers and beneficiaries as much as possible. The MACs will automatically reprocess the claims paid at the reduced rate if Congressional action is taken to avert the negative update. No action is necessary from providers who have already submitted claims for the impacted dates of service.
Again, this official guidance pre-dates the Senate vote and is likely to be re-vised soon. LeadingAge NY and LeadingAge national are closely monitoring the situation and will keep members informed of the latest developments.
Contact: Patrick Cucinelli, pcucinelli@leadingageny.org, 518-867-8827