Part II
Federal Register: July 13, 2009 (Volume 74, Number 132)
Proposed Rules
Page 33519-33825From the Federal Register Online via GPO Access [wais.access.gpo.gov]
DOCID:fr13jy09-23
Page 33519Part IIDepartment of Health and Human ServicesCenters for Medicare & Medicaid Services42 CFR Parts 410, 411, 414, et al.Medicare Program; Payment Policies Under the Physician Fee Schedule andOther Revisions to Part B for CY 2010; Proposed Rule
Page 33520DEPARTMENT OF HEALTH AND HUMAN SERVICESCenters for Medicare & Medicaid Services 42 CFR Parts 410, 411, 414, 415, and 485
CMS-1413-PRIN 0938-AP40Medicare Program; Payment Policies Under the Physician FeeSchedule and Other Revisions to Part B for CY 2010AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.ACTION: Proposed rule.SUMMARY: This proposed rule would address proposed changes to MedicarePart B payment policy. We are proposing these changes to ensure that our payment systems are updated to reflect changes in medical practice and the relative value of services. This proposed rule discusses:Refinements to resource-based work, practice expense and malpractice relative value units (RVUs); geographic practice cost indices (GPCIs); telehealth services; several coding issues; physician fee schedule update for CY 2010; payment for covered part B outpatient drugs and biologicals; the competitive acquisition program (CAP); payment for renal dialysis services; the chiropractic services demonstration; comprehensive outpatient rehabilitation facilities; physician self- referral; the ambulance fee schedule; the clinical laboratory fee schedule; durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS); and certain provisions of the Medicare Improvements for Patients and Providers Act of 2008. (See the Table of contents for a listing of the specific issues.)DATES: To be assured consideration, comments must be received at one of the addresses provided below, no later than 5 p.m. on Monday, August 31, 2009.ADDRESSES: In commenting, please refer to file code CMS-1413-P. Because of staff and resource limitations, we cannot accept comments by facsimile (FAX) transmission.You may submit comments in one of four ways (please choose only one of the ways listed): 1. Electronically. You may submit electronic comments on this regulation to http://www.regulations.gov. Follow the instructions under the ``More Search Options'' tab. 2. By regular mail. You may mail written comments to the following address ONLY: Centers for Medicare & Medicaid Services, Department ofHealth and Human Services, Attention: CMS-1413-P, P.O. Box 8013,Baltimore, MD 21244-8013.Please allow sufficient time for mailed comments to be received before the close of the comment period. 3. By express or overnight mail. You may send written comments to the following address only: Centers for Medicare & Medicaid Services,Department of Health and Human Services, Attention: CMS-1413-P, MailStop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850. 4. By hand or courier. If you prefer, you may deliver (by hand or courier) your written comments before the close of the comment period to either of the following addresses: a. For delivery in Washington, DC--Centers for Medicare & MedicaidServices, Department of Health and Human Services, Room 445-G, HubertH. Humphrey Building, 200 Independence Avenue, SW., Washington, DC 20201.(Because access to the interior of the Hubert H. Humphrey Building is not readily available to persons without Federal government identification, commenters are encouraged to leave their comments in the CMS drop slots located in the main lobby of the building. A stamp- in clock is available for persons wishing to retain a proof of filing by stamping in and retaining an extra copy of the comments being filed.) b. For delivery in Baltimore, MD--Centers for Medicare & MedicaidServices, Department of Health and Human Services, 7500 SecurityBoulevard, Baltimore, MD 21244-1850.If you intend to deliver your comments to the Baltimore address, please call telephone number (410) 786-9994 in advance to schedule your arrival with one of our staff members.Comments mailed to the addresses indicated as appropriate for hand or courier delivery may be delayed and received after the comment period.FOR FURTHER INFORMATION CONTACT:Rick Ensor, (410) 786-5617, for issues related to practice expense methodology.Craig Dobyski, (410) 786-4584, for issues related to geographic practice cost indices.Esther Markowitz, (410) 786-4595, for issues related to telehealth services.Ken Marsalek, (410) 786-4502, for issues related to the physician practice information survey and the multiple procedure payment reduction.Cathleen Scally, (410) 786-5714, for issues related to the initial preventive physical examination or consultation services.Regina Walker-Wren, (410) 786-9160, for issues related to the phasing out of the outpatient mental health treatment limitation.Diane Stern, (410) 786-1133, for issues related to the physician quality reporting initiative and incentives for e-prescribing.Lisa Grabert, (410) 786-6827, for issues related to the PhysicianResource Use Feedback Program.Colleen Bruce, (410) 786-5529, for issues related to value-based purchasing.Sandra Bastinelli, (410) 786-3630, for issues related to the implementation of accreditation standards.Jim Menas, (410) 786-4507, for issues related to teaching anesthesia services.Sarah McClain, (410) 786-2994, for issues related to the coverage of cardiac rehabilitation services.Dorothy Shannon, (410) 786-3396, for issues related to payment for cardiac rehabilitation services.Roya Lofti, (410) 786-4072, for issues related to the coverage of pulmonary rehabilitation.Jamie Hermansen, (410) 786-2064, for issues related to kidney disease patient education programs.Terri Harris, (410) 786-6830 for issues related to payment for kidney disease patient education.Henry Richter, (410) 786-4562, or Lisa Hubbard, (410) 786-5472, for issues related to renal dialysis provisions and payments for end-stage renal disease facilities.Cheryl Gilbreath, (410) 786-5919, for issues related to payment for covered outpatient drugs and biologicals.Edmund Kasaitis, (410) 786-0477, or Bonny Dahm, (410) 786-4006, for issues related to the Competitive Acquisition Program (CAP) for Part B drugs.Pauline Lapin, (410) 786-6883, for issues related to the chiropractic services demonstration budget neutrality issue.Monique Howard, (410) 786-3869, for issues related to CORF conditions of coverage.Roechel Kujawa, (410) 786-9111, for issues related to ambulance services.Anne Tayloe Hauswald, (410) 786-4546, for clinical laboratory issues.Troy Barsky, (410) 786-8873, or Roy Albert, (410) 786-1872, for issues related to physician self-referral.Michelle Peterman, (410) 786-2591, or Iffat Fatima, (410) 786-6709 for issues related to the grandfathering
Page 33521provisions of the durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) Competitive Acquisition Program.Ralph Goldberg, (410) 786-4870, or Heidi Edmunds, (410) 786-1781, for issues related to the damages process caused by the termination of contracts awarded in 2008 under the DMEPOS Competitive Bidding program.Diane Milstead, (410) 786-3355, or Gaysha Brooks, (410) 786-9649, for all other issues.SUPPLEMENTARY INFORMATION:Inspection of Public Comments: All comments received before the close of the comment period are available for viewing by the public, including any personally identifiable or confidential business information that is included in a comment. We post all comments received before the close of the comment period on the following Web site as soon as possible after they have been received: http:// www.regulations.gov. Follow the search instructions on that Web site to view public comments.Comments received timely will also be available for public inspection as they are received, generally beginning approximately 3 weeks after publication of a document, at the headquarters of theCenters for Medicare & Medicaid Services, 7500 Security Boulevard,Baltimore, Maryland 21244, Monday through Friday of each week from 8:30 a.m. to 4 p.m. To schedule an appointment to view public comments, phone 1-800-743-3951.Table of ContentsTo assist readers in referencing sections contained in this preamble, we are providing a table of contents. Some of the issues discussed in this preamble affect the payment policies, but do not require changes to the regulations in the Code of Federal Regulations(CFR). Information on the regulation's impact appears throughout the preamble, and therefore, is not exclusively in section V. of this proposed rule.I. BackgroundA. Development of the Relative Value System 1. Work RVUs 2. Practice Expense Relative Value Units (PE RVUs) 3. Resource-Based Malpractice RVUs 4. Refinements to the RVUs 5. Adjustments to RVUs Are Budget NeutralB. Components of the Fee Schedule Payment AmountsC. Most Recent Changes to Fee ScheduleII. Provisions of the Proposed RegulationA. Resource-Based Practice Expense (PE) Relative Value Units(RVUs) 1. Current Methodology a. Data Sources for Calculating Practice Expense b. Allocation of PE to Services c. Facility and Nonfacility Costs d. Services With Technical Components (TCs) and ProfessionalComponents (PCs) e. Transition Period f. PE RVU Methodology 2. PE Proposals for CY 2010 a. SMS and Supplemental Survey Background b. Physician Practice Information Survey (PPIS) c. Equipment Utilization Rate d. Miscellaneous PE Issues e. AMA RUC PE Recommendations for Direct PE InputsB. Geographic Practice Cost Indices (GPCIs): Locality Discussion 1. Update--Expiration of 1.0 Work GPCI Floor 2. Payment LocalitiesC. Malpractice RVUs 1. Background 2. Proposed Methodology for the Revision of Resource-BasedMalpractice RVUsD. Medicare Telehealth Services 1. Requests for Adding Services to the List of MedicareTelehealth Services 2. Submitted Requests for Addition to the List of TelehealthServicesE. Specific Coding Issues Related to Physician Fee Schedule 1. Canalith Repositioning 2. Payment for an Initial Preventive Physical Examination (IPPE) 3. Audiology Codes: Policy Clarification of Existing CPT Codes 4. Consultation ServicesF. Potentially Misvalued Codes Under the Physician Fee Schedule 1. Valuing Services Under the Physician Fee Schedule 2. High Cost Supplies 3. Review of Services Often Billed Together and the Possibility of Expanding the Multiple Procedure Payment Reduction (MPPR) toAdditional Nonsurgical Services 4. AMA RUC Review of Potentially Misvalued Services a. Site of Service Anomalies b. ``23-Hour'' Stay 5. Establishing Appropriate Relative Values for Physician FeeSchedule ServicesG. Issues Related to the Medicare Improvements for Patients andProviders Act of 2008 (MIPPA) 1. Section 102: Elimination of Discriminatory Copayment Rates for Medicare Outpatient Psychiatric Services 2. Section 131(b): Physician Payment, Efficiency, and QualityImprovements--Physician Quality Reporting Initiative (PQRI) 3. Section 131(c): Physician Resource Use Measurement andReporting Program 4. Section 131(d): Plan for Transition to Value-Based PurchasingProgram for Physicians and Other Practitioners 5. Section 132: Incentives for Electronic Prescribing (E-Prescribing)--The E-Prescibing Incentive Program 6. Section 135: Implementation of Accreditation Standards forSuppliers Furnishing the Technical Component (TC) of AdvancedDiagnostic Imaging Services 7. Section 139: Improvements for Medicare Anesthesia TeachingPrograms 8. Section 144(a): Payment and Coverage Improvements forPatients With Chronic Obstructive Pulmonary Disease and OtherConditions--Cardiac Rehabilitation Services 9. Section 144(a): Payment and Coverage Improvements forPatients With Chronic Obstructive Pulmonary Disease and OtherConditions--Pulmonary Rehabitation Services 10. Section 152(b): Coverage of Kidney Disease Patient EducationServices 11. Section 153: Renal Dialysis Provisions 12. Section 182(b): Revision of Definition of Medically-AcceptedIndication for Drugs; Compendia for Determination of Medically-Accepted Indications for Off-Label Uses of Drugs and Biologicals in an Anti-Cancer Chemotherapeutic RegimenH. Part B Drug Payment 1. Average Sales Price (ASP) Issues 2. Competitive Acquisition Program (CAP) IssuesI. Provisions Related to Payment for Renal Dialysis ServicesFurnished by End-Stage Renal Disease (ESRD) FacilitiesJ. Discussion of Chiropractic Services Demonstration 1. Background 2. Analysis of Demonstration 3. Payment AdjustmentK. Comprehensive Outpatient Rehabilitation Facilities (CORF) andRehabilitation Agency IssuesL. Ambulance Fee Schedule: Technical Correction to the RuralAdjustment Factor Regulations (414.610)M. Clinical Laboratory Fee Schedule: Signature on RequisitionN. Physician Self-Referral 1. General Background 2. Physician Stand in the ShoesO. Durable Medical Equipment-Related Issues 1. Damages to Suppliers Awarded a Contract Under the Acquisition of Certain Durable Medical Equipment, Prosthetics, Orthotics, andSupplies (Medicare DMEPOS Competitive Bidding Program) Caused by theDelay of the Program 2. Notification to Beneficiaries for Suppliers RegardingGrandfatheringP. Physician Fee Schedule Update for CY 2010III. Collection of Information RequirementsIV. Response to CommentsV. Regulatory Impact AnalysisRegulation TextAddendum A--Explanation and Use of Addendum BAddendum B--Proposed Relative Value Units and Related InformationUsed in Determining Medicare Payments for CY 2010Addendum C--[Reserved]Addendum D--Proposed 2010 Geographic Adjustment Factors (GAFs)Addendum E--Proposed 2010 Geographic Practice Cost Indices (GPCIs) by State and Medicare Locality
Page 33522Addendum F--Proposed CY 2010 ESRD Wage Index for Urban Areas Based on CBSA Labor Market AreasAddendum G--Propsoed CY 2010 ESRD Wage Index Based on CBSA LaborMarket Areas for Rural AreasAcronymsIn addition, because of the many organizations and terms to which we refer by acronym in this final rule with comment period, we are listing these acronyms and their corresponding terms in alphabetical order below:AACVPR American Association of Cardiovascular and PulmonaryRehabilitationACC American College of CardiologyACGME Accreditation Council on Graduate Medical EducationACR American College of RadiologyAFROC Association of Freestanding Radiation Oncology CentersAHA American Heart AssociationAHRQ [HHS'] Agency for Healthcare Research and QualityAIDS Acquired immune deficiency syndromeAMA American Medical AssociationAMP Average manufacturer priceAOA American Osteopathic AssociationAPA American Psychological AssociationAPTA American Physical Therapy AssociationASC Ambulatory surgical centerASP Average sales priceASRT American Society of Radiologic TechnologistsASTRO American Society for Therapeutic Radiology and OncologyATA American Telemedicine AssociationAWP Average wholesale priceBBA Balanced Budget Act of 1997 (Pub. L. 105-33)BBRA [Medicare, Medicaid and State Child Health Insurance Program]Balanced Budget Refinement Act of 1999 (Pub. L. 106-113)BIPA Medicare, Medicaid, and SCHIP Benefits Improvement ProtectionAct of 2000 (Pub. L. 106-554)BLS Bureau of Labor StatisticsBN Budget neutralityCABG Coronary artery bypass graftCAD Coronary artery diseaseCAH Critical access hospitalCAHEA Committee on Allied Health Education and AccreditationCAP Competitive acquisition programCBSA Core-Based Statistical AreaCCHIT Certification Commission for Healthcare Information TechnologyCEAMA Council on Education of the American Medical AssociationCF Conversion factorCfC Conditions for CoverageCFR Code of Federal RegulationsCKD Chronic kidney diseaseCLFS Clinical laboratory fee scheduleCMA California Medical AssociationCMHC Community mental health centerCMP Civil money penaltyCMS Centers for Medicare & Medicaid ServicesCNS Clinical nurse specialistCoP Condition of participationCOPD Chronic obstructive pulmonary diseaseCORF Comprehensive Outpatient Rehabilitation FacilityCOS Cost of serviceCPEP Clinical Practice Expert PanelCPI Consumer Price IndexCPI-U Consumer price index for urban customersCPT [Physicians'] Current Procedural Terminology (4th Edition, 2002, copyrighted by the American Medical Association)CR Cardiac rehabilitationCRNA Certified registered nurse anesthetistCRP Canalith repositioningCRT Certified respiratory therapistCSW Clinical social workerCY Calendar yearDHS Designated health servicesDME Durable medical equipmentDMEPOS Durable medical equipment, prosthetics, orthotics, and suppliesDOQ Doctor's Office QualityDRA Deficit Reduction Act of 2005 (Pub. L. 109-171)DSMT Diabetes self-management trainingE/M Evaluation and managementEDI Electronic data interchangeEEG ElectroencephalogramEHR Electronic health recordEKG ElectrocardiogramEMG ElectromyogramEMTALA Emergency Medical Treatment and Active Labor ActEOG Electro-oculogramEPO ErythropoietinESRD End-stage renal diseaseFAX FacsimileFDA Food and Drug Administration (HHS)FEV Forced expiratory volumeFFS Fee-for-serviceFR Federal RegisterFVC Forced expiratory vital capacity (liters)GAF Geographic adjustment factorGAO General Accountability OfficeGEM Generating Medicare [Physician Quality Performance MeasurementResults]GFR Glomerular filtration rateGPO Group purchasing organizationGPCI Geographic practice cost indexHAC Hospital-acquired conditionsHBAI Health and behavior assessment and interventionHCPAC Health Care Professional Advisory CommitteeHCPCS Healthcare Common Procedure Coding SystemHCRIS Healthcare Cost Report Information SystemHDRT High dose radiation therapyHH PPS Home Health Prospective Payment SystemHHA Home health agencyHHRG Home health resource groupHHS [Department of] Health and Human ServicesHIPAA Health Insurance Portability and Accountability Act of 1996(Pub. L. 104-191)HIT Health information technologyHITECH Health Information Technology for Economic and ClinicalHealth Act (Title IV of Division B of the Recovery Act, together with Title XIII of Division A of the Recovery Act)HITSP Healthcare Information Technology Standards PanelHIV Human immunodeficiency virusHOPD Hospital outpatient departmentHPSA Health Professional Shortage AreaHRSA Health Resources Services Administration (HHS)ICD International Classification of DiseasesIACS Individuals Access to CMS SystemsICF Intermediate care facilitiesICR Intensive cardiac rehabilitationICR Information collection requirementIDTF Independent diagnostic testing facilityIFC Interim final rule with comment periodIMRT Intensity-Modulated Radiation TherapyIPPE Initial preventive physical examinationIPPS Inpatient prospective payment systemIRS Internal Revenue ServiceISO Insurance services officeIVD Ischemic Vascular DiseaseIVIG Intravenous immune globulinIWPUT Intra-service work per unit of timeJRCERT Joint Review Committee on Education in Radiologic TechnologyJUA Joint underwriting associationKDE Kidney disease educationMA Medicare AdvantageMA-PD Medicare Advantage-Prescription Drug PlansMCMP Medicare Care Management PerformanceMedCAC Medicare Evidence Development and Coverage Advisory Committee(formerly the Medicare Coverage Advisory Committee (MCAC))MedPAC Medicare Payment Advisory CommissionMEI Medicare Economic IndexMIEA-TRHCA Medicare Improvements and Extension Act of 2006 (that is,Division B of the Tax Relief and Health Care Act of 2006 (TRHCA)(Pub. L. 109-432)MIPPA Medicare Improvements for Patients and Providers Act of 2008(Pub. L. 110-275)MMA Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Pub. L. 108-173)MMSEA Medicare, Medicaid, and SCHIP Extension Act of 2007 (Pub. L. 110-173)MNT Medical nutrition therapyMP MalpracticeMPPR Multiple procedure payment reductionMQSA Mammography Quality Standards Act of 1992 (Pub. L. 102-539)MRA Magnetic resonance angiographyMRI Magnetic resonance imagingMS-DRG Medicare Severity-Diagnosis related groupMSA Metropolitan statistical areaNCD National Coverage DeterminationNCH National Claims HistoryNCPDP National Council for Prescription Drug ProgramsNCQDIS National Coalition of Quality Diagnostic Imaging ServicesNDC National drug codeNF Nursing facilityNISTA National Institute of Standards and Technology ActNP Nurse practitionerNPDB National Practitioner Data BankNPI National Provider Identifier
Page 33523NPP Nonphysician practitionerNPPES National Plan and Provider Enumeration SystemNQF National Quality ForumNRC Nuclear Regulatory CommissionNTTAA National Technology Transfer and Advancement Act of 1995 (Pub.L. 104-113)NUBC National Uniform Billing CommitteeOACT [CMS'] Office of the ActuaryOBRA Omnibus Budget Reconciliation ActODF Open door forumOIG Office of Inspector GeneralOMB Office of Management and BudgetONC [HHS'] Office of the National CoordinatorOPPS Outpatient prospective payment systemOSA Obstructive Sleep ApneaOSCAR Online Survey and Certification and ReportingP4P Pay for performancePA Physician assistantPBM Pharmacy benefit managerPC Professional componentPCF Patient compensation fundPCI Percutaneous coronary interventionPDE Prescription drug eventPDP Prescription drug planPE Practice expensePE/HR Practice expense per hourPEAC Practice Expense Advisory CommitteePECOS Provider Enrollment, Chain, and Ownership SystemPERC Practice Expense Review CommitteePFS Physician Fee SchedulePGP [Medicare] Physician Group PracticePHP Partial hospitalization programPIM [Medicare] Program Integrity ManualPLI Professional liability insurancePOA Present on admissionPOC Plan of carePPI Producer price indexPPIS Physician Practice Information SurveyPPS Prospective payment systemPPTA Plasma Protein Therapeutics AssociationPQRI Physician Quality Reporting InitiativePRA Paperwork Reduction ActPSA Physician scarcity areasPSG PolysomnographyPT Physical therapyPTCA Percutaneous transluminal coronary angioplastyRA Radiology assistantRecovery Act American Recovery and Reinvestment Act (Pub. L. 111-5)ResDAC Research Data Assistance CenterRFA Regulatory Flexibility ActRIA Regulatory impact analysisRN Registered nurseRNAC Reasonable net acquisition costRPA Radiology practitioner assistantRRT Registered respiratory therapistRUC [AMA's Specialty Society] Relative (Value) Update CommitteeRVU Relative value unitSBA Small Business AdministrationSGR Sustainable growth rateSLP Speech-language pathologySMS [AMA's] Socioeconomic Monitoring SystemSNF Skilled nursing facilitySOR System of recordSRS Stereotactic radiosurgeryTC Technical ComponentTIN Tax identification numberTRHCA Tax Relief and Health Care Act of 2006 (Pub. L. 109-432)TTO Transtracheal oxygenUPMC University of Pittsburgh Medical CenterUSDE United States Department of EducationVBP Value-based purchasingWAMP Widely available market priceI. BackgroundSince January 1, 1992, Medicare has paid for physicians' services under section 1848 of the Social Security Act (the Act), ``Payment forPhysicians' Services.'' The Act requires that payments under the physician fee schedule (PFS) be based on national uniform relative value units (RVUs) based on the relative resources used in furnishing a service. Section 1848(c) of the Act requires that national RVUs be established for physician work, practice expense (PE), and malpractice expense. Before the establishment of the resource-based relative value system, Medicare payment for physicians' services was based on reasonable charges.A. Development of the Relative Value System 1. Work RVUsThe concepts and methodology underlying the PFS were enacted as part of the Omnibus Budget Reconciliation Act (OBRA) of 1989 (Pub. L. 101-239), and OBRA 1990, (Pub. L. 101-508). The final rule, published on November 25, 1991 (56 FR 59502), set forth the fee schedule for payment for physicians' services beginning January 1, 1992. Initially, only the physician work RVUs were resource-based, and the PE and malpractice RVUs were based on average allowable charges.The physician work RVUs established for the implementation of the fee schedule in January 1992 were developed with extensive input from the physician community. A research team at the Harvard School ofPublic Health developed the original physician work RVUs for most codes in a cooperative agreement with the Department of Health and HumanServices (DHHS). In constructing the code-specific vignettes for the original physician work RVUs, Harvard worked with panels of experts, both inside and outside the Federal government, and obtained input from numerous physician specialty groups.Section 1848(b)(2)(B) of the Act specifies that the RVUs for anesthesia services are based on RVUs from a uniform relative value guide, with appropriate adjustment of the conversion factor (CF), in a manner to assure that fee schedule amounts for anesthesia services are consistent with those for other services of comparable value. We established a separate CF for anesthesia services, and we continue to utilize time units as a factor in determining payment for these services. As a result, there is a separate payment methodology for anesthesia services.We establish physician work RVUs for new and revised codes based on our review of recommendations received from the American MedicalAssociation's (AMA) Specialty Society Relative Value Update Committee(RUC). 2. Practice Expense Relative Value Units (PE RVUs)Section 121 of the Social Security Act Amendments of 1994 (Pub. L. 103-432), enacted on October 31, 1994, amended section 1848(c)(2)(C)(ii) of the Act and required us to develop resource-basedPE RVUs for each physician's service beginning in 1998. We were to consider general categories of expenses (such as office rent and wages of personnel, but excluding malpractice expenses) comprising PEs.Section 4505(a) of the Balanced Budget Act of 1997 (BBA) (Pub. L. 105-33), amended section 1848(c)(2)(C)(ii) of the Act to delay implementation of the resource-based PE RVU system until January 1, 1999. In addition, section 4505(b) of the BBA provided for a 4-year transition period from charge-based PE RVUs to resource-based RVUs.We established the resource-based PE RVUs for each physicians' service in a final rule, published November 2, 1998 (63 FR 58814), effective for services furnished in 1999. Based on the requirement to transition to a resource-based system for PE over a 4-year period, resource-based PE RVUs did not become fully effective until 2002.This resource-based system was based on two significant sources of actual PE data: The Clinical Practice Expert Panel (CPEP) data; and theAMA's Socioeconomic Monitoring System (SMS) data. The CPEP data were collected from panels of physicians, practice administrators, and nonphysicians (for example, registered nurses (RNs)) nominated by physician specialty societies and other groups. The CPEP panels identified the direct inputs required for each physician's service in both the office setting and out-of-office setting. We have since refined and revised these inputs based on recommendations from the RUC.The AMA's SMS data provided aggregate
Page 33524specialty-specific information on hours worked and PEs.Separate PE RVUs are established for procedures that can be performed in both a nonfacility setting, such as a physician's office, and a facility setting, such as a hospital outpatient department. The difference between the facility and nonfacility RVUs reflects the fact that a facility typically receives separate payment from Medicare for its costs of providing the service, apart from payment under the PFS.The nonfacility RVUs reflect all of the direct and indirect PEs of providing a particular service.Section 212 of the Balanced Budget Refinement Act of 1999 (BBRA)(Pub. L. 106-113) directed the Secretary of Health and Human Services(the Secretary) to establish a process under which we accept and use, to the maximum extent practicable and consistent with sound data practices, data collected or developed by entities and organizations to supplement the data we normally collect in determining the PE component. On May 3, 2000, we published the interim final rule (65 FR 25664) that set forth the criteria for the submission of these supplemental PE survey data. The criteria were modified in response to comments received, and published in the Federal Register (65 FR 65376) as part of a November 1, 2000 final rule. The PFS final rules published in 2001 and 2003, respectively, (66 FR 55246 and 68 FR 63196) extended the period during which we would accept these supplemental data throughMarch 1, 2005.In the Calendar Year (CY) 2007 PFS final rule with comment period(71 FR 69624), we revised the methodology for calculating PE RVUs beginning in CY 2007 and provided for a 4-year transition for the newPE RVUs under this new methodology. 3. Resource-Based Malpractice (MP) RVUsSection 4505(f) of the BBA amended section 1848(c) of the Act requiring us to implement resource-based malpractice (MP) RVUs for services furnished on or after 2000. The resource-based MP RVUs were implemented in the PFS final rule published November 2, 1999 (64 FR 59380). The MP RVUs were based on malpractice insurance premium data collected from commercial and physician-owned insurers from all theStates, the District of Columbia, and Puerto Rico. 4. Refinements to the RVUsSection 1848(c)(2)(B)(i) of the Act requires that we review allRVUs no less often than every 5 years. The first 5-Year Review of the physician work RVUs was published on November 22, 1996 (61 FR 59489) and was effective in 1997. The second 5-Year Review was published in the CY 2002 PFS final rule with comment period (66 FR 55246) and was effective in 2002. The third 5-Year Review of physician work RVUs was published in the CY 2007 PFS final rule with comment period (71 FR 69624) and was effective on January 1, 2007. (Note: Additional codes relating to the third 5-Year Review of physician work RVUs were addressed in the CY 2008 PFS final rule with comment period (72 FR 66360).)In 1999, the AMA's RUC established the Practice Expense AdvisoryCommittee (PEAC) for the purpose of refining the direct PE inputs.Through March 2004, the PEAC provided recommendations to CMS for over 7,600 codes (all but a few hundred of the codes currently listed in theAMA's Current Procedural Terminology (CPT) codes). As part of the CY 2007 PFS final rule with comment period (71 FR 69624), we implemented a new methodology for determining resource-based PE RVUs and are transitioning this over a 4-year period. (Note: In section II.A.2. of this proposed rule, we are proposing to use new survey data under thePE methodology.)In the CY 2005 PFS final rule with comment period (69 FR 66236), we implemented the first 5-Year Review of the MP RVUs (69 FR 66263).(Note: In section II.C. of this proposed rule, we are proposing to update the malpractice RVUs with the use of new data.) 5. Adjustments to RVUs are Budget NeutralSection 1848(c)(2)(B)(ii)(II) of the Act provides that adjustments in RVUs for a year may not cause total PFS payments to differ by more than $20 million from what they would have been if the adjustments were not made. In accordance with section 1848(c)(2)(B)(ii)(II) of the Act, if adjustments to RVUs cause expenditures to change by more than $20 million, we make adjustments to ensure that expenditures do not increase or decrease by more than $20 million.As explained in the CY 2009 PFS final rule with comment period (73FR 69730), as required by section 133(b) of the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA) (Pub. L. 110-275), the separate budget neutrality (BN) adjustor resulting from the third 5-Year Review of physician work RVUs is being applied to the CF beginning with CY 2009 rather than the work RVUs.B. Components of the Fee Schedule Payment AmountsTo calculate the payment for every physicians' service, the components of the fee schedule (physician work, PE, and MP RVUs) are adjusted by a geographic practice cost index (GPCI). The GPCIs reflect the relative costs of physician work, PE, and malpractice expense in an area compared to the national average costs for each component.RVUs are converted to dollar amounts through the application of aCF, which is calculated by CMS' Office of the Actuary (OACT).The formula for calculating the Medicare fee schedule payment amount for a given service and fee schedule area can be expressed as:Payment = [(RVU work x GPCI work) + (RVU PE x GPCI PE) + (RVU malpractice x GPCI malpractice)] x CFC. Most Recent Changes to the Fee ScheduleThe CY 2009 PFS final rule with comment period (73 FR 69726) implemented changes to the PFS and other Medicare Part B payment policies finalized the CY 2008 interim RVUs and implemented interimRVUs for new and revised codes for CY 2009 to ensure that our payment systems are updated to reflect changes in medical practice and the relative value of services.The CY 2009 PFS final rule with comment period also addressed other policies, as well as certain provisions of the MIPPA.As required by the statute, and based on section 131 of the MIPPA, the CY 2009 PFS final rule with comment period also announced that thePFS update is 1.1 percent for CY 2009, the initial estimate for the sustainable growth rate for CY 2009 is 7.4 percent, and the conversion factor (CF) for CY 2009 is $36.0666.II. Provisions of the Proposed RegulationA. Resource-Based Practice Expense (PE) Relative Value Units (RVUs)Practice expense (PE) is the portion of the resources used in furnishing the service that reflects the general categories of physician and practitioner expenses, such as office rent and personnel wages but excluding malpractice expenses, as specified in section 1848(c)(1)(B) of the Act.Section 121 of the Social Security Amendments of 1994 (Pub. L. 103- 432), enacted on October 31, 1994, required CMS to develop a methodology for a resource-based system for determining
Page 33525PE RVUs for each physician's service. Until that time, PE RVUs were based on historical allowed charges. This legislation stated that the revised PE methodology must consider the staff, equipment, and supplies used in the provision of various medical and surgical services in various settings beginning in 1998. The Secretary has interpreted this to mean that Medicare payments for each service would be based on the relative PE resources typically involved with furnishing the service.The initial implementation of resource-based PE RVUs was delayed from January 1, 1998, until January 1, 1999, by section 4505(a) of theBBA. In addition, section 4505(b) of the BBA required that the new payment methodology be phased in over 4 years, effective for services furnished in CY 1999, and fully effective in CY 2002. The first step toward implementation of the statute was to adjust the PE values for certain services for CY 1998. Section 4505(d) of the BBA required that, in developing the resource-based PE RVUs, the Secretary must--Use, to the maximum extent possible, generally-accepted cost accounting principles that recognize all staff, equipment, supplies, and expenses, not solely those that can be linked to specific procedures and actual data on equipment utilization.Develop a refinement method to be used during the transition.Consider, in the course of notice and comment rulemaking, impact projections that compare new proposed payment amounts to data on actual physician PE.In CY 1999, we began the 4-year transition to resource-based PERVUs utilizing a ``top-down'' methodology whereby we allocated aggregate specialty-specific practice costs to individual procedures.The specialty-specific PEs were derived from the American MedicalAssociation's (AMA's) Socioeconomic Monitoring Survey (SMS). In addition, under section 212 of the BBRA, we established a process extending through March 2005 to supplement the SMS data with data submitted by a specialty. The aggregate PEs for a given specialty were then allocated to the services furnished by that specialty on the basis of the direct input data (that is, the staff time, equipment, and supplies) and work RVUs assigned to each CPT code.For CY 2007, we implemented a new methodology for calculating PERVUs. Under this new methodology, we use the same data sources for calculating PE, but instead of using the ``top-down'' approach to calculate the direct PE RVUs, under which the aggregate direct and indirect costs for each specialty are allocated to each individual service, we now utilize a ``bottom-up'' approach to calculate the direct costs. Under the ``bottom up'' approach, we determine the directPE by adding the costs of the resources (that is, the clinical staff, equipment, and supplies) typically required to provide each service.The costs of the resources are calculated using the refined direct PE inputs assigned to each CPT code in our PE database, which are based on our review of recommendations received from the AMA's Relative ValueUpdate Committee (RUC). For a more detailed explanation of the PE methodology, see the Five-Year Review of Work Relative Value UnitsUnder the PFS and Proposed Changes to the Practice Expense Methodology proposed notice (71 FR 37242) and the CY 2007 PFS final rule with comment period (71 FR 69629).Note: In section II.A.1 of this proposed rule, we discuss the current methodology used for calculating PE. In section II.A.2. of this proposed rule, which contains PE proposals for CY 2010, we are proposing to use data from the AMA Physician Practice InformationSurvey (PPIS) in place of the AMA's SMS survey data and supplemental survey data that is currently used in the PE methodology. 1. Current Methodology a. Data Sources for Calculating Practice ExpenseThe AMA's SMS survey data and supplemental survey data from the specialties of cardiothoracic surgery, vascular surgery, physical and occupational therapy, independent laboratories, allergy/immunology, cardiology, dermatology, gastroenterology, radiology, independent diagnostic testing facilities (IDTFs), radiation oncology, and urology are used to develop the PE per hour (PE/HR) for each specialty. For those specialties for which we do not have PE/HR, the appropriate PE/HR is obtained from a crosswalk to a similar specialty.The AMA developed the SMS survey in 1981 and discontinued it in 1999. Beginning in 2002, we incorporated the 1999 SMS survey data into our calculation of the PE RVUs, using a 5-year average of SMS survey data. (See the CY 2002 PFS final rule with comment period (66 FR 55246).) The SMS PE survey data are adjusted to a common year, 2005.The SMS data provide the following six categories of PE costs:Clinical payroll expenses, which are payroll expenses(including fringe benefits) for nonphysician clinical personnel.Administrative payroll expenses, which are payroll expenses (including fringe benefits) for nonphysician personnel involved in administrative, secretarial, or clerical activities.Office expenses, which include expenses for rent, mortgage interest, depreciation on medical buildings, utilities, and telephones.Medical material and supply expenses, which include expenses for drugs, x-ray films, and disposable medical products.Medical equipment expenses, which include depreciation, leases, and rent of medical equipment used in the diagnosis or treatment of patients.All other expenses, which include expenses for legal services, accounting, office management, professional association memberships, and any professional expenses not previously mentioned in this section.In accordance with section 212 of the BBRA, we established a process to supplement the SMS data for a specialty with data collected by entities and organizations other than the AMA (that is, those entities and organizations representing the specialty itself). (See theCriteria for Submitting Supplemental Practice Expense Survey Data interim final rule with comment period (65 FR 25664).) Originally, the deadline to submit supplementary survey data was through August 1, 2001. In the CY 2002 PFS final rule (66 FR 55246), the deadline was extended through August 1, 2003. To ensure maximum opportunity for specialties to submit supplementary survey data, we extended the deadline to submit surveys until March 1, 2005 in the Revisions toPayment Policies Under the Physician Fee Schedule for CY 2004 final rule with comment period (68 FR 63196) (hereinafter referred to as CY 2004 PFS final rule with comment period).The direct cost data for individual services were originally developed by the Clinical Practice Expert Panels (CPEP). The CPEP data include the supplies, equipment, and staff times specific to each procedure. The CPEPs consisted of panels of physicians, practice administrators, and nonphysicians (for example, RNs) who were nominated by physician specialty societies and other groups. There were 15 CPEPs consisting of 180 members from more than 61 specialties and subspecialties. Approximately 50 percent of the panelists were physicians.The CPEPs identified specific inputs involved in each physician's service provided in an office or facility setting.
Page 33526The inputs identified were the quantity and type of nonphysician labor, medical supplies, and medical equipment. The CPEP data has been regularly updated by various RUC committees on PE. b. Allocation of PE to ServicesThe aggregate level specialty-specific PEs are derived from theAMA's SMS survey and supplementary survey data. To establish PE RVUs for specific services, it is necessary to establish the direct and indirect PE associated with each service.(i) Direct costs. The direct costs are determined by adding the costs of the resources (that is, the clinical staff, equipment, and supplies) typically required to provide the service. The costs of these resources are calculated from the refined direct PE inputs in our PE database. These direct inputs are then scaled to the current aggregate pool of direct PE RVUs. The aggregate pool of direct PE RVUs can be derived using the following formula: (PE RVUs x physician CF) x(average direct percentage from SMS /(Supplemental PE/HR data)).(ii) Indirect costs. The SMS and supplementary survey data are the source for the specialty-specific aggregate indirect costs used in ourPE calculations. We then allocate the indirect costs to the code level on the basis of the direct costs specifically associated with a code and the greater of either the clinical labor costs or the physician work RVUs. For calculation of the 2010 PE RVUs, we use the 2008 procedure-specific utilization data crosswalked to 2010 services. To arrive at the indirect PE costs--We apply a specialty-specific indirect percentage factor to the direct expenses to recognize the varying proportion that indirect costs represent of total costs by specialty. For a given service, the specific indirect percentage factor to apply to the direct costs for the purpose of the indirect allocation is calculated as the weighted average of the ratio of the indirect to direct costs (based on the survey data) for the specialties that furnish the service. For example, if a service is furnished by a single specialty with indirectPEs that were 75 percent of total PEs, the indirect percentage factor to apply to the direct costs for the purposes of the indirect allocation would be (0.75/0.25) = 3.0. The indirect percentage factor is then applied to the service level adjusted indirect PE allocators.We use the specialty-specific PE/HR from the SMS survey data, as well as the supplemental surveys for cardiothoracic surgery, vascular surgery, physical and occupational therapy, independent laboratories, allergy/immunology, cardiology, dermatology, radiology, gastroenterology, IDTFs, radiation oncology, and urology. (Note: For radiation oncology, the data represent the combined survey data from the American Society for Therapeutic Radiology and Oncology (ASTRO) and the Association of Freestanding Radiation Oncology Centers (AFROC)). As discussed in the CY 2008 PFS final rule with comment period (72 FR 66233), the PE/HR survey data for radiology is weighted by practice size. We incorporate this PE/HR into the calculation of indirect costs using an index which reflects the relationship between each specialty's indirect scaling factor and the overall indirect scaling factor for the entire PFS. For example, if a specialty had an indirect practice cost index of 2.00, this specialty would have an indirect scaling factor that was twice the overall average indirect scaling factor. If a specialty had an indirect practice cost index of 0.50, this specialty would have an indirect scaling factor that was half the overall average indirect scaling factor.When the clinical labor portion of the direct PE RVU is greater than the physician work RVU for a particular service, the indirect costs are allocated based upon the direct costs and the clinical labor costs. For example, if a service has no physician work and 1.10 direct PE RVUs, and the clinical labor portion of the directPE RVUs is 0.65 RVUs, we would use the 1.10 direct PE RVUs and the 0.65 clinical labor portions of the direct PE RVUs to allocate the indirectPE for that service. c. Facility and Nonfacility CostsProcedures that can be furnished in a physician's office, as well as in a hospital or facility setting have two PE RVUs: Facility and nonfacility. The nonfacility setting includes physicians' offices, patients' homes, freestanding imaging centers, and independent pathology labs. Facility settings include hospitals, ambulatory surgical centers (ASCs), and skilled nursing facilities (SNFs). The methodology for calculating PE RVUs is the same for both facility and nonfacility RVUs, but is applied independently to yield two separate PERVUs. Because the PEs for services provided in a facility setting are generally included in the payment to the facility (rather than the payment to the physician under the PFS), the PE RVUs are generally lower for services provided in the facility setting. d. Services With Technical Components (TCs) and Professional Components(PCs)Diagnostic services are generally comprised of two components: A professional component (PC) and a technical component (TC), both of which may be performed independently or by different providers. When services have TCs, PCs, and global components that can be billed separately, the payment for the global component equals the sum of the payment for the TC and PC. This is a result of using a weighted average of the ratio of indirect to direct costs across all the specialties that furnish the global components, TCs, and PCs; that is, we apply the same weighted average indirect percentage factor to allocate indirect expenses to the global components, PCs, and TCs for a service. (The direct PE RVUs for the TC and PC sum to the global under the bottom-up methodology.) e. Transition PeriodAs discussed in the CY 2007 PFS final rule with comment period (71FR 69674), the change to the PE methodology was implemented over a 4- year period. In CY 2010, the transition period is concluded and PE RVUs will be calculated based entirely on the current methodology. f. PE RVU MethodologyThe following is a description of the PE RVU methodology.(i) Setup FileFirst, we create a setup file for the PE methodology. The setup file contains the direct cost inputs, the utilization for each procedure code at the specialty and facility/nonfacility place of service level, and the specialty-specific survey PE per physician hour data.(ii) Calculate the Direct Cost PE RVUsSum the Costs of Each Direct InputStep 1: Sum the direct costs of the inputs for each service. The direct costs consist of the costs of the direct inputs for clinical labor, medical supplies, and medical equipment. The clinical labor cost is the sum of the cost of all the staff types associated with the service; it is the product of the time for each staff type and the wage rate for that staff type. The medical supplies cost is the sum of the supplies associated with the service; it is the product of the quantity of each supply and the cost of the supply. The medical equipment cost is the sum of the cost of the equipment associated with the service; it is the product of the number of minutes each piece of equipment is used in the
Page 33527service and the equipment cost per minute. The equipment cost per minute is calculated as described at the end of this section.Apply a BN Adjustment to the Direct InputsStep 2: Calculate the current aggregate pool of direct PE costs. To do this, multiply the current aggregate pool of total direct and indirect PE costs (that is, the current aggregate PE RVUs multiplied by the CF) by the average direct PE percentage from the SMS and supplementary specialty survey data.Step 3: Calculate the aggregate pool of direct costs. To do this, for all PFS services, sum the product of the direct costs for each service from Step 1 and the utilization data for that service.Step 4: Using the results of Step 2 and Step 3 calculate a directPE BN adjustment so that the aggregate direct cost pool does not exceed the current aggregate direct cost pool and apply it to the direct costs from Step 1 for each service.Step 5: Convert the results of Step 4 to an RVU scale for each service. To do this, divide the results of Step 4 by the Medicare PFSCF.(iii) Create the indirect PE RVUs.Create indirect allocators.Step 6: Based on the SMS and supplementary specialty survey data, calculate direct and indirect PE percentages for each physician specialty.Step 7: Calculate direct and indirect PE percentages at the service level by taking a weighted average of the results of Step 6 for the specialties that furnish the service. Note that for services with TCs and PCs, we are calculating the direct and indirect percentages across the global components, PCs, and TCs. That is, the direct and indirect percentages for a given service (for example, echocardiogram) do not vary by the PC, TC and global component.Step 8: Calculate the service level allocators for the indirect PEs based on the percentages calculated in Step 7. The indirect PEs are allocated based on the three components: The direct PE RVU, the clinical PE RVU, and the work RVU.For most services the indirect allocator is: indirect percentage *(direct PE RVU/direct percentage) + work RVU.There are two situations where this formula is modified:If the service is a global service (that is, a service with global, professional, and technical components), then the indirect allocator is: Indirect percentage * (direct PE RVU/direct percentage) + clinical PE RVU + work RVU.If the clinical labor PE RVU exceeds the work RVU (and the service is not a global service), then the indirect allocator is:Indirect percentage * (direct PE RVU/direct percentage) + clinical PERVU.Note: For global services, the indirect allocator is based on both the work RVU and the clinical labor PE RVU. We do this to recognize that, for the professional service, indirect PEs will be allocated using the work RVUs, and for the TC service, indirect PEs will be allocated using the direct PE RVU and the clinical labor PERVU. This also allows the global component RVUs to equal the sum of the PC and TC RVUs.For presentation purposes in the examples in the Table 1, the formulas were divided into two parts for each service. The first part does not vary by service and is the indirect percentage * (direct PERVU/direct percentage). The second part is either the work RVU, clinical PE RVU, or both depending on whether the service is a global service and whether the clinical PE RVU exceeds the work RVU (as described earlier in this step.)Apply a BN Adjustment to the Indirect AllocatorsStep 9: Calculate the current aggregate pool of indirect PE RVUs by multiplying the current aggregate pool of PE RVUs by the average indirect PE percentage from the physician specialty survey data. This is similar to the Step 2 calculation for the direct PE RVUs.Step 10: Calculate an aggregate pool of indirect PE RVUs for allPFS services by adding the product of the indirect PE allocators for a service from Step 8 and the utilization data for that service. This is similar to the Step 3 calculation for the direct PE RVUs.Step 11: Using the results of Step 9 and Step 10, calculate an indirect PE adjustment so that the aggregate indirect allocation does not exceed the available aggregate indirect PE RVUs and apply it to indirect allocators calculated in Step 8. This is similar to the Step 4 calculation for the direct PE RVUs.Calculate the Indirect Practice Cost IndexStep 12: Using the results of Step 11, calculate aggregate pools of specialty-specific adjusted indirect PE allocators for all PFS services for a specialty by adding the product of the adjusted indirect PE allocator for each service and the utilization data for that service.Step 13: Using the specialty-specific indirect PE/HR data, calculate specialty-specific aggregate pools of indirect PE for all PFS services for that specialty by adding the product of the indirect PE/HR for the specialty, the physician time for the service, and the specialty's utilization for the service.Step 14: Using the results of Step 12 and Step 13, calculate the specialty-specific indirect PE scaling factors as under the current methodology.Step 15: Using the results of Step 14, calculate an indirect practice cost index at the specialty level by dividing each specialty- specific indirect scaling factor by the average indirect scaling factor for the entire PFS.Step 16: Calculate the indirect practice cost index at the service level to ensure the capture of all indirect costs. Calculate a weighted average of the practice cost index values for the specialties that furnish the service.Note: For services with TCs and PCs, we calculate the indirect practice cost index across the global components, PCs, and TCs.Under this method, the indirect practice cost index for a given service (for example, echocardiogram) does not vary by the PC, TC and global component.Step 17: Apply the service level indirect practice cost index calculated in Step 16 to the service level adjusted indirect allocators calculated in Step 11 to get the indirect PE RVU.(iv) Calculate the Final PE RVUsStep 18: Add the direct PE RVUs from Step 6 to the indirect PE RVUs from Step 17.Step 19: Calculate and apply the final PE BN adjustment by comparing the results of Step 18 to the current pool of PE RVUs. This final BN adjustment is required primarily because certain specialties are excluded from the PE RVU calculation for ratesetting purposes, but all specialties are included for purposes of calculating the final BN adjustment. (See ``Specialties excluded from ratesetting calculation'' below in this section.)(v) Setup File InformationSpecialties excluded from ratesetting calculation: For the purposes of calculating the PE RVUs, we exclude certain specialties such as midlevel practitioners paid at a percentage of the PFS, audiology, and low volume specialties from the calculation. These specialties are included for the purposes of calculating the BN adjustment.Crosswalk certain low volume physician specialties:Crosswalk the utilization of certain specialties with relatively lowPFS utilization to the associated specialties.Physical therapy utilization: Crosswalk the utilization associated with all physical therapy services to the specialty of physical therapy.Identify professional and technical services not identified under the usual
Page 33528TC and 26 modifiers: Flag the services that are PC and TC services, but do not use TC and 26 modifiers (for example, electrocardiograms). This flag associates the PC and TC with the associated global code for use in creating the indirect PE RVU. For example, the professional service code 93010 is associated with the global code 93000.Payment modifiers: Payment modifiers are accounted for in the creation of the file. For example, services billed with the assistant at surgery modifier are paid 16 percent of the PFS amount for that service; therefore, the utilization file is modified to only account for 16 percent of any service that contains the assistant at surgery modifier.Work RVUs: The setup file contains the work RVUs from this proposed rule.(vi) Equipment cost per minuteThe equipment cost per minute is calculated as:(1/(minutes per year * usage)) * price * ((interest rate/(1-(1/((1 + interest rate) ** life of equipment)))) + maintenance)Where: minutes per year = maximum minutes per year if usage were continuous(that is, usage = 1); 150,000 minutes. usage = equipment utilization assumption; 0.9 for certain equipment(see section II.A.2. of this proposed rule) and 0.5. for others. price = price of the particular piece of equipment. interest rate = 0.11. life of equipment = useful life of the particular piece of equipment. maintenance = factor for maintenance; 0.05.Note: To illustrate the PE calculation, in Table 1 we have used the conversion factor (CF) of $36.0666 which is the CF effectiveJanuary 1, 2009 as published in CY 2009 PFS final rule with comment period.BILLING CODE 4120-01-P
Page 33529
GRAPHIC
TIFF OMITTED TP13JY09.139
Page 33530BILLING CODE 4120-01-CNote: Proposed PE RVU in Table 1, row 27, may not match AddendumB due to rounding.* The direct adj = [current PE RVUs * CF * avg dir pct] / [sum direct inputs] = [Step 2] / [Step 3]** The indirect adj = [current PE RVUs * avg ind pct] / [sum of ind allocators] = [Step 9] / [Step 10] 2. PE Proposals for CY 2010 a. SMS and Supplemental Survey BackgroundCurrently, we use PE/HR obtained from the SMS surveys from 1995- 1999. For several specialties that collected additional PE/HR data through a more recent supplemental survey, we accepted and incorporated these data in developing current PE/HR values.While the SMS survey was not specifically designed for the purpose of establishing PE RVUs, we found these data to be the best available at the time. The SMS was a multi-specialty survey effort conducted using a consistent survey instrument and method across specialties. The survey sample was randomly drawn from the AMA Physician Masterfile to ensure national representativeness. The AMA discontinued the SMS survey in 1999.As required by the BBRA, we also established a process by which specialty groups could submit supplemental PE data. In the May 3, 2000 interim final rule entitled, Medicare Program; Criteria for SubmittingSupplemental Practice Expense Survey Data, (65 FR 25664), we established criteria for acceptance of supplemental data. The criteria were modified in the CY 2001 and CY 2003 PFS final rules with comment period (65 FR 65380 and 67 FR 79971, respectively). We currently use supplemental survey data for the following specialties: Cardiology; dermatology; gastroenterology; radiology; cardiothoracic surgery; vascular surgery; physical and occupational therapy; independent laboratories; allergy/immunology; independent diagnostic testing facilities (IDTFs); radiation oncology; medical oncology; and urology.Because the SMS data and the supplemental survey data are from different time periods, we have historically inflated them by the MEI to help put them on as comparable a time basis as we can when calculating the PE RVUs. This MEI proxy has been necessary in the past due to the lack of contemporaneous, consistently collected, and comprehensive multispecialty survey data. b. Physician Practice Information Survey (PPIS)The AMA has conducted a new survey, the PPIS, which was expanded(relative to the SMS) to include nonphysician practitioners (NPPs) paid under the PFS. The PPIS, administered in CY 2007 and CY 2008, was designed to update the specialty-specific PE/HR data used to develop PERVUs.The AMA and our contractor, The Lewin Group (Lewin), analyzed thePPIS data and calculated the PE/HR for physician and nonphysician specialties, respectively. The AMA's summary worksheets and Lewin's final report are available on the CMS Web site at http://www.cms.gov/PhysicianFeeSched/. (See AMA PPIS Worksheets 1-3 and Lewin Group FinalReport PPIS.) Table 2 shows the current indirect PE/HR based on SMS and supplemental surveys, the PPIS indirect PE/HR, and the indirect cost percentages of total costs.Table 2--Indirect PE/HR and Indirect Percentages
Current and PPISCurrentPPISSpecialtyindirectindirectCurrentPPISCurrent crosswalkPE/HRPE/HRindirect % indirect %All Physicians...............$59.04$86.366774Allergy and Immunology.......153.29162.686267Anesthesiology...............19.7629.375682Audiology....................59.0472.176785 All Physicians.Cardiology...................131.0288.045665Cardiothoracic Surgery.......61.7567.836883Chiropractor.................49.6065.336986 Internal Medicine.Clinical Laboratory (Billing66.4671.013737Independently) *.Clinical Psychology..........29.0720.079093 Psychiatry.Clinical Social Work.........29.0717.809097 Psychiatry.Colon & Rectal Surgery.......53.9390.857780Dermatology..................158.49184.627070Emergency Medicine...........36.8538.368894Endocrinology................49.6084.396973Family Medicine..............52.7990.156276Gastroenterology.............101.3096.787075General Practice.............52.7978.596269General Surgery..............53.9382.747782Geriatrics...................49.6054.146974Hand Surgery.................98.56148.787277Independent Diagnostic466.16501.455050Testing Facilities *.Internal Medicine............49.6084.036976Interventional Pain Medicine.59.04156.796770Interventional Radiology.....118.4882.555881Medical Oncology.............141.84129.945956Nephrology...................49.6066.006980Neurology....................66.05110.397487Neurosurgery.................89.64115.768687Nuclear Medicine.............118.4839.805877Obstetrics/Gynecology........69.7499.326767Ophthalmology................103.28170.086570Optometry....................59.0488.026777 All Physicians.Oral Surgery (Dentist only)..96.01173.197165 Otolaryngology.
Page 33531Orthopaedic Surgery..........98.56131.407281Osteopathic Manipulative59.0453.936793Therapy.Otolaryngology...............96.01141.537175Pain Medicine................59.04122.416770Pathology....................59.8074.987074Pediatrics...................51.5276.276269Physical Medicine and84.92110.137184Rehabilitation.Physical Therapy.............35.1757.266584Plastic Surgery..............99.32134.826774Podiatry.....................59.0474.766782 All Physicians.Psychiatry...................29.0730.099094Pulmonary Disease............44.6355.267674Radiation Oncology (Hospital114.00126.665056Based & Freestanding).Radiology....................118.4895.605871Registered Dieticians........59.0418.456784 All Physicians.Rheumatology.................84.9298.087167Urology......................119.5797.026973Vascular Surgery.............60.1083.986373\*\ Did not participate in PPIS. Data based on Supplemental Survey.The PPIS is a multispecialty, nationally representative, PE survey of both physician and NPPs using a consistent survey instrument and methods highly consistent with those used for the SMS and the supplemental surveys. The PPIS has gathered information from 3,656 respondents across 51 physician specialty and health care professional groups. We believe the PPIS is the most comprehensive source of PE survey information available to date.As noted, the BBRA required us to establish criteria for accepting supplemental survey data. Since the supplemental surveys were specific to individual specialties and not part of a comprehensive multispecialty survey, we had required certain precision levels be met in order to ensure that the supplemental data was sufficiently valid, and to be accepted for use in the development of the PE RVUs. Because the PPIS is a contemporaneous, consistently collected, and comprehensive multispecialty survey, we do not believe similar precision requirements are necessary and are not proposing to establish them for the use of the PPIS data.For physician specialties, the survey responses were adjusted for non-response bias. Non-response bias is the bias that results when the characteristics of survey respondents differ in meaningful ways, such as in the mix of practice sizes, from the general population. The non- response adjustment was developed based on a comparison of practice size and other characteristic information between the PPIS survey respondents and data from the AMA Masterfile (for physician specialties) or information from specialty societies (for non-physician specialties). For six specialties (that is, chiropractors, clinical social workers, nuclear medicine, osteopathic manipulative therapy, physical therapy, and registered dietians) such an adjustment was not possible due to a lack of available characteristic data. The AMA andLewin have indicated that the non-response weighting has only a small impact on PE/HR values.Under our current policy, various specialties without SMS or supplemental survey data have been crosswalked to other similar specialties to obtain a proxy PE/HR. For specialties that were part of the PPIS for which we currently use a crosswalked PE/HR, we are proposing instead to use the PPIS-based PE/HR. We are proposing to continue current crosswalks for specialties that did not participate inPPIS.Supplemental survey data on independent labs, from the College ofAmerican Pathologists, was implemented for payments in CY 2005.Supplemental survey data from the National Coalition of QualityDiagnostic Imaging Services (NCQDIS), representing IDTFs, was blended with supplementary survey data from the American College of Radiology(ACR) and implemented for payments in CY 2007. Neither IDTFs norIndependent Labs participated in PPIS. Therefore, we are proposing to continue using the current PE/HR that was developed using their supplemental survey data.We are not proposing to use the PPIS data for reproductive endocrinology, sleep medicine, and spine surgery since these specialties are not separately recognized by Medicare and we do not know how to blend this data with the Medicare recognized specialty data. We seek comment on this issue.We are not proposing changes to the manner in which the PE/HR data are used in the current PE RVU methodology. We are merely proposing to update the PE/HR data itself based on the new survey. We propose to utilize the PE/HR developed using PPIS data for all Medicare recognized specialties that participated in the PPIS for payments effectiveJanuary 1, 2010. The impact of using the new PPIS-based PE/HR is discussed in the Regulatory Impact Analysis in section V. of this proposed rule. c. Equipment Utilization RateAs part of the PE methodology associated with the allocation of equipment costs for calculating PE RVUs, we have adopted an equipment usage assumption of 50 percent. Most recently, we included a discussion in the CY 2008 PFS proposed rule on this equipment usage assumption (72FR 38132). We noted that if the assumed equipment usage percentage is set too high, the result would be an insufficient allowance at the service level for the practice costs associated with equipment. If the assumed equipment usage percentage is set too low, the result would be an excessive allowance for the practice costs of equipment at the service level. We acknowledged that
Page 33532the current 50 percent usage assumption does not capture the actual usage rates for all equipment, but stated that we did not believe that we had strong empirical evidence to justify any alternative approaches.The commenters' recommendations about making adjustments to the 50 percent utilization rate assumption varied. Certain commenters recommended we do nothing until stronger empirical evidence is available, while other commenters recommended a decrease in the utilization assumption, and some commenters recommended an increase in the utilization assumption. The particular changes recommended in the utilization assumption were, in most cases, directly related to a specific code.In the CY 2008 PFS final rule with comment period (72 FR 66232), we agreed with commenters that the equipment utilization rate should continue to be examined for accuracy. We reiterated our commitment to continue to work with interested parties on this issue. We indicated that we would continue to monitor the appropriateness of the equipment utilization assumption, and evaluate whether changes should be proposed in light of the data available.Since the publication of the CY 2008 PFS final rule with comment period, MedPAC addressed this issue again in its March 2009 Report toCongress (see http://www.medpac.gov/documents/Mar09_EntireReport.pdf).In part of its discussion, MedPAC stated:``In 2006, the Commission sponsored a survey by NORC of imaging providers in six markets, which found that MRI and CT machines are used much more than the 25 hours per week that CMS assumes (Table 2B-6). According to data from this survey, MRI scanners are used 52 hours per week, on average (median of 46 hours), and CT machines are operated 42 hours per week, on average (median of 40 hours) (NORC 2006).\32\ Although the survey results are not nationally representative, they are representative of imaging providers in the six markets included in the survey. We also analyzed data from a 2007 survey of CT providers by IMV, a market research firm (IMVMedical Information Division 2008). IMV data are widely used in the industry and have also appeared in published studies (Baker et al. 2008, Baker and Atlas 2004). Using IMV's data on 803 nonhospital CT providers (imaging centers, clinics, and physician offices), we calculated that the average provider uses its CT scanner 50 hours per week, which is twice the number CMS assumes.\33\ The IMV survey also found that nonhospital providers increased the average number of procedures per CT machine by 31 percent from 2003 to 2007, which indicates that providers either used their machines more hours per day or performed more scans per hour (IMV Medical InformationDivision 2008).'' (p. 108)We believe the studies cited by MedPAC strongly suggest that our current usage rate assumption is significantly understated, especially with respect to the types of high cost equipment that were the subject of the studies. Our current 50 percent utilization rate translates into about 25 hours per week out of a 50 hour work week. The median value of 46 hours for MRIs from the first study cited by MedPAC is equivalent to a utilization rate of 92 percent on a 50-hour week. For CT scanners, averaging the value from the first study of 40 hours per week and the value from the second study of 50 hours per week yields 45 hours and is equivalent to a 90 percent utilization rate on a 50 hour work week. We believe the studies cited by MedPAC suggest what we have long suspected, that physicians and suppliers would not typically make huge capital investments in equipment that would only be utilized 50 percent of the time. All of the equipment cited in the MedPAC studies is priced over $1 million. Therefore, we are proposing to change the equipment usage assumption from the current 50 percent usage rate to a 90 percent usage rate for equipment priced over $1 million. We will continue to explore data sources regarding the utilization rates of equipment priced at less than $1 million dollars, but are not proposing a change in the usage rate for this less expensive equipment at this time.As MedPAC indicated in its report, we do not believe this proposal would create access issues in rural areas. MedPAC noted,``According to our analysis of data from the American HospitalAssociation's 2006 AHA annual survey of hospitals, 95% of rural hospitals provide CT services in their community (AHA 2007).Therefore, if rural areas do not have physician offices or freestanding centers with MRI and CT machines, most of these communities have access to such services through a hospital.'' (p. 110)However, we welcome any additional analyses regarding access issues, and, as in our CY 2008 and CY 2009 rulemaking, we welcome additional empirical data relating to equipment utilization rates. Our understanding is that the PPIS survey did not produce information that can inform the utilization rate discussion, but we invite comments on this or other data sources. d. Miscellaneous PE IssuesAs we have discussed in the past rulemaking (see the CY 2008 PFS final rule with comment period (72 FR 66236) and the CY 2007 PFS final rule with comment period (71 FR 69647)), we continue to have concerns about the issue of PE RVUs for services which are utilized 24 hours a day/7 days a week, such as certain monitoring systems. For example, thePE equipment methodology was not developed with this type of 24/7 equipment in mind. We are continuing to analyze the issue of PEs for services which are utilized 24 hours a day/7 days a week to identify any modifications to our methodology that would address the specific``constant use'' issues associated with these services. Services that are currently contractor priced in CY 2009 would remain contractor priced in CY 2010. Any proposed changes will be communicated through future rulemaking.We also received comments regarding the PE direct cost inputs (for example, supply costs and the useful life of the renewable sources) related to several high dose radiation therapy (HDRT) and placement CPT codes. Based on our review of these codes and comments received, we are requesting that the AMA RUC consider these CPT codes for additional review. e. AMA RUC Recommendations for Direct PE InputsThe AMA RUC provided recommendations for PE inputs for the codes listed in Table 3.Table 3--Codes With AMA RUC PE RecommendationsCPT \1\ codeDescription37183......................... Remove hepatic shunt (tips). 47382......................... Percut ablate liver rf. 50200......................... Biopsy of kidney. 55873......................... Cryoablate prostate. 93025......................... Microvolt t-wave assess.\1\ CPT codes and descriptions are Copyright 2009 American MedicalAssociation.We are in agreement with the AMA RUC recommendations for the direct PE inputs for the codes listed in Table 3 and propose to adopt these forCY 2010.B. Geographic Practice Cost Indices (GPCIs): Locality Discussion 1. Update--Expiration of 1.0 Work GPCI FloorSection 1848(e)(1)(A) of the Act requires us to develop separateGeographic Practice Cost Indices (GPCIs) to measure resource cost differences among localities compared to the national average for each of the three fee schedule components (that is, work, PE and malpractice). While requiring that the PE and malpractice GPCIs reflect the full relative cost differences, section 1848(e)(1)(A)(iii) of
Page 33533the Act requires that the physician work GPCIs reflect only one-quarter of the relative cost differences compared to the national average.Section 1848(e)(1)(C) of the Act requires us to review and, if necessary, adjust the GPCIs at least every 3 years. This section also specifies that if more than 1 year has elapsed since the last GPCI revision, we must phase in the adjustment over 2 years, applying only one-half of any adjustment in each year. As discussed in the CY 2009PFS final rule with comment period (73 FR 69740), the CY 2009 adjustment to the GPCIs reflected the fully implemented fifth comprehensive GPCI update. We also noted that section 134 of the MIPPA extended the 1.000 work GPCI floor from July 1, 2008, through December 31, 2009. (Note: The 1.000 work GPCI floor was enacted and implemented for CY 2006, and, prior to enactment of the MIPPA, was set to expire onJune 30, 2008.) Additionally, section 1848(e)(1)(G) of the Act, as amended by section 134(b) of the MIPPA, set a permanent 1.5 work GPCI floor in Alaska for services furnished beginning January 1, 2009.Therefore, as required by the MIPPA, beginning on January 1, 2010, the 1.000 work GPCI floor will be removed. However, the 1.500 work GPCI floor for Alaska will remain in place. See Addenda D and E of this proposed rule for the GPCIs and summarized geographic adjustment factors (GAFs), respectively. 2. Payment Localities a. BackgroundAs stated above in this section, section 1848(e)(1)(A) of the Act requires us to develop separate GPCIs to measure resource cost differences among localities compared to the national average for each of the three fee schedule components (this is, work, PE, and malpractice). Payments under the PFS are based on the relative resources involved in furnishing physicians' services, and are adjusted for differences in relative resource costs among payment localities using the GPCIs. As a result, PFS payments vary between localities.The current PFS locality structure was developed and implemented in 1997. There are currently 89 localities including 37 higher-cost areas; 16 Rest of State areas (comprising the remaining counties not located in a higher-cost area within a State); 34 Statewide areas; and PuertoRico and the Virgin Islands which are designated as ``territory-wide'' localities. The development of the current locality structure is described in detail in the CY 1997 PFS proposed rule (61 FR 34615) and the subsequent final rule (61 FR 59494).As we have frequently noted, any changes to the locality configuration must be made in a budget neutral manner. Therefore, any change in localities can lead to significant redistributions in payments. For many years, we have not considered making changes to localities without the support of a State medical association in order to demonstrate consensus for the change among the professionals whose payments would be affected (with some increasing and some decreasing).However, we have recognized that, over time, changes in demographics or local economic conditions may lead us to conduct a more comprehensive examination of existing payment localities.Payment Locality Approaches Discussed in the CY 2008 PFS Proposed RuleFor the past several years, we have been involved in discussions with California physicians and their representatives about recent shifts in relative demographics and economic conditions among a number of counties within the current California payment locality structure.In the CY 2008 PFS proposed rule and final rule with comment period, we described three potential options for changing the payment localities in California (72 FR 38139 and 72 FR 66245, respectively).After reviewing the comments on these options, we decided not to proceed with implementing any of them at that time. We explained that there was no consensus among the California medical community as to which, if any, of the options would be most acceptable. We also received suggestions from the Medicare Payment Advisory Commission(MedPAC) for developing changes in payment localities for the entire country and other States expressed interest in having their payment localities reconfigured as well. In addition, other commenters wanted us to consider a national reconfiguration of localities rather than just making changes one State at a time. Because of the divergent views expressed in comments, we explained in the CY 2008 PFS final rule with comment period that we intended to conduct a thorough analysis of potential approaches to reconfiguring localities and would address this issue again in future rulemaking.Interim Study of Alternative Payment Localities Under the PFSAs a follow-up to the CY 2008 PFS final rule with comment period, we contracted with Acumen, LLC (Acumen), to conduct a preliminary study of several options for revising the payment localities on a nationwide basis. The contractor's interim report was posted on the CMS Web site on August 21, 2008, and we requested comments from the public. The report entitled, ``Review of Alternative GPCI Payment LocalityStructures,'' is still accessible from the CMS PFS Web page under the heading ``Interim Study of Alternative Payment Localities under thePFS.'' The report may also be accessed directly from the following link: http://www.cms.hhs.gov/PhysicianFeeSched/10_Interim_Study.asp#TopOfPage. We accepted comments on the interim report throughNovember 3, 2008. The alternative locality configurations discussed in the report are described briefly below in this section.Option 1: CMS Core Based Statistical Area (CBSA) Payment LocalityConfigurationThis option uses the Office of Management and Budget (OMB's)Metropolitan Statistical Area (MSA) designations for the payment locality configuration. MSAs would be considered as urban CBSAs.Micropolitan Areas (as defined by OMB) and rural areas would be considered as non-urban (rest of State) CBSAs. This approach would be consistent with the inpatient hospital prospective payment system(IPPS) pre-reclassification CBSA assignments and with the geographic payment adjustments used in other Medicare payment systems. This option would increase the number of localities from 89 to 439.Option 2: Separate High Cost Counties From Existing Localities(Separate Counties)Under this approach, higher cost counties are removed from their existing locality structure and they would each be placed into their own locality. This option would increase the number of localities from 89 to 214 using a 5 percent GAF differential to separate high cost counties.Option 3: Separate MSAs From Statewide Localities (Separate MSAs)This option begins with Statewide localities and creates separate localities for higher cost MSAs (rather than removing higher cost counties from their existing locality as described in option 2). This option would increase the number of localities from 89 to 130 using a 5 percent GAF differential to separate high cost MSAs.
Page 33534Option 4: Group Counties Within a State Into Locality Tiers Based onCosts (Statewide Tiers)This option creates tiers of counties (within each State) that may or may not be contiguous but share similar practice costs. This option would increase the number of localities from 89 to 140 using a 5 percent GAF differential to group similar counties into Statewide tiers.Additionally, as discussed in the interim locality study report, our contractor, Acumen, applied a ``smoothing'' adjustment to the current PFS locality structure, as well as to each of the alternative locality configurations (except option 4: Statewide Tiers). The``smoothing'' adjustment was applied to mitigate large payment differences (or payment ``cliffs'') between adjacent counties. Since large payment differences between adjacent counties could influence a physician's decision on a practice location (and possibly impact access to care), the ``smoothing'' adjustment was applied to ensure that GAF differences between adjacent counties do not exceed 10 percent. (For more information on the ``smoothing'' adjustment see the interim locality study report on the PFS Web page via the link provided above.) b. Summary of Public Comments on Interim Locality Study ReportIn the CY 2009 PFS proposed rule (73 FR 38514), we encouraged interested parties to submit comments on the options presented both in the proposed rule and in the interim report posted on our Web site. We also requested comments and suggestions on other potential alternative locality configurations (in addition to the options described in the report). Additionally, we requested comments on the administrative and operational issues associated with the various options under consideration. We also emphasized that we would not be proposing any changes to the current PFS locality structure for CY 2009 and that we would provide extensive opportunities for public comment before proposing any change. The following is a summary of the comments received on the alternative locality options discussed in the CY 2009PFS proposed rule and interim locality study report.(1) Introduction and General Support for ChangeWe received approximately 200 comments on the CY 2009 PFS proposed rule and locality study report from various specialty groups, medical societies, State medical associations, individual practitioners, and beneficiaries. Commenters generally commended us for acknowledging the need to reconfigure PFS payment localities and expressed support for our study of alternative locality configurations. Many commenters urged us to expedite changes to the current locality structure in order to accurately reflect the geographic cost differences of operating a medical practice. For example, the Connecticut State Medical Society commented that the current locality configuration contributes to medical access issues and problems with recruitment and retention of practitioners (with an emphasis on access to primary care).Another commenter stated that Ohio's Statewide locality configuration needs to be changed because a Statewide locality designation does not account for the (presumably higher) cost of operating a medical practice in northern Ohio. The commenter also objected to the agency's approach to requests for changes to the current locality structure (which includes an assessment of support for the changes by the medical community, including the relevant State medical associations). The commenter believes the State medical association does not represent all of the physicians in Ohio.Another commenter stated that a change in the PFS locality structure is long overdue. The commenter stated that San Diego County is the most underpaid area in the nation and that grouping that county with the Rest of California locality is erroneous. Moreover, several commenters stated that a timely reassessment is needed and urged us to update the locality structure every 3 years. Two commenters believe that previous studies completed on the PFS locality structure byMedPAC, GAO, Urban Institute, as well as the current study by Acumen, support immediate reform to the current PFS locality structure.We received many comments from hospitals and physicians located inFrederick County Maryland (which is currently grouped with the Rest ofMaryland locality). The commenters support each of the alternative locality configurations we presented because each option results in PFS payment increases for services furnished in Frederick County. The commenters stated that Frederick County is considered a `bedroom community' for the DC/Northern Virginia area, has experienced the highest growth rate in the State, and noted that the cost of living has increased significantly. Additionally, the commenters noted that the last economic census aligns costs in Frederick County with those inMontgomery County (whose doctors receive higher payment amounts) and that Frederick County competes with physician practices in MontgomeryCounty for professional staff. Moreover, the commenters believe that because of inadequate PFS payment amounts, access to care is becoming a problem and emergency room visits are on the rise.(2) Cautious ApproachSome commenters requested that we take a cautious approach to reconfiguring the locality structure. For instance, the Texas MedicalAssociation stated that because of the redistributive impact that results from any locality reconfiguration, CMS should avoid making large scale changes at one time. Additionally, another commenter stated that ``stakeholders'' should be given a long advance notification period (at least 2 full calendar years) prior to the effective date of any changes to the PFS locality configuration. The commenter also stated that the current locality structure should remain in place (for each locality) unless the need for revision is strongly substantiated because of a change in practice cost patterns. A specialty society expressed support for postponing any adjustments for at least 1 year to allow for more discussion between CMS and ``stakeholders''.(3) Guiding PrinciplesWe received several comments from California that suggested a set of goals for reforming the PFS payment locality structure. The goals suggested by the commenters are as follows:Improve payment accuracy (as compared to the current locality structure);Move towards MSA-based localities;Mitigate payment reductions to rural California areas (and therefore minimize corresponding negative impact on access to care inCalifornia); andPromote administrative simplification by aligning physician and hospital payment localities.The California Medical Association (CMA) urged us to apply a consistent methodology across all payment localities and requested that any revision to the localities include a ``formula driven'' mechanism that can be applied repeatedly to future revisions. A California county medical society stated that more specific objectives for reforming PFS payment localities should be developed. For example, the commenter suggested that
Page 33535payment reductions for practitioners should not exceed 1.5 percent in any given year, GAF differentials between adjacent localities should not exceed 10 percent, and that contiguous localities with less than a 1 percent difference in their GAF's should be combined into a single locality.(4) Comments on the Studied Alternative Locality OptionsWe received many comments on the options for reconfiguring PFS payment localities presented in the interim locality study report. One commenter stated that option 1 (the CMS CBSA locality configuration) is the best option because it provides the greatest payment accuracy. The same commenter also stated that using CBSAs as the PFS locality definition would be similar to other Medicare payment systems (for example, the IPPS). Therefore, the commenter believed that geographic payment adjustments for physicians and hospitals would be consistent for a given geographic area. The CMA and a California county medical society stated that although option 1 would provide the greatest payment accuracy, it would also lead to significant payment reductions for many counties. Those same commenters expressed concern with the negative impact of transitioning directly to the CMS CBSA locality configuration. If adopted, the commenters suggested that the CMS CBSA locality configuration be implemented in stages over several years. TheTexas Medical Association echoed this concern and urged us not to adopt option 1 unless we employ a hold harmless floor along with ``material'' increases in the conversion factor.The Texas Medical Association also stated that option 2 (SeparateHigh Cost Counties from Existing Localities) results in less significant payment reductions to rural practitioners, as compared to the reductions seen under option 1 (CMS CBSA) and option 4 (StatewideTiers). However, the commenter did not support option 2 because it would create different localities within major urban areas and, therefore, provide incentives for ``border-crossing,'' (in other words, incentives for physicians to move their medical practice to an adjacent urbanized county to obtain a higher payment amount). Additionally, theTexas Medical Association stated that option 2 increases administrative complexity due to the additional number of localities and the need to reallocate source data into smaller (county level) areas. The CMA also stated that option 2 results in less significant payment reductions (as compared to the other options). However, the CMA stated that option 2 continues to produce inaccurate payments because it applies MSA-based data to county-based localities.Many commenters from the State of California expressed support for option 3 (Separate High Cost MSAs from Statewide Localities) because the commenters believed it would improve payment accuracy (over the current locality configuration) and at the same time mitigate the payment reductions to rural areas that would occur under option 1 (CMSCBSA) and option 4 (Statewide Tiers). The CMA explained that selecting an MSA-based locality approach would provide consistency with the hospital payment system and enable physicians to better compete with hospitals for the local work force. For example, the commenters stated that hospitals located in the Santa Cruz MSA are some of the highest paid in the nation. However, under the PFS locality structure, SantaCruz County is grouped with the Rest of California locality, which is the lowest paid PFS locality in the State.The Texas Medical Association suggested that we adopt option 3 because it minimizes payment reductions to lower cost rural areas. For example, since option 3 results in the fewest payment localities (as compared to the other alternative locality configurations), it reduces the redistribution effects of separating higher cost areas from rural``rest of State'' areas. The commenter also stated that option 3(Separate MSAs) matches payment with the underlying data better than option 2 (Separate Counties) and option 4 (Statewide Tiers). Some commenters expressed their belief that MSAs are better basic locality units than counties because the cost data is more reliably derived directly from MSAs (instead of counties). Several commenters who supported the adoption of an MSA-based PFS locality structure suggested that option 3 could be used as a transition to the CMS CBSA locality configuration (option 1).With regard to option 4 (Statewide Tiers), the Texas MedicalAssociation stated that the Statewide Tiers locality configuration creates payment areas that are poorly aligned with the underlying data and results in unacceptable payment decreases to small urban and rural areas. The Florida Medical Association explained that many localities have experienced a shift in population and economic development since the last PFS locality reconfiguration. The commenter stated that counties with similar costs should be grouped together in the same locality regardless of geographic location and that the Statewide cost tier locality structure (option 4) would accomplish this objective. TheCMA stated that under option 4, counties are not geographically contiguous and noted that the counties grouped together in a locality may not be related to one another economically. The commenter suggested that noncontiguous counties may experience more frequent economic changes than contiguous counties. The commenter expressed concern that option 4 would need to be updated more frequently and therefore payments to physicians will fluctuate more often. A California county medical society stated that option 4 creates payment errors for counties in seven California localities that currently have accurate payments. The Connecticut State Medical Society stated that New HavenCounty would experience an increase under option 4.(5) Smoothing AdjustmentMany commenters from the State of California did not support the concept of ``smoothing'' because it would require payment reductions for higher cost counties to offset the increases given to lower cost counties (in order to achieve budget neutrality). Additionally, the same commenters stated that physicians in ``smoothed'' counties benefit financially from the smoothing adjustment solely because they are located adjacent to high cost areas. They also stated that a``smoothing'' adjustment would be complex to administer, and difficult to understand. The CMA, a California county medical society, and another commenter from California stated that a ``smoothing'' adjustment would require a change in the statute and that currentMedicare statute requires GPCIs to reflect the relative costs differences among localities for work, PE, and malpractice expense.Another commenter recommended that we study the extent to which a``smoothing'' adjustment can be used as a temporary measure; in order to phase-in significant changes in payment levels resulting from a PFS locality reconfiguration.(6) Other Alternative OptionsA few commenters submitted suggestions on other potential alternative PFS locality configurations in addition to those discussed in the interim report. For example, one medical clinic suggested a``market-based'' approach instead of the current ``cost-based'' methodology. Under this approach, PFS payment would be geographically adjusted based on the ratio of Medicare participating
Page 33536physicians to Medicare beneficiaries. The commenter suggested that payment amounts should be increased in geographic areas with a low physician to Medicare beneficiary ratio (for example, 1 physician for every 3,000 beneficiaries) and decreased in areas with a higher ratio(for example, 1 physician for every 200 beneficiaries). The commenter stated that ``this process could be used to bring physician to patient ratios in the United States to equilibrium.''The CMA and a California county medical society suggested variations of option 2 (Separate Counties) with the intention of reducing the number of localities that would result under this option.The commenters suggested adopting a ``basic locality unit'' (for example, MSA) instead of a county when removing areas from an existing locality. For example, if 5 counties are removed from a ``Rest ofState'' locality, and included within the same MSA, the 5 counties would be grouped into a single new locality rather than 5 separate new localities. The commenter also suggested that if removed counties are contiguous and have similar costs (even if not part of same MSA); they should be consolidated into one new locality instead of separate localities. The commenters stated that either of these variations would reduce the number of new localities created under option 2.Additionally, the CMA and a California county medical society suggested a variation of option 4 (Statewide Tiers). The commenters stated that fixed cost tiers be established for each State using .05GAF increments which would lock in the upper and lower GAF values for each cost tier. Under this approach, the fixed cost tiers would not change based on updates to the GPCIs; however, a county could be moved to a lower (or higher) cost tier without the need to define new tiers for the entire state.(7) Redistribution of PaymentMany commenters acknowledged that a significant redistribution of payments would occur under each alternative locality configuration option and requested that we minimize the payment discrepancy between urban and rural areas to ensure continued access to services.Additionally several commenters stated that any changes to the locality configuration should not be unfair to rural practitioners. One specialty college noted that any new locality configuration must be budget neutral, resulting in a shift of resources from one geographic area to another. The commenter expressed concern that the requirement for budget neutrality may help physicians who practice in certain geographic areas, but will be costly to others. As such, the commenters stated that each alternative PFS locality option could create problems for medical access in areas where payments are reduced. As a method to minimize payment reduction, a few commenters requested that we continue the application of the 1.0 work GPCI floor.The AMA stated that any proposal to reconfigure PFS payment localities should not necessitate budget-neutral payment redistributions. The commenter expressed the concern raised by other commenters that some localities would receive payment increases under some options while other localities would experience significant payment reductions to offset these increases. The commenters requested that if new locality definitions are proposed, new funding should be provided to increase payments in localities that are found to be underpaid. The commenters also stated that budget neutral redistributions would only exacerbate an already flawed and under- funded Medicare PFS. The AMA suggested that States with a Statewide locality should be given the option of remaining a Statewide locality and that CMS should continue its policy of allowing any State the option of converting to a Statewide locality at the request of theState Medical Association.The Iowa Medical Society stated that Medicare PFS payment levels inIowa are among the lowest in the country and that the four alternative locality configurations all appear to further reduce payments to State physicians. As such, they requested that Iowa remain a Statewide locality under any nationwide locality change.Because of the redistribution effect of any locality reconfiguration, some commenters did not find any of the potential alternative locality configurations preferable to the current payment locality structure. For example, one physician academy stated that all four of the alternative locality scenarios result in disproportionately lower GAFs for non-MSA counties. Therefore, the commenter encouraged us to maintain the current locality structure until we identify an alternative that decreases the number of payment localities and supports practitioners in rural and underserved areas. The commenter also expressed support for a locality reconfiguration that minimizes the number of payment localities; does not exceed the current number of 89 localities and eliminates geographic payment adjustments (except those designed to encourage physicians to practice in underserved areas). Furthermore, the Florida Medical Association urged us to work with Congress to remove the application of budget neutrality when making changes to the PFS payment locality structure. The commenter suggested that we use the current GCPI values as a ``floor'' to ensure that future updates to the localities will not result in payment reductions.(8) MethodologyThe CMA and a California county medical society commended the contractor, Acumen, for the accuracy of its calculations, modeling of the options, and observations. However, they recommended a change in the iterative methodology used to develop option 2 and option 3. The commenters stated that the threshold for removing high cost counties from existing localities (option 2) and removing high cost MSAs fromStatewide localities (option 3) should be equal to or greater than 5 percent (not just greater than 5 percent) with no rounding up for GAF differences below 5 percent. Additionally, with regard to option 2, the commenters recommended that counties with identical GAFs to the county being considered for a new locality should not be included in the calculation of the ``Rest of Locality'' GAF (which is used for comparison to the higher cost county).Additionally, the commenters objected to the methodology used for the ``smoothing'' adjustment. The commenters believe that a new locality created by smoothing should not have a significantly lower GAF than it would if the county was a single locality. For example, the commenters noted that San Diego County (which is currently included in the Rest of California locality) has a county-level GAF of 1.056.However, when the smoothing adjustment is applied to the current locality configuration, the GAF for San Diego is 1.018.One research institute questioned why high cost counties were separated from existing localities (option 2) and high cost MSAs were separated from Statewide localities (option 3); instead of separating low cost counties and low cost MSAs. The commenter stated that the CMSCBSA methodology is not designed to be sensitive enough to detect significant geographic differences in physician compensation and PE.The commenter questioned whether compensation and PE costs are correlated directly with population density.
Page 33537Clarification on Methodology Used To Develop Alternative LocalityConfigurations Discussed in the Interim ReportWith regard to the iterative methodology used for option 2 and option 3, the contractor, Acumen, analyzed these alternative locality configurations based on its understanding of the MedPAC ideas. A threshold of greater than 5 percent was used to separate high cost counties from existing localities (option 2) and to separate high costMSAs from Statewide localities (option 3). Additionally, the contractor compared just one county (or MSA) at a time against the weighted average GAF of all the lower-ranked counties in the Medicare locality.Counties with the same GAF were not treated as a group. In ranking counties by GAF, the contractor used physician work RVUs to break``ties.'' In other words, when two counties in a Medicare locality had the same GAF, the county with the higher physician work RVU was ranked as if it had the higher GAF. Keeping counties with identical GAFs together would be another possible strategy for developing alternativePFS payment localities. The high cost counties and MSAs were removed in the iterative process to reflect ongoing concerns regarding individual high cost counties (usually in ``rest of state'' areas) where the GAF is significantly higher than the norm for the locality. Removing low cost counties would isolate very low cost areas leading to further reductions in PFS payment levels for physicians and practitioners in these counties.With regard to the sensitivity of the CBSA methodology and whether compensation and PE cost are correlated directly to population density; the CBSA methodology has three types of areas: MSAs, MetropolitanDivisions within MSAs, and non-MSA areas. None of these definitions involve population density per se, although MSAs must include core areas with populations of 50,000 or greater. Given that the CBSA methodology has more regions than the other alternative locality configurations, it could potentially draw on more detailed levels of data than the other options, and therefore, result in a more precise reflection of geographic cost differences.(9) Suggested Additional Topics for ReviewOne commenter stated that the interim locality study report should have addressed how a change in payment locality structure might impact a physician's choice regarding practice location and Medicare beneficiary access to physician services.The CMA and a California county medical society stated that the interim locality study should have included a discussion of payment accuracy under the current locality structure and under each potential locality configuration. The commenters stated that a discussion of the potential negative impact under a particular option without a discussion of the accuracy of payment for each option is misleading.Additionally, they suggested adding a discussion of potential methods to mitigate payment reductions.(10) Administrative and Operational IssuesWe received few comments on administrative and operational issues related to making changes to the PFS payment locality structure. Some commenters stated that a locality revision would impose a minimal amount of additional administrative burden. However, the commenters did not specify whose administrative burden they were assessing. One commenter stated that implementing the CMS CBSA locality configuration(option 1) would be a significant administrative burden. Additionally, one health care plan explained that many Medicare Advantage Plans are based on Medicare fees in specific localities. As such, any fee schedule locality revision would be a large scale and costly administrative undertaking for managed care plans as well as for``traditional'' Medicare.(11) Underlying DataWe also received comments on the data used to develop GPCI values.Although we appreciate these comments, the focus of the interim locality study was not intended to be a review of the underlying data sources used to develop GPCI values. As discussed earlier, the interim locality study was a review of potential approaches for redefining theMedicare PFS payment localities.Response to CommentsWe would like to thank the public for the many thoughtful comments on the interim locality study report entitled, ``Review of AlternativeGPCI Payment Locality Structures''. As noted by the commenters and reflected in the report, significant payment redistribution would occur if a nationwide change in the PFS locality configuration were undertaken. All four of the potential alternative payment locality configurations reviewed in the report would increase the number of localities and separate higher cost, typically urban areas from lower cost, typically rural ``Rest of State'' areas. In general, payments to urban areas would increase while rural areas would see a decrease in payment under each of the options studied because they would no longer be grouped with higher cost ``urbanized'' areas. We intend to review the suggestions made by the commenters and consider the impact of each of the potential alternative locality configurations. We will also explore whether alternative underlying data sources are available nationwide. A final report will be posted to the CMS Web site after further review of the studied alternative locality approaches.We are not proposing changes in the PFS locality structure at this time. As explained in the CY 2009 PFS final rule with comment period, in the event we decide to make a specific proposal for changing the locality configuration, we would provide extensive opportunities for public input (for example, town hall meetings or open door forums, as well as opportunities for public comments afforded by the rulemaking process).C. Malpractice Relative Value Units (RVUs) 1. BackgroundSection 1848(c) of the Act requires that each service paid under the PFS be comprised of three components: work, PE, and malpractice.From 1992 to 1999, malpractice RVUs were charge-based, using weighted specialty-specific malpractice expense percentages and 1991 average allowed charges. Malpractice RVUs for new codes after 1991 were extrapolated from similar existing codes or as a percentage of the corresponding work RVU. Section 4505(f) of the BBA required us to implement resource-based malpractice RVUs for services furnished beginning in 2000. Initial implementation of resource-based malpracticeRVUs occurred in 2000. The statute also requires that we review, and if necessary adjust, RVUs no less often than every 5 years. The first review and update of resource based malpractice RVUs was addressed in the CY 2005 PFS final rule (69 FR 66263). Minor modifications to the methodology were addressed in the CY 2006 PFS final rule (70 FR 70153).In this current rule, we are proposing to implement the second review and update of malpractice RVUs.
Page 335382. Proposed Methodology for the Revision of Resource-Based MalpracticeRVUsThe proposed malpractice RVUs were developed by Acumen, LLC(Acumen) under contract to us.The methodology used in calculating the proposed second review and update of resource-based malpractice RVUs largely parallels the process used in the CY 2005 update. The calculation requires information on malpractice premiums, linked to the physician work conducted by different specialties that furnish Medicare services. Because malpractice costs vary by State and specialty, the malpractice premium information must be weighted geographically and across specialties.Accordingly, the proposed malpractice expense RVUs are based upon three data sources:Actual CY 2006 and CY 2007 malpractice premium data.CY 2008 Medicare payment data on allowed services and charges.CY 2008 Geographic adjustment data for malpractice premiums.Similar to the previous update of the resource-based malpractice expense RVUs, we are proposing to revise the RVUs using specialty- specific malpractice premium data because they represent the actual malpractice expense to the physician. In addition, malpractice premium data are widely available through State Departments of Insurance. We propose to use actual CY 2006 and CY 2007 malpractice premium data because they are the most current data available (CY 2008 malpractice premium data were not consistently available during the data collection process). Accounting for market shares, three fourths of all included rate filings were implemented in CY 2006 and CY 2007. The remaining rate filings were implemented in CY 2003 through CY 2005 but still effective in CY 2006 and CY 2007. Carriers submit rate filings to theirState Departments of Insurance listing the premiums and other features of their coverage. The rate filings include an effective date, which is the date the premiums go into effect. Some States require premium changes to be approved before their effective date; others just require the rate filings to be submitted. We try to capture at least 2 companies and at least 50 percent of the market share, starting with the largest carriers in a State.The primary determinants of malpractice liability costs continue to be physician specialty, level of surgical involvement, and the physician's malpractice history. We collected malpractice premium data from 49 States and the District of Columbia for all physician specialties represented by major insurance providers. Rate filings were not available through Departments of Insurance in Mississippi or PuertoRico. Premiums were for $1 million/$3 million, mature, claims-made policies (policies covering claims made, rather than services furnished during the policy term). A $1 million/$3 million liability limit policy means that the most that would be paid on any claim is $1 million and that the most that the policy would pay for several claims over the timeframe of the policy is $3 million. We collected data from commercial and physician-owned insurers and from joint underwriting associations (JUAs). A JUA is a State government-administered risk pooling insurance arrangement in areas where commercial insurers have left the market. Adjustments were made to reflect mandatory surcharges for patient compensation funds (PCFs) (funds to pay for any claim beyond the statutory amount, thereby limiting an individual physician's liability in cases of a large suit) in States where PCF participation is mandatory. We sought to collect premium data representing at least 50 percent of physician malpractice premiums paid in each State as identified by State Departments of Insurance and by the NationalAssociation of Insurance Commissioners (NAIC).Rather than select the top 20 physician specialties as when the malpractice RVU were originally established and updated, we included premium information for all physician and surgeon specialties and risk classifications available in the collected rate filings. Most insurance companies provided crosswalks from insurance services office (ISO) codes to named specialties; we matched these crosswalks to CMS specialty codes. We also preserved information obtained regarding surgery classes, which are categorizations that affect premium rates.For example, many insurance companies grouped general practice physicians into nonsurgical, minor-surgical and major-surgical classes, each with different malpractice premiums. Some companies provided additional surgical subclasses; for example, distinguishing general practice physicians that conducted obstetric procedures, which further impacted malpractice rates. We standardized this information to CMS specialty codes.We could not identify malpractice premium rates through typical malpractice rate filings for some physician specialties, nonphysician practitioners (NPPs), and other entities (for example, independent diagnostic testing facilities (IDTFs)) paid under the PFS. In the absence of available premium data for these specialties and entities, we took a number of steps.We collected data from one of the largest association program insurance brokers and administrators in the United States providing malpractice insurance to medical physicists. We incorporated the data into the calculation of the proposed update to the malpractice RVUs forTC services. (See section II.C.3 of this proposed rule for a discussion of this issue.)We also crosswalked 13 specialties for which there was not significant collected data available (those in less than 35 States' malpractice premium rate filings) to similar specialties and risk classes. The unassigned specialties and the specialty to which we are proposing to assign them are shown in Table 4. The remaining four specialties were dropped, meaning they were not included in the weighted averages for calculating the malpractice RVUs.Note: While we were able to collect data on many more specialties on this survey than under the previous one, these four specialties were also dropped under the previous version of the survey because of a lack of available data. This left 44 specialties, representing 90 percent of Medicare services, for which we used the malpractice premium data to develop risk factors.Table 4--Crosswalk of Specialties to Similar Physician SpecialtiesCrosswalkSpec. codeSpecialty namespecialty codeCrosswalk specialty09...................... Interventional Pain72 Pain Management.Management. 19...................... Oral Surgery...............03 Allergy Immunology*. 35...................... Chiropractic...............03 Allergy Immunology*. 62...................... Psychologist...............03 Allergy Immunology*. 65...................... Physical Therapist.........03 Allergy Immunology*.
Page 3353967...................... Occupational Therapist.....03 Allergy Immunology*. 68...................... Clinical Psychologist......03 Allergy Immunology*. 79...................... Addiction Medicine.........03 Allergy Immunology*. 85...................... Maxillofacial Surgery......03 Allergy Immunology*. 86...................... Neuropsychiatry............26 Psychiatry. 91...................... Surgical Oncology..........02 General Surgery. 94...................... Interventional Radiology...30 Diagnostic Radiology. 98...................... Gynecological/Oncology.....90 Medical Oncology. 99...................... Unknown Physician Specialty01 General Practice.* Lowest Physician Specialty.The methodology presented in this proposed rule conceptually follows the specialty-weighted approach used in the CY 2000 and CY 2005PFS final rules with comment period (63 FR 59383 and 69 FR 66263, respectively) and incorporates the minor modifications discussed in theCY 2006 final rule with comment period (70 FR 70153). We revised the current specialty-weighted approach to accommodate additional data gathered during the malpractice premium data collection. The specialty- weighted approach bases the malpractice RVUs upon a weighted average of the risk factors of all specialties furnishing a given service. This approach ensures that all specialties furnishing a given service are accounted for in the calculation of the final malpractice RVUs. Our proposed methodology is as follows:(1) Compute a preliminary national average premium for each specialty. Insurance rating area malpractice premiums for each specialty were mapped to the county level. The specialty premium for each county is then multiplied by the total county RVUs (as defined byMedicare claims data), which had been divided by the malpractice GPCI applicable to each county to standardize the relative values for geographic variations. If the malpractice RVUs were not normalized for geographic variation, the locality cost differences (as reflected by the GPCIs) would be counted twice. The product of the malpractice premiums and standardized RVUs is then summed across counties for each specialty. This calculation is then divided by the total RVUs for all counties, for each specialty, to yield a national average premium for each specialty.(2) Determine which risk class(es) to use within each specialty.Many specialties had premium rates that differed for major surgery, minor surgery, and no surgery. These surgery classes are designed to reflect differences in risk of professional liability and the cost of malpractice claims if they occur. The same concept applies to procedures; some procedures carry greater liability risks. Accordingly, we identified major, minor, nonsurgical, and obstetric procedures among all Medicare procedures by established indicators (Global SurgeryFlags). Table 5 shows the surgery class definitions used in the proposed methodology.Table 5--Surgery Classes by Procedure CodeSurgery classCPT code rangeGlobal surgery flagMajor Surgery (Maj)...................... 10000-69999................. 90 Day.Minor Surgery (Min)...................... 10000-69999................. All Other.Obstetrics (OB).......................... 59000-59899................. N/A.No Surgery (NS).......................... All other CPT Codes......... N/A.To account for the presence of surgery classes in the malpractice premium data and the task of mapping these premiums to procedures, we sought to calculate distinct risk factors for major, minor, and nonsurgical procedures, as well as a comparable approach for obstetric premiums and procedures. However, the availability of data by surgery class varied across specialties. In light of the complexity of the surgery class data, we evaluated both the frequency with which rate class data were reported and a preliminary set of normed national average premiums, calculated for all classes reported in the data.Because no single approach accurately addressed the risk weights and value differences of various specialty/procedure combinations, we developed five strategies for handling the surgical classes and defining specialties. These strategies are summarized in Table 6.(a) Substantial Data for Each Class: For 13 out of 44 specialties, we determined that there was sufficient data for each surgical class, as well as sufficient differences in rates between classes, to use the surgical class data as the basis for risk factors by surgical class.(b) Major Surgery Dominates: These 8 surgical specialties typically had rate filings that specified major surgery as the predominate rate reported. Filings that distinguished minor surgery or nonsurgical were relatively rare. For most of these surgical specialties, we did not have ``unspecified'' rate filings. When we had ``unspecified'' rate filings, the unspecified category was sometimes above and sometimes below the major surgery rate. For these cases, we assigned the premium for major surgery to all procedures conducted by this specialty. (In practice, the major surgery procedures dominate the services actually furnished.)(c) Little or No Data for Major Surgery: For five other specialties, specific premiums for major surgery were uncommon, but most States had rate filings that represented minor surgery or nonsurgical coverage. These five specialties had unspecified rates that were less common than the minor surgery-nonsurgery distinction and the nonsurgery rates. Therefore, for these five specialties we assigned the minor surgery rate filings for both major surgery and minor surgery procedures, and the nonsurgery filings for nonsurgical procedures.
Page 33540(d) Unspecified Dominates: Many malpractice rate filings did not specify surgery classes for some specialties; we refer to these instances as unspecified malpractice rates. In only two cases, we choose the unspecified premium as the premium information to use for the specialty. For both of these specialties, fewer than 20 States had rate filings that distinguished by surgical classes, while more than 40 had general rate filings for the specialty.(e) Blend All Available: For the last 16 specialties, there was wide variation across the State filings in terms of whether or not surgical classes were reported and which categories were reported.Because there was no clear strategy for these remaining specialties, we blended the rate information we collected into one general premium rate and applied that rate for all three premiums (major, minor and nonsurgical). For these specialties, we developed a weighted average``blended'' premium at the national level, according to the percentage of physician work RVUs correlated with the surgery classes within each specialty.Table 6--Summary of Approaches To Defining Premiums by Surgical ClassSituationSpecialty codes1. Substantial Data for Each Class (13) 01 (non-OB), 04, 06, 07. 08 (non-OB), 10, 13, 18. 16 (non-OB), 38, 39, 46, 93. 2. Major Surgery Dominates (8)......... 02, 14, 20, 24, 28, 33, 77, 78. 3. Little or No Data for Major Surgery 11, 22, 37, 44, 82.(5). 4. Unspecified Dominates (2)........... 05, 72. 5. Blend All Available (16)............ 03, 25, 26, 29, 30, 34, 36, 40, 48, 66, 71, 81, 83, 84, 90, 92.For rarely-billed Medicare procedures, we did not apply the 5 percent threshold for inclusion of services or specialties as utilized in previous MP RVU updates. Rather, we are proposing to use the risk factor of the dominant specialty by services for each procedure for which the number of allowed services is less than 100. This approach reflects the risk factors of the specialty that most frequently furnishes these low volume procedures.(3) Calculate a risk factor for each specialty. Differences among specialties in malpractice premiums are a direct reflection of the malpractice risk associated with the services furnished by a given specialty. The relative differences in national average premiums between various specialties can be expressed as a specialty risk factor. These risk factors are an index calculated by dividing the national average premium for each specialty by the national average premium for the specialty with the lowest average premium, allergy/ immunology. Table 7 shows the risk factors by specialty and surgery class.Table 7--Risk Factors by Specialty and Surgery ClassMinor-surgicalMajor-surgicalMedicare codeMedicare nameNon-surgical RFRFRF1............................ General Practice...........1.502.263.56 2............................ General Surgery............5.875.875.87 3............................ Allergy Immunology.........1.001.001.00 4............................ Otolaryngology.............1.442.373.55 5............................ Anesthesiology.............2.222.222.22 6............................ Cardiology.................1.872.656.09 7............................ Dermatology................1.142.063.96 8............................ Family Practice............1.572.233.79 10........................... Gastroenterology...........2.032.484.09 11........................... Internal Medicine..........1.722.522.52 13........................... Neurology..................2.202.9010.28 14........................... Neurosurgery...............9.949.949.94 16........................... Obstetrics Gynecology......1.672.374.64 18........................... Ophthalmology..............1.071.681.90 19........................... Oral Surgery...............1.001.001.00 20........................... Orthopedic Surgery.........5.465.465.46 22........................... Pathology..................1.742.262.26 24........................... Plastic and Reconstructive5.515.515.51Surgery. 25........................... Physical Medicine and1.141.141.14Rehabilitation. 26........................... Psychiatry.................1.221.221.22 28........................... Colorectal Surgery.........3.993.993.99 29........................... Pulmonary Disease..........2.082.082.08 30........................... Diagnostic Radiology.......2.622.622.62 33........................... Thoracic Surgery...........6.516.516.51 34........................... Urology....................2.642.642.64 35........................... Chiropractic...............1.001.001.00 36........................... Nuclear Medicine...........1.551.551.55 37........................... Pediatric Medicine.........1.492.412.41 38........................... Geriatric Medicine.........1.432.234.22 39........................... Nephrology.................1.612.274.17 40........................... Hand Surgery...............3.493.493.49 44........................... Infectious Disease.........2.092.522.52 46........................... Endocrinology..............1.512.234.46
Page 3354148........................... Podiatry...................1.981.981.98 62........................... Psychologist...............1.001.001.00 65........................... Physical Therapist.........1.001.001.00 66........................... Rheumatology...............1.561.561.56 67........................... Occupational Therapist.....1.001.001.00 68........................... Clinical Psychologist......1.001.001.00 71........................... Registered Dietitian/1.541.541.54Nutrition Professional. 72........................... Pain Management............2.212.212.21 77........................... Vascular Surgery...........6.506.506.50 78........................... Cardiac Surgery............6.896.896.89 79........................... Addiction Medicine.........1.001.001.00 81........................... Critical Care2.152.152.15(Intensivists). 82........................... Hematology.................1.592.032.03 83........................... Hematology/Oncology........1.721.721.72 84........................... Preventive Medicine........1.161.161.16 85........................... Maxillofacial Surgery......1.001.001.00 86........................... Neuropsychiatry............1.221.221.22 90........................... Medical Oncology...........1.761.761.76 91........................... Surgical Oncology..........5.875.875.87 92........................... Radiation Oncology.........2.302.302.30 93........................... Emergency Medicine.........2.293.774.87 94........................... Interventional Radiology...2.622.622.62 98........................... Gynecological/Oncology.....1.761.761.76 99........................... Unknown Physician Specialty1.502.263.56One complication in the calculation of specialty risk factors is technical component (TC) data. Many procedures are comprised of professional components (PC) and TCs. These components are referred to as global procedures when billed together. The TC represents the cost of equipment, supplies, and technician/staff salaries involved in furnishing a procedure, such as the taking of an x-ray by a technician.The PC represents the portion of a service that is furnished by a physician such as the interpretation of an x-ray by the physician. The distinction is important because PCs and TCs have different associated risk factors and face different malpractice insurance costs. The previous update of the malpractice RVUs did not update the TCs due to the lack of available malpractice premium data for entities providingTC services. In the past, we were unable to obtain data concerning malpractice costs associated with the TC, so we based the malpracticeRVUs for TC services and the TC portion of global services on historical allowed charges.We have had ongoing discussions with the AMA RUC and various specialty societies about this issue. In the CY 2008 PFS proposed rule(72 FR 38143), we noted that the Professional Liability Insurance (PLI) workgroup, a subset of the AMA RUC brought to our attention the fact that there are approximately 600 services that have TC malpractice RVUs that are greater than the PC malpractice RVUs. The PLI workgroup requested that we make changes to these malpractice RVUs and suggested that it is illogical for the malpractice RVUs for the TC of a service to be higher than the malpractice RVUs for the PC.We responded that we would like to develop a resource-based methodology for the technical portion of these malpractice RVUs; but that we did not have data to support such a change. We asked for information about whether, and if so, how technicians employed by facilities purchase PLI or how their professional liability is covered.We also asked for comments on what types of PLI are carried by entities that furnish these technical services.In the CY 2009 PFS proposed rule (73 FR 38515), we stated that the issue of assigning malpractice RVUs for the TC of certain services continues to be a source of concern for several physician associations and for CMS. We noted that we did not receive a response to our CY 2008 request for additional data on this issue and that this issue is one of importance to CMS. We also stated that the lack of available PLI data affects our ability to make a resource-based evaluation of the TC malpractice RVUs for these codes. We indicated that as part of our work to update the malpractice RVUs in CY 2010, we would instruct our contractor to research available data sources for the malpractice costs associated with the TC portion of these codes and that we would also ask the contractor to look at what is included in general liability insurance versus PLI for physicians and other professional staff. We also stated that if data sources were available, we would instruct the contractor to gather the data so we will be ready to implement revised malpractice RVUs for the TC of these codes in conjunction with the update of malpractice RVUs for the PCs in CY 2010.In the CY 2009 PFS final rule (73 FR 69741), we again responded to comments on this issue. We noted that one commenter provided us with the name of a company that provides liability insurance to imaging facilities. We stated that we planned to share the information with our contractor and that if premium data could be identified; it would be incorporated into the malpractice RVU update. Our contractor, AcumenLLC, contacted the company suggested by the commenter and obtained medical physicist malpractice premium data from one of the largest association program insurance brokers and administrators in the UnitedStates providing this type of malpractice insurance. The premium data indicate that medical physicists have very low malpractice premiums relative to physicians.Medical physicists are involved in complex services such asIntensity-Modulated Radiation Therapy (IMRT). IMRT is an advanced mode of radiotherapy that utilizes computer-controlled x-ray accelerators to deliver radiation doses to a malignant tumor. Based on the complexity of these services, we believe that medical
Page 33542physicists would pay one of the highest malpractice premium rates of the entities furnishing TC services and that using their data as a proxy (in the absence of actual premium data) to develop malpracticeRVUs for TC services would be more realistic than our current approach for these entities. Moreover, we believe it is unlikely that actual malpractice premium rates for these entities would exceed those for medical physicists. Therefore, based on this new data collection, we are proposing to use the medical physicists' premium data as a proxy for the malpractice premiums paid by entities providing TC services. We believe that the use of this data will better reflect the level of malpractice premiums paid by entities providing TC services than the current charge-based malpractice RVUs or crosswalks to the malpractice premium data of physician specialties.As we have done in the past, we continue to encourage public commenters to submit or identify alternative data that we might use for the purpose of establishing malpractice RVUs.(4) Calculate malpractice RVUs for each code. Resource-based malpractice RVUs were calculated for each procedure. The first step was to identify the percentage of services furnished by each specialty for each respective procedure code. This percentage was then multiplied by each respective specialty's risk factor as calculated in Step 3. The products for all specialties for the procedure were then added together, yielding a specialty-weighted malpractice RVU reflecting the weighted malpractice costs across all specialties for that procedure.This sum was then multiplied by the procedure's work RVUs to account for differences in risk-of-service.Certain codes have no physician work RVUs. The overwhelming majority of these codes are the TCs of diagnostic tests, such as x-rays and cardiac catheterization, which have a distinctly separate TC (the taking of an x-ray by a technician) and PC (the interpretation of the x-ray by a physician). Examples of other codes with no work RVUs are audiology tests and injections. These services are usually furnished byNPPs, in this example, audiologists and nurses, respectively. In many cases, the NPP or entity furnishing the TC is distinct and separate from the physician ordering and interpreting the test. We believe it is appropriate for the malpractice RVUs assigned to TCs to be based on the malpractice costs of the NPP or entity, not the professional liability of the physician.Our proposed methodology, however, would result in zero malpracticeRVUs for codes with no physician work, since we propose the use of physician work RVUs to adjust for risk-of-service. We believe that zero malpractice RVUs for reasons other than rounding would be inappropriate because NPPs and entities such as IDTFs also have malpractice liability.Note that the earlier discussion above in ``(3) Calculate a risk factor for each specialty'' addressed the proposed use of the medical physicist premium data to develop a TC risk factor. This TC risk factor is used in (3), as noted above, along with the global risk factor to calculate a PC risk factor. Once the global and PC risk factors are calculated, they are used here in step (4) to calculate the global andPC malpractice RVUs. Once we have calculated the global and PC malpractice RVUs, we propose to address the lack of work RVUs for TC services by setting the TC malpractice RVUs equal to the difference between the global malpractice RVUs and PC malpractice RVUs.(5) Rescale for budget neutrality. The statute requires that changes to fee schedule RVUs be budget neutral. The current resource- based malpractice RVUs and the proposed resource-based malpractice RVUs were constructed using entirely different malpractice premium data.Thus, the last step is to adjust for budget neutrality by rescaling the proposed malpractice RVUs so that the total proposed resource-based malpractice RVUs equal the total current resource-based malpracticeRVUs.We are requesting comments on our proposed methodology for updating the malpractice RVUs. We are especially interested in comments on our proposed process for revising the malpractice RVUs of the TC of codes with no physician work. Additionally, we intend to post the Acumen report, ``Interim Report on Malpractice RVUs for the CY 2010 MedicarePhysician Fee Schedule Proposed Rule'' on the CMS Web site in conjunction with publication of this proposed.D. Medicare Telehealth Services 1. Requests for Adding Services to the List of Medicare TelehealthServicesSection 1834(m)(4)(F) of the Act defines telehealth services as professional consultations, office visits, and office psychiatry services, and any additional service specified by the Secretary. In addition, the statute requires us to establish a process for adding services to or deleting services from the list of telehealth services on an annual basis.In the December 31, 2002 Federal Register (67 FR 79988), we established a process for adding services to or deleting services from the list of Medicare telehealth services. This process provides the public an ongoing opportunity to submit requests for adding services.We assign any request to make additions to the list of Medicare telehealth services to one of the following categories:Category #1: Services that are similar to professional consultations, office visits, and office psychiatry services. In reviewing these requests, we look for similarities between the requested and existing telehealth services for the roles of, and interactions among, the beneficiary, the physician (or other practitioner) at the distant site and, if necessary, the telepresenter.We also look for similarities in the telecommunications system used to deliver the proposed service, for example, the use of interactive audio and video equipment.Category #2: Services that are not similar to the current list of telehealth services. Our review of these requests includes an assessment of whether the use of a telecommunications system to deliver the service produces similar diagnostic findings or therapeutic interventions as compared with the face-to-face ``hands on'' delivery of the same service. Requesters should submit evidence showing that the use of a telecommunications system does not affect the diagnosis or treatment plan as compared to a face-to-face delivery of the requested service.Since establishing the process, we have added the following to the list of Medicare telehealth services: Psychiatric diagnostic interview examination; ESRD services with two to three visits per month and four or more visits per month (although we require at least one visit a month to be furnished in-person ``hands on,'' by a physician, clinical nurse specialist (CNS), nurse practitioner (NP), or physician assistant(PA) to examine the vascular access site); individual medical nutrition therapy; neurobehavioral status exam; and follow-up inpatient telehealth consultations.Requests to add services to the list of Medicare telehealth services must be submitted and received no later than December 31 of each calendar year to be considered for the next rulemaking cycle. For example, requests submitted before the end of CY 2008 are considered for the CY 2010 proposed rule. Each request for adding a service to the list of Medicare telehealth
Page 33543services must include any supporting documentation you wish us to consider as we review the request. Because we use the annual PFS rulemaking process as a vehicle for making changes to the list ofMedicare telehealth services, requesters should be advised that any information submitted is subject to disclosure for this purpose. For more information on submitting a request for an addition to the list ofMedicare telehealth services, including where to mail these requests, visit our Web site at http://www.cms.hhs.gov/telehealth/. 2. Submitted Requests for Addition to the List of Telehealth ServicesWe received requests in CY 2008 to add the following services asMedicare telehealth services effective for CY 2010: (1) Health and behavior assessment and intervention (HBAI) procedures; and (2) nursing facility services. In addition, we received a number of requests to add services that we considered previously and did not approve as Medicare telehealth services in previous PFS rules. These requested services include critical care services; initial and subsequent hospital care; group medical nutrition therapy; diabetes self-management training; speech and language pathology services; and physical and occupational therapy services. The following is a discussion of these requests. a. Health and Behavior Assessment and Intervention (HBAI)The American Psychological Association (APA) submitted a request to add HBAI services (as described by HCPCS codes 96150 through 96154) to the list of approved telehealth services. The APA asks us to evaluate and approve HBAI services as Category 1 service because they are comparable to the psychotherapy services currently approved for telehealth.CMS ReviewTo determine whether to assign a request to Category 1, we look for similarities between the service that is being considered for addition and the existing telehealth services in the roles of, and interactions among, the beneficiary, the physician (or other practitioner) at the distant site and, if necessary, the telepresenter.Clinical psychologists furnish HBAI services to beneficiaries to help them manage or improve their behavior in response to physical problems. Elements of HBAI services typically include interviewing, observing, and counseling beneficiaries to help them modify their behavior. These elements are also common to the office psychiatry services currently approved for telehealth. We believe the interaction between a practitioner and a beneficiary receiving individual HBAI services (as described by HCPCS codes 96150 through 96152) is similar to the assessment and counseling elements of the individual office psychiatry services currently approved for telehealth. Therefore, we are proposing to revise Sec. 410.78 and Sec. 414.65 to include individual HBAI services as Medicare telehealth services.With regard to group HBAI (as described by HCPCS code 96153) or family-with-patient HBAI (as described by HCPCS code 96154), we note that no group services are currently approved as Medicare telehealth services. Group counseling services have a different interactive dynamic between the physician or practitioner and his or her patients as compared to individual services. No other group counseling or other group services are approved as telehealth services. Since the interactive dynamic for group HBAI services is not similar to that for individual HBAI services or any other approved telehealth services, we do not believe that group HBAI or family-with-patient HBAI services are properly considered as Category 1 requests. To be considered as a Category 1 request, a service must be similar to the current list of Medicare telehealth services. (See 70 FR 45787 and 70157, and 73 FR 38516 and 69743).Since the interactive dynamic between practitioner and patient for group HBAI and family-with-patient HBAI is not similar to that for office psychiatry services or any other service currently approved for telehealth, we believe that group HBAI and family-with-patient HBAI must be evaluated as Category 2 services. Because we consider group HBAI and family-with-patient HBAI to be Category 2 services, we need to evaluate whether these are services for which telehealth can be an adequate substitute for a face-to-face encounter.The requester did not submit evidence suggesting that the use of a telecommunications system to deliver these services would produce similar diagnostic findings or therapeutic interventions as compared to the face-to-face delivery of these services. As such, we do not propose to add group HBAI (as described by HCPCS code 96153) or family-with- patient HBAI (as described by HCPCS code 96154) to the list of approved telehealth services. b. Nursing Facility ServicesIn 2005, we received a request to add the following nursing facility services to the list of approved telehealth services: Initial nursing facility care (as described by HCPCS codes 99304 through 99306); subsequent nursing facility care (HCPCS codes 99307 through 99310); nursing facility discharge services (HCPCS codes 99315 and 99316); and other nursing facility services (HCPCS code 99318). In theCY 2007 PFS final rule with comment period, we did not add these nursing facility care services to the list of approved telehealth services because these procedure codes did not describe services that were appropriate to add to the list of available telehealth originating sites in CY 2007. At that time, skilled nursing facilities (SNFs) were not defined in the statute as originating sites (71 FR 69657).However, section 149 of the MIPPA added SNFs as telehealth originating sites effective for services furnished on or after January 1, 2009. In light of this provision, the American TelemedicineAssociation (ATA) urged us to add nursing facility care codes to the list of telehealth services for CY 2009, as requested in 2005.In the CY 2009 PFS final rule with comment period, we noted that section 149 of the MIPPA did not add any services to the list ofMedicare telehealth services. In the CY 2009 PFS final rule with comment period, we also responded to the ATA's comment suggesting that we add nursing facility care codes to the list of telehealth services for CY 2009, as requested in 2005. In our response, we noted that when we received the 2005 request to consider the addition of nursing facility care services for telehealth for CY 2007, we did not include a full review of these codes in either the CY 2007 PFS proposed rule or final rule with comment period since we believed it was not relevant to add the nursing facility services codes when the SNFs in which these services would be furnished were not eligible originating sites. In theCY 2009 PFS final rule with comment period, we responded that we believe it would be more appropriate to consider the addition of nursing facility care services for telehealth through our existing process, including full notice and comment procedures. We committed to revisiting the 2005 request to add the nursing facility codes in the CY 2010 PFS proposed rule, and we noted that we would accept additional information in support of the 2005 request if we received the information prior to December 31, 2008 (73 FR 69747).Subsequent to publication of the CY 2009 PFS final rule with comment period, the ATA submitted an amended request to add subsequent nursing facility care; nursing facility discharge
Page 33544services; and other nursing facility services to the list of approved telehealth services. The Center for Telehealth and e-Health Law submitted a request to add the same nursing facility services and indicated its support of ATA's request. We also received a request from the Marshfield Clinic to add the same services requested by the ATA, plus the initial nursing facility care services. The requesters drew analogies to the evaluation and management (E/M) services currently approved for telehealth, and they provided evidence in support of their belief that the use of telehealth could be a reasonable surrogate for the face-to-face delivery of this type of care.CMS ReviewThe procedure codes included in these requests are used to reportE/M services furnished onsite to patients in nursing facilities. In the context of these codes, ``nursing facility'' describes SNFs, NFs, intermediate care facilities, and psychiatric residential treatment centers.Medicare telehealth services can only be furnished to beneficiaries located at an originating site authorized by law. A SNF (as defined in section 1819(a) of the Act) is the only type of nursing facility that can also be considered an originating site for telehealth services.Therefore, our review of these services focuses on the potential impact of adding these services when furnished via telehealth to a Medicare beneficiary located in a SNF.Federally-Mandated Visits in Skilled Nursing FacilitiesIn describing our assessment, we first describe the service requirements of a Medicare SNF stay. In response to concerns about inadequate care provided to residents of nursing homes, the OmnibusBudget Reconciliation Act of 1987 (OBRA '87) (Pub. L. 100-203) included extensive revisions to the requirements for Medicare and Medicaid certified nursing homes. These provisions were designed to significantly improve the quality of life and the quality of care provided to residents of nursing homes, and were a high priority for the Department of Health and Human Services.Specific requirements for assuring the quality of care that SNFs must meet to participate in Medicare are specified in section 1819 of the Act. In addition, section 1819(d)(4)(B) of the Act provides that``[a] skilled nursing facility must meet such other requirements relating to the health, safety, and well-being of residents or relating to the physical facilities thereof as the Secretary may find necessary.'' The provisions of 42 CFR Part 483 codify the requirements set forth in the statute that long term care facilities are obligated to meet in order to participate in the Medicare and/or Medicaid program.Section 1819(b)(6)(A) of the Act requires that the medical care of every SNF resident must be provided under the supervision of a physician. The requirements contained in Sec. 483.40 include a prescribed visit schedule and specify that the physician must perform the initial visit personally. Section 483.40(c) requires that the resident of a SNF must be seen by a physician at least once every 30 days for the first 90 days after admission, and at least once every 60 days thereafter. As we indicated in the preamble to the February 2, 1989 final rule (54 FR 5341), and again in response to comments in theSeptember 26, 1991 final rule (56 FR 48826), the wording of the regulation states that the resident ``must be seen'' by the physician and requires an actual, face-to-face contact. Except for certain stated exceptions, all required physician visits must be made personally by the physician. Section 483.40(e)(2) requires that when personal performance of a particular task by a physician is specified in the regulations, performance of that task cannot be delegated to anyone else. Section 483.40(c)(4) requires that the physician must perform the initial visit personally, and Sec. 483.40(c)(5), allows the physician the option of alternating with a qualified NPP (that is, physician assistant, nurse practitioner, or clinical nurse specialist) in making the subsequent required visits. These regulations ensure that at least a minimal degree of personal contact between physician or qualified NPP and resident is maintained, both at the point of admission to the facility and periodically during the course of the resident's stay (54FR 5342).In the CY 2009 PFS final rule with comment period (73 FR 69747), we noted that in considering nursing facility care for telehealth, we would need to carefully evaluate the use of telehealth for the personal visits that are currently required under Sec. 483.40. The OBRA '87 and other long-term care legislation enacted since then require a SNF to care for its residents ``in such a manner and in such an environment as will promote maintenance or enhancement of the quality of life of each resident'' as specified in section 1819(b)(1)(A) of the Act. We believe that a minimum number of periodic, comprehensive, hands-on examinations of a resident by a physician or a qualified NPP are necessary to ensure that the resident receives quality care. We believe that the complexity of care required by many residents of SNFs warrants at least a minimal degree of direct personal contact between physicians or qualified NPPs and SNF residents. Therefore, we believe that these Federally-mandated visits should be conducted in-person, and not as telehealth services, in order to provide direct personal contact between the resident and the physician or qualified NPP.In the MMA, the Congress recognized the importance of furnishing the Federally-mandated visits in person, rather than via telehealth.Section 418 of the MMA required the Secretary to submit a Report toCongress evaluating the use of telehealth in SNFs. If the Secretary determined that it was advisable to permit a SNF to be an originating site for telehealth services, the MMA provided the Secretary with the authority to expand telehealth originating sites to include SNFs. SNFs were permitted to be added as originating sites only if the Secretary could establish a mechanism to ensure that telehealth does not serve as a substitute for in-person visits furnished by a physician, or for in- person visits furnished by a physician assistant, nurse practitioner, or clinical nurse specialist.On November 9, 2007, the Secretary provided to Congress the report specified under section 418 of the MMA, entitled, ``Permitting SkilledNursing Facilities to be Originating Telehealth Sites.'' Overall, theReport noted that evidence concerning the net impact of allowing SNFs to be originating telehealth sites was not conclusive and further analysis was needed. With respect to Federally-mandated visits in SNFs, the Report stated that the Secretary could use its authority to add services to and delete services from the list of Medicare telehealth services as a mechanism to ensure that Federally-mandated visits are not furnished as a Medicare telehealth service by not adding these visits to the lists of Medicare telehealth services.In consideration of the history of the OBRA '87, 42 CFR part 483, and Congressional concern expressed in section 418 of the MMA, we do not propose to add any procedure codes that are used exclusively to describe E/M services that fulfill Federal requirements for personal visits under Sec. 483.40. We are proposing to revise Sec. 410.78 to restrict physicians and practitioners from using telehealth to furnish the physician visits required under Sec. 483.40(c).
Page 33545In the following sections, we will separately review the use of telehealth for each of the subcategories of nursing facility services included in these requests. In these discussions, we will also indicate which of these subcategories are used to describe E/M services that fulfill Federal requirements for personal visits under Sec. 483.40.Initial Nursing Facility CareThe initial nursing facility care procedure codes (as described byHCPCS codes 99304 through 99306) are used to report the initial E/M visit in a SNF or NF that fulfills Federally-mandated requirements under Sec. 483.40(c). For survey and certification requirements, this initial visit must occur no later than 30 days after admission. In aSNF, a physician must furnish the initial visit.One of the requesters noted that once the patient is transferred to the SNF, it might be days until a physician can see a resident in- person. The requester believes a higher quality of care would be provided if the initial nursing facility service can be done in an expeditious manner--via telehealth--rather than delayed until the physician is on site.As noted above, we are not proposing to add any procedure codes that are used exclusively to describe E/M services that fulfill Federal requirements for personal visits under Sec. 483.40. We believe that these Federally-mandated visits should be conducted in-person because this will ensure at least a minimal degree of direct personal contact between physicians or qualified NPPs and residents. Further, we believe it is particularly important that the Federally-mandated initial visit should be conducted in-person because this will ensure that the physician can comprehensively assess the resident's condition upon admission to the SNF through a thorough hands-on examination. We believe that even if the initial visit is delayed for a few days, it is necessary for the resident of a SNF to have a face-to-face visit with the physician who is developing a plan of care. Under section 1819(b)(2) of the Act, a SNF must provide services to attain or maintain the highest practicable physical, mental, and psychosocial well-being of each resident. We believe that furnishing the initial visit in a face-to-face encounter, and not via telehealth, is necessary to assure quality care. As such, we are not proposing to add the initial nursing facility care services (as described by HCPCS codes 99304 through 99306) to the list of approved telehealth services.Subsequent Nursing Facility CareThe subsequent nursing facility care procedure codes (as described by HCPCS codes 99307 through 99310) are used to report either aFederally-mandated periodic visit under Sec. 483.40(c), or any E/M visit, prior to and after the initial physician visit, that is reasonable and medically necessary to meet the medical needs of the individual resident.The long-term care regulations at Sec. 483.40 require periodic physician visits for residents of SNFs (and NFs) at least once every 30 days for the first 90 days after admission and at least once every 60 days thereafter. After the initial visit, Federally-mandated periodic visits in SNFs may, at the option of the physician, alternate between personal visits by the physician and visits by a qualified NPP (who is under the supervision of a physician, and meets the other requirements specified at Sec. 483.40(e)). As noted above, we are not proposing to allow the use of telehealth to furnish these Federally-mandated personal visits. We believe that these Federally-mandated periodic visits should be conducted in-person because this will ensure at least a minimal degree of direct personal contact between physicians or qualified NPPs and residents. Under section 1819(b)(2) of the Act, aSNF must provide services to attain or maintain the highest practicable physical, mental, and psychosocial well-being of each resident. We believe that furnishing the periodic personal visits in face-to-face encounters, and not via telehealth, is necessary to assure quality care.We considered the possibility of approving subsequent nursing facility care for telehealth with specific limitations, for example, approving subsequent nursing facility care for telehealth only when the codes are used for medically necessary E/M visits that are in addition to Federally mandated periodic personal visits. In past years, we did not add hospital E/M visits to the list of Medicare approved telehealth services because of our concern regarding the use of telehealth for the ongoing E/M of a high-acuity hospital inpatient. (See 69 FR 47511, 69FR 66276, 72 FR 38144, 72 FR 66250, 73 FR 38517, and 73 FR 69745.) Many residents of SNFs require medically complex care, and we have similar concerns about allowing physicians or NPPs to furnish E/M visits via telehealth to residents of SNFs.Because the complexity of care required by many residents of SNFs may be significantly greater than the complexity of care generally associated with patients receiving the office visits approved for telehealth, we do not consider E/M visits furnished to residents ofSNFs similar to the office visits on the current list of Medicare telehealth services. Therefore, we believe the use of subsequent nursing facility care for medically necessary E/M visits that are in addition to Federally mandated periodic personal visits must be evaluated as a Category 2 service.Because we consider subsequent nursing facility care to be aCategory 2 request, we evaluate whether these are services for which telehealth can be an adequate substitute for a face-to-face encounter. The requesters submitted supporting documentation intended to suggest that the use of telehealth could be a reasonable surrogate for the face-to-face delivery of this type of care.One study assessed the impact of videoconferencing (as opposed to communication by telephone without video) on nighttime, on-call medical decision-making in the nursing home. The comparison of videoconferencing with telephonic communication of information by nurses does not provide a comparative analysis demonstrating that E/M visits furnished via telehealth to residents of SNFs is equivalent to the face-to-face delivery of such services. As such, this study was not relevant to this review.Another study assessed the value of a monitoring system in reducing falls and injuries in non-acute late-evening and nighttime situations in a nursing home setting. The monitoring system described in this study was comprised of sensors to alert caregivers via a silent pager when a high-risk resident exits his or her bed, bedroom, or bathroom.This allows caregivers to aid the resident and potentially reduce falls. The technologies utilized in this study do not correspond with our definitions of telehealth as specified in Sec. 410.78. In addition, this type of resident monitoring is performed typically by nursing staff and is not an E/M visit. As such, this study was not relevant to this review.A third study presented the savings achieved through avoiding transport to emergency departments and physicians' offices by furnishing visits via telehealth to residents in nursing facilities.The study did not provide any comparative analysis of the services furnished via telehealth with those furnished in person.A fourth study evaluated the impact of telemedicine as a decision aid for residents of long-term care SNFs with chronic wounds. The patients selected for this study were alert and
Page 33546intellectually interactive. The study concluded that furnishing a telehealth consultation prior to a face-to-face consultation increased the level of patient comfort with care-related decisions made during the face-to-face consultation. The control group did not receive an equivalent intermediate consultation face-to-face that could be compared to the services furnished to the test group. We acknowledge the study's findings that the intermediate telehealth consultation was a useful decision aid, but we do not consider this a comparative analysis between delivery of the same type of care via telehealth versus face-to-face.We received a pilot study evaluating the usefulness of E/M services furnished via telehealth for making routine medical decisions in the nursing home. The nursing home residents were evaluated over videoconferencing and then evaluated immediately afterward by the same clinician in person. On a scale of 1 to 5 (1 being the least ill), the clinicians assessed the illness level of these residents at 3 or below, with the illness level for over 65 percent of the encounters assessed at ``1.'' Videoconferencing without a face-to-face examination was sufficient for making medical decisions in most cases studied in this pilot, although face-to-face examinations were preferred. Clinicians generated orders in 30 percent of these paired encounters, with a predominance of orders generated after, rather than before, the face- to-face examination. The study also noted that even when nursing home residents were alert, they had limited participation in the telemedicine interactions and were not as involved in making informed medical decisions with their clinicians, compared to face-to-face encounters. The study suggests that remote examination by video might serve as a substitute for some routine visits, if interspersed with face-to-face examinations. The study concluded that videoconferencing is feasible for making routine medical decisions in the nursing home.We appreciate the comparative analysis provided by this study.However, we note that this study focused on the usefulness of telehealth for routine decision-making in the nursing home, and the reported illness levels of the residents in these sample encounters was relatively low to moderate. We do not consider these findings persuasive that telehealth can, more generally, be an adequate substitute for the face-to-face delivery of E/M visits to residents ofSNFs who might require more medically complex care.We considered the possibility of approving the use of telehealth to furnish E/M visits to residents of SNFs who do not require medically complex care or approving subsequent nursing facility care for telehealth only for medically necessary E/M visits with straightforward or low complexity medical decision-making (as described by HCPCS codes 99307 and 99308). Although this last pilot study concluded that videoconferencing is feasible for making routine medical decisions in the nursing home, we are concerned with the study's finding that residents with low to moderate levels of reported illness had limited participation in the telemedicine interactions and less involvement in making informed medical decisions with their clinicians, compared to face-to-face encounters. Under section 1819(c)(1)(A) of the Act, a SNF must protect and promote the rights of each resident, including the right to be fully informed in advance of any changes in care or treatment that may affect the resident's well-being, and (except with respect to a resident adjudged incompetent) to participate in planning care and treatment or changes in care or treatment. Under Sec. 483.10(b)(3), a resident has the right to be fully informed in language that he or she can understand of his or her total health status, including but not limited to his or her medical condition. If the use of telehealth does not elicit from residents with low to moderate reported illness adequate participation in making informed medical decisions with their clinicians when compared to face-to-face encounters, we believe that telehealth is not an adequate substitute for the face-to-face delivery of E/M visits to any residents of SNFs.After reviewing these studies, we do not have sufficient comparative analysis or other compelling evidence to demonstrate that furnishing E/M visits via telehealth to residents of SNFs is an adequate substitute for the face-to-face encounter between the practitioner and the resident, especially in cases where the resident requires medically complex care. Therefore, we are not proposing to add subsequent nursing facility care services (as described by HCPCS codes 99307 through 99310) to the list of approved telehealth services.Nursing Facility Discharge Day ManagementThe nursing facility discharge day management codes (as described by HCPCS codes 99315 and 99316) are used to report an E/M visit that prepares a resident for discharge from a nursing facility. We note that there is no Medicare Part B requirement to furnish and bill an E/M visit in preparation for a resident's discharge from a SNF. However, if a physician or qualified NPP bills a Nursing Facility DischargeServices code, we believe that a face-to-face encounter will better insure that the resident is prepared for discharge, as we do not have evidence that nursing facility discharge services via telehealth is adequately equivalent to face-to-face provision. As such, we are not proposing to add the nursing facility discharge day management services(as described by HCPCS codes 99315 and 99316) to the list of approved telehealth services.Other Nursing Facility ServiceIn 2006, CPT added a procedure code for Other Nursing FacilityService (CPT code 99318) to describe an annual nursing facility assessment. An annual assessment is not one of the required visits under the long-term care regulations at Sec. 483.40. For Medicare purposes, this code can be used in lieu of a Subsequent NursingFacility Care code to report a Federally-mandated periodic personal visit furnished under Sec. 483.40(c). An annual assessment visit billed using CPT code 99318 does not represent a distinct benefit service for Medicare Part B physician services, and it cannot be billed in addition to the required number of Federally-mandated periodic personal visits. Under Medicare Part B, we cover this procedure code if the visit fully meets the CPT code 99318 requirements for an annual nursing facility assessment and if such an annual assessment falls on the 60-day mandated visit cycle. We are not proposing to add the other nursing facility care services (as described by HCPCS code 99318) to the list of approved telehealth services because this code is payable by Medicare only if the visit is substituted for a Federally-mandated visit under Sec. 483.40(c). As explained above, we believe all of theFederally-mandated periodic visits must be conducted in person.Follow-up Inpatient ConsultationsPrior to 2006, follow-up inpatient consultations (as described byCPT codes 99261 through 99263) were approved telehealth services. In 2006, the CPT Editorial Panel of the American Medical Association (AMA) deleted the codes for follow-up inpatient consultations. In the hospital setting, the AMA advised practitioners to bill for services that would previously have been billed as follow-up inpatient consultations using the procedure codes for subsequent hospital care(as described by CPT codes 99231 through 99233). In the nursing facility setting,
Page 33547the AMA advised practitioners to bill for these services using the procedure codes for subsequent nursing facility care (as described byCPT codes 99307 through 99310).In the CY 2008 PFS proposed rule (72 FR 38144) and subsequent final rule with comment period (72 FR 66250), we discussed a request from theATA to add subsequent hospital care to the list of approved telehealth services. Because there was no method for practitioners to bill for follow-up consultations delivered via telehealth to hospital inpatients, the ATA requested that we add the subsequent hospital care codes to the list of Medicare approved telehealth services. We expressed our concern that subsequent hospital care codes describe a broader range of services than follow-up consultations, including some services that may not be appropriate to be furnished via telehealth. We committed to continue evaluating the issues.In the CY 2009 PFS proposed rule (73 FR 38517), we proposed to create a new series of HCPCS codes for follow-up inpatient telehealth consultations. In the CY 2009 PFS final rule with comment period (73 FR 69745), we finalized our proposal to create follow-up inpatient telehealth consultation codes (as described by HCPCS codes G0406 through G0408) and added these G-codes to the list of Medicare telehealth services. These HCPCS codes are limited to the range of services included in the scope of the previous CPT codes for follow-up inpatient consultations, and the descriptions limit the use of such services for telehealth. (See the CMS Internet-Only Medicare BenefitPolicy Manual, Pub. 100-02, Chapter 15, Section 270.2.1 and theMedicare Claims Processing Manual, Pub. 100-04, Chapter 12, Section 190.3.1 for the current definition of follow-up inpatient telehealth consultations.)We note that if the former codes for follow-up consultations (as described by CPT codes 99261 through 99263) still existed, these procedure codes would also be available to practitioners to submit claims to their Medicare contractors for payment of follow-up consultations provided via telehealth to patients located in SNFs.Although we did not receive a public request to add follow-up inpatient consultations for patients in SNFs to the list of approved Medicare telehealth services, we recognize a similar need to establish a method for practitioners to furnish and bill for follow-up consultations delivered via telehealth to patients in SNFs.We considered the possibility of approving subsequent nursing facility care for telehealth with specific limitations, for example, approving subsequent nursing facility care for telehealth only when the codes are used for follow-up consultations. However, as discussed above, we do not believe it would be appropriate for E/M visits to be furnished via telehealth to treat residents of SNFs requiring medically complex care. We are concerned that it could be difficult to implement sufficient controls and monitoring to ensure that the use of the subsequent nursing facility care codes for telehealth is limited to the delivery of services that were formerly described as follow-up inpatient consultations.We considered creating new G-codes to enable practitioners to bill for the services that were formerly described as follow-up inpatient telehealth consultations when furnished to residents of SNFs. We examined the feasibility of creating such codes to parallel the subsequent nursing facility care services, which are the codes currently used to bill these follow-up consultations in a face-to-face encounter. We found that the elements of the four levels of subsequent nursing facility care did not correspond to the three levels of the deleted CPT codes previously used for follow-up inpatient consultations. We believe that it would be administratively simpler to utilize the three existing codes for follow-up inpatient telehealth consultations rather than add additional G-codes. The use of the same``follow-up inpatient telehealth consultation'' G-codes for services furnished in both hospital inpatient and SNF settings would also correspond to the use of the previous CPT codes for services furnished to hospital inpatients and residents of SNFs.For CY 2010, we are proposing to revise Sec. 410.78 to specify that the G-codes for follow-up inpatient telehealth consultations (as described by HCPCS codes G0406 through G0408) include follow-up telehealth consultations furnished to beneficiaries in hospitals andSNFs. The HCPCS codes will clearly designate these services as follow- up consultations provided via telehealth, and not subsequent nursing facility care used for E/M visits. Utilization of these codes for patients in SNFs will facilitate payment for these services, as well as enable us to monitor whether the codes are used appropriately.As described in the CMS Internet-Only Medicare Benefit PolicyManual, Pub. 100-02, Chapter 15, Section 270.2.1 and the MedicareClaims Processing Manual, Pub. 100-04, Chapter 12, Section 190.3.1, follow-up inpatient telehealth consultations include monitoring progress, recommending management modifications, or advising on a new plan of care in response to changes in the patient's status or no changes on the consulted health issue. Counseling and coordination of care with other providers or agencies is included as well, consistent with the nature of the problem(s) and the patient's needs. The physician or practitioner who furnishes the inpatient follow-up consultation via telehealth cannot be the physician of record or the attending physician, and the follow-up inpatient consultation would be distinct from the follow-up care provided by a physician of record or the attending physician. If a physician consultant has initiated treatment at an initial consultation and participates thereafter in the patient's ongoing care management, such care would not be included in the definition of a follow-up inpatient consultation and is not appropriate for delivery via telehealth.Consistent with our policy for follow-up telehealth consultations furnished to hospital inpatients, in order to bill and receive payment for these services, physicians and practitioners must submit the appropriate HCPCS procedure code for follow-up inpatient telehealth consultations along with the ``GT'' modifier (``via interactive audio and video telecommunications system''). By coding and billing the``GT'' modifier with the follow-up inpatient telehealth consultation codes, the distant site physician or practitioner certifies that the beneficiary was present at an eligible originating site when the telehealth service was furnished. (See the CMS Internet-Only MedicareClaims Processing Manual, Pub. 100-04, Chapter 12, Section 190.6.1 for instructions for submission of interactive telehealth claims.)In the case of Federal telemedicine demonstration programs conducted in Alaska or Hawaii, store and forward technologies may be used as a substitute for an interactive telecommunications system.Covered store and forward telehealth services are billed with the``GQ'' modifier, ``via asynchronous telecommunications system.'' By using the ``GQ'' modifier, the distant site physician or practitioner certifies that the asynchronous medical file was collected and transmitted to him or her at the distant site from a Federal telemedicine demonstration project conducted in Alaska or Hawaii. (See the CMS Internet-Only Medicare Claims Processing Manual, Pub. 100-04,Chapter 12, Section 190.6.2 for instructions for submission of telehealth store and forward claims.)
Page 33548c. Critical Care ServicesIn the CY 2009 PFS proposed rule (73 FR 38517), we reviewed a request submitted by the University of Pittsburgh Medical Center (UPMC) to add critical care services (as described by HCPCS codes 99291 and 99292) to the list of approved telehealth services. UPMC drew analogies to the E/M consultation services currently approved for telehealth and described how it uses telehealth to give stroke patients timely access to consultative input from highly specialized physicians who are not available to furnish services face-to-face.In the CY 2009 PFS final rule with comment period (73 FR 69744), we did not add critical care services to the list of approved telehealth services. This request was not considered as a category 1 request because, as we stated, we believe that remote critical care services are a different service than the telehealth delivery of critical care (as described by HCPCS codes 99291 and 99292). We stated that we had no evidence suggesting that the use of telehealth could be a reasonable surrogate for the face-to-face delivery of this type of care, and we did not add critical care services to the list of Medicare approved telehealth services. We noted that this decision does not preclude physicians from providing telehealth consultations to critically ill patients.Following publication of the CY 2009 PFS final rule with comment period, Philips Healthcare, the maker of a remote critical care system, submitted an expanded request to add critical care services to the list of Medicare approved telehealth services. The Philips Healthcare request stated that critical care services can be approved as aCategory 1 service based on their similarity to the inpatient consultation services currently approved for telehealth. The requester noted that many of the components of critical care are similar to a high-level inpatient consultation service, which is currently approved for telehealth. Common components include obtaining a patient history, conducting an examination, and engaging in complex medical decision- making for patients who may be severely ill. Because we classified critical care as a Category 2 service last year, Philips also submitted evidence to support its belief that the use of telehealth could be a reasonable surrogate for the face-to-face delivery of this type of care.CMS ReviewTo determine whether to assign a request to Category 1, we look for similarities between the service that is being considered for addition and existing telehealth services for the roles of, and interactions among, the beneficiary, the physician (or other practitioner) at the distant site and, if necessary, the telepresenter.In this case, we look for such similarities between critical care and inpatient consultations and other similar services on the current list of approved Medicare telehealth services. Critical care (as described by HCPCS codes 99291 and 99292) is the direct delivery by a physician of medical care for a critically ill or critically injured patient. It involves high complexity decision-making to assess, manipulate, and support vital system function(s) to treat single or multiple vital organ system failure and/or to prevent further life-threatening deterioration of the patient's condition. Within the current standards of practice, we believe critical care services require the physical presence of the physician rendering the critical care services. We also note that a number of hands-on interventions (for example, gastric intubation and vascular access procedures), when furnished on the day a physician bills for critical care, are included in the critical care service and are not reported separately. Inpatient consultations generally do not include hands-on interventions. Because we believe that critical care services (as described by HCPCS codes 99291 and 99292) require the physical presence of a physician who is available to furnish any necessary hands-on interventions, we do not consider critical care services similar to any services on the current list ofMedicare telehealth services. Therefore, we believe critical care must be evaluated as a Category 2 service.In order to evaluate critical care services as a Category 2 service, we need to determine whether these are services for which telehealth can be an adequate substitute for a face-to-face encounter. In CPT 2009, the AMA defined remote critical care services tracking codes (codes 0188T through 0189T) with cross-references to critical care services (HCPCS codes 99291 through 99292). CPT directs that only one physician may report either critical care services or remote critical care services for the same period. The requester cites this as evidence that the AMA considers the two services equivalent, and that critical care should be approved as a Category 2 service. We do not consider the CPT coding guidance persuasive evidence that remote critical care is the telehealth delivery of critical care, as defined by HCPCS codes 99291 and 99292. We believe that if the AMA valued the two services equally, they would not have created separate tracking codes for remote critical care services.As we noted in the CY 2009 PFS final rule with comment period, consistent with the AMA's creation of tracking codes, we believe that remote critical care services are different from the telehealth delivery of critical care services (as described by HCPCS codes 99291 and 99292). Category III CPT codes track utilization of a service, facilitating data collection on, and assessment of, new services and procedures. We believe that the data collected for these tracking codes will help provide useful information on how to best categorize and value remote critical care services in the future.The requester also submitted studies which conclude that remote critical care services furnished by intensivists improve mortality rates, decrease length of stay, reduce per patient costs, and improve compliance with best practices, thereby improving patient outcomes.These studies are similar to the ones we received and reviewed from theCY 2009 PFS proposed rule. We maintain that remote critical care services are not the telehealth delivery of critical care services (as described by HCPCS codes 99291 and 99292). Therefore, we do not find the new studies submitted with the CY 2010 request persuasive that telehealth can be an adequate substitute for the face-to-face delivery of critical care services (as described by HCPCS codes 99291 and 99292).We continue to believe that remote critical care services are different services than the telehealth delivery of critical care (as described by HCPCS codes 99291 and 99292). As such, we are not proposing to add critical care services (as described by HCPCS codes 99291 and 99292) to the list of approved telehealth services. We reiterate that our decision not to add critical care services to the list of approved telehealth services does not preclude physicians from furnishing telehealth consultations to critically ill patients. d. Other RequestsWe received a number of requests to add services that we reviewed and did not approve in previous PFS Rules. The following are brief summaries and references to previous discussions regarding our decisions not to add these procedure codes to the list of Medicare approved telehealth services. As explained further below, we are not reconsidering these previous decisions.
Page 33549Initial and Subsequent Hospital CareWe received a request to add initial hospital care (as described byHCPCS codes 99221 through 99223) and subsequent hospital care (as described by HCPCS codes 99231 through 99233) to the list of approved telehealth services. In response to previous requests, we did not add initial or subsequent hospital care to the list of approved telehealth services because of our concern regarding the use of telehealth for the ongoing E/M of a high-acuity hospital inpatient. (See 69 FR 47510 and 66276, 72 FR 38144 and 66250, and 73 FR 38517 and 69745.) We did not receive any new information with this request that would alter our previous decisions. Therefore, we are not proposing to add initial hospital care (as described by HCPCS codes 99221 through 99223) or subsequent hospital care (as described by HCPCS codes 99231 through 99233) to the list of approved telehealth services.Group Medical Nutrition Therapy ServicesWe received a request to add group medical nutrition therapy (MNT) services (as described by HCPCS codes G0271 and 97804) to the list of approved telehealth services. In response to a previous request, we did not add group MNT to the list of approved telehealth services because we believe that group services are not appropriately delivered through telehealth. (See 70 FR 45787 and 70157.) We did not receive any new information with this request that would alter our previous decision.Therefore, we are not proposing to add group MNT (as described by HCPCS codes G0271 and 97804) to the list of approved telehealth services.Diabetes Self-Management Training (DSMT)We received a request to add diabetes self-management training(DSMT) (as described by HCPCS codes G0108 and G0109) to the list of approved telehealth services. In response to previous requests, we did not add DSMT to the list of approved telehealth services because of the statutory requirement that DSMT include teaching beneficiaries to self- administer injectable drugs. Furthermore, DSMT is often performed in group settings and we believe that group services are not appropriately delivered through telehealth. (See 70 FR 45787 and 70157, and 73 FR 38516 and 69743.) We did not receive any new information with this request that would alter our previous decisions. Therefore, we are not proposing to add DSMT (as described by HCPCS codes G0108 and G0109) to the list of approved telehealth services.Speech and Language Pathology ServicesWe received a request to add various speech and language pathology services to the list of approved telehealth services. Speech-language pathologists are not permitted under current law to furnish and receive payment for Medicare telehealth services. Therefore, we do not propose to add any speech and language pathology services to the list ofMedicare telehealth services. (For further discussion, see 69 FR 47512 and 66276, and 71 FR 48995 and 69657.)Physical and Occupational Therapy ServicesWe received a request to add various physical and occupational therapy services to the list of approved telehealth services. Physical and occupational therapists are not permitted under current law to furnish and receive payment for Medicare telehealth services.Therefore, we are not proposing to add any physical and occupational therapy services to the list of approved telehealth services. (For further discussion, see 71 FR 48995 and 69657.)E. Coding Issues 1. Canalith RepositioningIn 2008, the CPT Editorial Panel created a new code for canalith repositioning (CRP). This procedure is a treatment for vertigo which involves therapeutic maneuvering of the patient's body and head in order to use the force of gravity to redeposit the calcium crystal debris in the semicircular canal system.In the CY 2009 PFS final rule with comment period (73 FR 69896), new CPT code 95992, Canalith repositioning procedure(s) (eg, Epley maneuver, Semont maneuver), per day, was assigned the bundled status indicator (B). We explained that this procedure previously was billed as part of an evaluation and management (E/M) service or under a number of CPT codes, including CPT code 97112, Therapeutic procedure, one or more areas, each 15 minutes; neuromuscular reeducation of movement, balance, coordination, kinesthetic sense, posture, and/or proprioception for sitting and/or standing activities. We also explained that because neurologists and therapists are the predominant providers of this service to Medicare patients (each at 22 percent), it was assigned as a ``sometimes therapy'' service under the therapy code abstract file.We received comments on this issue from the American PhysicalTherapy Association (APTA), as well as other organizations expressing opposition to our decision to bundle the new code. Commenters stated that they believe that our decision to bundle CPT code 95992 is flawed since physical therapists are unable to bill E/M services. The commenter also stated that therapists would be precluded from using another code for billing for this service because CPT correct coding instructions require that the provider/supplier select the procedure that most accurately defines the service provided. Commenters also expressed concern that this could impact beneficiary access to this service.Based upon the commenters' feedback, we realized that we had failed to address how therapists would bill for the service since they cannot bill E/M services. In order to address this situation so that access to this service would not be impacted, we included language in a change request (CR) (the quarterly update CR for April) and also released aMedLearn article informing PTs to continue using one of the more generally defined ``always therapy'' CPT codes (97112) as a temporary measure. See http://www.cms.hhs.gov/transmittals/downloads/R1691CP.pdf and http://www.cms.hhs.gov/MLNMattersArticles/downloads/MM6397.pdf.In response to the concerns raised and upon additional review of this issue for CY 2010, we are proposing to change the status indicator from B (Bundled) to I (Invalid). We propose that physicians would continue to be paid for CRP as a part of an E/M service. Physical therapists would continue to use one of the more generally defined``always therapy'' CPT codes (97112). We believe that this will enable beneficiaries to continue to receive this service while at the same time it will address our concerns about the potential for duplicate billing for this service to the extent that this service is paid as a part of an E/M service. As a result of this proposal, CPT code 95992 would be removed as a ``sometimes'' therapy code from the therapy code list. 2. Payment for an Initial Preventive Physical Examination (IPPE)Beginning January 1, 2010, we propose to increase the payment for an initial preventive physical examination (IPPE) furnished face-to- face with the patient and billed with HCPCS code G0402, Initial preventive physical examination; face-to-face visit, services
Page 33550limited to new beneficiary during the first 12 months of Medicare enrollment. The IPPE service includes a broad array of components and focuses on primary care, health promotion, and disease prevention.Section 101(b) of the MIPPA changed the IPPE benefit by adding to the IPPE visit the measurement of an individual's body mass index and, upon an individual's consent, end-of-life planning. Section 101(b) of the MIPPA also removed the screening electrocardiogram (EKG) as a mandatory service of the IPPE.In order to implement this MIPPA provision, in the CY 2009 PFS final rule with comment period (73 FR 69870), we created HCPCS codeG0402 as a new HCPCS code and retained, on an interim basis, the workRVUs of 1.34 assigned to HCPCS code G0344, the code that was previously used to bill for the IPPE. While we did not believe the revisions to the IPPE required by MIPPA impacted the work RVUs associated with this service, we solicited public comments on this issue, as well as suggested valuations of this service to reflect resources involved in furnishing the service.We received comments from several medical groups representing primary care physicians and geriatricians, as well as comments from theAmerican Medical Association concerning this issue. The commenters stated that the IPPE service was undervalued prior to the addition of components by the MIPPA. Commenters also stated that the current level of work RVUs would discourage delivery of appropriate end-of-life planning with the beneficiary. One commenter suggested the work associated with HCPCS code G0402 for the IPPE, as described in statute, is captured in existing CPT code 99387, Preventive Medicine Service, new patient, Initial comprehensive preventive medicine, 65 years and older. (This code is not paid under the PFS.) The work RVUs for thisCPT code are 2.06.Based on a review of the comments and upon further evaluation of the component services of the IPPE, we believe the services, in the context of work and intensity, contained in HCPCS code G0402 are most equivalent to those services contained in CPT code 99204, Evaluation and management new patient, office or other outpatient visit, and propose increasing the work RVUs for HCPCS code G0402 to 2.30 effective for services furnished beginning on January 1, 2010. 3. Audiology Codes: Policy Clarification of Existing CPT CodesIn the CY 2009 PFS final rule with comment period (73 FR 69890), we noted that the RUC reviewed and recommended work RVUs for 6 audiology codes with which we agreed (that is, CPT codes 92620, 92621, 92625, 92626, 92627, and 92640). We also noted that in the Medicare program, audiology services are provided under the diagnostic test benefit and that some of the work descriptors for these services include``counseling,'' ``potential for remediation,'' and ``establishment of interventional goals.'' We noted that we do not believe these aspects fit within the diagnostic test benefit, and therefore, we solicited comment on this issue.Since audiology services fall under the diagnostic test benefit, aspects of services that are therapeutic or management activities are not payable to audiologists. This distinction is of particular importance since CPT codes 92620, 92621, 92626, 92627, and 92640 are``timed'' codes, that is, these codes are billed based on the actual time spent furnishing the service. In response to our request, the society that represents speech language pathologists, audiologists, and speech and language scientists, provided the following comments.Comment: With respect to the term ``counseling,'' the commenter stated that ``counseling'' as used in the intraservice work description for CPT code 92640, Diagnostic analysis with programming of auditory brainstem implant, per hour, is used in the context of informational rather than personal counseling. In this instance the counseling provides information and guidance to the patient on what to expect relative to the service (application of the electrical stimulation).This counseling is an integral part of the diagnostic procedure and not a means of providing therapy or active treatment.Response: We appreciate the comments related to counseling by the specialty society, but are not persuaded that counseling is an integral part of a diagnostic test. Although we understand that test results are sometimes conveyed to the patient during or at the conclusion of a diagnostic test, counseling the patient about how to compensate for a hearing loss is part of a therapeutic service. As such, therapeutic and/or management of disease process counseling are not part of the diagnostic test benefit and time attributable to such activities is not payable to audiologists under the Medicare program.Comment: With respect to the term ``potential for remediation,'' which is found as part of the intraservice work descriptor for CPT code 92625, Assessment of tinnitus (includes pitch, loudness matching, and masking), the commenter states that the procedure evaluates the frequency and intensity characteristics of the perceived tinnitus in addition to measuring how the tinnitus responds to a masking noise. The response to masking noise is diagnostic information that audiologists and physicians refer to as the ``potential for remediation.'' This assessment is thus a part of a complete diagnostic workup and is not a treatment or therapeutic service.Response: The intraservice work for this service includes informing the patient of the outcome of the evaluation and the potential for remediation. As noted above, although we understand that test results are sometimes conveyed to the patient during or at the conclusion of a diagnostic test, discussing therapeutic options and/or providing therapy or management based on test results are not part of a diagnostic test. Discussing the potential for remediation does not appear to be part of a diagnostic test. While this service can involve a small amount of nondiagnostic work, CPT code 92625 is not a timed code and the bulk of the work described in the code appears to be diagnostic in nature.Comment: With respect to the term ``establishment of interventional goals,'' this phrase is found in the intraservice work description ofCPT code 92626, Evaluation of auditory rehabilitation status; first hour. The commenter states that this procedure focuses on diagnostic information relative to the patient's ability to use residual hearing with a hearing aid, a cochlear implant, or with no electronic device.The intervention goals may take a variety of forms, such as the following: Meeting audiological criteria for cochlear implantation; a recommendation to continue use of hearing aids (that is, not a cochlear implant candidate); and the need to coordinate with a speech-language pathologist for auditory training. This provides the physician with a complete diagnostic evaluation of the patient's residual hearing status. There is no element of therapy or treatment associated with this service.Response: Diagnostic testing usually does not involve the establishment of interventional goals. The test report usually contains test findings and may suggest additional tests. While we appreciate the comments of the specialty society, we are not persuaded that establishing interventional goals is
Page 33551part of a diagnostic test under Medicare. The establishment of interventional goals is clearly a function of therapeutic management.As such, establishment of goals is not part of the diagnostic test benefit and time attributable to such activity is not payable to an audiologist under the Medicare program.We appreciate the comments we received on this issue. We want to emphasize that therapeutic and/or management activities associated with these audiology tests are not payable to audiologists because of the benefit category under which these tests are covered. We may also issue instructions to contractors to monitor these services to prevent inappropriate payments. 4. Consultation Services a. BackgroundThe current physician visit and consultation codes were developed by the American Medical Association (AMA) Current ProceduralTerminology (CPT) Editorial Panel in November 1990. A consultation service is an evaluation and management (E/M) service furnished to evaluate and possibly treat a patient's problem(s). It can involve an opinion, advice, recommendation, suggestion, direction, or counsel from a physician or qualified NPP at the request of another physician or appropriate source. (See the Internet-Only Medicare Claims ProcessingManual, Pub. 100-04, chapter 12, Sec. 30.6.10A for more information.)A consultation service must be documented and a written report given to the requesting professional. Currently, consultation services are predominantly billed by specialty physicians. Primary care physicians infrequently furnish these services.The required documentation supports the accuracy and medical necessity of a consultation service that is requested and provided.Medicare pays for a consultation service when the request and report are documented as a consultation service, regardless of whether treatment is initiated during the consultation evaluation service. (See the Internet-Only Medicare Claims Processing Manual, Pub. 100-04, chapter 12, Sec. 30.6.10B.) A consultation request between professionals may be done orally by telephone, face-to-face, or by written prescription brought from one professional to another by the patient. The request must be documented in the medical record.In the Physician Fee Schedule Final Rule issued June 5, 1991, (56FR 25828) we stated that the agency's goal for the development of the new visit and consultation codes was that they meet two criteria: (1)They should be used reliably and consistently by all physicians and carriers; that is, the same service should be coded the same way by different physicians; and (2) they should be defined in a way that enables us to properly crosswalk the new codes to the relative values for the Harvard vignettes so valid RVUs for work are assigned to the new codes.Based on requests from the physician community to clarify our consultation payment policy and to provide consultation examples, we convened an internal workgroup of medical officers within CMS (then called the Health Care Financing Administration, or HCFA) and revised the payment policy instructions in August 1999 in the Medicare ClaimsProcessing Manual (at Sec. 30.6.10 as cited above). We provided examples of consultation services and examples of clinical scenarios that did not satisfy Medicare criteria for consultation services.Without explicit instructions for every possible clinical scenario outlined in national policy instructions or in AMA coding definitions or coding instructions, the local policy interpretations by Medicare contractors were not universally equivalent or acceptable to the physician community and resulted in denials in different localities.Some Medicare contractors would consider a consultation service with treatment to be an initial visit rather than a consultation thus resulting in a denial for the billed consultation. We clarified in the 1999 revision that Medicare would pay for a consultation whether treatment was initiated at the consultation visit or not. The physician community has stated that terms such as referral, transfer and consultation, used interchangeably by physicians in clinical settings, confuse the actual meaning of a consultation service and that interpretation of these words varies greatly among members of that community as some label a transfer as a referral and others label a consultation as a referral. Although we clarified the terms referral and consultation in the 1999 revision, there was disagreement with our policy by physicians in the health care community and by AMA CPT staff.We provided our documentation guidance so physicians would be in compliance with our payment policy. The consultation definition in theAMA CPT simply stated that the consultant's opinion or other information must be communicated to the requesting physician.Additional manual revisions in both January and September 2001 (atSec. 30.6.10 as cited above) clarified that NPPs can both request and furnish consultation services within their scope of practice and licensure requirements. We continued to explain our documentation requirements to the physician community through our Medicare contractors and in our discussions with the AMA CPT staff. Under our current policy and in the AMA CPT definition, a consultation service must have a request from another physician or other professional and be followed by a report to the requesting professional. The AMA CPT definition does not state the request must be written in the requesting physician's medical record. However, we require the request to be documented in the requesting physician's plan of care in the medical record as a condition for Medicare payment. The E/M documentation guidelines which apply to all E/M visits or consultations (http:// www.cms.hhs.gov/MLNEdWebGuide/25_EMDOC.asp) clearly state that when referrals are made, consultations are requested, or advice is sought, the medical record should indicate to whom and where the referral or consultation is made or from whom the advice is requested. Our Medicare contractors are responsible for reviewing and paying consultation claims when submitted. When there is a question that triggers a review of a consultation service, our Medicare contractors will look at both the requesting physician's medical record (where the request should be noted) and the consultant's medical record where the consultation is reported and at the report generated for the requesting physician.Medicare contractors do not look for evidence of documentation on every claim, only when there is a concern raised during random sampling or during a specific audit performed by a contractor. The AMA CPT coding manual, which is not a payment manual, does not specify these requirements, and, therefore, as we understand it, many physicians do not agree with the CMS policy.In March 2006, the Office of the Inspector General (OIG) published a report entitled, ``Consultations in Medicare: Coding andReimbursement'' (OEI-09-02-00030). The purpose of the report was to assess whether Medicare's payments for consultation services were appropriate. While the OIG study was being conducted, we continued our ongoing discussions with the AMA CPT staff for potential changes to the consultation definition and guidance in CPT. The findings in the OIG report (based on claims paid by Medicare in 2001) indicated thatMedicare allowed
Page 33552approximately $1.1 billion more in 2001 than it should have for services that were billed as consultations. Approximately 75 percent of services paid as consultations did not meet all applicable program requirements (per the Medicare instructions) resulting in improper payments. The majority of these errors (47 percent of the claims reviewed) were billed as the wrong type or level of consultation. The second most frequent error was for services that did not meet the definition of a consultation (19 percent of the claims reviewed). The third category of improperly paid claims was a lack of appropriate documentation (9 percent of the claims reviewed). The OIG recommended that CMS, through our Medicare contractors, should educate physicians and other health care practitioners about Medicare criteria and proper billing for all types and levels of consultations with emphasis on the highest levels and follow-up inpatient consultation services.We agreed with the OIG findings that additional education would help physicians understand the differences in the requirements for a consultation service from those for other E/M services. With each additional revision from 1999 until the OIG study began, we continually educated physicians through the guidance provided by our Medicare contractors. However, there remained discrepancies with unclear and ambiguous terms and instructions in the AMA CPT consultation coding definition, transfer of care and documentation, and the feedback from the physician community indicated they disagreed with Medicare guidance.Prior to the official publication of the OIG report, we issued aMedlearn Matters article, effective January 2006, to educate the physician community about requirements and proper billing for all types and levels of consultation services as requested by the OIG in their report. The Medlearn Matters article reflected the manual changes we made in 2006 and the AMA CPT coding changes as noted below.Our consultation policy revisions continued as a work-in-progress over several years as disagreements were raised by the physician community. We continued to work with AMA CPT coding staff in an attempt to have improved guidance for consultation services in the CPT coding definition. In looking at physician claims data (for example, the low usage of confirmatory consultation services) and in response to concerns from the physician community regarding how to correctly use the follow-up consultation codes, the AMA CPT Editorial Panel chose to delete some of the consultation codes for 2006. The Follow-Up InpatientConsultation codes (CPT codes 99261 through 99263) and the ConfirmatoryConsultation codes (CPT codes 99271 through 99275) were deleted. During our ongoing discussions, the AMA CPT staff, maintained that physicians did not fully understand the use of these codes and historically submitted them inappropriately for payment as was reflected in the OIG study.We issued a manual revision in the Medicare Claims ProcessingManual (at Sec. 30.6.10 as cited above) simultaneously with the publication of AMA CPT 2006 coding changes removing the follow-up consultation codes, and instructed physicians to use the existing subsequent hospital care code(s) and subsequent nursing facility care codes for visits following a consultation service. The confirmatory consultation codes (which were typically used for second opinions) were also removed and we instructed physicians to use the existing E/M codes for a second opinion service. We further clarified the documentation requirements by making it easier to document a request for a consultation service from another physician and to submit a consultation report to the requesting professional. Again, physicians stated that a consultant has no control over what a requesting or referring physician writes in a medical record, and that they should not be penalized for the behavior of others. However, our consultation policy instructions apply to all physicians, whether they request a consultation or furnish a consultation. As noted above, documentation by both the requesting physician and the physician who furnishes the consultation, is required under the E/M documentation guidelines. TheE/M documentation guidelines have been in use since 1995. In our discussions with the AMA CPT staff and physician groups, and national physician open door conference calls, we have emphasized that the requesting physician medical record is not reviewed unless there is a specific audit or random sampling performed. The physician furnishing the consultation service should document in the medical record from whom a request is received.We continue to hear from the AMA and from specific national physician specialty representatives that physicians are dissatisfied with Medicare documentation requirements and guidance that distinguish a consultation service from other E/M services such as transfer of care. CPT has not clarified transfer of care. Therefore, many physician groups disagree with our requirements for documentation of transfer of care. Interpretation differs from one physician to another as to whether transfer of care should be reported as an initial E/M service or as a consultation service.Despite our efforts, the physician community disagrees withMedicare interpretation and guidance for documentation of transfer of care and consultation. The existing consultation coding definition in the AMA CPT definition remains ambiguous and confusing for certain clinical scenarios and without a clear definition of transfer of care.The CPT consultation codes are used by physicians and qualified NPPs to identify their services for Medicare payment. There is an absence of any guidance in the AMA CPT consultation coding definition that distinguishes a transfer of care service (when a new patient visit is billed) from a consultation service (when a consultation service is billed). Medicare does provide guidance although there is disagreement with our policy from AMA CPT staff and some members of the physician community. Because of the disparity between AMA coding guidance andMedicare policy some physicians state they have difficulty in choosing the appropriate code to bill. The payment for both inpatient consultation and office/outpatient consultation services is higher than for initial hospital care and new patient office/outpatient visits.However, the associated physician work is clinically similar. Many physicians contend that there is more work involved with a new patient visit than a consultation service because of the post work involvement with a new patient. The payment for a consultation service has been set higher than for initial visits because a written report must be made to the requesting professional. However, all medically necessary Medicare services require documentation in some form in a patient's medical record. Over the past several years, some physicians have asked CMS to recognize the provision of the consultation report via a different form of communication in lieu of a written letter report to the requesting physician so as to lessen any paperwork burden on physicians. We have eased the consultation reporting requirements by lessening the required level of formality and permitting the report to be made in any written form of communication, (including submission of a copy of the evaluation examination taken directly from the medical record and submitted without a letter format) as long as the identity of the physician who furnished the consultation is
Page 33553evident. Although preparation and submission of the consultant's report is no longer the major defining aspect of consultation services, the higher payment has remained. (See the Internet-Only Medicare ClaimsProcessing Manual, Pub. 100-04, chapter 12, Sec. 30.6.10 F.)Both AMA CPT coding rules and Medicare Part B payment policy have always required that there is only one admitting physician of record for a particular patient in the hospital or nursing facility setting.(AMA CPT 2009, Hospital Inpatient Services, Initial Hospital Care, p.12) This physician has been the only one permitted to bill the initial hospital care codes or initial nursing facility codes. All other physicians must bill either the subsequent hospital care codes, subsequent nursing facility care codes or consultation codes. (See theInternet-Only Medicare Claims Processing Manual, Pub. 100-04, chapter 12, Sec. 30.6.9.1 G.)Beginning January 1, 2008, we ceased to recognize office/outpatient consultation CPT codes for payment of hospital outpatient visits (72 FR 66790 through 66795). Instead, we instructed hospitals to bill a new or established patient visit CPT code, as appropriate to the particular patient, for all hospital outpatient visits. Regardless of all of our efforts to educate physicians on Medicare guidance for documentation, transfer of care, and consultation policy, disagreement in the physician community prevails. b. ProposalBeginning January 1, 2010, we propose to budget neutrally eliminate the use of all consultation codes (inpatient and office/outpatient codes for various places of service except for telehealth consultationG-codes) by increasing the work RVUs for new and established office visits, increasing the work RVUs for initial hospital and initial nursing facility visits, and incorporating the increased use of these visits into our PE and malpractice RVU calculations.We note that section 1834(m) of the Act includes ``professional consultations'' (including the initial inpatient consultation codes``as subsequently modified by the Secretary'') in the definition of telehealth services. We recognize that consultations furnished via telehealth can facilitate the provision of certain services and/or medical expertise that might not otherwise be available to a patient located at an originating site. Therefore, for CY 2010, if we finalize our proposed policy to eliminate consultations from the PFS, then we propose to create HCPCS codes specific to the telehealth delivery of initial inpatient consultations. The purpose of these codes would be solely to preserve the ability for practitioners to provide and bill for initial inpatient consultations delivered via telehealth. These codes are intended for use by practitioners when furnishing services that meet Medicare requirements relating to coverage and payment for telehealth services. Practitioners would use these codes to submit claims to their Medicare contractors for payment of initial inpatient consultations provided via telehealth. The new HCPCS codes would be limited to the range of services included in the scope of the CPT codes for initial inpatient consultations, and the descriptions would be modified to limit the use of such services for telehealth. The HCPCS codes would clearly designate these as initial inpatient consultations provided via telehealth, and not initial hospital care or initial nursing facility care used for inpatient visits. Utilization of these codes would allow us to provide payment for these services, as well as enable us to monitor whether the codes are used appropriately.If we create HCPCS G-codes specific to the telehealth delivery of initial inpatient consultations, then we also propose to crosswalk theRVUs for these services from the RVUs for initial hospital care (as described by CPT codes 99221 through 99223). We believe this is appropriate because a physician or practitioner furnishing a telehealth service is paid an amount equal to the amount that would have been paid if the service had been furnished without the use of a telecommunication system. Since physicians and practitioners furnishing initial inpatient consultations in a face-to-face encounter to hospital inpatients must continue to utilize initial hospital care codes (as described by CPT codes 99221 through 99223), we believe it is appropriate to set the RVUs for the proposed inpatient telehealth consultation G-codes at the same level as for the initial hospital care codes.We considered creating separate G-codes to enable practitioners to bill initial inpatient telehealth consultations when furnished to residents of SNFs and crosswalking the RVUs to initial nursing facility care (as described by CPT codes 99304 through 99306). For the sake of administrative simplicity, if we create HCPCS G-codes specific to the telehealth delivery of initial inpatient consultations, they will be defined in Sec. 410.78 and in our manuals as appropriate for use to deliver care to beneficiaries in hospitals or skilled nursing facilities. If we adopt this proposal, then we will make corresponding changes to our regulations at Sec. 410.78 and Sec. 414.65. In addition, we will add the definition of these codes to the CMSInternet-Only Medicare Benefit Policy Manual, Pub. 100-02, Chapter 15,Section 270 and the Medicare Claims Processing Manual, Pub. 100-04,Chapter 12, Section 190.Outside the context of telehealth services, physicians will bill an initial hospital care or initial nursing facility care code for their first visit during a patient's admission to the hospital or nursing facility in lieu of the consultation codes these physicians may have previously reported. The initial visit in a skilled nursing facility and nursing facility must be furnished by a physician except as otherwise permitted as specified in Sec. 483.40(c)(4). In the nursing facility setting, an NPP who is enrolled in the Medicare program, and who is not employed by the facility, may perform the initial visit when the State law permits this. (See this exception in the Internet-OnlyMedicare Claims Processing Manual, Pub. 100-04, chapter 12, Sec. 30.6.13A). An NPP, who is enrolled in the Medicare program is permitted to report the initial hospital care visit or new patient office visit, as appropriate, under current Medicare policy. Because of an existingCPT coding rule and current Medicare payment policy regarding the admitting physician, we will create a modifier to identify the admitting physician of record for hospital inpatient and nursing facility admissions. For operational purposes, this modifier will distinguish the admitting physician of record who oversees the patient's care from other physicians who may be furnishing specialty care. The admitting physician of record will be required to append the specific modifier to the initial hospital care or initial nursing facility care code which will identify him or her as the admitting physician of record who is overseeing the patient's care. Subsequent care visits by all physicians and qualified NPPs will be reported as subsequent hospital care codes and subsequent nursing facility care codes.We believe the rationale for a differential payment for a consultation service is no longer supported because documentation requirements are now similar across all E/M services. To be consistent with OPPS policy, as noted above, we will pay only new and established office or other clinic visits under the PFS.This proposed change would be implemented in a budget neutral
Page 33554manner, meaning it would not increase or decrease PFS expenditures. We would make this change budget neutral for the work RVUs by increasing the work RVUs for new and established office visits by approximately 6 percent to reflect the elimination of the office consultation codes and the work RVUs for initial hospital and facility visits by approximately 2 percent to reflect the elimination of the facility consultation codes. We have crosswalked the utilization for the office consultation codes into the office visits and the utilization of the hospital and facility consultation codes into the initial hospital and facility visits. This change would be made budget neutral in the PE and malpractice RVU methodologies through the use of the new work RVUs and the crosswalked utilization. The PE and malpractice RVU methodologies are described elsewhere in this proposed rule.We are soliciting comments on the proposal, described more fully above, to eliminate payment for all consultation services codes under the PFS and to allow all physicians to bill, in lieu of a consultation service code, an initial hospital care visit or initial nursing facility care visit for their first visit during a patient's admission to the hospital or nursing facility. Additionally, we are soliciting comments on the proposal to create HCPCS G-codes to identify the telehealth delivery of initial inpatient consultations.F. Potentially Misvalued Services Under the Physician Fee Schedule 1. Valuing Services Under the Physician Fee ScheduleThe American Medical Association's (AMA) Relative Value SystemUpdate Committee (RUC) provides recommendations to CMS for the valuation of new and revised codes, as well as codes identified as misvalued. On an ongoing basis, the AMA RUC's Practice Expense (PE)Subcommittee reviews direct PE (clinical staff, medical supplies, medical equipment) for individual services and examines the many broad and methodological issues relating to the development of PE relative value units (RVUs).To address concerns expressed by stakeholders with regard to the process we use to price services paid under the PFS, the AMA RUC created the Five-Year Review Identification Workgroup. As we stated in the CY 2009 PFS proposed rule (73 FR 38582), the workgroup identified some potentially misvalued codes through several vehicles, namely, identifying codes with site of service anomalies, high intra-service work per unit time (IWPUT), and services with high volume growth. TheIWPUT is derived from components of the ``building-block'' approach, as described in the CY 2007 PFS proposed rule (71 FR 37172), and is used as a measure of service intensity. There were 204 services identified as misvalued last year and we plan to continue working with the AMA RUC to identify additional codes that are potentially misvalued. In the CY 2009 PFS proposed rule (73 FR 38586), we also listed approaches for theAMA RUC to utilize, namely, the review of the fastest growing procedure codes, review of Harvard-valued codes, and review of PE RVUs.We plan to address the AMA RUC's recommendations from the February and April 2009 meetings for codes with site of service anomalies in theCY 2010 PFS final rule with comment period in a manner consistent with the way we address other AMA RUC recommendations. Specifically, we complete our own review of the AMA RUC recommendations; and then in thePFS final rule with comment period, we describe the AMA RUC's recommendations, indicate whether or not we accept them, and provide a rationale for our decision. The values for these services will be published as interim values for the next calendar year.We believe that there are additional steps we can take to help address the issue of potentially misvalued services. In the CY 2009 PFS proposed rule, we identified approaches to address this issue including reviewing services often billed together and the possibility of expanding the multiple procedure payment reduction (MPPR) to additional nonsurgical procedures and the update of high cost supplies. 2. High Cost SuppliesIn the CY 2009 PFS proposed rule (73 FR 38582), we proposed a process to update the prices associated with high cost supplies over$150 every 2 years. We explained that we would need the cooperation of the medical community in obtaining typical prices in the marketplace.We also outlined examples of acceptable documentation. Although we received many thoughtful comments on the proposed process for updating high-cost supplies, as stated in the CY 2009 PFS final rule with comment period (73 FR 69882), we are continuing to examine alternatives on the best way to obtain accurate pricing information and will propose a revised process in future rulemaking. 3. Review of Services Often Billed Together and the Possibility ofExpanding the Multiple Procedure Payment Reduction (MPPR) to AdditionalNonsurgical ProceduresIn the CY 2009 PFS final rule with comment period (73 FR 69882), we stated that we plan to perform a data analysis of nonsurgical CPT codes that are often billed together. This would identify whether there are inequities in PFS payments that are a result of variations between services in the comprehensiveness of the codes used to report the services, or in the payment policies applied to each (for example, global surgery and MPPRs). The rationale for the MPPR is that certain clinical labor activities, supplies, and equipment are not performed or furnished twice when multiple procedures are performed. We stated that we would consider developing a proposal either to bundle additional services or expand application of the MPPR to additional procedures.Several specialty groups noted that the AMA RUC has already taken action to identify frequently occurring code pairs. The commenters support the AMA RUC's recommendation that CMS analyze data to identify nonsurgical CPT codes that are billed together 90 to 95 percent of the time. Additionally, the Medicare Payment Advisory Committee (MedPAC) requested that we consider duplicative physician work, as well as PE, in any expansion of the MPPR.We plan to analyze codes furnished together more than 75 percent of the time, excluding E/M codes. We will analyze both physician work andPE inputs. If duplications are found, we will consider whether an MPPR or bundling of services is most appropriate. Any proposed changes will be made through rulemaking and be subject to public comment at a later date. 4. AMA RUC Review of Potentially Misvalued Codes a. Site of Service AnomaliesThe AMA RUC created the Five-Year Review Identification Workgroup to respond to concerns expressed by the MedPAC, the Congress, and other stakeholders regarding accurate pricing under the PFS. The workgroup identified potentially misvalued codes through several vehicles. For example, the workgroup focused on codes for which there have been shifts in the site of service (site of service anomalies), codes with a high intra-service work per unit of time (IWPUT), and codes that were high volume. There were 204 potentially misvalued services
Page 33555identified in 2008 (see the CY 2009 PFS final rule with comment period(73 FR 69883)). These codes were reviewed by the AMA RUC and recommendations were submitted to CMS in 2008.In the CY 2009 PFS final rule with comment period (73 FR 69883), we noted that although we would accept the AMA RUC valuation for these site of service anomaly codes for 2009, we recognized that many of them included deletion or modification of certain inputs such as hospital days, office visits, service times, and discharge day management services in the global period. We also indicated that we had concerns about the methodology used by the AMA RUC to review these services which may have resulted in removal of hospital days and deletion or reallocation of office visits without extraction of the associated RVUs from the valuation of the code. However, we stated that we believed theAMA RUC-recommended valuations were still a better representation of the resources used to furnish these services than the current ones. We also stated that we would continue to examine these codes and would consider whether it would be appropriate to propose additional changes in future rulemaking.After further review of these codes, we believe it would be appropriate to propose further changes to several of the codes where the valuation has been adjusted to reflect changes in the site of service. Specifically, we are proposing changes to codes for which theAMA RUC review process deleted or reallocated pre-service and post service times, hospital days, office visits, and discharge day management services without the extraction of the associated RVUs.We believe the AMA RUC-recommended values do not reflect the extraction of the RVUs associated with deleted or reallocated pre- service and post-service times, hospital days, office visits, and discharge day management services. Therefore, we have recalculated the work RVUs based upon the AMA RUC-recommended inputs (that is, changes in pre-service and post-service times and associated E/M services). The proposed work RVUs for each CPT code shown in Table 8 were recalculated using the pre-AMA RUC review work RVUs as a starting point, and adjusting them for the addition or extraction of pre-service and post- service times, inpatient hospital days, discharge day management services and outpatient visits as recommended by the AMA RUC. We used the following methodology: 1. For each CPT code noted in Table 8, we separated out each component (that is, pre-service time, intra-service time, post-service time, inpatient hospital day, discharge day management services, and outpatient visits) that comprised the entire work RVUs for the service. 2. We calculated the incremental difference between the pre-service and post-service time from before and after the AMA RUC review, and multiplied that difference by an IWPUT intensity factor of 0.0224, which is a constant in the IWPUT equation. For example, if the pre- service time prior to the AMA RUC review was 75 minutes and, following its review, the AMA RUC recommended an increase in pre-service time to 85 minutes, we multiplied the difference (10 minutes) by 0.0224 to determine the RVUs associated with the increase in pre-service time, and then added that number of RVUs to the pre-AMA RUC evaluation workRVU. 3. We then added or removed the work RVUs associated with the extraction or reallocation of each inpatient hospital day, outpatient visit or discharge day management service as appropriate. For example, assume that prior to the AMA RUC review a code was assigned: 1 inpatient hospital day (currently billed using CPT code 99231 and assigned 0.76 work RVUs); 1 discharge day management service (currently billed usingCPT code 99238 and assigned 1.28 work RVUs); and 2 outpatient visits (currently billed using 99212 and assigned 0.45 work RVUs).After the AMA RUC review, the inpatient hospital day and discharge day management service were removed. To account for the removal of these services, we would have subtracted 0.76 work RVUs (represents the removal of the work RVUs for 1 inpatient hospital day) and 1.28 workRVUs (represents the removal of the work RVUs for 1 discharge day management service) from the pre-AMA RUC review work RVUs in order to develop the CMS proposed work RVUs.The methodology discussed above was used for each code noted inTable 8 and reflects the extraction of the RVUs associated with deleted or reallocated hospital days, office visits, discharge day management services, and pre-service and post-service times based upon the AMA RUC recommendations.Table 8: CY 2010 CMS Proposed Work RVUs2009 AMA RUC2010 CMSCPT code \1\DescriptorPre-AMA RUCrecommended proposed work eval. work RVUwork RVURVU21025........................... Excision of bone, lower jaw...11.079.877.23 23415........................... Release of shoulder ligament..10.099.0710.64 25116........................... Remove wrist/forearm lesion...7.387.384.83 42440........................... Excise submaxillary gland.....7.057.056.88 52341........................... Cysto w/ureter stricture tx...6.115.355.20 52342........................... Cysto w/up stricture tx.......6.615.855.63 52343........................... Cysto w/renal stricture tx....7.316.556.55 52344........................... Cysto/uretero, stricture tx...7.817.056.83 52345........................... Cysto/uretero w/up stricture..8.317.558.51 52346........................... Cystouretero w/renal strict...9.348.589.02 52400........................... Cystouretero w/congen repr....10.068.668.25 52500........................... Revision of bladder neck......9.397.998.49 52640........................... Relieve bladder contracture...6.894.734.28 53445........................... Insert uro/ves nck sphincter..15.2115.2117.02 54410........................... Remove/replace penis prosth...16.4815.0016.01 54530........................... Removal of testis.............9.318.358.65 57287........................... Revise/remove sling repair....11.4910.9710.36 62263........................... Epidural lysis mult sessions..6.416.416.04 62350........................... Implant spinal canal cath.....8.046.001.29
Page 3355663650........................... Implant neuroelectrodes.......7.577.154.18 63685........................... Insrt/redo spine n generator..7.876.004.27 64708........................... Revise arm/leg nerve..........6.226.227.36 64831........................... Repair of digit nerve.........10.239.009.74 65285........................... Repair of eye wound...........14.4314.4314.43\1\ All CPT codes copyright 2008 American Medical Association.Using the methodology described above, the adjustments to work RVUs for CPT codes 62355, 62360, 62361, 62362, and 62365 would result in negative valuation: 62355 = -1.96; 62360 = -2.31; 62361 = -2.42; 62362= -2.46; and 62365 = -1.88. For these codes, we are requesting that theAMA RUC re-review the entire family of associated codes and in the interim will maintain the AMA RUC recommended values until a methodology is developed to address codes that result in negative valuation when the methodology described above is utilized.In addition to the proposed revisions to the AMA RUC-recommendedRVUs described above, we encourage the AMA RUC to utilize the building block methodology as described in the CY 2007 PFS proposed rule (71 FR 37172) in the future when revaluing codes with site of service anomalies. We recognize that the AMA RUC looks at families of codes and may assign RVUs based on a particular code ranking within the family.However, the relative value scale requires each service to be valued based on the resources used in furnishing the service.We are also seeking public comment on alternative methodologies that could be utilized to establish work RVUs for codes that would have a negative valuation under the methodology we used for the proposed revisions to the AMA RUC-recommended values described above. b. ``23-Hour'' StayFor services that are performed in the outpatient setting and require a hospital stay of less than 24 hours, we consider this an outpatient service and recognize the additional time associated with the patient evaluation and assessment in the post-service period. We are requesting that the AMA RUC include the additional minutes in their recommendations to CMS. We do not believe the current minutes assigned in the post-service period accurately reflects the total time required for evaluation and assessment of the patient. We believe the use of E/M codes for services rendered in the post-service period for procedures requiring less than a 24-hour hospital stay would result in overpayment for pre-service and intraservice work that would not be provided.Therefore, we will not allow an additional E/M service to be billed for care furnished during the post procedure period when care is furnished for an outpatient service requiring less than a 24-hour hospital stay. 5. Establishing Appropriate Relative Values for Physician Fee ScheduleServicesIn MedPAC's March 2006 Report to Congress, MedPAC made a number of recommendations to improve the review of the relative values for PFS services. Since that time, we have taken significant action to improve the accuracy of the RVUs. As MedPAC noted in its recent March 2009Report to Congress, ``CMS and the AMA RUC have taken several steps to improve the review process'' in the intervening years since those initial recommendations. Many of our efforts to improve the accuracy ofRVUs have also resulted in substantial increases in the payments for primary care services, which was one of the motivations for MedPAC's recommendations.We completed the most recent Five-Year Review of workRVUs, resulting in an increase in over 25 percent to the work RVUs for primary care services.We significantly revised the methodology for determiningPE RVUs, resulting in more than a 5 percent increase for primary care services.We improved our processes for identifying potentially misvalued services by engaging in an ongoing review that includes screens for rapidly growing services and services with substantial shifts in site of service. We also identified approaches to address the issue of potentially misvalued services including reviewing services often billed together and the possibility of expanding the multiple procedure payment reduction (MPPR) to additional nonsurgical procedures and the update of high cost supplies.As discussed elsewhere in this proposed rule, we are proposing a number of improvements to the calculation and establishment of the work, PE, and malpractice RVUs that would result in overall payment increases to primary care specialties of between 6 percent and 8 percent in CY 2010. These changes include a 6 percent increase in the work RVUs for office visits as a result of our proposal regarding consultation services; our proposed use of more accurate specialty- specific survey data on physician practice costs; our proposal to revise the utilization rate assumption for certain equipment; and our proposed use of updated and expanded malpractice premium data in the calculation of the malpractice RVUs.MedPAC has in the past also recommended the establishment of a group panel of experts separate from the AMA RUC to review RVUs. This original March 2006 recommendation was summarized in its March 2008Report to Congress:``We also recommended that CMS establish a group of experts, separate from the AMA RUC, to help the agency conduct these and other activities. This recommendation was intended not to supplant the AMA RUC but to augment it. To that end, the panel should include members who do not directly benefit from changes to Medicare's payment rates, such as experts in medical economics and technology diffusion and physicians who are employed by managed care organizations and academic medical centers.''The idea of a group of experts separate from the AMA RUC, to help the agency improve the review of relative values raises a number of issues. We seek broad public input on the following questions and other aspects of such an approach:How could input from a group of experts best be incorporated into existing processes of rulemaking and agency receipt of AMA RUC recommendations?What specifically would be the roles of a group of experts(for example,
Page 33557identify potentially misvalued services, provide recommendations on valuation of specified services, review AMA RUC recommendations selected by the Secretary, etc.)?What should be the composition of a group of experts? How could such a group provide expertise on services that clinician group members do not furnish?How would such a group relate to the AMA RUC and existingSecretarial advisory panels such as the Practicing Physician AdvisoryCommittee?Also of interest are comments on the resources required to establish and maintain such a group. As MedPAC noted in its March 2006Report with respect to the group of experts ``we recognize that these recommendations will increase demands on CMS and urge the Congress to provide the agency with the financial resources and administrative flexibility needed to undertake them.''We welcome comments on these topics, as well as others of interest to the stakeholder community. We will consider these comments as we consider the establishment of a group of experts to assist us in our ongoing reviews of the PFS RVUs.G. Issues Related to the Medicare Improvements for Patients andProviders Act of 2008 (MIPPA)This section addresses certain provisions of the MedicareImprovements for Patients and Providers Act of 2008 (MIPPA) (Pub. L. 110-275). We are proposing to revise our policies and regulations as described below in order to conform them to the statutory amendments. 1. Section 102: Elimination of Discriminatory Copayment Rates forMedicare Outpatient Psychiatric ServicesPrior to the enactment of the MIPPA, section 1833(c) of the Act provided that for expenses incurred in any calendar year in connection with the treatment of mental, psychoneurotic, and personality disorders of an individual who is not an inpatient of a hospital, only 62\1/2\ percent of such expenses are considered to be incurred under MedicarePart B when determining the amount of payment and application of thePart B deductible in any calendar year. This provision is known as the outpatient mental health treatment limitation (the limitation), and has resulted in Medicare paying only 50 percent of the approved amount for outpatient mental health treatment, rather than the 80 percent that is paid for most other outpatient services.Section 102 of the MIPPA amends the statute to phase out the limitation on recognition of expenses incurred for outpatient mental health treatment, which will result in an increase in the Medicare PartB payment for outpatient mental health services to 80 percent by CY 2014. When this section is fully implemented in 2014, Medicare will pay for outpatient mental health services at the same level as other Part B services. For CY 2010, section 102 of the MIPPA provides that Medicare will recognize 68\3/4\ percent of expenses incurred for outpatient mental health treatment, which translates to a payment of 55 percent of the Medicare-approved amount. Section 102 of the MIPPA specifies that the phase out of the limitation will be implemented as shown in Table 9(provided that the patient has satisfied his or her deductible).Table 9--Implementation of Section 102 of the MIPPARecognized incurredPatient paysMedicare paysCalendar yearexpenses (in(in percent)(in percent) percent)CY 2009 and prior calendar years................................62.505050CY 2010 and CY 2011.............................................68.754555CY 2012.........................................................75.004060CY 2013.........................................................81.253565CY 2014.........................................................100.002080At present, Sec. 410.155(c) of the regulations includes examples to illustrate application of the current limitation. We are proposing to remove these examples from our regulations and, instead, to provide examples in this proposed rule, in our manual, and under provider education materials as needed. The following examples illustrate the application of the limitation in various circumstances as it is gradually reduced under section 102 of the MIPPA. We note that although we have used the CY 2009 Part B deductible of $135 for purposes of the examples below, the actual deductible amount for CY 2010 and future years will be subject to change.Example #1: In 2010, a clinical psychologist submits a claim for$200 for outpatient treatment of a patient's mental disorder. TheMedicare-approved amount is $180. Since clinical psychologists must accept assignment, the patient is not liable for the $20 in excess charges. The patient previously satisfied the $135 annual Part B deductible. The limitation reduces the amount of incurred expenses to 68\3/4\ percent of the approved amount. Medicare pays 80 percent of the remaining incurred expenses. The Medicare payment and patient liability are computed as shown in Table 10.Table 10--Example 1--CY 20101. Actual charges.......................................$200.00 2. Medicare-approved amount.............................180.00 3. Medicare incurred expenses (0.6875 x line 2) *.......123.75 4. Unmet deductible.....................................0.00 5. Remainder after subtracting deductible (line 3 minus123.75 line 4)................................................ 6. Medicare payment (0.80 x line 5).....................99.00 7. Patient liability (line 2 minus line 6)..............81.00* The recognized incurred expenses for 2010 are 68\3/4\ percent.
Page 33558Example #2: In 2012, a clinical social worker submits a claim for $135 for outpatient treatment of a patient's mental disorder.The Medicare-approved amount is $120. Since clinical social workers must accept assignment, the patient is not liable for the $15 in excess charges. The limitation reduces the amount of incurred expenses to 75 percent of the approved amount. The patient previously satisfied $70 of the $135 annual Part B deductible, leaving $65 unmet (see Table 11).Table 11--Example 2--CY 20121. Actual charges.......................................$135.00 2. Medicare-approved amount.............................120.00 3. Medicare incurred expenses (0.75 x line 2) *.........90.00 4. Unmet deductible.....................................65.00 5. Remainder after subtracting deductible (line 3 minus25.00 line 4)................................................ 6. Medicare payment (0.80 x line 5).....................20.00 7. Patient liability (line 2 minus line 6)..............100.00* The recognized incurred expenses for CY 2012 are 75 percent.Example #3: In CY 2013, a physician who does not accept assignment submits a claim for $780 for services in connection with the treatment of a mental disorder that did not require inpatient hospitalization. The Medicare-approved amount is $750. Because the physician does not accept assignment, the patient is liable for the$30 in excess charges. The patient has not satisfied any of the $135Part B annual deductible (see Table 12).Table 12--Example 3--CY 20131. Actual charges.......................................$780.00 2. Medicare-approved amount.............................750.00 3. Medicare incurred expenses (0.8125 x line 2) *.......609.38 4. Unmet deductible.....................................135.00 5. Remainder after subtracting deductible (line 3 minus474.38 line 4)................................................ 6. Medicare payment (0.80 x line 5).....................379.50 7. Patient liability (line 1 minus line 6)..............400.50* The recognized incurred expenses for CY 2013 are 81\1/4\ percent.Example #4: A patient's Part B expenses during CY 2014 are for a physician's services in connection with the treatment of a mental disorder that initially required inpatient hospitalization, with subsequent physician services furnished on an outpatient basis. The patient has not satisfied any of the $135 Part B deductible. The physician accepts assignment and submits a claim for $780. TheMedicare-approved amount is $750. Since the limitation will be completely phased out as of January 1, 2014, the entire $750Medicare-approved amount is recognized as the total incurred expenses because such expenses are no longer reduced. Also, there is no longer any distinction between mental health services the patient receives as an inpatient or outpatient (see Table 13).Table 13--Example 4--CY 20141. Actual charges.......................................$780.00 2. Medicare-approved amount.............................750.00 3. Medicare incurred expenses (1.00 x line 2) *.........750.00 4. Unmet deductible.....................................135.00 5. Remainder after subtracting deductible (line 3 minus615.00 line 4)................................................ 6. Medicare payment (0.80 x line 5).....................492.00 7. Beneficiary liability (line 2 minus line 6)..........258.00* The recognized incurred expenses for CY 2014 are 100 percent.Section 102 of the MIPPA did not make any other changes to the outpatient mental health treatment limitation. Therefore, other aspects of the limitation will remain unchanged during the transition period between CYs 2010 and 2014. The limitation will continue to be applied as it has been in accordance with our regulation at Sec. 410.155(b) which specifies that the limitation applies to outpatient treatment of a mental, psychoneurotic, or personality disorder, identified under theInternational Classification of Diseases (ICD) diagnosis code range 290-319. We use the place of service code, and the procedure code to identify services to which the limitation applies.Additionally, we are proposing to make technical corrections toSec. 410.155(b)(2) in order to update and clarify the services to which the limitation does not apply. Our proposed technical changes are as follows:Under Sec. 410.155(b)(2)(ii), revise the regulation to specify the HCPCS code, M0064 (or any successor code), that represents the statutory exception to the limitation for brief office visits for the sole purpose of monitoring or changing drug prescriptions used in mental health treatment.At Sec. 410.155(b)(2)(iv), we are proposing to revise the regulation to add neuropsychological tests and diagnostic psychological tests to the examples of diagnostic services that are not subject to the limitation when performed to establish a diagnosis.Under Sec. 410.155(b)(2)(v), we are proposing to revise the regulation to specify the CPT code 90862 (or any successor code) that represents pharmacologic management services to which the limitation does not apply when furnished to treat a patient who is diagnosed with Alzheimer's disease or a related disorder.
Page 33559Finally, we are proposing to add a new paragraph (c) to Sec. 410.155 that provides a basic formula for computing the limitation during the phase-out period from CY 2010 through CY 2013, as well as after the limitation is fully removed from CY 2014 onward. 2. Section 131: Physician Payment, Efficiency, and QualityImprovements--Physician Quality Reporting Initiative (PQRI) a. Program Background and Statutory AuthorityThe Physician Quality Reporting Initiative (PQRI) is a voluntary reporting program that provides an incentive payment to eligible professionals who satisfactorily report data on quality measures for covered professional services during a specified reporting period.Under section 1848(k)(3)(B) of the Act, the term ``eligible professional'' means any of the following: (1) A physician; (2) A practitioner described in section 1842(b)(18)(C); (3) A physical or occupational therapist or a qualified speech-language pathologist; (4)A qualified audiologist. The PQRI was first implemented in 2007 as a result of section 101 of Division B of the Tax Relief and Health CareAct of 2006--the Medicare Improvements and Extension Act of 2006 (Pub.L. 109-432) (MIEA-TRHCA), which was enacted on December 20, 2006. ThePQRI was extended and further enhanced as a result of the Medicare,Medicaid, and SCHIP Extension Act of 2007 (Pub. L. 110-173) (MMSEA), which was enacted on December 29, 2007, and the MIPPA, which was enacted on July 15, 2008. Changes to the PQRI as a result of these laws, as well as information about the PQRI in 2007, 2008, and 2009 are discussed in detail in the CY 2008 PFS proposed rule (72 FR 38196 through 38204), CY 2008 PFS final rule with comment period (72 FR 66336 through 66353), CY 2009 PFS proposed rule (73 FR 38558 through 38575), and CY 2009 PFS final rule with comment period (73 FR 69817 through 69847). In addition, detailed information about the PQRI is available on the CMS Web site at http://www.cms.hhs.gov/PQRI. b. Incentive Payments for the 2010 PQRIFor 2010, section 1848(m)(1)(B) of the Act authorizes the Secretary to provide an incentive payment equal to 2.0 percent of the estimated total allowed charges (based on claims submitted not later than 2 months after the end of the reporting period) for all covered professional services furnished during the reporting period for 2010.Although PQRI incentive payments are only authorized through 2010 under section 1848(m)(1)(A) of the Act, section 1848(k)(2)(C) of the Act provides for the use of consensus-based quality measures for the PQRI for 2010 and subsequent years.The PQRI incentive payment amount is calculated using estimated allowed charges for all covered professional services furnished under the PFS, not just those charges associated with the reported quality measures. ``Allowed charges'' refers to total charges, including the beneficiary deductible and coinsurance, and is not limited to the 80 percent paid by Medicare or the portion covered by Medicare whereMedicare is secondary payer. Amounts billed above the PFS amounts for assigned and non-assigned claims will not be included in the calculation of the incentive payment amount. In addition, since, by definition under section 1848(k)(3)(A)) of the Act, ``covered professional services'' are limited to services for which payment is made under, or is based on, the PFS and which are furnished by an eligible professional, other Part B services and items that may be billed by eligible professionals but are not paid under or based upon the Medicare Part B PFS are not included in the calculation of the incentive payment amount.Under section 1848(m)(6)(C) of the Act, the ``reporting period'' for the 2008 through 2011 PQRI is defined to be the entire year, but the Secretary is authorized to revise the reporting period for years after 2009 if the Secretary determines such ``revision is appropriate, produces valid results on measures reported, and is consistent with the goals of maximizing scientific validity and reducing administrative burden.''We are also required by section 1848(m)(5)(F) of the Act to establish alternative criteria for satisfactorily reporting and alternative reporting periods for registry-based reporting and for reporting measures groups. Therefore, eligible professionals who meet the proposed alternative criteria for satisfactorily reporting for registry-based reporting and for reporting measures groups for the proposed 2010 alternative reporting periods for registry-based reporting and for reporting measures groups would also be eligible to earn an incentive payment equal to 2.0 percent of the estimated totalMedicare Part B PFS allowed charges for all covered professional services furnished by the eligible professional during the proposed alternative reporting periods for 2010 PQRI registry-based reporting or for reporting measures groups.The proposed PQRI reporting options for an individual eligible professional seeking to qualify for a 2010 PQRI incentive payment (that is, the proposed PQRI reporting mechanisms, proposed reporting periods, and proposed criteria for satisfactory reporting, including the proposed alternative reporting periods and alternative criteria for satisfactorily reporting for registry-based reporting and for reporting measures groups) are addressed in sections II.G.2.c. through II.G.2.f. of this proposed rule. The proposed 2010 PQRI quality measures and proposed 2010 PQRI measures groups are discussed in section II.G.2.i. of this proposed rule.Prior to 2010, the PQRI was an incentive program in which determination of whether an eligible professional satisfactorily reported quality data was made at the individual professional level, based on the National Provider Identifier (NPI). Although the incentive payments were made to the practice(s) represented by the TaxIdentification Number (TIN) to which payments are made for the individual professional's services, there were no incentive payments made to the group practice based on a determination that the group practice, as a whole, satisfactorily reported PQRI quality measures data. To the extent individuals (based on the individuals' NPIs) satisfactorily reported data on PQRI quality measures that were associated with more than one practice or TIN, the determination of whether an eligible professional satisfactorily reported PQRI quality measures data was made for each unique TIN/NPI combination. Therefore, the incentive payment amount was calculated for each unique TIN/NPI combination and payment was made to the holder of the applicable TIN.However, section 1848(m)(3)(C)(i) of the Act requires that byJanuary 1, 2010, the Secretary establish and have in place a process under which eligible professionals in a group practice (as defined by the Secretary) shall be treated as satisfactorily submitting data on quality measures for the PQRI for covered professional services for a reporting period, if, in lieu of reporting measures under subsection(k)(2)(C), the group practice reports measures determined appropriate by the Secretary, such as measures that target high-cost chronic conditions and preventive care, in a form and manner, and at a time, specified by the Secretary. Therefore, beginning with the 2010 PQRI, group practices who satisfactorily submit data on quality measures also would be eligible to earn an incentive payment equal to 2.0 percent of the
Page 33560estimated total allowed charges for all covered professional services furnished by the group practice during the applicable reporting period.As required by section 1848(m)(3)(C)(iii) of the Act, payments to a group practice by reason of the process described above shall be in lieu of the PQRI incentive payments that would otherwise be made to eligible professionals in the group practice for satisfactorily submitting data on quality measures. Therefore, an individual eligible professional who is participating in the group practice reporting option as a member of a group practice would not be able to separately earn a PQRI incentive payment as an individual eligible professional.The process proposed to be used to determine whether a group practice satisfactorily submits data on quality measures for the 2010PQRI is described in section II.G.2.g. of this proposed rule. The proposed measures on which a group practice would need to report in order to be treated as satisfactorily submitting data on quality measures for the 2010 PQRI are discussed in section II.G.2.j. of this proposed rule. c. Proposed 2010 Reporting Periods for Individual EligibleProfessionalsAs we indicated above, section 1848(m)(6)(C) of the Act defines``reporting period'' for 2010 to be the entire year. Section 1848(m)(6)(C)(ii) of the Act, however, authorizes the Secretary to revise the reporting period for years after 2009 if the Secretary determines such revision is appropriate, produces valid results on measures reported, and is consistent with the goals of maximizing scientific validity and reducing administrative burden. To be consistent with section 1848(m)(6)(C) of the Act and with prior years, we propose the 2010 PQRI reporting period for the reporting of individual PQRI quality measures through claims or a qualified electronic health record (EHR) (see section II.G.2.d. of this proposed rule for discussion of proposed 2010 PQRI reporting mechanisms) will be the entire year (that is, January 1, 2010 through December 31, 2010).We also considered exercising our authority to revise the reporting period for claims-based reporting of individual measures by proposing to add an alternative reporting period beginning July 1, 2010 for claims-based reporting of individual measures. Doing so would make the reporting periods for claims-based reporting of individual measures consistent with the alternative reporting periods for reporting measures groups and for registry-based reporting that have been in place since the 2008 PQRI. This would allow an eligible professional to earn a PQRI incentive payment equal to 2.0 percent of his or her estimated allowed charges for covered professional services furnished for the last half of 2010 if he or she satisfactorily reports data on individual PQRI quality measures through claims during the last half of 2010. We received input from a few stakeholders in support of a partial year reporting period for claims-based reporting of individual measures to give more eligible professionals the opportunity to begin reporting later in the year. Other stakeholders recommended that we offer the same reporting periods for all reporting mechanisms. We agree that having the same reporting periods for all reporting mechanisms may be less complex. We also agree that the addition of a 6-month reporting period may facilitate participation in PQRI for certain eligible professionals. However, we do not believe that making a 6-month reporting period available would serve to enhance the validity of results on measures reported or to maximize scientific validity as required under section 1848(m)(6)(C)(ii) of the Act. In addition, given our desire to transition from the use of the claims-based reporting mechanism as the primary reporting mechanism for clinical quality measures for PQRI after 2010 to rely more heavily on registry-based reporting (see section II.G.2.d. of this proposed rule for further discussion), we do not believe it appropriate to add a new 6-month reporting period for claims-based reporting of individual measures.Given the fact that we seek to lessen reliance on the claims-based reporting mechanism for the PQRI after 2010, we believe the cost of adding a 6-month reporting period for claims-based reporting of individual measures outweighs any added flexibility that eligible professionals may receive in the short-term.Nevertheless, we invite comments on the decision to not propose a 6-month reporting period for claims-based reporting of individual PQRI quality measures.In addition, section 1848(m)(5)(F) of the Act requires, for 2008 and subsequent years, the Secretary to establish alternative reporting periods for reporting groups of measures and for registry-based reporting. To satisfy the requirements of section 1848(m)(5)(F) of theAct and to maintain program stability, we propose to retain the 2 alternative reporting periods from the 2008 and 2009 PQRI for reporting measures groups and for registry-based reporting: (1) The entire year; and (2) a 6-month reporting period beginning July 1. Therefore, for 2010, the proposed alternative reporting periods for reporting measures groups and for registry-based reporting are: (1) January 1, 2010 through December 31, 2010; and (2) July 1, 2010 through December 31, 2010. We note that the 6-month reporting period, beginning July 1, 2010, is proposed to be available for reporting on measures groups and for reporting using the registry-based reporting mechanism only. For an eligible professional who satisfactorily reports measures groups or through the registry-based reporting mechanism for the 6-month reporting period, the eligible professional would qualify to earn aPQRI incentive payment equal to 2.0 percent of his or her total estimated allowed charges for covered professional services furnished between July 1, 2010 and December 31, 2010 only. The incentive payment would not be calculated based on the eligible professional's charges for covered professional services for the entire year. d. Proposed 2010 PQRI Reporting Mechanisms for Individual EligibleProfessionalsWhen the PQRI was first implemented in 2007, there was only 1 reporting mechanism available to submit data on PQRI quality measures.For the 2007 PQRI, the only way that eligible professionals could submit data on PQRI quality measures was by reporting the appropriate quality data codes on their Medicare Part B claims (claims-based reporting). For the 2008 PQRI, we added a second reporting mechanism as required by section 1848(k)(4) of the Act, so that eligible professionals could submit data on PQRI quality measures to a qualifiedPQRI registry and request the registry to submit PQRI quality measures results and numerator and denominator data on the 2008 PQRI quality measures or measures groups on their behalf (registry-based reporting).For the 2009 PQRI, we retained the 2 reporting mechanisms used in the 2008 PQRI (that is, claims-based reporting and registry-based reporting) for reporting individual PQRI quality measures and for reporting measures groups.To promote the adoption of EHRs, we also conducted limited testing of a third reporting mechanism for the 2008 PQRI, which was the submission of clinical quality data extracted from an EHR, or the EHR- based reporting mechanism. No incentive payment was available to those eligible professionals who participated in testing the EHR-based reporting mechanism. In the CY 2009 PFS proposed rule (73 FR 38564 through 38565), we described our plans to test the submission of clinical quality
Page 33561data extracted from qualified EHR products for five 2008 PQRI measures and proposed to accept PQRI data from EHRs and to pay PQRI incentive payments based on that submission for a limited subset of the proposed 2009 PQRI quality measures. However, as described in the CY 2009 PFS final rule with comment period (73 FR 69830), we did not finalize our proposal to allow eligible professionals to submit clinical quality data extracted from EHRs for purposes of receiving a PQRI incentive payment for 2009. Since the 2008 EHR testing process was not complete at the time of publication of the CY 2009 PFS final rule, we instead opted to continue to test the submission of clinical quality data extracted from EHRs in 2009 and provide no incentive payment to those eligible professionals participating in testing the EHR-based reporting mechanism in 2009.For the 2010 PQRI, we are proposing to retain the claims-based reporting mechanism and the registry-based reporting mechanism. In addition, we are again proposing for the 2010 PQRI to accept PQRI quality measures data extracted from a qualified EHR product for a limited subset of the proposed 2010 PQRI quality measures, as identified in Table 20, contingent upon the successful completion of our 2009 EHR data submission testing process and a determination based on that testing process that accepting data from EHRs on quality measures for the 2010 PQRI is practical and feasible. We will make the determination as to whether accepting data from EHRs on quality measures is practical and feasible for the 2010 PQRI prior to publication of the CY 2010 PFS final rule with comment period. We will indicate in the CY 2010 PFS final rule with comment period whether we intend to finalize this proposal. If we finalize this proposal, then, unlike in prior years, an eligible professional would be able to earn aPQRI incentive payment through the EHR-based reporting mechanism in 2010.We seek to offer more reporting mechanisms because we recognize that 1 mode of quality reporting does not suit all practices and our experience with the registry-based reporting mechanism thus far has been favorable. While the availability of multiple reporting mechanisms should increase opportunities for eligible professionals to satisfactorily report quality data for the PQRI, we also recognize that there are a number of limitations associated with claims-based reporting. On one hand, claims submission is available to nearly all eligible professionals. On the other hand, submission of quality data on claims has certain drawbacks since the claims processing system was developed for billing purposes and not for the submission of quality data. As we noted in the CY 2009 PFS final rule with comment period (73FR 69833), for example, measures with complex specifications, such as those that require multiple diagnosis codes are not as conducive to claims-based reporting and may be associated with a greater number of invalidly reported quality data codes. Similarly, when multiple measures share the same codes it may be difficult to determine which measure(s) the eligible professional intended to report through claims.We believe that EHR-based reporting is a viable option for overcoming the limitations associated with claims-based reporting of quality measures. Therefore, we propose to add an EHR-based reporting mechanism for the 2010 PQRI in order to promote the adoption and use ofEHRs and to provide both eligible professionals and CMS experience onEHR-based quality reporting.Furthermore, on February 17, 2009, the President signed into law the American Recovery and Reinvestment Act (the Recovery Act) (Pub. L. 111-5). Section 4101(a) of the Health Information Technology forEconomic and Clinical Health (HITECH) Act (Title IV of Division B of the Recovery Act, together with Title XIII of Division A of theRecovery Act), which amends section 1848 of the Act to add new subsection (o), authorizes incentive payments under Medicare for certain eligible professionals who are ``meaningful EHR users'' beginning in 2011. However, the provisions in this proposed rule do not implement any HITECH Act statutory provisions. While our efforts to encourage the adoption and use of EHRs through testing EHR-based data submission in the 2008 and 2009 PQRI and our proposal to add an EHR- based reporting mechanism for the purpose of receiving a PQRI incentive payment for the 2010 PQRI could potentially provide invaluable experience and serve as a foundation for establishing the capacity for eligible professionals to send, and for CMS to receive, data on quality measures via EHRs, the provisions of the HITECH Act will be implemented in future notice and comment rulemaking.In summary, we propose that for 2010, an eligible professional may choose to report data on PQRI quality measures through claims, to a qualified registry (for the qualification requirements for registries, see section II.G.2.i.(4) of this proposed rule), or through a qualifiedEHR product (for the qualification requirements for EHR vendors and their products, see section II.G.2.i.(5) of this proposed rule).Depending on which PQRI individual quality measures or measures groups an eligible professional selects, however, one or more of the proposed reporting mechanisms may not be available for reporting a particular 2010 PQRI individual quality measure or measures group. The proposed 2010 reporting mechanisms through which each proposed 2010 PQRI individual quality measure and measures group could be reported is identified in Tables 14 through 15. We invite comments on the proposed reporting mechanisms for the 2010 PQRI, including our proposal to add an EHR-based reporting mechanism to the 2010 PQRI, contingent upon the successful completion of our 2009 EHR data submission testing process and a determination that accepting data from EHRs on quality measures for the 2010 PQRI is practical and feasible.While we propose to retain the claims-based reporting mechanism for 2010, we note that we are considering significantly limiting the claims-based mechanism of reporting clinical quality measures for thePQRI after 2010. This would be contingent upon there being an adequate number and variety of registries available and/or EHR reporting options. Potentially, we would retain claims-based reporting in years after 2010 principally for the reporting of structural measures, such as Measure 124 Health Information Technology (HIT): Adoption/Use of Electronic Health Records (EHR), and circumstances where claims- based reporting is the only available mechanism for certain categories of eligible professionals to report on PQRI quality measures.Reducing our reliance on the claims-based reporting mechanism after 2010 will allow us and eligible professionals to devote available resources to maximizing the potential of registries and EHRs for quality measurement reporting. Both mechanisms hold the promise of more sophisticated and timely reporting on clinical quality measures.Clinical data registries allow the collection of more detailed data, including outcomes, without the necessity of a single submission contemporaneously with claims billing, which overcomes some of the limitations of the claims-based reporting mechanism. Registries can also provide feedback and quality improvement information based on reported data. Finally, clinical data registries can also receive data from EHRs, and therefore, serve as an alternative means to reporting clinical quality data extracted
Page 33562from an EHR. As we continue to qualify additional registries, we believe that there will be a sufficient number of qualified PQRI registries by 2011 to make it possible to reduce or even discontinue the claims-based reporting mechanism for most measures after 2010. We invite comments on our intent to lessen our reliance on the claims- based reporting mechanism for the PQRI beyond 2010.Regardless of the reporting mechanism chosen by an eligible professional, there is no requirement for the eligible professional to sign up or register to participate in the PQRI. However, there may be some requirements for participation through a specific reporting mechanism that are unique to that particular reporting mechanism. In addition to the criteria for satisfactory reporting of individual measures and measures groups described in sections II.G.2.e. andII.G.2.f., respectively, of this proposed rule, eligible professionals must ensure that they meet all requirements for their chosen reporting mechanism.(1) Requirements for Individual Eligible Professionals Who Choose theClaims-Based Reporting MechanismFor eligible professionals who choose to participate in the PQRI by submitting data on individual quality measures or measures groups through the claims-based reporting mechanism, the only requirement associated with claims-based reporting that we are proposing apart from the proposed criteria for satisfactory reporting of individual measures and measures described below in sections II.G.2.e. and II.G.2.f., respectively, of this proposed rule, is the submission of the appropriate PQRI quality data codes on the professionals' Medicare PartB claims. An eligible professional would be permitted to submit the quality data codes for the eligible professional's selected individualPQRI quality measures or measures group at any time during the 2010 reporting period. Please note, however, that as required by section 1848(m)(1)(A) of the Act, all claims for services furnished betweenJanuary 1, 2010 and December 31, 2010 must be processed by no later than February 28, 2011 to be included in the 2010 PQRI analysis.(2) Requirements for Individual Eligible Professionals Who Choose theRegistry-Based Reporting MechanismIn order to report quality measures results and numerator and denominator data on the 2010 PQRI individual quality measures or measures group through a qualified clinical registry, we propose that eligible professionals would need to enter into and maintain an appropriate legal arrangement with a qualified 2010 PQRI registry. Such arrangements would provide for the registry's receipt of patient- specific data from the eligible professional and the registry's disclosure of quality measures results and numerator and denominator data on PQRI quality measures or measures groups on behalf of the eligible professional to CMS. Thus, the registry would act as a HealthInsurance Portability and Accountability Act of 1996 (Pub. L. 104-191)(HIPAA) Business Associate and agent of the eligible professional. Such agents are referred to as ``data submission vendors.'' The ``data submission vendors'' would have the requisite legal authority to provide clinical quality measures results and numerator and denominator data on individual quality measures or measures groups on behalf of the eligible professional for the PQRI. The registry, acting as a data submission vendor, would submit registry-derived measures information to the CMS designated database for the PQRI, using a CMS-specified record layout. The record layout will be provided to the registry byCMS.To maintain compliance with applicable statutes and regulations, our program and its data system must maintain compliance with the HIPAA requirements for requesting, processing, storing, and transmitting data. Eligible professionals that conduct HIPAA covered transactions also must maintain compliance with the HIPAA requirements.Eligible professionals choosing to participate in PQRI by submitting quality measures results and numerator and denominator data on PQRI individual quality measures or measures groups through the registry-based reporting mechanism for 2010 would need to select a qualified PQRI registry and submit information on PQRI individual quality measures or measures groups to the selected registry in the form and manner and by the deadline specified by the registry.The process and requirements that we propose to use to determine whether a registry is qualified to submit quality measures results and numerator and denominator data on PQRI quality measures or measures groups on an eligible professional's behalf in 2010 are described in section II.G.2.d. of this proposed rule. We will post on the PQRI section of the CMS Web site at http://www.cms.hhs.gov a list of qualified registries for the 2010 PQRI, including the registry name, contact information, and the 2010 measure(s) and/or measures group(s) for which the registry is qualified and intends to report. We propose to post the names of 2010 PQRI qualified registries in 2 phases. In either event, even though a registry is listed as ``qualified,'' we cannot guarantee or assume responsibility for the registry's successful submission of PQRI quality measures results and numerator and denominate data on PQRI quality measures or measures groups on behalf of eligible professionals.In the first phase, we anticipate that by December 31, 2009, we will be able to, at minimum, post a list of those registries qualified for the 2010 PQRI based on: (1) Being a qualified registry for the 2008 and 2009 PQRI that successfully submitted 2008 PQRI quality measures results and numerator and denominator data on the quality measures; (2) having received a letter indicating their continued interest in being aPQRI registry for 2010; and (3) the registry's compliance with the 2010PQRI registry requirements. By posting this first list of qualified registries for the 2010 PQRI, we seek to make available the names of registries that can be qualified at the start of the 2010 reporting period. We do this to accommodate requests we have received from eligible professionals who wish to avoid claims-based reporting pending knowing whether a particular registry is qualified for the 2010 PQRI.In the second phase, we anticipate to complete posting of the list of qualified 2010 registries as soon as we have completed vetting the registries interested in participating in the 2010 PQRI and identified the qualified registries for the 2010 PQRI, which we anticipate will be completed by no later than Summer 2010. An eligible professional's ability to report PQRI quality measures results and numerator and denominator data on PQRI quality measures or measures groups using the registry-based reporting mechanism should not be impacted by the complete list of qualified registries for the 2010 PQRI being made available after the start of the reporting period. First, registries will not begin submitting eligible professionals' PQRI quality measures results and numerator and denominator data on the quality measures or measures groups to CMS until 2011. Second, if an eligible professional decides that he or she is no longer interested in submitting quality measures results and numerator and denominator data on PQRI individual quality measures or measures group through the registry-based reporting mechanism after the complete list of qualified registries becomes available, this does not preclude the eligible
Page 33563professional from attempting to meet the criteria for satisfactory reporting through another 2010 PQRI reporting mechanism.In addition to meeting the above proposed requirements specific to registry-based reporting, eligible professionals who choose to participate in PQRI through the registry-based reporting mechanism would need to meet the relevant criteria proposed for satisfactory reporting of individual measures or measures groups that all eligible professionals must meet in order to qualify to earn a 2010 PQRI incentive payment. The criteria for satisfactory reporting of individual measures and measures groups are described in sectionsII.G.2.e. and II.G.2.f., respectively, of this proposed rule.(3) Requirements for Individual Eligible Professionals Who Choose theEHR-Based Reporting MechanismFor eligible professionals who choose to participate in the 2010PQRI by submitting data on individual quality measures through the EHR- based reporting mechanism, the only proposed requirements associated with EHR-based reporting other than meeting the criteria for satisfactory reporting of individual measures described in sectionII.G.2.e. of this proposed rule are to: (1) Select a qualified EHR product and (2) submit clinical quality data extracted from the EHR to a CMS clinical data warehouse. Provided that our 2009 EHR data submission testing process is successful, we propose to begin accepting submission of clinical quality data extracted from ``qualified'' EHRs on January 1, 2010, or as soon thereafter as is technically feasible.We propose that eligible professionals will have until March 31, 2011 to complete data submission through qualified EHRs for services furnished during the 2010 PQRI reporting period. The process that was used to determine whether an EHR vendor and its EHR product(s) are qualified to submit clinical quality data extracted from EHRs for the 2010 PQRI is described in section II.G.2.d.5. of this proposed rule.The specifications for the electronic transmission of the proposed 2010 PQRI measures identified in Table 20 (section II.G.2.i.(4) of this proposed rule) as being under consideration for EHR-based reporting in 2010 will be posted on a public Web site when available. We will announce the availability and exact location of these specifications through familiar CMS communications channels, including the PQRI section of the CMS Web site at http://www.cms.hhs.gov/PQRI. The posting of specifications for the electronic transmission of any particular measure prior to publication of the final rule does not signify that the measure will necessarily be selected for the 2010 PQRI measure set, nor that EHR-based reporting will be accepted for that measure even if it may otherwise be included in the 2010 PQRI. However, by posting the specifications for electronic transmission of these measures, we seek to allow sufficient time for EHR vendors to adapt their products to support EHR-based capture and submission of data for these measures prior to the start of any 2010 PQRI reporting periods.We do not propose any option to report measures groups through EHR- based reporting on services furnished during 2010. Because EHR-based reporting to CMS of data on quality measures would be new to PQRI for 2010, we propose to make available only the criteria applicable to reporting of individual PQRI measures.We cannot assume responsibility for the successful submission of data from eligible professionals' EHRs. Any eligible professional who chooses to submit PQRI data extracted from an EHR should contact theEHR product's vendor to determine if the product is qualified and has been updated to facilitate PQRI quality measures data submission. Such professionals also should begin attempting submission promptly after we announce that the clinical data warehouse is ready to accept 2010 PQRI quality measures data through the EHR mechanism in order to assure the professional has a reasonable period of time to work with his or herEHR and/or its vendor to correct any problems that may complicate or preclude successful quality measures data submission through that EHR.As we indicated above, data submission for the 2010 PQRI would need to be completed by March 31, 2011.(4) Qualification Requirements for RegistriesIn order to be ``qualified'' to submit quality measures results and numerator and denominator data on PQRI quality measures and measures groups on behalf of eligible professionals pursuing incentive payment for the 2008 and 2009 PQRI, we required registries to complete a self- nomination process and to meet certain technical and other requirements. For the 2009 PQRI, registries that were ``qualified'' for 2008 did not need to be ``re-qualified'' for 2009 unless they were unsuccessful at submitting 2008 PQRI data (that is, failed to submit 2008 PQRI data per the 2008 PQRI registry requirements). Registries that were ``qualified'' for 2008 and wished to continue to participate in 2009 were only required to communicate their desire to continue participation for 2009 by submitting a letter to CMS indicating their continued interest in being a PQRI registry for 2009 and their compliance with the 2009 PQRI registry requirements by March 31, 2009.For the 2010 PQRI, we are again proposing to require a self- nomination process for registries wishing to submit 2010 PQRI quality measures or measures groups on behalf of eligible professionals for services furnished during the applicable reporting periods in 2010.Similar to the 2008 and 2009 PQRI registry self-nomination process, the proposed registry self-nomination process for the 2010 PQRI would be based on a registry meeting specific technical and other requirements.In order to be consistent with the registry requirements from prior program years, we propose that the 2010 registry requirements be substantially the same as for 2008 and 2009. Specifically, to be considered a qualified registry for purposes of submitting individual quality measures and measures groups on behalf of eligible professionals who choose to report using this reporting mechanism under the 2010 PQRI, we propose that a registry would need to:Be in existence as of January 1, 2009.Be able to collect all needed data elements and calculate results for at least 3 measures in the 2010 PQRI program (according to the posted 2010 PQRI Measure Specifications).Be able to calculate and submit measure-level reporting rates by TIN/NPI;Be able to calculate and submit, by TIN/NPI, a performance rate (that is, the percentage of a defined population who receive a particular process of care or achieve a particular outcome) for each measure on which the TIN/NPI reports;Be able to separate out and report on Medicare Part B FFS patients;Provide the name of the registry;Provide the reporting period start date the registry will cover;Provide the reporting period end date the registry will cover;Provide the measure numbers for the PQRI quality measures on which the registry is reporting;Provide the measure title for the PQRI quality measures on which the registry is reporting;Report the number of eligible instances (reporting denominator);Report the number of instances of quality service performed (numerator);
Page 33564Report the number of performance exclusions;Report the number of reported instances, performance not met (eligible professional receives credit for reporting, not for performance);Be able to transmit this data in a CMS-approved XML format. We expect that this CMS-specified record layout will be substantially the same as for the 2008 and 2009 PQRI. This layout will be provided to registries in 2010;Comply with a CMS-specified secure method for data submission, such as submitting its data in an XML file through anIndividuals Access to CMS Systems (IACS) user account;Submit an acceptable ``validation strategy'' to CMS byMarch 31, 2010. A validation strategy ascertains whether eligible professionals have submitted accurately and on at least the minimum number (80 percent) of their eligible patients, visits, procedures, or episodes for a given measure. Acceptable validation strategies often include such provisions as the registry being able to conduct random sampling of their participants' data, but may also be based on other credible means of verifying the accuracy of data content and completeness of reporting or adherence to a required sampling method;Enter into and maintain with its participating professionals an appropriate Business Associate agreement that provides for the registry's receipt of patient-specific data from the eligible professionals, as well as the registry's disclosure of quality measure results and numerator and denominator data on behalf of eligible professionals who wish to participate in the PQRI program;Obtain and keep on file signed documentation that each holder of an NPI whose data are submitted to the registry has authorized the registry to submit quality measures results and numerator and denominator data to CMS for the purpose of PQRI participation. This documentation must be obtained at the time the eligible professional signs up with the registry to submit PQRI quality measures data to the registry and must meet any applicable laws, regulations, and contractual business associate agreements;Provide CMS access (if requested) to review the Medicare beneficiary data on which 2010 PQRI registry-based submissions are founded;Provide the reporting option (reporting period and reporting criteria) that the eligible professional has satisfied or chosen; andProvide CMS a signed, written attestation statement via mail or e-mail which states that the quality measure results and numerator and denominator data provided to CMS are accurate and complete.With respect to the submission of 2010 measure results and numerator and denominator data on measures groups, we propose to retain the following registry requirements from the 2009 PQRI:Indicate the reporting period chosen for each eligible professional who chooses to submit data on measures groups;Base reported information on measures groups only on patients to whom services were furnished during the 12-month reporting period of January through December 2010 or the 6-month reporting period of July 2010 through December 2010;Agree that the registry's data may be inspected by CMS under our oversight authority if non-Medicare patients are included in the patient sample;Be able to report data on all of the measures in a given measures group and on either 30 patients from January 1 throughDecember 31, 2010 (note this patient sample must include some MedicarePart B FFS beneficiaries) or on 80 percent of applicable Medicare PartB FFS patients for each eligible professional (with a minimum of 15 patients during the January 1, 2010 through December 31, 2010 reporting period or a minimum of 8 patients during the July 1, 2010 throughDecember 31, 2010 reporting period) (see criteria for satisfactory reporting of measures groups described in section II.G.2.f. of this proposed rule for further information); andBe able to report the number of Medicare FFS patients and the number of Medicare Advantage patients that are included in the patient sample for a given measures group.In addition to the above requirements, we propose the following new requirements for registries for the 2010 PQRI:Registries must have at least 25 participants;Registries must provide at least 1 feedback report per year to participating eligible professionals;Registries must not be owned and managed by an individual locally-owned single-specialty group (in other words, single-specialty practices with only 1 practice location or solo practitioner practices would be prohibited from self-nominating to become a qualified PQRI registry);Registries must participate in ongoing 2010 PQRI mandatory support conference calls hosted by CMS (approximately 1 call per month);Registries must provide a flow and XML of a measure's calculation process for each measure type that the registry intends to calculate; andRegistries must use PQRI measure specifications to calculate reporting or performance unless otherwise stated.These proposed new requirements are intended to improve the registry-based reporting mechanism by taking advantage of some of the registries' existing quality improvement functions, maximizing the registry's ability to successfully submit eligible professionals' quality measure results and numerator and denominator data on PQRI individual quality measures or measures groups to CMS, and discouraging small physician offices or an individual eligible professional from self-nominating to become a qualified registry. We are concerned that an individual eligible professional or a small practice does not have the resources or capabilities to successfully submit quality measures results and numerator and denominator data on PQRI individual measures or measures groups through the registry data submission process.We propose to post the final 2010 PQRI registry requirements, including the exact date by which registries that wish to qualify for 2010 must submit a self-nomination letter and instructions for submitting the self-nomination letter, on the PQRI section of the CMSWeb site at http://www.cms.hhs.gov/PQRI by November 15, 2009. We anticipate that new registries that wish to self-nominate for 2010 will be required to do so by January 31, 2010.Similar to the 2009 PQRI, we propose that registries that were``qualified'' for 2009 and wish to continue to participate in 2010 would not need to be ``re-qualified'' for 2010 unless they are unsuccessful at submitting 2009 PQRI data (that is, fail to submit 2009PQRI data per the 2009 PQRI registry requirements). We further propose that registries that were ``qualified'' for 2009, were successful in submitting 2009 PQRI data, and wish to continue to participate in 2010 would need to indicate their desire to continue participation for 2010 by submitting a letter to CMS indicating their continued interest in being a PQRI registry for 2010 and their compliance with the 2010 PQRI registry requirements by no later than October 31, 2009. Instructions regarding the procedures for submitting this letter will be provided to qualified 2009 PQRI registries on the 2009 PQRI registry support conference calls.If a qualified 2009 PQRI registry fails to submit 2009 PQRI data per the 2009 PQRI registry requirements, we propose
Page 33565the registry would be considered unsuccessful at submitting 2009 PQRI data and would need to go through the full self-nomination process again to participate in the 2010 PQRI. By March 31, 2010, registries that are unsuccessful submitting quality measures results and numerator and denominator data for 2009 would need to be able to meet the 2010PQRI registry requirements and go through the full vetting process again.Finally, as discussed further under section II.G.5.c.(1) of this proposed rule, we propose that the above registry requirements would apply not only for the purpose of a registry qualifying to report 2010PQRI quality measure results and numerator and denominator data on PQRI individual quality measures or measures groups, but also for the purpose of a registry qualifying to submit the proposed electronic prescribing measure for the 2010 E-Prescribing Incentive Program.(5) Qualification Requirements for EHR Vendors and Their ProductsIn the CY 2009 PFS final rule with comment period (73 FR 69830), we announced our intent to qualify EHR vendors and their specific products to submit quality data extracted from their EHR products to the CMS clinical quality data warehouse so that we may potentially begin to accept data via EHRs for purposes of satisfactorily reporting data on quality measures in future PQRI reporting. We stated that we anticipate posting on the PQRI section of the CMS Web site at http:// www.cms.hhs.gov/PQRI, by December 31, 2008, a list of requirements thatEHR vendors must be able to meet in order to self-nominate to have their product ``qualified'' to potentially be able to submit quality measures data for the 2010 PQRI to CMS. We also stated that qualifyingEHR vendors ahead of actual data submission will facilitate the live data submission process.On December 31, 2008, the ``Requirements for Electronic HealthRecord (EHR) Vendors to Participate in the 2009 PQRI EHR TestingProgram,'' was posted on the Reporting page of the PQRI section of theCMS Web site at http://www.cms.hhs.gov/PQRI/20_Reporting.asp#TopOfPage, which described the EHR vendor requirements and the EHR vendor self-nomination process.The vendor's EHR system must be updated according to the Draft 2009EHR specifications posted on the QualityNet Web site at http:// www.qualitynet.org in order for an EHR vendor and its product to qualify to submit test information on 2009 PQRI measures, and for possible EHR data submission for future PQRI reporting years. In addition, the 2009 PQRI EHR test-vendors must meet the following requirements:Be able to collect and transmit all required data elements according to the 2009 EHR Specifications.Be able to separate out and report on Medicare Part B FFS patients only.Be able to include TIN/NPI information submitted with an eligible professional's quality data.Be able to transmit this data in the CMS-approved format.Comply with a secure method for data submission.Enter into and maintain with its participating professionals an appropriate legal arrangement that provides for theEHR vendor to receive patient-specific data from the eligible professional, as well as the EHR vendor's disclosure of protected health information on behalf of eligible professionals who wish to participate in the 2009 PQRI EHR test program.Obtain and keep on file signed documentation that each NPI whose data is submitted to the EHR vendor has authorized the EHR vendor to submit patient data to CMS for the purpose of PQRI testing. This documentation must meet the standards of applicable law, regulations, and contractual or business associate agreements.As described in the ``Requirements for Electronic Health Record(EHR) Vendors to Participate in the 2009 PQRI EHR Testing Program,'' which is posted on the Reporting page of the PQRI section of the CMSWeb site at http://www.cms.hhs.gov/PQRI/20_Reporting.asp#TopOfPage,EHR vendors who wish to qualify to participate in the 2009 PQRI EHR test program were required to submit a self-nomination letter requesting inclusion in the 2009 EHR testing process by February 13, 2009. All nominees would then go through a vetting process. Those nominees passing this vetting process would be asked to submit test data (that is, mock-up data) or to submit live test data from some of their clients (users) with their permission. Vendors who successfully submit their test data would also need to be able to adapt their system to any changes in the measure specifications that may arise due toHealthcare Information Technology Standards Panel (HITSP) orCertification Commission for Healthcare Information Technology (CCHIT) adoption of quality measure data reporting criteria.It is expected that the process for qualifying self-nominated EHR vendors may conclude in 2009. At the conclusion of this process, we propose that those EHR products that meet all of the EHR vendor requirements will be listed on the PQRI section of the CMS Web site at http://www.cms.hhs.gov/PQRI as a ``qualified'' EHR product (that is, the name of the vendor software product and the version that is qualified), which indicates that the product's users may submit quality data to CMS (either directly from their system or through the vendor-- which is yet to be determined) for the 2010 PQRI, if and when, EHR submission is included in the 2010 PQRI as a PQRI reporting mechanism.As discussed further under section II.G.5.c.(1) of this proposed rule, we propose that the above EHR vendor requirements would apply not only for the purpose of a vendor's EHR product being qualified for the purpose of the product's users being able to submit data extracted from the EHR for the 2010 PQRI, but also for the purpose of a vendor's EHR product being qualified for the purpose of the product's users being able to electronically submit data extracted from the EHR for the electronic prescribing measure for the 2010 E-Prescribing IncentiveProgram.During 2010, we expect to use the self-nomination process described in the ``Requirements for Electronic Health Record (EHR) Vendors toParticipate in the 2009 PQRI EHR Testing Program'' posted on the PQRI section of the CMS Web site at http://www.cms.hhs.gov/PQRI/20_Reporting.asp#TopOfPage, to qualify additional EHR vendors and theirEHR products to submit quality data extracted from their EHR products to the CMS clinical quality data warehouse for program years after 2010. We anticipate that the requirements will be similar to those used to qualify EHR products for the 2009 PQRI EHR testing, but they may be modified based on the results of our 2009 EHR testing. At the conclusion of this process, sometime in late 2010, those EHR products that meet all of the EHR vendor requirements will be listed on the PQRI section of the CMS Web site at http://www.cms.hhs.gov/PQRI as a``qualified'' EHR product, which indicates that the product's users may submit quality data to CMS (either directly from their system or through the vendor--which is yet to be determined) for the 2011 PQRI or subsequent years, if and when, EHR submission is included as a PQRI reporting mechanism for years after 2010. e. Proposed Criteria for Satisfactory Reporting of Individual QualityMeasures for Individual Eligible ProfessionalsUnder section 1848(m)(3)(A) of the Act, the criteria for satisfactorily
Page 33566submitting data on individual quality measures through claims-based reporting require the reporting of at least 3 applicable measures in at least 80 percent of the cases in which the measure is reportable. If fewer than 3 measures are applicable to the services of the professional, the professional may meet the criteria by reporting on all applicable measures (that is, 1 to 2 measures) for at least 80 percent of the cases where the measures are reportable. It is assumed that if an eligible professional submits quality data codes for a particular measure, the measure applies to the eligible professional.In prior program years, when we were required, under section 1848(m)(5)(F) of the Act, to establish alternative criteria for satisfactorily reporting using the registry-based reporting mechanism, we decided that the criteria for registry-based reporting of individual measures should be consistent with the criteria for claims-based reporting of individual measures. Thus, we adopted the same criteria for satisfactory reporting of individual measures through registry- based reporting as the criteria for satisfactory reporting of individual measures through claims-based reporting except that an eligible professional could choose to report through the registry-based reporting mechanism only if there are at least 3 PQRI quality measures applicable to the services of the professional. For the 2008 or 2009PQRI, eligible professionals could not satisfactorily report PQRI measures through the registry-based reporting mechanism by reporting on fewer than 3 measures.For years after 2009, section 1848(m)(3)(D) of the Act authorizes the Secretary, in consultation with stakeholders and experts, to revise the criteria for satisfactorily reporting data on quality measures.Based on this authority and the input we have received from stakeholders via the invitation to submit suggestions for the 2010 PQRI reporting options posted on the PQRI section of the CMS Web site at http://www.cms.hhs.gov/PQRI in April 2009, we propose 3 criteria for satisfactory reporting of individual PQRI quality measures for 2010. In an effort to continue to be consistent with the criteria of satisfactory reporting used in prior PQRI program years, we propose to retain the following 2 criteria with respect to satisfactorily reporting data on individual quality measures in circumstances where 3 or more individual quality measures apply to the services furnished by an eligible professional:Report on at least 3 2010 PQRI measures (unless fewer than 3 2010 PQRI measures apply to the services furnished by the eligible professional); andReport each measure for at least 80 percent of the eligible professional's Medicare Part B FFS patients for whom services were furnished during the reporting period to which the measure applies.These criteria would apply to all proposed 2010 PQRI reporting mechanisms available for reporting individual PQRI quality measures(that is, claims-based reporting, registry-based reporting, and EHR- based reporting).If an eligible professional has fewer than 3 PQRI measures that apply to the professional's services, then the professional would be able to meet the criteria for satisfactorily reporting data on individual quality measures by meeting the following 2 proposed criteria:Reporting on all measures that apply to the services furnished by the professional (that is 1 to 2 measures); andReporting each measure for at least 80 percent of the eligible professional's Medicare Part B FFS patients for whom services were furnished during the reporting period to which the measure applies.We propose that, as in previous years, these criteria for satisfactorily reporting data on fewer than 3 individual quality measures would be available for the claims-based reporting mechanism only. An eligible professional who has fewer than 3 PQRI measures that apply to the professional's services would not be able to meet the criteria for satisfactory reporting by reporting on all applicable measures (that is, 1 or 2 measures) through the registry-based reporting mechanism.While we have received input from several stakeholders requesting that we permit an eligible professional to report fewer than 3 measures through the registry-based reporting mechanism if fewer than 3 measures apply to him or her, doing so would be inefficient. First, in addition to needing to analyze the data submitted to us by the registry, we would have to analyze the claims data to ensure that no additional measures are applicable to the eligible professional, much like what we do under the Measure Applicability Validation process for claims-based reporting. Second, we would also have to analyze the claims data to ensure that the eligible professional had not attempted to report additional measures through claims. For these reasons, we are not proposing to permit eligible professionals who choose the registry- based or EHR-based reporting mechanism to report on individual quality measures to report on fewer than 3 measures if only 1 or 2 measures apply to the services they furnish.Based on the previously stated assumption that a measure applies to the eligible professional if an eligible professional submits quality data codes for a particular measure, we propose that an eligible professional who reports on fewer than 3 measures through the claims- based reporting mechanism in 2010 may be subject to the MeasureApplicability Validation process, which allows us to determine whether an eligible professional should have reported quality data codes for additional measures. This process was applied in the 2007 and 2008PQRI. When an eligible professional reports on fewer than 3 measures, we propose to review whether there are other closely related measures(such as those that share a common diagnosis or those that are representative of services typically provided by a particular type of professional). If an eligible professional who reports on fewer than 3 measures in 2010 reports on a measure that is part of an identified cluster of closely related measures and did not report on any other measure that is part of that identified cluster of closely related measures, then the professional would not qualify to receive a 2010PQRI incentive payment. Additional information on the MeasureApplicability Validation process can be found on the Analysis andPayment page of the PQRI section of the CMS Web site at http:// www.cms.hhs.gov/PQRI.In addition to the above criteria related to the number of measures on which an eligible professional would be required to report and the frequency of reporting, we propose a third criterion for satisfactory reporting of individual measures. Based on our authority to revise the criteria for satisfactory reporting under section 1848(m)(3)(D) of theAct, we propose that an eligible professional also be required to report data on at least one individual measure on a minimum number ofMedicare Part B FFS patients seen during the reporting period, as detailed below. Establishing a minimum patient sample size requirement would enhance the scientific validity of eligible professionals' performance results and encourage eligible professionals to select to report only measures that are representative of the types of services they typically provide in their practice. If, for example, an eligible professional selects 3 patient-level measures (that is, measures in which the required
Page 33567reporting frequency is a minimum of once per reporting period per individual eligible professional) where only one of his or her MedicarePart B FFS patients are eligible for the measures and there is no minimum patient sample size requirement, then the eligible professional currently could qualify to earn a PQRI incentive payment by reportingPQRI quality measures data only 3 times during the entire reporting period. We believe that information on such a small sample of cases would be insufficient to do any meaningful analysis of the eligible professional's performance on the reported measure. We also believe that a minimum patient sample size requirement would prevent an eligible professional from purposely selecting measures that apply to only a few of their patients.Regardless of the reporting mechanism chosen by the eligible professional, we propose that the minimum patient sample size for reporting individual quality measures be 15 Medicare Part B FFS patients for the 12-month reporting period. An eligible professional would need to meet this minimum patient sample size requirement for at least one measure on which the eligible professional chooses to report.This proposed number is based on our experience with the 2007 PQRI and the limited information we have available regarding the 2008 PQRI reporting experience. For the 2007 PQRI measures, where the only reporting period was a 6-month reporting period beginning July 1, 2007, the median number of instances in which an eligible professional could have reported a 2007 PQRI measure was, on average, 9 eligible instances per measure. If we assume that the number of eligible instances for the first half of 2007 were similar to the number of eligible instances in the second half of 2007, then we can assume that the median number of eligible instances was an average of 18 instances per measure for the entire year. Preliminary information from the 2008 PQRI, based on data through September 2008, indicate that the median number of instances in which an eligible professional could have reported a 2008 PQRI measure was, on average, 18 eligible instances per measure. Since eligible professionals are not required to report a measure for all eligible cases, we based the proposed minimum patient sample size threshold on 80 percent of 18 eligible instances, which is 14.4.Similarly, for the 6-month reporting period (available for registry-based reporting only), we propose that the minimum patient sample size for reporting on individual quality measures be 8 MedicarePart B FFS patients seen during the 6-month reporting period. An eligible professional would need to meet this minimum patient sample size requirement for at least one measure on which the eligible professional chooses to report. We welcome comments on the proposal to add a minimum patient sample size criterion to the criteria for satisfactory reporting of data on individual quality measures. In addition, we invite comments on the specific thresholds proposed for the 12-month reporting period (available for claims-based, registry- based, and EHR-based reporting) and for the 6-month reporting period(available for registry-based reporting only) for reporting individual quality measures.The proposed 2010 criteria for satisfactory reporting of data on individual PQRI quality measures are summarized in Table 14 and are arranged by reporting mechanism and reporting period.Table 14--Proposed 2010 Criteria for Satisfactory Reporting of Data on Individual PQRI Quality Measures, byReporting Mechanism and Reporting PeriodReporting mechanismReporting criteriaReporting periodClaims-based reporting................ Report at least 3 PQRIJanuary 1, 2010-December 31, measures, or 1-2 measures if less than 2010. 3 measures apply to the eligible professional;Report each measure for at least 80% of the eligible professional's Medicare Part B FFS patients seen during the reporting period to whom the measure applies; andReport at least 1 PQRI measure on at least 15 Medicare Part B FFS patients seen during the reporting period to which the measure applies.Registry-based reporting.............. Report at least 3 PQRIJanuary 1, 2010-December 31, measures;2010.Report each measure for at least 80% of the eligible professional's Medicare Part B FFS patients seen during the reporting period to whom the measure applies; and.Report at least 1 PQRI measure on at least 15 Medicare Part B FFS patients seen during the reporting period to which the measure applies.Registry-based reporting.............. Report at least 3 PQRIJuly 1, 2010-December 31, measures;2010.Report each measure for at least 80% of the eligible professional's Medicare Part B FFS patients seen during the reporting period to whom the measure applies; and.Report at least 1 PQRI measure on at least 8 Medicare Part B FFS patients seen during the reporting period to which the measure applies.EHR-based reporting................... Report at least 3 PQRIJanuary 1, 2010-December 31, measures;2010.Report each measure for at least 80% of the eligible professional's Medicare Part B FFS patients seen during the reporting period to whom the measure applies; and.Report at least 1 PQRI measure on at least 15 Medicare Part B FFS patients seen during the reporting period to which the measure applies.
Page 33568As illustrated in Table 14, there are a total of 4 proposed reporting options, or ways in which an eligible professional may meet the criteria for satisfactory reporting on individual quality measures for the 2010 PQRI. Each reporting option consists of the criteria for satisfactorily reporting such data and results on individual quality measures relevant to a given reporting mechanism and reporting period.While eligible professionals may potentially qualify as satisfactorily reporting individual quality measures under more than one of the proposed reporting criteria, proposed reporting mechanisms, and/or for more than one proposed reporting period, only one incentive payment would be made to an eligible professional based on the longest reporting period for which the eligible professional satisfactorily reports. f. Proposed Criteria for Satisfactory Reporting Measures Groups forIndividual Eligible ProfessionalsAs described above, section 1848(m)(5)(F) of the Act requires that, for 2008 and subsequent years, the Secretary establish alternative reporting periods and alternative criteria for satisfactorily reporting groups of measures. In establishing these alternatives in prior years, we have labeled these groups of measures ``measures groups.'' We have previously defined ``measures groups'' as a subset of four or more PQRI measures that have a particular clinical condition or focus in common.The denominator definition and coding of the measures group identifies the condition or focus that is shared across the measures within a particular measures group.In the 2008 and 2009 PQRI, measures groups were reportable through claims-based or registry-based reporting. For the 2008 and 2009 PQRI, there were 2 basic sets of criteria for satisfactory reporting measures groups through claims-based or registry-based reporting: (1) The reporting of at least 1 measures group for at least 80 percent of patients to whom the measures group applies during the reporting period; or (2) the reporting of at least 1 measures group for a specified number of consecutive patients to whom the measures group applies during the reporting period. For registry-based reporting in the 2008 and 2009 PQRI, we allowed eligible professionals to include some non-Medicare Part B FFS patients in the consecutive patient sample under the second set of criteria. For registry-based reporting quality measures results and numerator and denominator data on measures groups in 2009, we also added to the first set of criteria a requirement to report the measures group on a minimum number of patients commensurate with the reporting period duration.For the 2010 PQRI, we again propose 2 basic sets of criteria for satisfactory reporting on measures group. Both sets of criteria would apply to the claims-based and registry-based reporting mechanism. As discussed in section II.G.2.d.(3) of this proposed rule, we are not proposing to make the EHR-based reporting mechanism available for reporting on measures groups in 2010.The first set of proposed criteria, which we propose to make available for either the 12-month or 6-month reporting period in 2010, would be consistent with the 2009 criteria for satisfactory reporting of measures groups through registry-based reporting, which require the reporting of at least 1 measures group for at least 80 percent of patients to whom the measures group applies during the applicable reporting period (with reporting required on a minimum number ofMedicare Part B FFS patients commensurate with the reporting period duration). In the 2009 PQRI, there was a requirement under these criteria to report each measures group on at least 30 Medicare Part BFFS patients for the 12-month reporting period and at least 15 MedicarePart B FFS patients for the 6-month reporting period for registry-based reporting of measures groups. For the 2010 PQRI, we propose to revise the requirement by making these criteria applicable to both registry- based and claims-based reporting and to change the number of MedicarePart B FFS patients on which an eligible professional would be required to report a measures group. We propose to require an eligible professional who chooses to report on measures groups based on reporting on 80 percent of applicable patients to report on a minimum of 15 Medicare Part B FFS patients for the 12-month reporting period and a minimum of 8 Medicare Part B FFS patients for the 6-month reporting period, regardless of whether the eligible professional chooses to report the measures group through claims-based reporting or registry-based reporting. We propose to revise the required minimum sample size to make the proposed 2010 criteria for satisfactory reporting of measures groups consistent with the proposed 2010 criteria for satisfactory reporting of individual measures. We invite comments on our proposal to make the criteria for satisfactory reporting of measures groups more consistent with those proposed for reporting individual measures. We especially would be interested in comments with respect to our proposal to revise the minimum sample size requirement related to satisfactory reporting on measures group through the registry-based reporting mechanism so that the criteria for satisfactory reporting of measures groups, regardless of reporting mechanism, would be identical to those proposed for reporting individual measures.The second set of proposed criteria, which we propose to make available for the 12-month reporting period only, would be based on reporting on a measures group on a specified minimum number of patients. The second set of criteria would require reporting on at least 1 measures group for at least 30 patients seen between January 1, 2010 and December 31, 2010 to whom the measures group applies. Unlike the 2009 PQRI, which required that eligible professionals report on consecutive patients (that is, patients seen in order, by date of service), the 30 patients on which an eligible professional would need to report a measures group for 2010 would not need to be consecutive patients. The eligible professional would be able to report on any 30 patients seen during the reporting period to which the measures group applies. We propose to remove the requirement to report on patients seen consecutively by date of service because our preliminary analysis of the 2008 PQRI claims-based reporting experience through September 2008 suggests that this requirement is difficult for professionals to apply accurately to meet the criteria for satisfactory reporting of measures groups. In addition, the questions we receive from eligible professionals indicate that many eligible professionals are not clear on how to determine which patients are ``consecutive'' and should be included in the patient sample. We believe that any adverse effect on the reliability or validity of the quality information received as a result of the removal of the requirement to report on patients seen consecutively and allowing eligible professionals to report on any 30 patients would be minimal. When eligible professionals report measures groups, they are required to report on multiple measures for a given clinical condition or focus, which makes it harder for them to selectively choose patients in an attempt to improve their performance results. We invite comments on our proposal to allow eligible professionals to report on measures groups on any 30 patients rather than a consecutive patient sample.As in previous years, we propose that for 2010, the patients, for claims-based
Continued on page 33569From the Federal Register Online via GPO Access [wais.access.gpo.gov]]
pp. 33569-33618Medicare Program; Payment Policies Under the Physician FeeSchedule and Other Revisions to Part B for CY 2010
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Page 33569reporting, would be limited to Medicare Part B FFS patients. We receive claims on Medicare patients only. For registry-based reporting, however, we propose that the patients could include some, but not be exclusively, non-Medicare Part B FFS patients.The proposed 2010 criteria for satisfactory reporting on measures groups are summarized in Table 15, which is arranged by reporting mechanism and reporting period.Table 15--Proposed 2010 Criteria for Satisfactory Reporting on Measures Groups, by Reporting Mechanism andReporting PeriodReporting mechanismReporting criteriaReporting periodClaims-based reporting........... Report at least 1 PQRI measures group;January 1, 2010-December 31, 2010.Report each measures group for at least 30Medicare Part B FFS patients.Claims-based reporting........... Report at least 1 PQRI measures group;January 1, 2010-December 31, 2010.Report each measures group for at least 80% of the eligible professional's Medicare Part B FFS patients seen during the reporting period to whom the measures group applies; andReport each measures group on at least 15Medicare Part B FFS patients seen during the reporting period to which the measures group applies.Claims-based reporting........... Report at least 1 PQRI measures group;July 1, 2010-December 31, 2010.Report each measures group for at least 80% of January 1, 2010- the eligible professional's Medicare Part B FFSDecember 31, 2010. patients seen during the reporting period to whom the measures group applies; andReport each measures group on at least 8Medicare Part B FFS patients seen during the reporting period to which the measures group applies.Registry-based reporting......... Report at least 1 PQRI measures group;January 1, 2010-December 31, 2010.Report each measures group for at least 30 patients. Patients may include, but may not be exclusively, non-Medicare Part B FFS patients.Registry-based reporting......... Report at least 1 PQRI measures group;January 1, 2010-December 31, 2010.Report each measures group for at least 80% of the eligible professional's Medicare Part B FFS patients seen during the reporting period to whom the measures group applies; andReport each measures group on at least 15Medicare Part B FFS patients seen during the reporting period to which the measures group applies.Registry-based reporting......... Report at least 1 PQRI measures group;July 1, 2010-December 31, 2010.Report each measures group for at least 80 % of the eligible professional's Medicare Part B FFS patients seen during the reporting period to whom the measures group applies; andReport each measures group on at least 8Medicare Part B FFS patients seen during the reporting period to which the measures group applies.As illustrated in Table 15, there are a total of 6 proposed reporting options, or ways in which an eligible professional may meet the proposed criteria for satisfactory reporting of measures groups for the 2010 PQRI. Each reporting option consists of the criteria for satisfactory reporting relevant to a given reporting mechanism and reporting period. As stated previously, while eligible professionals may potentially qualify as satisfactorily reporting on measures groups under more than one of the proposed reporting criteria, proposed reporting mechanisms, and/or for more than one proposed reporting period, only one incentive payment would be made to an eligible professional based on the longest reporting period for which the eligible professional satisfactorily reports. g. Proposed Reporting Option for Satisfactory Reporting on QualityMeasures by Group PracticesAs stated previously, section 1848(m)(3)(C)(i) of the Act requires the Secretary to establish and have in place a process by January 1, 2010 under which eligible professionals in a group practice (as defined by the Secretary) shall be treated as satisfactorily submitting data on quality measures under PQRI if, in lieu of reporting measures underPQRI, the group practice reports measures determined appropriate by theSecretary, such as measures that target high-cost chronic conditions and preventive care, in a form and manner, and at a time specified by the Secretary. Section 1848(m)(3)(C)(ii) of the Act requires that this process provide for the use of a statistical sampling model to submit data on measures, such as the model used under the Medicare PhysicianGroup Practice (PGP) demonstration project under section 1866A of theAct.In addition, payments to a group practice under section 1848(m) of the Act by reason of the process proposed herein shall be in lieu of the PQRI incentive payments that would otherwise be made to eligible professionals in the group practice for satisfactorily submitting data on quality measures (that is, prohibits double payments). Therefore, in addition to making incentive payments for 2010 to group practices based on separately analyzing whether the individual eligible professionals within the group practice (that is, for each TIN/NPI combination) satisfactorily reported on PQRI quality measures, we will begin making incentive payments to group practices based on the determination that the group practice, as a whole (that is, for the TIN), satisfactorily reports on
Page 33570PQRI quality measures for 2010. In addition, an individual eligible professional who is affiliated with a group practice participating in the group practice reporting option that satisfactorily reports under the proposed group practice reporting option would not be eligible to earn a separate PQRI incentive payment for 2010 on the basis of his or her satisfactorily reporting PQRI quality measures data at the individual level.(1) Definition of ``Group Practice''As stated above, section 1848(m)(3)(C)(i) of the Act authorizes theSecretary to define ``group practice.'' For purposes of determining whether a group practice satisfactorily submits PQRI quality measures data, we propose that a ``group practice'' would consist of a physician group practice, as defined by a TIN, with at least 200 or more individual eligible professionals (or, as identified by NPIs) who have reassigned their billing rights to the TIN.Generally, our intent is to build on an existing quality reporting program that group practices may already be familiar with by modeling the PQRI group practice reporting option after the PGP demonstration.Since the PGP demonstration is a demonstration program for large group practices, one of the requirements for group practices participating in the PGP demonstration is for each practice to have 200 or more members.To be consistent with the PGP demonstration, we also propose to limit initial implementation of the PQRI group practice reporting option for 2010 to similar large group practices. As we gain more experience with the group practice reporting option, we may consider lowering the group size threshold in the future. We invite comments on the proposed definition of ``group practice'' and our proposal to limit initial implementation of the PQRI group practice reporting option in 2010 to practices with 200 or more individual eligible professionals.In order to participate in the 2010 PQRI through the group practice reporting option, we propose to require group practices to complete a self-nomination process and to meet certain technical and other requirements. Group practices interested in participating in the 2010PQRI through the group practice reporting option would be required to submit a self-nomination letter to CMS or a CMS designee requesting to participate in the 2010 PQRI group practice reporting option. We propose that each group practice would be required to meet the following requirements:Have an active Individuals Access to CMS Systems (IACS) user account;Provide CMS or a CMS designee with the group practice'sTIN and the NPI numbers and names of all eligible professionals who will be participating as part of the group practice (that is, all individual NPI numbers associated with the group practice's TIN). This information must be provided in an electronic format specified by CMS, such as in an Excel spreadsheet; andAgree to have the group practice's PQRI quality measurement performance rates for each measure publicly reported by posting of the results on a CMS Web site.We propose to post the final participation requirements for group practices, including the exact date by which group practices that wish to participate in the 2010 PQRI through the group practice reporting option must submit a self-nomination letter and other instructions for submitting the self-nomination letter, on the PQRI section of the CMSWeb site at http://www.cms.hhs.gov/PQRI by November 15, 2009. We anticipate that group practices that wish to self-nominate for 2010 will be required to do so by the end of the first quarter of 2010, but not later than the end of the second quarter of 2010. Upon receipt of the self-nomination letters we will assess whether the participation requirements proposed above have been met by each self-nominated group practice.(2) Process for Physician Group Practices To Participate as GroupPractices and Criteria for Satisfactory Reporting Data on QualityMeasures by Group PracticesFor physician groups selected to participate in the PQRI group practice reporting option for 2010, we propose the reporting period would be the 12-month reporting period beginning January 1, 2010. We propose that group practices would be required to submit information on these measures using a data collection tool based on the data collection tool used in CMS' Medicare Care Management Performance(MCMP) demonstration and the quality measurement and reporting methods used in CMS' PGP demonstration. We propose that physician groups selected to participate in the 2010 PQRI through the group practice reporting option would be required to report on a common set of 26 NQF- endorsed quality measures that are based on measures currently used in the MCMP and/or PGP demonstration and that target high-cost chronic conditions and preventive care. These quality measures are identified in Table 34. Additional information on the MCMP and PGP demonstrations is posted on the Medicare Demonstrations section of the CMS Web site at http://www.cms.hhs.gov/DemoProjectsEvalRpts/MD/list.asp#TopOfPage.Although our proposed process for physician groups to participate inPQRI as a group practice incorporates some characteristics and methods from the PGP demonstration and the MCMP demonstration, the PQRI group practice reporting option will be a separate program with its own specifications and methodology from the PGP and MCMP demonstration programs.The proposed quality measures identified in Table 34 are based on a subset of the Doctor's Office Quality (DOQ) quality measures set developed and specified under the direction of CMS and which are used in the PGP and/or MCMP demonstration programs. Contributors to the development of the DOQ measure set included the American MedicalAssociation's Physician Consortium for Performance Improvement (AMA-PCPI), the American College of Cardiology (ACC), the American HeartAssociation (AHA), the National Diabetes Quality Improvement Alliance, the National Committee for Quality Assurance (NCQA), and the VeteransHealth Administration (VA) and, in most instances, overlap with proposed 2010 PQRI measures. These quality measures are grouped into four disease modules: diabetes; heart failure; coronary artery disease; and preventive care services.As part of the data submission process, we propose that, beginning in 2011, each group practice would be required to report quality measures with respect to services furnished during the 2010 reporting period (that is, January 1, 2010 through December 31, 2010) on an assigned sample of Medicare beneficiaries. We propose to analyze theJanuary 1, 2010 through October 29, 2010 (that is, the last business day of October 2010) National Claims History (NCH) file to assignMedicare beneficiaries to each physician group practice using the same patient assignment methodology used in the PGP demonstration. Assigned beneficiaries are limited to those Medicare FFS beneficiaries withMedicare Parts A and B for whom Medicare is the primary payer. Assigned beneficiaries do not include Medicare Advantage enrollees. Essentially, a beneficiary would be assigned to the physician group that provides the plurality of a beneficiary's office or other outpatient E/M allowed charges (based on Medicare Part B claims submitted for the beneficiary for dates of services between January 1, 2010 and October 29, 2010).Beneficiaries with
Page 33571only 1 visit to the group practice between January 1, 2010 and October 29, 2010 would be eliminated from the group practice's assigned patient sample. Once the beneficiary assignment has been made for each physician group, each physician group would be required to report the quality measures on a random sample of the assigned beneficiaries per disease module or preventive care measure. For each disease module or preventive care measure, the physician group would be required to report information on the assigned patients in the order in which they appear in the group's sample (that is, consecutively). In the fourth quarter of 2010, we would pull a random sample of assigned beneficiaries for each disease module or preventive care measure and provide the sample to the physician group consistent with the methods used in the PGP demonstration. Identical to the sampling method used in the PGP demonstration, the random sample must consist of at least 411 assigned beneficiaries. If the pool of eligible assigned beneficiaries is less than 411, then the group practice must report on 100 percent of the assigned beneficiaries to participate in the group practice reporting option.We propose a unique reporting mechanism for the group practice reporting option that would not be available to individual eligible professionals participating in the 2010 PQRI. We propose that each physician group selected to participate in the group practice reporting option would have access to a database (that is, a data collection tool) that would include the assigned beneficiary sample and the quality measures. This data collection tool was originally developed for use in the PGP demonstration, updated for use in the MCMP demonstration, and would be updated as needed for use in the PQRI. The assigned beneficiaries' demographic and utilization information would be prepopulated based on claims data. We anticipate being able to provide the selected physician groups with access to this prepopulated database by the fourth quarter of 2010. The physician group would be required to populate the remaining data fields necessary for capturing quality measure information on each of the assigned beneficiaries.Numerators for each of the quality measures would include all beneficiaries in the denominator population who also satisfy the quality performance criteria for that measure. Denominators for each quality measure would include a sample of the assigned beneficiaries who meet the eligibility criteria for that quality measure module or preventive care measure.We invite comments on our proposal to adopt the PGP demonstration's quality measurement and reporting methods for the PQRI group practice reporting option. We specifically request comments on the proposed patient assignment methodology and our proposal to use a data collection tool based on the one used in the MCMP demonstration as the reporting mechanism for physician groups selected to participate in thePQRI group practice reporting option.We propose 2 criteria for satisfactory reporting of quality measures by a physician group. First, the physician group would be required to report completely on all of the proposed modules and measures listed in Table 34. Second, the physician group would be required to report on the first 411 consecutively assigned Medicare beneficiaries per disease module or preventive care measure. This is identical to the reporting criteria used in the PGP demonstration. By building on an existing demonstration program that large group practices may already have experience with, we hope to minimize burden on both group practices and CMS. The sample that we pull for and provide to each physician group would include more than the 411 assigned beneficiaries (the sample would include an over sample of approximately 50 percent). More beneficiaries are provided in the sample than the group practice is required to report on in order to account for beneficiaries included in the sample who cannot be confirmed with the diagnosis for a particular disease module or whose medical information may not be able to be located within the physician group's systems. h. Statutory Requirements and Other Considerations for MeasuresProposed for Inclusion in the 2010 PQRI(1) Statutory Requirements for Measures Proposed for Inclusion in the 2010 PQRIAs a result of section 131(b) of the MIPPA, the statutory requirements with respect to the use of quality measures for the 2010PQRI are different from the statutory requirements for previous program years. For the 2007 PQRI, section 1848(k)(2)(A)(i) of the Act required the Secretary to generally select the quality measures identified as 2007 physician quality measures under the Physician Voluntary ReportingProgram. For the 2008 and 2009 PQRI, section 1848(k)(2)(B) of the Act required that the quality measures be measures that have been adopted or endorsed by a consensus organization (such as the National QualityForum or AQA), that include measures that have been submitted by a physician specialty, and that the Secretary identifies as having used a consensus-based process for developing such measures. For purposes of reporting data on quality measures for covered professional services furnished during 2010 and subsequent years for the PQRI, subject to the exception noted below, section 1848(k)(2)(C)(i) of the Act, as added byMIPPA, requires that the quality measures shall be such measures selected by the Secretary from measures that have been endorsed by the entity with a contract with the Secretary under subsection 1890(a) of the Act, as added by section 183 of the MIPPA. On January 14, 2009, theU.S. Department of Health and Human Services awarded the contract required under section 1890(a) of the Act to the National Quality Forum(NQF).In the case of a specified area or medical topic determined appropriate by the Secretary for which a feasible and practical measure has not been endorsed by the NQF, however, section 1848(k)(2)(C)(ii) of the Act authorizes the Secretary to specify a measure that is not so endorsed as long as due consideration is given to measures that have been endorsed or adopted by a consensus organization identified by theSecretary, such as the AQA alliance. In light of these statutory requirements, we believe that, except in certain specified circumstances, each proposed 2010 PQRI quality measure would need to be endorsed by the NQF by July 1, 2009. In those circumstances in which a feasible and practical measure has not been endorsed by the NQF, we believe that all other proposed 2010 PQRI quality measures would need to have at least been adopted by the AQA or another organization with comparable consensus-organization characteristics. However, in January 2009, the AQA announced that it will no longer be adopting measures and we are not aware of any other organizations with consensus-organization characteristics (see 73 FR 38565 through 38566 for discussion of the considerations applied in determining whether an entity is a consensus organization). Therefore, our policy with respect to identifying exceptions under section 1848(k)(2)(C)(ii) of the Act would be to give due consideration to measures that have been endorsed by the NQF. As a result, in reviewing measures for possible inclusion in the 2010 PQRI quality measure set, we propose that any new quality measures proposed for the 2010 PQRI must be NQF-endorsed
Page 33572by July 1, 2009, while any proposed 2010 PQRI quality measures selected from the 2009 PQRI quality measure set would need to have been adopted by the AQA as of January 31, 2009, if the measure still is not endorsed by the NQF by July 1, 2009.In addition, section 1848(k)(2)(D) of the Act requires that for each 2010 PQRI quality measure, ``the Secretary shall ensure that eligible professionals have the opportunity to provide input during the development, endorsement, or selection of measures applicable to services they furnish.'' Measure developers generally include a public comment phase in their measure development process. As part of the measure development process, measure developers typically solicit public comments on measures that they are testing in order to determine whether additional refinement of the measure(s) is needed prior to submission for consensus endorsement. For example, information on the measure development process employed by us when CMS or a CMS contractor is the measure developer is available in the ``Measures ManagementSystem Blueprint'' found on the CMS Web site at http://www.cms.hhs.gov/ apps/QMIS/mmsBlueprint.asp.Eligible professionals also have the opportunity to provide input on a measure as the measure is being vetted through the NQF consensus endorsement process (and previously, the AQA consensus adoption process). In particular, the NQF employs a public comment period for measures vetted through its consensus endorsement process (and previously, for the AQA, its consensus adoption process).Finally, eligible professionals have an opportunity to provide input on the measures proposed for inclusion in the 2010 PQRI through this proposed rule, which provides a 60-day comment period.Accordingly, with regard to the 2010 PQRI, we believe we have satisfied this requirement in multiple ways.(2) Other Considerations for Measures Proposed for Inclusion in the 2010 PQRIConsistent with the statutory requirements described in sectionII.G.2.h.(1) of this proposed rule, we propose to apply the following considerations with respect to the selection of 2009 PQRI quality measures proposed for inclusion in the 2010 PQRI quality measure set:Where some 2009 PQRI quality measures have been endorsed by the NQF and others have not, those 2009 PQRI quality measures that have been specifically considered by NQF for possible endorsement, butNQF has declined to endorse it, are not proposed for inclusion in the 2010 PQRI quality measure set (that is, we propose to retire the measure for 2010).In circumstances where no NQF-endorsed measure is available, we propose to exercise the exception under section 1848(k)(2)(C)(ii) of the Act. Under these circumstances, a 2009 PQRI quality measure that previously (that is, prior to January 31, 2009) has been adopted by the AQA would meet the requirements under the Act and we propose that it would be appropriate for eligible professionals to use the measure to submit quality measures data and/or quality measures results and numerator and denominator data on quality measures, as appropriate.Although we do not propose to include any 2009 PQRI measures that have not been endorsed by the NQF or adopted by the AQA in the final 2010 PQRI quality measure set, we acknowledge that section 1848(k)(C)(ii) of the Act provides an exception to the requirement that the Secretary select measures that have been endorsed by the entity with a contract under section 1890(a) of the Act (that is, the NQF) as long as an area or medical topic for which a feasible and practicalNQF-endorsed measure is not available has been identified and due consideration has been given to measures that have been endorsed by theNQF and/or, prior to January 31, 2009, adopted by the AQA.The statutory requirements under section 1848(k)(2)(C) of the Act, subject to the exception noted above, require only that the measures be selected from measures that have been endorsed by the entity with a contract with the Secretary under section 1890(a) (that is, the NQF) and are silent with respect to how the measures that are submitted to the NQF for endorsement were developed. The basic steps for developing measures applicable to physicians and other eligible professionals prior to submission of the measures for endorsement may be carried out by a variety of different organizations. We do not believe there needs to be any special restrictions on the type or make up of the organizations carrying out this basic development of physician measures, such as restricting the initial development to physician-controlled organizations. Any such restriction would unduly limit the basic development of quality measures and the scope and utility of measures that may be considered for endorsement as voluntary consensus standards. 2009 PQRI measures that were part of the 2007 and/or 2008PQRI in which the 2007 and 2008 PQRI analytics indicate a lack of significant reporting and usage were not considered for inclusion in the 2010 PQRI.In addition to reviewing the 2009 PQRI measures and previously retired measures, for purposes of developing the proposed 2010 PQRI measures, we have reviewed and considered measure suggestions including comments received in response to the CY 2009 PFS proposed rule and final rule with comment period. Additionally, suggestions and input received through other venues, such as an invitation for measures suggestions posted on the PQRI section of the CMS Web site in February 2009 were also reviewed and considered for purposes of our development of the list of proposed 2010 PQRI quality measures.With respect to the selection of new measures (that is, measures that have never been selected as part of a PQRI quality measure set for 2009 or any prior year), we propose to apply the following considerations, which include many of the same considerations applied to the selection of 2009 PQRI quality measures for proposed inclusion in the 2010 PQRI quality measure set described above:High Impact on Healthcare.Measures that are high impact and support CMS and HHS priorities for improved quality and efficiency of care for Medicare beneficiaries. These current and long term priority topics include:Prevention; chronic conditions; high cost and high volume conditions; elimination of health disparities; healthcare-associated infections and other conditions; improved care coordination; improved efficiency; improved patient and family experience of care; improved end-of-life/ palliative care; effective management of acute and chronic episodes of care; reduced unwarranted geographic variation in quality and efficiency; and adoption and use of interoperable HIT.Measures that are included in, or facilitate alignment with, other Medicare, Medicaid, and CHIP programs in furtherance of overarching healthcare goals.NQF Endorsement.+ Measures must be NQF-endorsed by July 1, 2009 in order to be considered for inclusion in the 2010 PQRI quality measure set.+ Although we do not propose to include any new measures that are not endorsed by the NQF by July 1, 2009 in the final 2010 PQRI quality measure set, we acknowledge that section (k)(2)(C)(ii) of the Act provides an exception to the requirement that the Secretary select measures that have been endorsed by the entity with a contract under section 1890(a) of the Act (that is, the NQF). As
Page 33573long as an area or medical topic for which a feasible and practicalNQF-endorsed measure is not available has been identified and due consideration has been given to measures that have been adopted by theAQA or other consensus organization identified by Secretary.+ The statutory requirements under section 1848(k)(2)(C) of theAct, subject to the exception noted above, require only that the measures be selected from measures that have been endorsed by the entity with a contract with the Secretary under section 1890(a) (that is, the NQF) and are silent with respect to how the measures that are submitted to the NQF for endorsement were developed. The basic steps for developing measures applicable to physicians and other eligible professionals prior to submission of the measures for endorsement may be carried out by a variety of different organizations. We do not believe there needs to be any special restrictions on the type or make up of the organizations carrying out this basic development of physician measures, such as restricting the initial development to physician-controlled organizations. Any such restriction would unduly limit the basic development of quality measures and the scope and utility of measures that may be considered for endorsement as voluntary consensus standards. The requirements under section 1848(k)(2)(C) of the Act pertain only to the selection of measures and not to the development of measures.Address Gaps in PQRI Measure Set.+ Measures that increase the scope of applicability of the PQRI measures to services furnished to Medicare beneficiaries and expand opportunities for eligible professionals to participate in PQRI. We seek to achieve broad ability to assess the quality of care furnished to Medicare beneficiaries, and ultimately to compare performance among professionals. We seek to increase the circumstances where eligible professionals have at least 3 measures applicable to their practice and measures that help expand the number of measures groups with at least four measures in a group.Measures of various aspects of clinical quality including outcome measures, where appropriate and feasible, process measures, structural measures, efficiency measures, and measures of patient experience of care.Other considerations that we propose to apply to the selection of measures for 2010, regardless of whether the measure is a 2009 PQRI measure or not, are:Measures that are functional, which is to say measures that can be technically implemented within the capacity of the CMS infrastructure for data collection, analysis, and calculation of reporting and performance rates. This leads to preference for measures that reflect readiness for implementation, such as those that are currently in the 2009 PQRI program or have been through testing. The purpose of measure testing is to reveal the measure's strengths and weaknesses so that the limitations can be addressed and the measure refined and strengthened prior to implementation. For new measures, preference is given to those that can be most efficiently implemented for data collection and submission. Therefore, any measures that have been found to be technically impractical to report because they are analytically challenging due to any number of factors, including those that are claims-based, have not been included in the 2010 PQRI. For example, in some cases, we have proposed to replace existing 2009 PQRI measures with updated and improved measures that are less technically challenging to report.For some measures that are useful, but where data submission is not feasible through all otherwise available PQRI reporting mechanisms, a measure may be included for reporting solely through specific reporting mechanism(s) in which its submission is feasible. For example, we are proposing to limit reporting of some measures that previously were available for claims-based reporting and registry-based reporting to registry-based reporting only because they were technically challenging to report and/or analyze through the claims-based reporting mechanism. For further discussion of the proposed reporting mechanisms, see section II.G.2.d. of this proposed rule.We also reviewed 33 measures that have been retired from the PQRI in previous years using the considerations for selecting proposed measures for the 2010 PQRI discussed above. None were found to be eligible for inclusion in the 2010 PQRI quality measure set because they did not meet the criteria described above.We welcome comments on the implication of including or excluding any given measure or measures proposed herein in the final 2010 PQRI quality measure set and on our approach in selecting measures. We recognize that some commenters may also wish to recommend additional measures for inclusion in the 2010 PQRI measures that we have not herein proposed. While we welcome all constructive comments and suggestions, and may consider such recommended measures for inclusion in future measure sets for PQRI and/or other programs to which such measures may be relevant, we will not be able to consider such additional measures for inclusion in the 2010 measure set.As discussed above, section 1848(k)(2)(D) of the Act requires that the public have the opportunity to provide input during the selection of measures. We also are required by other applicable statutes to provide opportunity for public comment on provisions of policy or regulation that are established via notice and comment rulemaking.Measures that were not included in this proposed rule for inclusion in the 2010 PQRI that are recommended to CMS via comments on this proposed rule have not been placed before the public with opportunity for the public to comment on the selection of those measures within the rulemaking process. Even when measures have been published in theFederal Register, but in other contexts and not specifically proposed as PQRI measures, such publication does not provide true opportunity for public comment on those measures' potential inclusion in PQRI.Thus, such additional measures recommended for selection for the 2010PQRI via comments on this proposed rule cannot be included in the 2010 measure set. However, as discussed above, we will consider comments and recommendations for measures, which may not be applicable to the final set of 2010 PQRI measures, for purposes of identifying measures for possible use in future years' PQRI or other initiatives to which those measures may be pertinent.In addition, as in prior years, we note that we do not use notice and comment rulemaking as a means to update or modify measure specifications. Quality measures that have completed the consensus process have a designated party (usually, the measure developer/owner) who has accepted responsibility for maintaining the measure. In general, it is the role of the measure owner, developer, or maintainer to make changes to a measure. Therefore, comments requesting changes to a specific proposed PQRI measure's title, definition, and detailed specifications or coding should be directed to the measure developer identified in Tables 16 through 34. Contact information for the 2009PQRI measure developers is listed in the ``2009 PQRI Quality MeasuresList,'' which is available on the PQRI section of the CMS Web site at http://www.cms.hhs.gov/PQRI.
Page 33574i. Proposed 2010 PQRI Quality Measures for Individual EligibleProfessionalsAs stated previously, individual eligible professionals have the choice of reporting PQRI quality measures data on either individual quality measures or on measures groups.Consistent with the statutory requirements for measures included in the 2010 PQRI and other considerations for identifying proposed 2010 quality measures discussed in section II.G.2.h.(1) and II.G.2.h.(2), respectively, of this proposed rule, the individual quality measures identified for use in the 2010 PQRI will be selected from those we propose in this rule and will be finalized as of the date the CY 2010PFS final rule with comment period goes on display at the Office of theFederal Register. No changes (that is, additions or deletions of measures) will be made after publication of the CY 2010 PFS final rule with comment period. However, as was the case for 2008 and 2009, we may make modifications or refinements, such as revisions to measures titles and code additions, corrections, or revisions to the detailed specifications for the 2010 measures until the beginning of the reporting period. Such specification modifications may be made through the last day preceding the beginning of the reporting period. The 2010 measures specifications for individual quality measures will be available on the PQRI section of the CMS Web site at http:// www.cms.hhs.gov/PQRI when they are sufficiently developed or finalized.We are targeting finalization and publication of the detailed specifications for all 2010 PQRI measures on the PQRI section of theCMS Web site by November 15, 2009 and will, in no event, publish these specifications later than December 31, 2009. The detailed specifications will include instructions for reporting and identify the circumstances in which each measure is applicable.For 2010, we are proposing that final PQRI quality measures will be selected from 153 of the 2009 PQRI measures and 149 measure suggestions received in response to the February 2009 invitation to submit suggestions for measures and measures groups for possible inclusion in the 2010 PQRI (that is, the ``Call for 2010 Measure Suggestions''). We propose to include a total of 168 measures (this includes both individual measures and measures that are part of a proposed 2010 measures group) on which individual eligible professionals can report for the 2010 PQRI. The individual PQRI quality measures proposed for the 2010 PQRI are listed in Tables 17 through 20 and fall into four broad categories as set forth below in this section. The four categories are the following:(1) Proposed 2010 Individual Quality Measures Selected From the 2009 PQRI Quality Measures Set Available for Claims-based Reporting andRegistry-Based Reporting;(2) Proposed 2010 Individual Quality Measures Selected From the 2009 PQRI Quality Measures Set Available for Registry-based ReportingOnly;(3) New Individual Quality Measures Proposed for 2010; and(4) Proposed 2010 Measures Available for EHR-based Reporting.In addition, we propose 13 measures groups for 2010. The measures proposed for inclusion in each of the proposed 2010 measures groups are listed in Tables 21 through 33.(1) Proposed 2010 Individual Quality Measures Selected From the 2009 PQRI Quality Measures Set Available for Claims-based Reporting andRegistry-based ReportingAfter careful consideration of 2009 PQRI measures, we propose to retire 7 measures because they did not meet one or more of the considerations for selection of proposed 2010 measures discussed in section II.G.2.h. of this proposed rule. The measures, including theirMeasure Number and Measure Title, and the specific reason(s) we are using as the basis for our proposal to retire the measures are identified in Table 16.Table 16--2009 PQRI Quality Measures Not Proposed for Inclusion in the 2010 PQRIMeasure no.Measure titleReason for retirement11.................. Stroke and StrokeAnalytically challengingRehabilitation: Carotid / Replaced with anotherImagining Reporting.measure. 34.................. Stroke and StrokeAnalytically challengingRehabilitation: Tissue/ Replaced with anotherPlasminogen Activator. measure. 94.................. Otitis Media withLack of significantEffusion (OME):reporting.Diagnostic Evaluation. 95.................. Otitis Media withLack of significantEffusion (OME): Hearing reporting.Test. 143................. Oncology: Medical andAnalyticallyRadiation--Painchallenging.Intensity Quantified. 144................. Oncology: Medical andAnalyticallyRadiation--Plan of Care challenging. for Pain. 152................. Coronary Artery Disease Declined for NQF(CAD): Lipid Profile in Endorsement.Patients with CAD.We propose to include in the 2010 PQRI quality measure set 116 of the 2009 PQRI measures, which would be available for either claims- based reporting or registry-based reporting as individual quality measures. We note that one of these proposed measures, Measure 46 Medication Reconciliation: Reconciliation After Discharge from an Inpatient Facility, is reportable through the registry-based reporting mechanism only in the 2009 PQRI. However, for the 2010 PQRI, we propose to make this measure available for either claims-based reporting or registry-based reporting. For the 2009 PQRI, registries have reported difficulty capturing the required information since the measure requires the inpatient discharge to be correlated to the outpatient visit. Therefore, for the 2010 PQRI we propose to make this measure available for both claims-based and registry-based reporting.These 116 proposed measures do not include any measures that are proposed to be included as part of the 2010 Back Pain measures group.Similar to the 2009 PQRI, we propose that any 2010 PQRI measure that is included in the Back Pain measures group would not be reportable as individual measures through claims-based reporting or registry-based reporting.The 116 individual 2009 PQRI measures proposed for inclusion in the 2010 PQRI quality measure set as individual quality measures for either claims-based reporting or registry-based reporting are listed by theirMeasure Number and Title in Table 17, along with the name of the measure's developer/owner, their NQF endorsement status as of May 1, 2009, and their AQA adoption status as of January 31, 2009. The PQRIMeasure Number is a unique identifier assigned by CMS to all measures in the PQRI measure set. Once a PQRI Measure Number is assigned to a measure, it will not be used again to identify a different
Page 33575measure, even if the original measure to which the number was assigned is subsequently retired from the PQRI measure set. A description of the proposed measures listed in Table 17 can be found in the ``2009 PQRIQuality Measures List,'' which is available on the Measures and Codes page of the PQRI section of the CMS Web site at http://www.cms.hhs.gov/PQRI.The 2009 measures that are proposed to be available for registry- based reporting only for the 2010 PQRI are discussed and identified in section II.G.2.i.(2) of this proposed rule.Table 17--Proposed 2010 Measures Selected From the 2009 PQRI Quality Measure Set Available for Either Claims-Based Reporting or Registry-Based ReportingNQF endorsement statusAQA adoption status asMeasure No.Measure titleas of 5/1/09of 1/31/09Measure developer1................... Diabetes Mellitus: Yes..................... Yes.................... NCQA.Hemoglobin A1cPoor Control inDiabetes Mellitus. 2................... Diabetes Mellitus: Yes..................... Yes.................... NCQA.Low DensityLipoprotein (LDL-C) Control inDiabetes Mellitus. 3................... Diabetes Mellitus: Yes..................... No..................... NCQA.High BloodPressure Control in DiabetesMellitus. 6................... Coronary ArteryYes..................... Yes.................... AMA-PCPI.Disease (CAD):Oral AntiplateletTherapy Perscribed for Patients withCAD. 9................... Major DepressiveYes..................... Yes.................... NCQA.Disorder (MDD):AntidepressantMedication DuringAcute Phase forPatients with MDD. 10.................. Stroke and StrokeYes..................... Yes.................... AMA-PCPI/NCQA.Rehabilitation:ComputedTomography (CT) orMagnetic ResonanceImaging (MRI)Reports. 12.................. Primary Open Angle Yes..................... Yes.................... AMA-PCPI/NCQA.Glaucoma (POAG):Optic NerveEvaluation. 14.................. Age-Related macular Yes..................... Yes.................... AMA-PCPI/NCQA.Degeneration(AMD): DilatedMacularExamination. 18.................. DiabeticYes..................... Yes.................... AMA-PCPI/NCQA.Retinopathy:Documentation ofPresence orAbsence of MacularEdema and Level ofSeverity ofRetinopathy. 19.................. DiabeticYes..................... Yes.................... AMA-PCPI/NCQA.Retinopathy:Communication with the PhysicianManaging On-goingDiabetes Care. 20.................. Perioperative Care: Yes..................... Yes.................... AMA-PCPI/NCQA.Timing ofAntibioticProphylaxis--Order ing Physician. 21.................. Perioperative Care: Yes..................... Yes.................... AMA-PCPI/NCQA.Selection ofProphylacticAntibiotic--FirstOR SecondGenerationCephalosporin. 22.................. Perioperative Care: Yes..................... Yes.................... AMA-PCPI/NCQA.Discontinuation ofProphylacticAntibiotics (Non-CardiacProcedures). 23.................. Perioperative Care: Yes..................... Yes.................... AMA-PCPI/NCQA.VenousThromboembolism(VTE) Prophylaxis(When Indicated inALL Patients). 24.................. Osteoporosis:Yes..................... Yes.................... AMA-PCPI/NCQA.Communication with the PhysicianManaging On-goingCare Post Fracture. 28.................. Aspirin at Arrival Yes..................... Yes.................... AMA-PCPI/NCQA. for AcuteMyocardialInfarction (AMI). 30.................. Perioperative Care: Yes..................... Yes.................... AMA-PCPI/NCQA.Timing ofProphylacticAntibiotics--Admin istering Physician. 31.................. Stroke and StrokeYes..................... Yes.................... AMA-PCPI/NCQA.Rehabilitation:Deep VeinThrombosisProphylaxis (DVT) for IschemicStroke orIntracranialHemorrhage. 32.................. Stroke and StrokeYes..................... Yes.................... AMA-PCPI/NCQA.Rehabilitation:Discharged onAntiplateletTherapy. 35.................. Stroke and StrokeYes..................... Yes.................... AMA-PCPI/NCQA.Rehabilitation:Screening forDysphagia. 36.................. Stroke and StrokeYes..................... Yes.................... AMA-PCPI/NCQA.Rehabilitation:Consideration forRehabilitationServices. 39.................. Screening orYes..................... Yes.................... AMA-PCPI/NCQA.Therapy forOsteoporosis forWomen Aged 65Years and Older. 40.................. Osteoporosis:Yes..................... Yes.................... AMA-PCPI/NCQA.ManagementFollowing Fracture. 41.................. Osteoporosis:Yes..................... Yes.................... AMA-PCPI/NCQA.PharmacologicTherapy. 43.................. Coronary ArteryYes..................... Yes.................... Society ofBypass GraftThoracic Surgeons(CABG): Use of(STS).Internal MammaryArtery (IMA) inPatients withIsolated CABGSurgery.
Page 3357644.................. Coronary ArteryYes..................... Yes.................... STS.Bypass Graft(CABG):Preoperative Beta-Blocker inPatients withIsolated CABGSurgery. 45.................. Perioperative Care: Yes..................... Yes.................... AMA-PCPI/NCQA.Discontinuation ofProphylacticAntiobitics(CardiacProcedures). 46.................. MedicationYes..................... Yes.................... AMA-PCPI/NCQA.Reconciliation:ReconciliationAfter Discharge from an InpatientFacility. 47.................. Advance Care Plan.. Yes..................... Yes.................... AMA-PCPI/NCQA. 48.................. UrinaryYes..................... Yes.................... AMA-PCPI/NCQA.Incontinence:Assessment ofPresence orAbsence of UrinaryIncontinence inWomen Aged 6 Years and Older. 49.................. UrinaryYes..................... Yes.................... AMA-PCPI/NCQA.Incontinence:Characterization of UrinaryIncontinence inWomen Aged 65Years and Older. 50.................. UrinaryYes..................... Yes.................... AMA-PCPI/NCQA.Incontinence: Plan of Care forUrinaryIncontinence inWomen Aged 65Years and Older. 51.................. Chronic Obstructive Yes..................... No..................... AMA-PCPI.Pulmonary Disease(COPD): SpirometryEvaluation. 52.................. Chronic Obstructive Yes..................... No..................... AMA-PCPI.Pulmonary Disease(COPD):BronchodilatorTherapy. 53.................. Asthma:Yes..................... Yes.................... AMA-PCPI.PharmacologicTherapy. 54.................. 12-LeadYes..................... Yes.................... AMA-PCPI/NCQA.Electrocardiogram(ECG) Performed for Non-TraumaticChest Pain. 55.................. 12-LeadYes..................... Yes.................... AMA-PCPI/NCQA.Electrocardiogram(ECG) Performed for Syncope. 56.................. Community-Acquired Yes..................... Yes.................... AMA-PCPI/NCQA.Pneumonia (CAP):Vital Signs. 57.................. Community-Acquired Yes..................... Yes.................... AMA-PCPI/NCQA.Pneumonia (CAP):Assessment ofOxygen Saturation. 58.................. Community-Acquired Yes..................... Yes.................... AMA-PCPI/NCQA.Pneumonia (CAP):Assessment ofMental Status. 59.................. Community-Acquired Yes..................... Yes.................... AMA-PCPI/NCQA.Pneumonia (CAP):Empiric Antibiotic. 64.................. Asthma: AsthmaYes..................... Yes.................... AMA-PCPI.Assessment. 65.................. Treatment forYes..................... Yes.................... NCQA.Children withUpper RespiratoryInfection (URI):Avoidance ofInappropriate Use. 66.................. Appropriate Testing Yes..................... Yes.................... NCQA. for Children withPharyngitis. 67.................. MyelodysplasticYes..................... Yes.................... AMA-PCPI/AmericanSyndrome (MDS) andSociety ofAcute Leukemias:Hematology (ASH).BaselineCytogeneticTesting Performed on Bone Marrow. 68.................. MyelodysplasticYes..................... Yes.................... AMA-PCPI/ASH.Syndrome (MDS):Documentation ofIron Stores inPatients ReceivingErythropoietinTherapy. 69.................. Multiple Myeloma:Yes..................... Yes.................... AMA-PCPI/ASH.Treatment withBisphosphonates. 70.................. Chronic Lymphocytic Yes..................... Yes.................... AMA-PCPI/ASH.Leukemia (CLL):Baseline FlowCytometry. 71.................. Breast Cancer:Yes..................... Yes.................... AMA-PCPI/AmericanHormonal TherapySociety of for Stage IC-IIICClinical OncologyEstrogen Receptor/(ASCO)/NationalProgesteroneComprehensiveReceptor (ER/PR)Cancer NetworkPositive Breast(NCCN).Cancer. 72.................. Colon Cancer:Yes..................... Yes.................... AMA-PCPI/ASCO/Chemotherapy forNCCN.Stage III ColonCancer Patients. 76.................. Prevention ofYes..................... Yes.................... AMA-PCPI.Catheter-RelatedBloodstreamInfections(CRBSI): CentralVenous Catheter(CVC) InsertionProtocol. 79.................. End Stage RenalYes..................... Yes.................... AMA-PCPI.Disease (ESRD):InfluenzaImmunization withPatients in ESRD. 84.................. Hepatitis C:Yes..................... Yes.................... AMA-PCPI.Ribonucleic Acid(RNA) TestingBefore InitiatingTreatment. 85.................. Hepatitis C: HCVYes..................... Yes.................... AMA-PCPI.Genotype TestingPrior to Treatment. 86.................. Hepatitis C:Yes..................... Yes.................... AMA-PCPI.AntiviralTreatmentPrescribed. 87.................. Hepatitis C: HCVYes..................... Yes.................... AMA-PCPI.Ribonucleic Acid(RNA) Testing atWeek 12 ofTreatment. 89.................. Hepatitis C:Yes..................... Yes.................... AMA-PCPI.CounselingRegarding Risk ofAlcoholConsumption.
Page 3357790.................. Hepatitis C:Yes..................... Yes.................... AMA-PCPI.CounselingRegarding Use ofContraceptionPrior to AntiviralTherapy. 91.................. Acute OtitisNo...................... Yes.................... AMA-PCPI.Externa (ACE):Topical Therapy. 92.................. Acute OtitisNo...................... Yes.................... AMA-PCPI.Externa (ACE):Pain Assessment. 93.................. Acute OtitisNo...................... Yes.................... AMA-PCPI.Externa (ACE):SystemicAntimicrobialTherapy--Avoidance of InappropriateUse. 99.................. Breast CancerYes..................... Yes.................... AMA-PCPI/CollegeResectionof AmericanPathologyPathologistsReporting: pT(CAP).Category (PrimaryTumor) and pNCategory (RegionalLymph Nodes) withHistologic Grade. 100................. Colorectal CancerYes..................... Yes.................... AMA-PCPI/CAP.ResectionPathologyReporting: pTCategory (PrimaryTumor) and pNCategory (RegionalLymph Nodes) withHistologic Grace. 102................. Prostate Cancer:Yes..................... Yes.................... AMA-PCPI.Avoidance ofOveruse of BoneScan for StagingLow-Risk ProstateCancer Patients. 104................. Prostate Cancer:Yes..................... Yes.................... AMA-PCPI.Adjuvant HormonalTherapy for High-Risk ProstateCancer Patients. 105................. Prostate Cancer:Yes..................... Yes.................... AMA-PCPI.Three-Dimensional(3D) Radiotherapy. 106................. Major DepressiveYes..................... No..................... AMA-PCPI.Disorder (MDD):DiagnosticEvaluation. 107................. Major DepressiveYes..................... No..................... AMA-PCPI.Disorder (MDD):Suicide RiskAssessment. 108................. RheumatoidYes..................... No..................... NCQA.Arthritis (RA):Disease ModifyingAnti-RheumaticDrug (DMARD)Therapy. 109................. Osteoarthritis:Yes..................... No..................... AMA-PCPI.Function and PainAssessment. 110................. Preventive Care and Yes..................... No..................... AMA-PCPI.Screening:InfluenzaImmunization forPatients >=50Years Old. 111................. Preventive Care and Yes..................... Yes.................... NCQA.Screening:PneumoniaVaccination forPatients 65 Years and Older. 112................. Preventive Care and Yes..................... Yes.................... NCQA.Screening:ScreeningMammography. 113................. Preventive Care and Yes..................... Yes.................... NCQA.Screening:Colorectal CancerScreening. 114................. Preventive Care and Yes..................... Yes.................... AMA-PCPI.Screening: InquiryRegarding TobaccoUse. 115................. Preventive Care and Yes..................... Yes.................... NCQA.Screening:Advising Smokers to Quit. 116................. AntibioticYes..................... No..................... NCQA.Treatment forAdults with AcuteBronchitis:Avoidance ofInappropriate Use. 117................. Diabetes Mellitus: Yes..................... Yes.................... NCQA.Dilated Eye Exam in DiabeticPatient. 119................. Diabetes Mellitus: Yes..................... No..................... NCQA.Urine Screening for Microalbumin or MedicalAttention forNephropathy inDiabetic Patients. 121................. Chronic KidneyNo...................... Yes.................... AMA-PCPI.Disease (CKD):Laboratory Testing(Calcium,Phosphorous,Intact ParathyroidHormone (iPTH) andLipid Profile). 122................. Chronic KidneyNo...................... Yes.................... AMA-PCPI.Disease (CKD):Blood PressureManagement. 123................. Chronic KidneyNo...................... Yes.................... AMA-PCPI.Disease (CKD):Plan of Care--ElevatedHemoglobin forPatients ReceivingErythropoiesis-Stimulating Agents(ESA). 124................. Health Information Yes..................... Yes.................... CMS/QualityTechnology (HIT):Insights ofAdoption/Use ofPennsylvaniaElectronic Health(QIP).Records (EHR).
Page 33578126................. Diabetes Mellitus: Yes..................... Yes.................... American PodiatricDiabetic Foot andMedicalAnkle Care,AssociationPeripheral(APMA).Neuropathy--Neurol ogical Evaluation. 127................. Diabetes Mellitus: Yes..................... Yes.................... APMA.Diabetic Foot andAnkle Care, UlcerPrevention--Evalua tion of Footwear. 128................. Preventive Care and Yes..................... Yes.................... CMS/QIP.Screening: BodyMass Index (BMI)Screening andFollow-Up. 130................. Documentation andYes..................... Yes.................... CMS/QIP.Verification ofCurrentMedications in theMedical Record. 131................. Pain AssessmentYes..................... Yes.................... CMS/QIP.Prior toInitiation ofPatient Therapy and Follow-Up. 134................. Screening forYes..................... Yes.................... CMS/QIP.ClinicalDepression andFollow-Up Plan. 135................. Chronic KidneyYes..................... Yes.................... AMA-PCPI.Disease (CKD):InfluenzaImmunization. 140................. Age-Related Macular No...................... Yes.................... AMA-PCPI/NCQA.Degeneration(AMD): Counseling on AntioxidantSupplement. 142................. OsteoarthritisYes..................... Yes.................... AMA-PCPI.(OA): Assessment for Use of Anti-Inflammatory orAnalgesic Over-the-Counter (OTC)Medications. 145................. Radiology: Exposure Yes..................... Yes.................... AMA-PCPI/NCQA.Time Reported forProcedures UsingFluoroscopy. 146................. Radiology:Yes..................... Yes.................... AMA-PCPI/NCQA.Inappropriate Use of ``ProbablyBenign''AssessmentCategory inMammographyScreening. 147................. Nuclear Medicine:Yes..................... Yes.................... AMA-PCPI.Correlation withExisting ImagingStudies for AllPatientsUndergoing BoneScintigraphy. 153................. Chronic KidneyYes..................... Yes.................... AMA-PCPI.Disease (CKD):Referral forArteriovenous (AV)Fistula. 154................. Falls: RiskNo...................... Yes.................... AMA-PCPI/NCQA.Assessment. 155................. Falls: Plan of Care No...................... Yes.................... AMA-PCPI/NCQA. 156................. Oncology: Radiation Yes..................... Yes.................... AMA-PCPI.Dose Limits toNormal Tissues. 157................. Thoracic Surgery:Yes..................... Yes.................... STS.Recording ofClinical Stage forLung Cancer andEsophageal CancerResection. 158................. Endarterectomy: Use Yes..................... No..................... Society of of Patch DuringVascular SurgeonsConventional(SVS).Endarterectomy. 163................. Diabetes Mellitus: Yes..................... No..................... NCQA.Foot Exam. 172................. HemodialysisYes..................... No..................... SVS.Vascular AccessDecision-Making bySurgeon toMaximize Placement of AutogenousArterial Venous(AV) Fistula. 173................. Preventive Care and No...................... Yes.................... AMA-PCPI.Screening:Unhealthy AlcoholUse--Screening. 175................. Pediatric End Stage No...................... Yes.................... AMA-PCPI.Renal Disease(ESRD): InfluenzaImmunization. 176................. RheumatoidNo...................... Yes.................... AMA-PCPI/NCQA.Arthritis (RA):TuberculosisScreening. 177................. RheumatoidNo...................... Yes.................... AMA-PCPI/NCQA.Arthritis (RA):PeriodicAssessment ofDisease Activity. 178................. RhuematoidNo...................... Yes.................... AMA-PCPI/NCQA.Arthritis (RA):Functional StatusAssessment. 179................. RheumatoidNo...................... Yes.................... AMA-PCPI/NCQA.Arthritis (RA):Assessment andClassification ofDisease Prognosis. 180................. RheumatoidNo...................... Yes.................... AMA-PCPI/NCQA.Arthritis (RA):GlucocorticoidManagement. 181................. Elder Maltreatment No...................... Yes.................... CMS/QIP.Screen and Follow-Up Plan. 182................. Functional Outcome No...................... Yes.................... CMS/QIP.Assessment inChiropractic Care. 183................. Hepatitis C:Yes..................... Yes.................... AMA-PCPI.Hepatitis AVaccination inPatients with HCV. 184................. Hepatitis C:Yes..................... Yes.................... AMA-PCPI.Hepatatis BVaccination inPatients with HCV.
Page 33579185................. Endoscopy & PolypNo...................... Yes.................... AMA-PCPI/NCQA.Surveillance:ColonoscopyInterval forPatients with aHistory ofAdenomatousPolyps--Avoidance of InappropriateUse. 186................. Wound Care: Use of No...................... Yes.................... AMA-PCPI/NCQA.Compression System in Patients withVenous Ulcers.Please note that detailed measure specifications for 2009 individual PQRI quality measures may have been updated or modified during the NQF endorsement process or for other reasons prior to 2010.The 2010 PQRI quality measure specifications for any given individual quality measure may, therefore, be different from specifications for the same quality measure used for 2009. Specifications for all 2010 individual PQRI quality measures, whether or not included in the 2009PQRI program, must be obtained from the specifications document for 2010 individual PQRI quality measures, which will be available on thePQRI section of the CMS Web site on or before December 31, 2009.(2) Proposed 2010 Individual Quality Measures Selected From the 2009PQRI Quality Measures Set Available for Registry-Based Reporting OnlyIn the 2008 PQRI, all 2008 PQRI quality measures were reportable through either claims-based reporting or registry-based reporting. In the CY 2009 PFS final rule with comment period (73 FR 69833), we noted that some measures are not as conducive to claims-based reporting and indicated that 18 of the 2009 PQRI quality measures are not currently reportable through claims-based reporting due to their complexity.Instead, these 18 measures must be reported through a qualified PQRI registry for the 2009 PQRI. We referred to these measures as``registry-only'' measures. As discussed further in section II.G.2.d. of this proposed rule, registry-based reporting overcomes some of the limitations of claims-based reporting.For the 2010 PQRI, we again propose to include registry-only individual measures. For 2010, we propose to select 26 registry-only individual measures from the 2009 PQRI.As we noted previously, 1 measure (measure 46) that was a registry-only measure for the 2009 PQRI is now proposed to be available for either claims-based reporting or registry-based reporting in the 2010 PQRI. Therefore, this measure is not included among these 26 proposed registry-only individual measures. These 26 proposed measures do include 9 measures that are available for either claims-based reporting or registry-based reporting in the 2009 PQRI and are now proposed to be included in the 2010 PQRI as registry-only measures. We are proposing to make more 2009 measures registry-only to relieve some analytical difficulties encountered during the 2009 PQRI.Although we are designating certain measures as registry-only measures, we cannot guarantee that there will be a registry qualified to submit each registry-only measure for 2010. We rely on registries to self-nominate and identify the types of measures for which they would like to be qualified to submit quality measures results and numerator and denominator data on quality measures. If no registry self-nominates to submit measure results and numerator and denominator data on a particular type of measure for 2010, then an eligible professional would not be able to report that particular measure type. We invite comments on our proposal to increase the number of registry-only measures for the 2010 PQRI.The Measure Number and Measure Title for these proposed registry- only measures are listed in Table 18 along with the name of each measure's developer, the measure's NQF endorsement status as of May 1, 2009, and the measure's AQA adoption status as of January 31, 2009. A description of the proposed measures listed in Table 18 can be found in the ``2009 PQRI Quality Measures List,'' which is available on theMeasures and Codes page of the PQRI section of the CMS Web site at http://www.cms.hhs.gov/PQRI. Measures that were available for either claims-based reporting or registry-based reporting in the 2009 PQRI but are proposed to be available for registry-based reporting only in the 2010 PQRI are identified by an asterisk (*) in Table 18.Table 18--Proposed 2010 Measures Selected From the 2009 PQRI Quality Measure Set Available for Registry-BasedReporting OnlyNQF endorsement statusAQA adoption status asMeasure No.Measure titleas of 5/1/09of 1/31/09Measure developer5................... Heart Failure:Yes..................... Yes.................... AMA-PCPI.Angiotensin-Converting Enzyme(ACE) Inhibitor orAngiotensinReceptor Blocker(ARB) Therapy forLeft VentricularSystolicDysfunction(LVSD)*. 7................... Coronary ArteryYes..................... Yes.................... AMA-PCPI.Disease (CAD):Beta-BlockerTherapy for CADPatients withPrior MyocardialInfarction (MI). 8................... Heart Failure: Beta- Yes..................... Yes.................... AMA-PCPI.Blocker Therapy for LeftVentricularSystolicDysfunction(LVSD)*.
Page 3358033................. Stroke and StrokeYes..................... Yes.................... AMA-PCPI/NCQA.Rehabilitation:AnticoagulantTherapy Prescribed for AtrialFibrillation atDischarge. 81.................. End Stage RenalYes..................... Yes.................... AMA-PCPI.Disease (ESRD):Plan of Care forInadequateHemodialysis inESRD Patients. 82.................. End Stage RenalYes..................... Yes.................... AMA-PCPI.Disease (ESRD):Plan of Care forInadequatePeritonealDialysis. 83.................. Hepatitis C:Yes..................... Yes.................... AMA-PCPI.Testing forChronic HepatitisC--Confirmation ofHepatitis CViremia*. 118................. Coronary ArteryYes..................... No..................... AMA-PCPI.Disease (CAD):Angiotensin-Converting Enzyme(ACE) Inhibitor orAngiotensinReceptor Blocker(ARB) Therapy forPatients with CAD and Diabetes and/ or LeftVentricularSystolicDysfunction(LSVD)*. 136................. Melanoma: Follow-Up No...................... Yes.................... AMA-PCPI/NCQA.Aspects of Care*. 137................. Melanoma:No...................... Yes.................... AMA-PCPI/NCQA.Continuity ofCare--RecallSystem*. 138................. Melanoma:No...................... Yes.................... AMA-PCPI/NCQA.Coordination ofCare*. 139................. Cataracts:No...................... Yes.................... AMA-PCPI/NCQA.ComprehensivePreoperativeAssessment forCataract Surgery with IntraocularLens (IOL)Placement*. 141................. Primary Open-Angle No...................... Yes.................... AMA-PCPI/NCQA.Glaucoma (POAG):Reduction ofIntraocularPressure (IOP) by 15% ORDocumentation of aPlan of Care*. 159................. HIV/AIDS: CD4+ Cell Yes..................... No..................... AMA-PCPI/NCQA.Count or CD4+Percentage. 160................. HIV/AIDS:Yes..................... No..................... AMA-PCPI/NCQA.PneumocystisJiroveci Pneumonia(PCP) Prophylaxis. 161................. HIV/AIDS:Yes..................... No..................... AMA-PCPI/NCQA.Adolescent andAdult Patients with HIV/AIDS WhoAre PrescribedPotentAntiretroviralTherapy. 162................. HIV/AIDS: HIV RNAYes..................... No..................... AMA-PCPI/NCQA.Control After SixMonths of PotentAntiretroviralTherapy. 164................. Coronary ArteryYes..................... Yes.................... STS.Bypass Graft(CABG): ProlongedIntubation(Ventilation). 165................. Coronary ArteryYes..................... Yes.................... STS.Bypass Graft(CABG): DeepSternal WoundInfection Rate. 166................. Coronary ArteryYes..................... Yes.................... STS.Bypass Graft(CABG): Stroke/CerebrovascularAccident (CVA). 167................. Coronary ArteryYes..................... Yes.................... STS.Bypass Graft(CABG):PostoperativeRenalInsufficiency. 168................. Coronary ArteryYes..................... Yes.................... STS.Bypass Graft(CABG): SurgicalRe-exploration. 169................. Coronary ArteryYes..................... Yes.................... STS.Bypass Graft(CABG):AntiplateletMedications atDischarge. 170................. Coronary ArteryYes..................... Yes.................... STS.Bypass Graft(CABG): Beta-BlockersAdministered atDischarge. 171................. Coronary ArteryYes..................... Yes.................... STS.Bypass Graft(CABG): LipidManagement andCounseling. 174................. Pediatric End Stage No...................... Yes.................... AMA-PCPI.Renal Disease(ESRD): Plan ofCare forInadequateHemodialysis.* Individual 2009 PQRI measures that were available for both claims-based and registry-based reporting but proposed to be available for registry-based reporting only for the 2010 PQRI.Please note that detailed measure specifications for 2009 PQRI quality measures may have been updated or modified during the NQF endorsement process or for other reasons prior to 2010. Therefore, the 2010 PQRI quality measure specifications for any given quality measure may be different from specifications for the same quality measure used for 2009. Specifications for all 2010 individual PQRI quality measures, whether or not included in the 2009 PQRI program, must be obtained from the specifications document for 2010 individual PQRI quality measures, which will be available on the PQRI section of the CMS Web site on or before December 31, 2009.(3) New Individual Quality Measures Proposed for 2010We propose to include in the 2010 PQRI quality measure set 22 measures that were not included in the 2009 PQRI quality measures provided that each
Page 33581measure obtains NQF endorsement by July 1, 2009 and its detailed specifications are completed and ready for implementation in PQRI byAugust 15, 2009. Besides having NQF endorsement, the development of a measure is considered complete for the purposes of the 2010 PQRI if byAugust 15, 2009--(1) The final, detailed specifications for use in data collection for PQRI have been completed and are ready for implementation, and (2) all of the Category II Current ProceduralTerminology (CPT II) codes required for the measure have been established and will be effective for CMS claims data submission on or before January 1, 2010. The titles of these proposed additional, or new, measures are listed in Table 19 along with the name of the measure developer and the proposed reporting mechanism (that is, whether the measure is proposed to be reportable using claims, registries, or both). For these 22 proposed measures, a PQRI Measure Number will be assigned to a measure if and when the measure is included in the final set of 2010 PQRI measures.Due to the complexity of their measure specifications, we propose that 16 of these 22 measures would be available as registry-only measures for the 2010 PQRI. We do not believe that these 16 measures are conducive to the claims-based reporting mechanism. The remaining 6 measures would be available for reporting through either claims-based reporting or registry-based reporting.Table 19--New Individual Quality Measures Proposed for 2010NQF endorsementMeasure titlestatus as of 5/ AQA adoption statusMeasureReporting mechanism(s) 1/09as of 1/31/09developerThrombolytic TherapyYes............. No.................. American Heart Registry.Administered.Association(AHA)/AmericanStrokeAssociation(ASA).Referral for OtologicPending NQFNo.................. AudiologyClaims, Registry.Evaluation for Patients with review.QualityVisible Congenital orConsortiumTraumatic Deformity of the(AQC).Ear.Referral for OtologicPending NQFNo.................. AQC............ Claims, Registry.Evaluation for Patients with review.History of Active Drainage from the Ear within thePrevious 90 days.Referral for OtologicPending NQFNo.................. AQC............ Claims, Registry.Evaluation for Patients with review. a History of Sudden orRapidly Progressive HearingLoss within the Previous 90 days.Cataracts: 20/40 or BetterPending NQFYes................. AmericanRegistry.Visual Acuity within 90 days review.Academy ofFollowing Cataract Surgery.Ophthalmology(AAO)/AMA-PCPI/NCQA.Cataracts: ComplicationsPending NQFYes................. AAO/AMA-PCPI/Registry. within 30 Days Followingreview.NCQA.Cataract Surgery RequiringAdditional SurgicalProcedures.Perioperative TemperatureYes............. Yes................. AMA-PCPI....... Claims, Registry.Management.Cancer Stage Documented...... Yes............. Yes................. AMA-PCPI....... Claims, Registry.Stenosis Measurement inYes............. Yes................. AmericanClaims, Registry.Carotid Imaging Studies.College ofRadiology(ACR)/AMA-PCPI/NCQA.Coronary Artery DiseaseYes............. No.................. ACC/AHA/AMA-Registry.(CAD): Symptom and ActivityPCPI.Assessment.Coronary Artery DiseaseYes............. No.................. ACC/AHA/AMA-Registry.(CAD): Drug Therapy forPCPI.Lowering LDL-Cholesterol.Heart Failure (HF): LeftYes............. No.................. ACC/AHA/AMA-Registry.Ventricular FunctionPCPI.Assessment.Heart Failure (HF): PatientYes............. No.................. ACC/AHA/AMA-Registry.Education.PCPI.Heart Failure (HF): Warfarin Yes............. No.................. ACC/AHA/AMA-Registry.Therapy Patients with AtrialPCPI.Fibrillation.Blood Pressure Management:Yes............. No.................. NCQA........... Registry.Control.Complete Lipid Profile....... Yes............. No.................. NCQA........... Registry.Cholesterol Count............ Yes............. No.................. NCQA........... Registry.Use of Aspirin or AnotherYes............. No.................. NCQA........... Registry.Anti-Thrombotic.HIV/AIDS: SexuallyYes............. No.................. AMA-PCPI/NCQA.. Registry.Transmitted Diseases--Chlamydia and GonorrheaScreenings.HIV/AIDS: Screening for High Yes............. No.................. AMA-PCPI/NCQA.. Registry.Risk Sexual Behaviors.HIV/AIDS: Screening forYes............. No.................. AMA-PCPI/NCQA.. Registry.Injection Drug Use.HIV/AIDS: SexuallyYes............. No.................. AMA-PCPI/NCQA.. Registry.Transmitted Diseases--Syphilis Screening.
Page 33582(4) Proposed 2010 Individual Quality Measures Available for EHR-BasedReportingAs discussed in section II.G.2.d.(3) of this proposed rule, we propose to accept PQRI data from EHRs for a limited subset of the proposed 2010 PQRI quality measures, contingent upon the successful completion of our 2009 EHR data submission testing process and a determination that accepting data from EHRs on quality measures for the 2010 PQRI is practical and feasible. The 10 proposed 2010 PQRI quality measures on which we propose to accept clinical quality data extracted from EHRs are identified in Table 20. We propose to make these measures available for electronic submission via an EHR because these measures target preventive care or common chronic conditions. In addition, 4 of these proposed measures overlap with measures used in the MedicareQuality Improvement Organization program's 9th Statement of Work.Finally, it is much less burdensome for an eligible professional to report Measure 124, which assesses adoption and use of EHRs, through an EHR than through claims.Table 20--Proposed 2010 Measures Available for EHR-based ReportingNQF endorsement statusAQA adoption status asMeasure numberMeasure titleas of 5/1/09of 1/31/09Measure developer1................... Diabetes Mellitus: Yes..................... Yes.................... NCQAHemoglobin A1cPoor Control inDiabetes Mellitus. 2................... Diabetes Mellitus: Yes..................... Yes.................... NCQALow DensityLipoprotein (LDL-C) Control inDiabetes Mellitus. 3................... Diabetes Mellitus: Yes..................... No..................... NCQAHigh BloodPressure Control in DiabetesMellitus. 5................... Heart Failure:Yes..................... Yes.................... AMA-PCPIAngiotensin-Converting Enzyme(ACE) Inhibitor orAngiotensinReceptor Blocker(ARB) Therapy forLeft VentricularSystolicDysfunction (LVSD). 7................... Coronary ArteryYes..................... Yes.................... AMA-PCPIDisease (CAD):Beta-BlockerTherapy for CADPatients withPrior MyocardialInfarction (MI). 110................. Preventive Care and Yes..................... No..................... AMA-PCPIScreening:InfluenzaImmunization forPatients >= 50Years Old. 111................. Preventive Care and Yes..................... Yes.................... NCQAScreening:PneumoniaVaccination forPatients 65 Years and Older. 112................. Preventive Care and Yes..................... Yes.................... NCQAScreening:ScreeningMammography. 113................. Preventive Care and Yes..................... Yes.................... NCQAScreening:Colorectal CancerScreening. 124................. Health Information Yes..................... Yes.................... CMS/QIPTechnology (HIT):Adoption/Use ofElectronic HealthRecords (EHR).(5) Measures Proposed for Inclusion in 2010 Measures GroupsWe propose to retain the 7 2009 PQRI measures groups for the 2010PQRI: (1) Diabetes Mellitus; (2) CKD; (3) Preventive Care; (4) CABG;(5) Rheumatoid Arthritis; (6) Perioperative Care; and (7) Back Pain.These measures groups were selected for inclusion in the 2010 PQRI because they each contain at least 4 PQRI quality measures that share a common denominator definition.Except for the CABG measures group, all 2009 measures groups are reportable either through claims-based reporting or registry-based reporting. The CABG measures group, for the 2009 PQRI, is reportable through the registry-based reporting mechanism only since some measures included in the 2009 CABG measures group are registry-only individualPQRI measures. For this reason, we propose the CABG measures group would be reportable through the registry-based reporting mechanism only for 2010 while the remaining 6 2009 PQRI measures groups would be reportable through either claims-based reporting or registry-based reporting for the 2010 PQRI.Except for the measures included in the Back Pain measures group, the measures included in a 2009 PQRI measures group are reportable either as individual measures or as part of a measures group. As stated in the CY 2009 PFS final rule with comment period (73 FR 69843 through 69844), as individual measures, the measures in the Back Pain measures group are too basic. However, taken together they are meaningful indicators of quality of care for back pain. For this reason, for the 2010 PQRI, we propose that except for the measures included in the BackPain measures group, the measures included in a 2009 PQRI measures group that we propose to carry forward for the 2010 PQRI would be reportable either as individual measures or as part of a measures group.The measures proposed for inclusion in the 2010 measures groups that are based on the measures groups from 2009 are identified inTables 21 through 27. Some measures proposed for inclusion in some of these measures groups for 2010 were not included in the measures groups in 2009. The 2009 measures proposed for inclusion in a 2010 measures group that were not included in the measures group for 2009 are identified with an asterisk (*).As with measures group reporting in the 2008 and 2009 PQRI, we propose that each eligible professional electing to report a group of measures for 2010 must report all measures in the group that are applicable to each patient or encounter to which the measures group applies at least up to the minimum number of patients required by applicable reporting criteria (described above in section II.G.2.f. of this proposed rule). The individual measures included in the final 2010PQRI measures groups will be limited to
Page 33583those measures which will be identified in the CY 2010 PFS final rule with comment period as final 2010 PQRI measuresTable 21--Measures Proposed for 2010 Diabetes Mellitus Measures GroupNQF endorsement statusAQA adoption status asMeasure numberMeasure titleas of 5/1/09of 1/31/09Measure developer1................... Diabetes Mellitus: Yes..................... Yes.................... NCQA.Hemoglobin A1cPoor Control inDiabetes Mellitus. 2................... Diabetes Mellitus: Yes..................... Yes.................... NCQA.Low DensityLipoprotein (LDL-C) Control inDiabetes Mellitus. 3................... Diabetes Mellitus: Yes..................... No..................... NCQA.High BloodPressure Control in DiabetesMellitus. 117................. Diabetes Mellitus: Yes..................... Yes.................... NCQA.Dilated Eye Exam in DiabeticPatient. 119................. Diabetes Mellitus: Yes..................... No..................... NCQA.Urine Screening for Microalbumin or MedicalAttention forNephropathy inDiabetic Patients. 163................. Diabetes Mellitus: Yes..................... No..................... NCQA.Foot Exam *.* This 2009 PQRI measure was not part of this measures group for 2009, but is proposed for inclusion in this measures group for 2010.Table 22--Measures Proposed for 2010 CKD Measures GroupNQF endorsement statusAQA adoption status asMeasure numberMeasure titleas of 5/1/09of 1/31/09Measure developer121................. Chronic KidneyNo...................... Yes.................... AMA-PCPI.Disease (CKD):Laboratory Testing(Calcium,Phosphorus, IntactParathyroidHormone (iPTH) andLipid Profile). 122................. Chronic KidneyNo...................... Yes.................... AMA-PCPI.Disease (CKD):Blood PressureManagement. 123................. Chronic KidneyNo...................... Yes.................... AMA-PCPI.Disease (CKD):Plan of Care--ElevatedHemoglobin forPatients ReceivingErythropoiesis-Stimulating Agents(ESA). 135................. Chronic KidneyNo...................... Yes.................... AMA-PCPI.Disease (CKD):InfluenzaImmunization. 153................. Chronic KidneyNo...................... Yes.................... AMA-PCPI.Disease (CKD):Referral forArteriovenous (AV)Fistula.Table 23--Measures Proposed for 2010 Preventive Care Measures GroupNQF endorsement statusAQA adoption status asMeasure numberMeasure titleas of 5/1/09of 1/31/09Measure developer39.................. Screening orYes..................... Yes.................... AMA-PCPI/NCQA.Therapy forOsteoporosis forWomen Aged 65Years and Older. 48.................. UrinaryYes..................... Yes.................... AMA-PCPI/NCQA.Incontinence:Assessment ofPresence orAbsence of UrinaryIncontinence inWomen Aged 65Years and Older. 110................. Preventive Care and Yes..................... No..................... AMA-PCPI.Screening:InfluenzaImmunization forPatients >= 50Years Old. 111................. Preventive Care and Yes..................... Yes.................... NCQA.Screening:PneumoniaVaccination forPatients 65 Years and Older. 112................. Preventive Care and Yes..................... Yes.................... NCQA.Screening:ScreeningMammography. 113................. Preventive Care and Yes..................... Yes.................... NCQA.Screening:Colorectal CancerScreening. 114................. Preventive Care and Yes..................... Yes.................... AMA-PCPI.Screening: InquiryRegarding TobaccoUse. 115................. Preventive Care and Yes..................... Yes.................... NCQA.Screening:Advising Smokers to Quit. 128................. Preventive Care and Yes..................... Yes.................... CMS/QIP.Screening: BodyMass Index (BMI)Screening andFollow-Up. 173................. Preventive Care and No...................... Yes.................... AMA-PCPI.Screening:Unhealthy AlcoholUse--Screening *.* This 2009 PQRI measure was not part of this measures group for 2009, but is proposed for inclusion in this measures group for 2010.
Page 33584Table 24--Measures Proposed for 2010 CABG Measures Group +NQF endorsement statusAQA adoption status asMeasure numberMeasure titleas of 5/1/09of 1/31/09Measure developer43.................. Coronary ArteryYes..................... Yes.................... Society ofBypass GraftThoracic Surgeons(CABG): Use of(STS).Internal MammaryArtery (IMA) inPatients withIsolated CABGSurgery. 44.................. Coronary ArteryYes..................... Yes.................... STS.Bypass Graft(CABG):Preoperative Beta-Blocker inPatients withIsolated CABGSurgery. 164................. Coronary ArteryYes..................... Yes.................... STS.Bypass Graft(CABG): ProlongedIntubation(Ventilation). 165................. Coronary ArteryYes..................... Yes.................... STS.Bypass Graft(CABG): DeepSternal WoundInfection Rate. 166................. Coronary ArteryYes..................... Yes.................... STS.Bypass Graft(CABG): Stroke/CerebrovascularAccident (CVA). 167................. Coronary ArteryYes..................... Yes.................... STS.Bypass Graft(CABG):PostoperativeRenalInsufficiency. 168................. Coronary ArteryYes..................... Yes.................... STS.Bypass Graft(CABG): SurgicalRe-exploration. 169................. Coronary ArteryYes..................... Yes.................... STS.Bypass Graft(CABG):AntiplateletMedications atDischarge. 170................. Coronary ArteryYes..................... Yes.................... STS.Bypass Graft(CABG): Beta-BlockersAdministered atDischarge. 171................. Coronary ArteryYes..................... Yes.................... STS.Bypass Graft(CABG): LipidManagement andCounseling.+ This measures group is proposed to be reportable through registry-based reporting only.Table 25--Measures Proposed for 2010 Rheumatoid Arthritis Measures GroupNQF endorsement statusAQA adoption status asMeasure numberMeasure titleas of 5/1/09of 1/31/09Measure developer108................. RheumatoidYes..................... No..................... NCQA.Arthritis (RA):Disease ModifyingAnti-RheumaticDrug (DMARD)Therapy. 176................. RheumatoidNo...................... Yes.................... AMA-PCPI/NCQA.Arthritis (RA):TuberculosisScreening. 177................. RheumatoidNo...................... Yes.................... AMA-PCPI/NCQA.Arthritis (RA):PeriodicAssessment ofDisease Activity. 178................. RheumatoidNo...................... Yes.................... AMA-PCPI/NCQA.Arthritis (RA):Functional StatusAssessment. 179................. RheumatoidNo...................... Yes.................... AMA-PCPI/NCQA.Arthritis (RA):Assessment andClassification ofDisease Prognosis. 180................. RheumatoidNo...................... Yes.................... AMA-PCPI/NCQA.Arthritis (RA):GlucocorticoidManagement.Table 26--Measures Proposed for 2010 Perioperative Care Measures GroupNQF endorsement statusAQA adoption status asMeasure numberMeasure titleas of 5/1/09of 1/31/09Measure developer20.................. Perioperative Care: Yes..................... Yes.................... AMA-PCPI/NCQA.Timing ofAntibioticProphylaxis--Order ing Physician. 21.................. Perioperative Care: Yes..................... Yes.................... AMA-PCPI/NCQA.Selection ofProphylacticAntibiotic--FirstOR SecondGenerationCephalosporin. 22.................. Perioperative Care: Yes..................... Yes.................... AMA-PCPI/NCQA.Discontinuation ofProphylacticAntibiotics (Non-CardiacProcedures). 23.................. Perioperative Care: Yes..................... Yes.................... AMA-PCPI/NCQA.VenousThromboembolism(VTE) Prophylaxis(When Indicated inALL Patients).
Page 33585Table 27--Measures Proposed for 2010 Back Pain Measures GroupNQF endorsement statusAQA adoption status asMeasure numberMeasure titleas of 5/1/09of 1/31/09Measure developer148................. Back Pain: Initial Yes..................... Yes.................... NCQA.Visit. 149................. Back Pain: Physical Yes..................... Yes.................... NCQA.Exam. 150................. Back Pain: AdviceYes..................... Yes.................... NCQA. for NormalActivities. 151................. Back Pain: AdviceYes..................... Yes.................... NCQA.Against Bed Rest.In addition to the 7 measures groups that we propose to retain from the 2009 PQRI, we propose 6 new measures groups for the 2010 PQRI, for a total of 13 CY 2010 measures groups. The 6 new measures groups proposed for the 2010 PQRI are: (1) Coronary Artery Disease (CAD); (2)Heart Failure (HF); (3) Ischemic Vascular Disease (IVD); (4) HepatitisC; (5) Human Immunodeficiency Virus (HIV)/Acquired Immune DeficiencySyndrome (AIDS); and (6) Community Acquired Pneumonia (CAP). Many of the 6 new measures groups proposed for 2010 contain proposed new registry-only measures, which would make them reportable through registry-based reporting only. Therefore, only 8 proposed 2010 measures groups would be reportable through either claims-based reporting or registry-based reporting: Diabetes Mellitus; CKD; Preventive Care;Perioperative Care; Rheumatoid Arthritis; Back Pain; Hepatitis C; andCommunity Acquired Pneumonia. We invite comments on our proposal to limit claims-based reporting of measures groups in 2010.New measures groups are proposed for the 2010 PQRI in order to address gaps in quality reporting and are those that have a high impact on HHS and CMS priority topics for improved quality and efficiency forMedicare beneficiaries (such as prevention, chronic conditions, high cost/high volume conditions, improved care coordination, improved efficiency, improved patient and family experience of care, and effective management of acute and chronic episodes of care). Groups were identified in topical areas where: (1) 4 or more proposed 2010 measures are available; (2) the measures are NQF endorsed; and (3) they address a gap in quality reporting. The measures proposed for inclusion in these new 2010 measures groups are identified in Tables 28 through 33.Some measures proposed for inclusion in these 6 measures group are current 2009 individual PQRI measures. The title of each such measure is preceded with its PQRI Measure Number in Tables 28 through 33. As stated previously, the PQRI Measure Number is a unique identifier assigned by CMS to all measures in the PQRI measure set. Once a PQRIMeasure Number is assigned to a measure, it will not be used again, even if the measure is subsequently retired from the PQRI measure set.Measures that are not preceded by a number (in other words, those preceded by ``TBD'') in Tables 28 through 33 have never been part of aPQRI measure set until being proposed now. A number will be assigned to such measures if we include them in the final set of 2010 PQRI measures groups.Table 28--Measures Proposed for 2010 CAD Measures Group +NQF endorsement statusAQA adoption status asMeasure numberMeasure titleas of 5/1/09of 1/31/09Measure developer6................... Coronary ArteryYes..................... Yes.................... AMA-PCPI.Disease (CAD):Oral AntiplateletTherapy Prescribed for Patients withCAD. 114................. Preventive Care and Yes..................... Yes.................... AMA-PCPI.Screening: InquiryRegarding TobaccoUse. 115................. Preventive Care and Yes..................... Yes.................... NCQA.Screening:Advising Smokers to Quit.TBD................. Coronary ArteryYes..................... Yes.................... ACC/AHA/AMA-PCPI.Disease (CAD):Symptom andActivityAssessment.TBD................. Coronary ArteryYes..................... Yes.................... ACC/AHA/AMA-PCPI.Disease (CAD):Drug Therapy forLowering LDL-Cholesterol.+ This measures group is proposed to be reportable through registry-based reporting only.Table 29--Measures Proposed for 2010 HF Measures Group +NQF endorsement statusAQA adoption status asMeasure numberMeasure titleas of 5/1/09of 1/31/09Measure developer5................... Heart Failure:Yes..................... Yes.................... AMA-PCPI.Angiotensin-Converting Enzyme(ACE) Inhibitor orAngiotensinReceptor Blocker(ARB) Therapy forLeft VentricularSystolicDysfunction (LVSD). 8................... Heart Failure: Beta- Yes..................... Yes.................... AMA-PCPI.Blocker Therapy for LeftVentricularSystolicDysfunction (LVSD). 114................. Preventive Care and Yes..................... Yes.................... AMA-PCPI.Screening: InquiryRegarding TobaccoUse. 115................. Preventive Care and Yes..................... Yes.................... NCQA.Screening:Advising Smokers to Quit.
Page 33586TBD................. Heart Failure (HF): Yes..................... Yes.................... ACC/AHA/AMA-PCPI.Left VentricularFunctionAssessment.TBD................. Heart Failure (HF): Yes..................... Yes.................... ACC/AHA/AMA-PCPI.Patient Education.TBD................. Heart Failure (HF): Yes..................... Yes.................... ACC/AHA/AMA-PCPI.Warfarin TherapyPatients withAtrialFibrillation.+ This measures group is proposed to be reportable through registry-based reporting only.Table 30--Measures Proposed for 2010 IVD Measures Group +NQF endorsement statusAQA adoption status asMeasure numberMeasure titleas of 5/1/09of 1/31/09Measure Developer114................. Preventive Care and Yes..................... Yes.................... AMA-PCPI.Screening: InquiryRegarding TobaccoUse. 115................. Preventive Care and Yes..................... Yes.................... NCQA.Screening:Advising Smokers to Quit.TBD................. Blood PressureYes..................... No..................... NCQA.Management:Control.TBD................. Complete LipidYes..................... No..................... NCQA.Profile.TBD................. Cholesterol Control Yes..................... No..................... NCQA.TBD................. Use of Aspirin orYes..................... No..................... NCQA.Another Anti-Thrombotic.+ This measures group is proposed to be reportable through registry-based reporting only.Table 31--Measures Proposed for 2010 Hepatitis C Measures GroupNQF endorsement statusAQA adoption status asMeasure No.Measure titleas of 5/1/09of 1/31/09Measure developer84.................. Hepatitis C:Yes..................... Yes.................... AMA-PCPI.Ribonucleic Acid(RNA) TestingBefore InitiatingTreatment. 85.................. Hepatitis C: HCVYes..................... Yes.................... AMA-PCPI.Genotype TestingPrior to Treatment. 86.................. Hepatitis C:Yes..................... Yes.................... AMA-PCPI.AntiviralTreatmentPrescribed. 87.................. Hepatitis C: HCVYes..................... Yes.................... AMA-PCPI.Ribonucleic Acid(RNA) Testing atWeek 12 ofTreatment. 89.................. Hepatitis C:Yes..................... Yes.................... AMA-PCPI.CounselingRegarding Risk ofAlcoholConsumption. 90.................. Hepatitis C:Yes..................... Yes.................... AMA-PCPI.CounselingRegarding Use ofContraceptionPrior to AntiviralTherapy. 183................. Hepatitis C:Yes..................... Yes.................... AMA-PCPI.Hepatitis AVaccination inPatients with HCV. 184................. Hepatitis C:Yes..................... Yes.................... AMA-PCPI.Hepatitis BVaccination inPatients with HCV.Table 32--Measures Proposed for 2010 HIV/AIDS Measures Group +NQF endorsement statusAQA adoption status asMeasure No.Measure titleas of 5/1/09of 1/31/09Measure developer159................. HIV/AIDS: CD4+ Cell Yes..................... No..................... AMA-PCPI/NCQA.Count or CD4+Percentage. 160................. HIV/AIDS:Yes..................... No..................... AMA-PCPI/NCQA.PneumocystisJiroveci Pneumonia(PCP) Prophylaxis. 161................. HIV/AIDS:Yes..................... No..................... AMA-PCPI/NCQA.Adolescent andAdult Patients with HIV/AIDS WhoAre PrescribedPotentAntiretroviralTherapy. 162................. HIV/AIDS: HIV RNAYes..................... Yes.................... AMA-PCPI/NCQA.Control After SixMonths of PotentAntiretroviralTherapy.TBD................. HIV/AIDS: Sexually Yes..................... Yes.................... AMA-PCPI/NCQA.TransmittedDiseases--Chlamydi a and GonorrheaScreenings.TBD................. HIV/AIDS: Screening Yes..................... Yes.................... AMA-PCPI/NCQA. for High RiskSexual Behaviors.TBD................. HIV/AIDS: Screening Yes..................... Yes.................... AMA-PCPI/NCQA. for Injection DrugUse.
Page 33587TBD................. HIV/AIDS: Sexually Yes..................... No..................... AMA-PCPI/NCQA.TransmittedDiseases--SyphilisScreening.+ This measures group is proposed to be reportable through registry-based reporting only.Table 33--Measures Proposed for 2010 Community-Acquired Pneumonia Measures GroupNQF endorsement statusAQA adoption status asMeasure No.Measure titleas of 5/1/09of 1/31/09Measure developer56.................. Community-Acquired Yes..................... Yes.................... AMA-PCPI/NCQA.Pneumonia (CAP):Vital Signs. 57.................. Community-Acquired Yes..................... Yes.................... AMA-PCPI/NCQA.Pneumonia (CAP):Assessment ofOxygen Saturation. 58.................. Community-Acquired Yes..................... Yes.................... AMA-PCPI/NCQA.Pneumonia (CAP):Assessment ofMental Status. 59.................. Community-Acquired Yes..................... Yes.................... AMA-PCPI/NCQA.Pneumonia (CAP):Empiric Antibiotic.We note that the specifications for measures groups do not necessarily contain all the specification elements of each individual measure making up the measures group. This is based on the need for a common set of denominator specifications for all the measures making up a measures group in order to define the applicability of the measures group. Therefore, the specifications and instructions for measures groups will be provided separately from the specifications and instructions for the individual 2010 PQRI measures. We will post the detailed specifications and specific instructions for reporting measures groups on the PQRI section of the CMS Web site at http:// www.cms.hhs.gov/PQRI by no later than December 31, 2008.Additionally, the detailed measure specifications and instructions for submitting data on those proposed 2010 measures groups that were also included as 2009 PQRI measures groups may be updated or modified prior to 2010. Therefore, the 2010 PQRI measure specifications for any given measures group could be different from specifications and submission instructions for the same measures group used for 2009.These measure specification changes do not materially impact the intended meaning of the measures or the strength of the measures.(6) Request for Public Comment on Measure Suggestions for Future PQRIQuality Measure SetsAs stated above, on February 1, 2009, we posted a ``Call for 2010PQRI Measure Suggestions'' on the PQRI section of the CMS Web site at http://www.cms.hhs.gov/PQRI. The ``Call for 2010 PQRI MeasureSuggestions'' invited the public to submit suggestions for individual quality measures and measures groups (that is, suggestions for new measures groups and/or suggestions for the composition of existing measures groups) for consideration for possible inclusion in the proposed set of quality measure for use in the 2010 PQRI. To facilitate our evaluation of the suggested measures, we asked individuals or organizations submitting suggestions to provide us with the following information:Requestor contact information, such as name and title, organization/practice name, phone number and e-mail address;Measure title;Measure description;Measure owner/developer;NQF endorsement status, including the date of endorsement or anticipated endorsement (if not NQF-endorsed) and type of endorsement (for example, time-limited endorsement);AQA adoption status, including date of AQA adoption or anticipated AQA adoption;Preferred PQRI reporting option for the suggested measure(s) (that is, claims, registry, registry-only, measures group, measures group only, EHRs); andThe measure specifications.In lieu of posting a call for 2011 PQRI measure suggestions on thePQRI section of the CMS Web site in 2010, we invite commenters to submit suggestions for individual quality measures and measures groups(that is, suggestions for new measures groups and/or suggestions for the composition of proposed 2010 measures groups) for consideration for possible inclusion in the proposed set of quality measures for use in the 2011 PQRI. When submitting suggestions for future PQRI quality measure sets as part of the comment period for this proposed rule, commenters should submit all the information requested above for the``Call for 2010 PQRI Measure Suggestions.''Please note that suggesting individual measures or measures for a new or proposed measures group does not mean that the measure(s) will be included in the proposed or final sets of measures of any proposed or final rules that address the 2011 PQRI. We will determine what individual measures and measures group(s) to include in the proposed set of quality measures, and after a period of public comment, we will make the final determination with regard to the final set of quality measures for the 2011 PQRI. j. Proposed 2010 PQRI Quality Measures for Physician Groups Selected toParticipate in the Group Practice Reporting OptionAs discussed in section II.G.2.g. of this proposed rule, we propose that physician groups selected to participate in the 2010 PQRI group practice reporting option would be required to report on 26 measures.These measures are NQF-endorsed measures currently collected as part of the PGP and/or MCMP demonstrations and are identified in Table 34. To the extent that a measure is an existing PQRI measure, the MeasureTitle is preceded by the measure's PQRI Measure Number. If there is no number in the Measure Number column of the table, then the
Page 33588measure is not an existing PQRI measure and will be added to the 2010PQRI for purposes of the group practice reporting option.Table 34--Measures Proposed for Physician Groups Participating in the 2010 PQRI Group Practice Reporting OptionNQF endorsement statusAQA adoption status asMeasure No.Measure titleas of 5/1/09of 1/31/09Measure developer1................... Diabetes Mellitus: Yes..................... Yes.................... NCQA.Hemoglobin A1cPoor Control. 2................... Diabetes Mellitus: Yes..................... Yes.................... NCQA.Low DensityLipoproteinControl. 3................... Diabetes Mellitus: Yes..................... No..................... NCQA.High BloodPressure Control. 5................... Heart Failure: ACE Yes..................... Yes.................... AMA-PCPI.Inhibitor or ARBTherapy for LVSD. 6................... Coronary ArteryYes..................... Yes.................... AMA-PCPI.Disease: Oral Anti- platelet Therapy. 7................... Coronary ArteryYes..................... Yes.................... AMA-PCPI.Disease:Beta- blocker Therapy for CAD Patients with Prior MI. 8................... Heart Failure: Beta- Yes..................... Yes.................... AMA-PCPI. blocker Therapy for LVSD. 110................. Preventive Care:Yes..................... No..................... AMA-PCPI.InfluenzaVaccination forPatients > 50 years. 111................. Preventive Care:Yes..................... Yes.................... NCQA.PneumoniaVaccination forPatients 65+ years. 112................. Preventive Care:Yes..................... Yes.................... NCQA.ScreeningMammography. 113................. Preventive Care:Yes..................... Yes.................... NCQA/AMA-PCPI.ScreeningColorectal Cancer. 117................. Diabetes Mellitus: Yes..................... Yes.................... NCQA.Dilated Eye Exam. 118................. Coronary ArteryYes..................... No..................... AMA-PCPI.Disease: ACE/ARB for Patients withCAD and Diabetes and/or LVSD. 119................. Diabetes Mellitus: Yes..................... No..................... NCQA.Urine Screening for Microalbumin or MedicalAttention forNephropathy. 163................. Diabetes Mellitus: Yes..................... No..................... NCQA.Foot Exam.TBD................. Diabetes Mellitus: Yes..................... No..................... NCQA.Hemoglobin A1cTesting.TBD................. Diabetes Mellitus: Yes..................... No..................... NCQA.Lipid Profile.TBD................. Heart Failure: Left Yes..................... Yes.................... CMS.VentricularFunction Testing.TBD................. Heart Failure: Left Yes..................... Yes.................... ACC/AHA/AMA-PCPI.VentricularFunctionAssessment.TBD................. Heart Failure:Yes..................... No..................... ACC/AHA/AMA-PCPI.Weight Measurement.TBD................. Heart Failure:Yes..................... Yes.................... ACC/AHA/AMA-PCPI.Patient Education.TBD................. Heart Failure:Yes..................... Yes.................... ACC/AHA/AMA-PCPI.Warfarin Therapy for Patients withAtrialFibrillation.TBD................. Coronary ArteryYes..................... Yes.................... ACC/AHA/AMA-PCPI.Disease: DrugTherapy forLowering LDL-Cholesterol.TBD................. Preventive Care:Yes..................... No..................... ACC/AHA/AMA-PCPI.Blood PressureManagement.TBD................. Hypertension: Blood Yes..................... No..................... CMS/NCQA.Pressure Control.TBD................. Hypertension: Plan Yes..................... No..................... ACC/AHA/AMA-PCPI. of Care.k. Public Reporting of PQRI DataSection 1848(m)(5)(G) of the Act, as added by the MIPPA, requires the Secretary to post on the CMS Web site, in an easily understandable format, a list of the names of eligible professionals (or group practices) who satisfactorily submitted data on quality measures for the PQRI and the names of the eligible professionals (or group practices) who are successful electronic prescribers as defined and discussed further in section II.G.5. of this proposed rule. In accordance with section 1848(m)(5)(G) of the Act, we indicated in theCY 2009 PFS final rule with comment period (73 FR 69846 through 69847) our intent, in 2010, to enhance the current Physician and Other HealthCare Professionals directory at http://www.medicare.gov with the names of eligible professionals that satisfactorily submit quality data for the 2009 PQRI. In December 2008, we listed, by State, the names of eligible professionals who participated in the 2007 PQRI on thePhysician and Other Health Care Professionals Directory.As required by section 1848(m)(5)(G) of the Act, we intend to make public the names of eligible professionals and group practices that satisfactorily submit quality data for the 2010 PQRI on the Physician and Other Health Care Professionals Directory. We anticipate that the names of individual eligible professionals and group practices that satisfactorily submit quality data for the 2010 PQRI will be available in 2011 after the 2010 incentive payments are paid.For purposes of publicly reporting the names of eligible professionals, on the Physician and Other Health Care ProfessionalsDirectory, we propose to post the names of eligible professionals who:(1) Submit data on the 2010 PQRI quality measures through one of the
Page 33589reporting mechanisms available for the 2010 PQRI; (2) meet one of the proposed satisfactory reporting criteria of individual measures or measures groups for the 2010 PQRI described above in section II.G.2.e. and II.G.2.f., respectively of this proposed rule; and (3) qualify to earn a PQRI incentive payment for covered professional services furnished during the applicable 2010 PQRI reporting period.Similarly, for purposes of publicly reporting the names of group practices, on the Physician and Other Health Care ProfessionalsDirectory, we propose to post the names of group practices who: (1)Submit data on the 2010 PQRI quality measures through the proposed group practice reporting option described in section II.G.2.g. of this proposed rule; (2) meet the proposed criteria for satisfactory reporting under the group practice reporting option; and (3) qualify to earn a PQRI incentive payment for covered professional services furnished during the applicable 2010 PQRI reporting period for group practices.In addition to posting the information required by section 1848(m)(5)(G) of the Act, for those group practices that are selected to participate in PQRI under the group practice reporting option, we also propose to make the group practices' PQRI performance rates publicly available, for each of the measures. As we stated in the CY 2009 PFS proposed rule (73 FR 38574 through 38575), it is our goal to make the quality of care for services furnished to Medicare beneficiaries publicly available by making physician quality measure performance rates, either at the individual practitioner level or physician group level, publicly available. While we currently have Web pages at http://www.medicare.gov for the public reporting of performance results on standardized quality measures for hospitals(Hospital Compare), dialysis facilities (Dialysis Facility Compare), nursing homes (Nursing Home Compare), and home health facilities (HomeHealth Compare), we do not have a similar Compare Web site for information on the quality of care for services furnished by physicians and other professionals to Medicare beneficiaries.Public reporting of group practices' PQRI performance results at the group practice level would allow us to move toward our goal of making information on physician performance publicly available. We believe that the way we have proposed to design the group practice reporting option (see section II.G.2.g. of this proposed rule) facilitates public reporting of the groups' performance results. Group practices participating in the group practice reporting option would have already agreed in advance to have their performance results publicly reported. All groups participating in the group practice reporting option would be reporting on identical measures, which facilitate comparison of the results across groups. In addition, as a result of the proposed reporting criteria, no performance results would be calculated based on small denominator sizes. Finally, because we intend to modify the data collection tool will provide each group practice with numerator, denominator, and performance rates for each measure at the time of tool submission, the group practice will have had an opportunity to review their performance results before they are made public.In making performance rates for group practices publicly available, we will attribute the group practice's performance to the entire group.We will not post information with respect to the performance of individual physicians or other eligible professionals associated with the group. However, we may identify the individual eligible professionals who were associated with the group during the reporting period. We invite comments regarding our proposal to publicly report group practices' PQRI performance results. 3. Section 131(c): Physician Resource Use Measurement and ReportingProgram a. Statutory AuthorityAs required under section 1848(n) of the Act, as added by section 131(c) of the MIPPA, we established and implemented by January 1, 2009, a Physician Feedback Program using Medicare claims data and other data to provide confidential feedback reports to physicians (and as determined appropriate by the Secretary, to groups of physicians) that measure the resources involved in furnishing care to Medicare beneficiaries. Section 1848(n) of the Act authorizes us, as we determine appropriate, to include information on the quality of care furnished to Medicare beneficiaries by the physician (or group of physicians) in the reports. Although we initially called this effort the Physician Resource Use Feedback Program, we are renaming this initiative the ``Physician Resource Use Measurement and ReportingProgram'' (hereinafter referred to as ``Program''). b. BackgroundAs we stated in the CY 2009 PFS final rule with comment period (73FR 69866), the Program would consist of multiple phases. We included a summary of the activities of phase I of the Program in the CY 2009 PFS final rule with comment period (73 FR 69866 through 69869). In addition to discussing phase I of the Program, we also highlighted the activities of several other initiatives, including Medicare Value-BasedPurchasing (VBP) programs and demonstrations and related activities undertaken by the MedPAC and the Government Accountability Office(GAO). We refer readers to the CY 2009 PFS final rule with comment period (73 FR 69866 through 69869) for a detailed discussion of these activities.In the CY 2009 PFS final rule with comment period (73 FR 69866 through 69869), we finalized, on an interim basis, the following parameters for phase I of the Program: (1) Use of both per capita and episode of care methodologies for resource use measurement; (2) cost of service category analysis (for example, imaging services or inpatient admissions); (3) use of 4 calendar years of claims data; (4) focus on high cost and/or high volume conditions; (5) reporting to physician specialties relevant to the selected focal conditions; (6) focus on physicians practicing in certain geographic areas, and (7) low, median, and high cost benchmarks. We intend to finalize these parameters in theCY 2010 PFS final rule with comment period. c. Summary of Comments From the CY 2009 PFS Final Rule With CommentPeriodSection 1848(n)(1)(B) of the Act requires that the Program measures resources based on the following: (1) An episode basis; (2) a per capita basis; or (3) both an episode and a per capita basis. We solicited public comments on the use of each of these measurement methodologies (73 FR 69868).Comment: Commenters were in favor of using both the per capita and the per episode measurement methodologies.Response: We agree with commenters that both the per capita and per episode methodologies are appropriate measures of cost for the Program.Each methodology offers distinct advantages. For a further discussion regarding the advantages, we refer readers to CMS' Medicare ResourceUse Measurement Plan Web site at http://www.cms.hhs.gov/QualityInitiativesGenInfo/downloads/ResourceUse_Roadmap_OEA_1-15_ 508.pdf. We intend to finalize both
Page 33590methodologies as options for use in future phases of the Program in theCY 2010 PFS final rule with comment period.In phase I of the Program, we included cost of service (COS) category information from aggregated Medicare FFS claims data. We solicited public comment on which COS categories are most meaningful and actionable (73 FR 69868).Comment: Commenters were overwhelmingly in favor of including E/M services and imaging services as meaningful and actionable COS categories. Further, commenters supported including laboratory services, outpatient services, procedures, and post-acute services asCOS categories. No commenters raised specific categories that should be excluded.Response: We appreciate the comments in support of the COS category analysis. We intend to finalize the option to include information on all of these COS categories in future phases of the Program in the CY 2010 PFS final rule with comment period.Section 1848(n)(3) of the Act requires that, to the extent practicable, the data for the reports shall be based on the most recent data available. In phase I of the Physician Resource Use FeedbackProgram, we used Medicare FFS claims data from CY 2004 through CY 2007.We solicited public comment on this approach (73 FR 69868).Comment: The majority of commenters stated that 3 calendar years of data is sufficient for calculating resource use measures. Further, commenters emphasized, to the extent practicable, CMS should use the most recent three years of data available for the Program.Response: We agree with commenters that 3 years of Medicare FFS claims data are sufficient for calculating resource use measures. We intend to finalize the use of the most recent 3 years of data available for the Program in the CY 2010 PFS final rule with comment period.Under section 1848(n)(4)(B) of the Act, the Secretary may focus theProgram as appropriate, including focusing on physicians who treat conditions that are high cost, high volume, or both. We finalized on an interim basis for phase I of the Program, the following conditions: (1)Congestive heart failure; (2) chronic obstructive pulmonary disease;(3) prostate cancer; (4) cholecystitis; (5) coronary artery disease with acute myocardial infarction; (6) hip fracture; (7) community- acquired pneumonia; and (8) urinary tract infection (73 FR 69868). We solicited public comments on the use of these high cost/high volume conditions (73 FR 69868).Comment: Commenters strongly supported these conditions as appropriate for measuring the resources furnished to Medicare beneficiaries. In addition, several commenters suggested that we include diabetes among the priority conditions for the Program.Response: We agree with commenters that diabetes is an important condition to capture in the Program. We intend to finalize the option to include: (1) Congestive heart failure; (2) chronic obstructive pulmonary disease; (3) prostate cancer; (4) cholecystitis; (5) coronary artery disease with acute myocardial infarction; (6) hip fracture; (7) community-acquired pneumonia; (8) urinary tract infection; and (9) diabetes, in the Program in the CY 2010 PFS final rule with comment period.Under section 1848(n)(4)(A) of the Act, we are permitted to focus reporting on physician specialties that account for a certain percentage of spending for physicians' services. Based on the high cost and high volume conditions selected above, we included the following physician specialties in phase I of the Program: General internal medicine, family practice, gastroenterology, cardiology, general surgery, infectious disease, neurology, orthopedic surgery, physical medicine and rehabilitation, pulmonology, and urology (73 FR 69868). We solicited public comments on the inclusion of these physician specialties (73 FR 69868).Comment: Commenters supported including all of the physician specialties listed above as appropriate for measurement and reporting based on the selected conditions.Response: We agree with commenters that the physician specialties listed above should be included in the Program. We intend to finalize the option to include these physician specialties in the Program in theCY 2010 PFS final rule with comment period.Section 1848(n)(4)(D) of the Act permits us to focus the Program on physicians practicing in certain geographic areas. In the CY 2009 PFS final rule with comment period (73 FR 69866 through 69869) we referenced two geographic sites (Baltimore, MD and Boston, MA) for phase I of the Program, which we generally selected based on close proximity to the CMS central office and due to high per capita Medicare costs, respectively. Since the final rule was published, we have also mailed reports to physicians in the following sites:Greenville, SC;Indianapolis, IN;Northern New Jersey;Orange County, CA;Seattle, WA;Syracuse, NY;Boston, MA;Cleveland, OH;East Lansing, MI;Little Rock, AR;Miami, FL; andPhoenix, AZ.Comment: Commenters were in favor of including a limited number of sites representing a wide range of geographic locations to facilitate a phased implementation. No commenters submitted specific areas that should be excluded.Response: We appreciate the comments in support of including a limited number of sites. We intend to continue to include the geographic sites listed above, and identify a limited number of new locations, in the Program in the CY 2010 PFS final rule with comment period.Section 1848(n)(4)(C) of the Act also permits us to focus the program on physicians who use a high amount of resources compared to other physicians. The resource use reports disseminated in phase I of the Program defined peer groups of physicians by focusing on one condition, one specialty, and one of the geographic locations mentioned above. Within each peer group, the resource use reports indicated whether the physician fell over the 90th percentile (high cost benchmark), below the 10th percentile (low cost benchmark), or over the 50th percentile (median cost benchmark). We solicited public comments on which cost benchmarks make the resource use reports meaningful, actionable, and fair (73 FR 69869).Comment: Commenters supported the use of high, median, and low cost benchmarks because the benchmarks highlight useful cost categories within a given peer group.Response: We agree with commenters that the high, median, and low cost benchmarks are appropriate. We intend to finalize these cost benchmarks as options to include in the Program in the CY 2010 PFS final rule with comment period.Comment: A few commenters expressed support for including small geographic areas for benchmarking.Response: Though we recognize that a small geographic benchmark may capture a more homogenous beneficiary population for comparison, smaller sample sizes may adversely affect the statistical precision of the comparison. A larger sample captured through broader geographic benchmarks makes
Page 33591it less likely that physicians will be erroneously identified as high or low cost outliers.In addition to commenting on specific statutory parameters, commenters also provided feedback on other general topics. Those comments and responses are included below.Comment: A few commenters mentioned the use of proprietary commercial episode grouper software as a barrier to transparency within the Program. These commenters indicated that in order to understand and validate the resource use reports, physicians would need additional information about how the proprietary commercial software allocated costs to episodes.Response: One of the primary goals of CMS' VBP initiatives is to implement performance-based incentive payment programs with transparent methodologies. We note that the Program is currently limited under section 1848(n)(1)(A) of the Act to confidential reporting. Use of physician resource use information for other purposes, such as payment or public reporting, would likely require a higher level of transparency than confidential reporting.We note that we have previously discussed the use of proprietary products for payment purposes in previous rules published in theFederal Register. For example, we discussed the use of a proprietary product prior to implementation of the MS-DRGs in the FY 2007 IPPS final rule (72 FR 47171).We recognize the efforts of episode grouper vendors toward improved transparency. For more information on episode groupers that is publicly available, we refer readers to the following Web sites: http:// www.ingenix.com/ThoughtLeadership/ETG/EtgRegistration/ and http:// www.thomsonreuters.com/business_units/healthcare/.We are soliciting public comment on the use of proprietary products to measure episodes of the care in the Program.Comment: Some commenters expressed that the best method for dissemination of resource use reports is paper copies distributed via the mail. Others favored an electronic mechanism for dissemination.Some commenters expressed that resource use reports should be made available in both paper format and electronically.Response: For phase I of the Program, we disseminated reports in paper form via mail. We agree with commenters that electronic dissemination would also be desirable. Pending resource availability, we will consider this suggestion in a future phase of the Program. d. Phase I of the ProgramAs indicated above, the Program consists of multiple phases. Under this approach, each phase of the Program will inform future phases of the Program. We refer readers to the CY 2009 PFS final rule with comment period (73 FR 69866 through 69869) for a description of phase IProgram activities. Using the parameters that were finalized on an interim basis, we have disseminated approximately 230 resource use reports to physicians in each of the 12 geographic regions listed above in this section. We refer readers to the following Web site to review a de-identified sample of the resource use reports disseminated to physicians: http://rurinfo.mathematica-mpr.com/. We are soliciting public comment on the design and elements of the sample resource use report used in phase I of the Program. We are particularly interested in receiving comment on the usefulness of the cost of service category drill-down analysis included on pages 10, 16, 20, 24, 28, 32, and 36 of the sample resource use report. These comments will inform future phases of the Program. e. Phase II of the ProgramFor phase II, we are proposing to expand the Program in ways that will make the information more meaningful and actionable for physicians. We are proposing to add reporting to groups of physicians recognizing that physicians practice in various arrangements. Group level reporting provides a mechanism for addressing sample size issues that arise when individual physicians have too few Medicare beneficiaries with specific conditions to generate statistically significant reports. We are also proposing to add quality measurement information as context for interpreting comparative resource use. These proposals are addressed in greater detail below in this section.Phase I of the Program focused on providing confidential feedback on resource use measures to individual physicians. Section 1848(n)(1)(A) of the Act states that the Secretary may also provide confidential feedback reports to groups of physicians. Many physicians practice in groups. Recognizing groups of physicians within the Program is consistent with other CMS VBP initiatives and demonstrations under the Medicare program.We are proposing to provide reports to groups of physicians, in addition to providing reports to individual physicians, for theProgram. In December 2008, CMS posted an Issues Paper on theDevelopment of a Transition to a Medicare Physician Value-BasedPurchasing Program for Physician and Other Professional Services.\1\The Issues paper describes cost of care measurement, the focus of PhaseI of this Program, as one of the central tenets of Physician Value-Based Purchasing (see section II.G.4. of this proposed rule). Further, the Issues Paper referenced possible groups of physicians under consideration including: (1) Formally established single or multi- specialty group practices; (2) physicians practicing in defined geographic regions; and (3) physicians practicing within facilities or larger systems of care. We are soliciting public comments on the appropriateness of resource use measurement and reporting for these and other groups of physicians.\1\ http://www.cms.hhs.gov/PhysicianFeeSched/downloads/PhysicianVBP-Plan-Issues-Pape.pdf.sPhase I of the Program focused on providing confidential feedback on resource use measures. Section 1848(n)(1)(A) of the Act states that the Secretary may also include information on quality of care furnished to Medicare beneficiaries by the physician. Providing physicians with feedback on both quality and cost of care better captures the value of the care provided. Including quality measures in the Program is consistent with the direction for other CMS VBP initiatives.We are proposing the use of quality measures, in addition to resource use measures, for the Program. Possible sources of quality measures include the Physician Quality Reporting Initiative (PQRI) (see section II.G.2. of this proposed rule) and the Generating MedicarePhysician Quality Performance Measurement Results (referred to as GEM)Project.\2\ We refer readers to the Issues Paper, mentioned above,\3\ for additional discussion on how CMS would use quality measures in thisProgram and for Physician Value-Based Purchasing (see section II.G.4. of this proposed rule). We are soliciting public comments on the use ofPQRI, GEM, and other broader aggregate quality measures to be used to capture value for the groups proposed above in the Physician ResourceUse Measurement and Reporting Program.\2\ http://www.cms.hhs.gov/GEM/.\3\ http://www.cms.hhs.gov/PhysicianFeeSched/downloads/PhysicianVBP-Plan-Issues-Pape.pdf.
Page 335924. Section 131(d): Plan for Transition to Value-Based PurchasingProgram for Physicians and Other Practitioners a. BackgroundValue-based purchasing uses payment incentives and transparency to increase the value of care by rewarding providers for higher quality and more efficient services and for publicly reporting performance information. Section 131(d) of the MIPPA requires the Secretary to develop a plan to transition to a value-based purchasing (VBP) program for Medicare payment for covered professional services made under, or based on, the PFS. Section 131(d) of the MIPPA also states that by May 1, 2010, the Secretary shall submit a report to the Congress, containing the plan, together with recommendations for such legislation and administrative action as the Secretary determines appropriate. TheSecretary, through the Physician and Other Health Professional VBP(PVBP) Workgroup, submitted a progress letter to Congress on January 8, 2009 detailing the progress made on the VBP plan for physicians and other professionals.Currently, Medicare health professional payments are based on quantity of services and procedures provided, without recognition of quality or efficiency. Under various authorities, we have pursued the implementation of building blocks to support the establishment of a VBP program for health professionals. These include initiatives in the following major topic areas: Quality and efficiency measurement and reporting, approaches for aligning incentives with providing higher quality care instead of higher volume of care, care coordination, prevention, and health information technology (HIT). The following is a list of examples of the initiatives specifically relevant to physicians and other health professionals:Pay for reporting of quality measurement data instituted under the Physician Quality Reporting Initiative (PQRI);Resource use reports comparing overall costs, as well as costs for treatment across episodes of care, as part of, as required by the Physician Resource Use Feedback Program (See section II.G.3. of this proposed rule); andDemonstration projects, including the Physician GroupPractice demonstration of a shared savings model, gainsharing demonstrations, medical home and other care coordination and disease management demonstrations, and the Acute Care Episodes demonstration of a bundled payment model.We are fully committed to implementing VBP incentives to drive quality improvement and greater efficiency for services furnished toMedicare beneficiaries. b. Approach to Plan DevelopmentWe have created an internal cross-component team, the PVBPWorkgroup, to lead development of the PVBP Plan. Four Subgroups were established to address the major sections of the Plan: Measures; incentives; data strategy and infrastructure; and public reporting. ThePVBP Workgroup was tasked with reviewing the state-of-the-art in performance-based payment for physicians, including relevant Medicare programs and demonstrations and private sector initiatives; preparing an Issues Paper to present program objectives and design principles; engaging stakeholders and obtaining input on program design; and developing the PVBP Plan and Report to Congress. A similar approach was used in the development of the CMS Hospital VBP Plan.To guide the planning process, the PVBP Workgroup adopted the following goal to improve Medicare beneficiary health outcomes and experience of care by using payment incentives and transparency to encourage higher quality, more efficient professional services. In pursuit of this goal, the Workgroup has defined the following objectives:Promote evidence-based medicine through measurement, payment incentives, and transparency.Reduce fragmentation and duplication through accountability across settings, alignment of measures and incentives across settings, better care coordination for smoother transitions, and attention to episodes of care.Encourage effective management of chronic disease by improving early detection and prevention, focusing on preventable hospital readmissions, and emphasizing the importance of advanced care planning and appropriate end-of-life care.Accelerate the adoption of effective, interoperable HIT, including clinical registries, e-prescribing, and electronic health records.Empower consumers to make value-based health care choices and encourage health professionals to improve the value of care by disseminating actionable performance information.The goal and objectives were captured in an Issues Paper that was posted on the CMS Web site on November 24, 2008, in preparation for theDecember 9, 2008 Listening Session which was held at CMS headquarters.The Issues Paper included questions seeking public input on key design considerations. The Issues Paper is available on the CMS Web site at http://www.cms.hhs.gov/PhysicianFeeSched/downloads/PhysicianVBP-Plan-Issues-Paper.pdf. Nearly 500 stakeholders participated in the day-longListening Session. We received both verbal and written comments that are informing the design of the PVBP Plan. c. Stakeholder Input From the Listening SessionBoth at the Listening Session, and in written comments received following the Session, we obtained input from a wide range of diverse stakeholders. A large portion of the comments were received from physician and other professional specialty societies. Commenters also included consumer advocates, health care consulting firms, and healthIT vendors, and individual practicing physicians.(1) Overarching IssuesCommenters generally affirmed the goal and objectives presented in the Issues Paper. Commenters encouraged the consideration of new payment approaches that cut across settings of care to align MedicarePart A and Part B payment incentives. Many commenters stated that the current Medicare payment system for health professionals is flawed in that it fails to align incentives for high-value care across providers and settings and that this cannot be fixed solely by a VBP program.Commenters agreed with the Issues Paper assumption that the Plan will need to contain more than one approach to accommodate different practice arrangements. Several commenters praised the attention given in the Issues Paper to addressing disparities and pointed out the necessity of adequate risk adjustment and proper use of measures, incentives, and program evaluation to protect vulnerable populations.Commenters also urged careful attention to the operational transition from the current payment system to VBP to minimize care delivery disruptions.(2) MeasurementCommenters emphasized the importance of aligning measures across payment settings and applying measures consistently across payers. Many commenters stressed the need for valid, reliable, nationally-recognized measures, particularly in the areas of outcomes, care coordination, patient
Page 33593experience, and the effective use of HIT. Adequate risk adjustment was raised as a paramount issue for outcomes and resource use measures.Regarding resource use measures, several commenters noted that quality and cost measures should be reported together and that CMS should get experience with confidential feedback reporting of resource use before using the information for incentives or public reporting (See sectionII.G.3. of this proposed rule). A few commenters suggested avoidable readmission rates as a good measure of both cost and quality of care.Commenters emphasized the importance of CMS working with health professionals on the selection of quality and cost measures.Commenters generally agreed with the Issues Paper assumption that the Plan should address multiple levels of accountability, including individual health professionals, care teams, group practices, and accountable care entities. A few commenters mentioned that performance measurement at the regional level could help address regional variation. Consumer advocates made strong arguments for individual accountability, while noting that care delivery is ultimately a team effort. Others noted that measurement is more difficult at the individual level and that accountability at more aggregated levels could support promising payment models like bundled payment, gainsharing, and shared savings.(3) IncentivesCommenters noted that incentive payments should be large enough to be meaningful, be made timely, and at least cover the cost of participating in the program. Commenters encouraged us to coordinate the incentives, as well as measures, with other payers. Many commenters stated that incentives should reward both improvement and attainment, and not be based on a ranking system that rewards only high attainers; instead, all who perform above a certain prospective benchmark should earn the incentive. Several commenters indicated that use of incentives could be an effective way to promote the use of effective HIT. Most commenters agreed that more than one incentive structure would be necessary to address different practice arrangements and to focus effort on specific objectives (for example, care coordination).(4) Data Strategy and InfrastructureCommenters emphasized that the administrative burden of data exchange, for both health professionals and CMS, should be minimized.Several commenters noted that clinical data registries and direct reporting from electronic health records were superior approaches to claims-based reporting for gathering clinical data. Commenters indicated that feedback on performance should be timely and detailed enough to be actionable. Commenters also asked for the opportunity to review and appeal the accuracy of their performance assessments prior to use of that information for payment incentives or public reporting.(5) Public ReportingConsumer advocates highlighted the importance of transparency while professional associations urged caution to assure that publicly reported information not be inaccurate or misleading for consumers.Several commenters noted that public reporting should address multiple levels of accountability, including individual health professionals, the care delivery team, group practices, and at the regional level. All agreed that publicly reported information should be user-friendly. d. Next Steps in Plan DevelopmentBuilding on input from the Listening Session on the Issues Paper topics, the PVBP Workgroup has begun to develop potential recommendations for inclusion in the Report to Congress. The first step is to design various approaches for performance-based payment that will address the planning goal and objectives for different practice arrangements. This design process will include identifying appropriate measures and incentive structures, considering the necessary data infrastructure, and addressing public reporting options. Consideration will be given to approaches that:(1) Overlay the current PFS, such as differential fee schedule payments based on measured performance or for providing a medical home;(2) Address multiple levels of accountability, including individual health professionals, as well as larger teams or organizations; and(3) Promote more integrated care through shared savings models and bundled payment arrangements.We are seeking further public comment on the development of thePVBP plan and Report to Congress. Comments already submitted by participating in person at the December 9, 2008 Listening Session or as written comments following the Session, do not need to be resubmitted.At this time, we are soliciting original comments that were not previously submitted. Particularly, we are interested in the comments further discussing the issues of the appropriate level of accountability (for example, group practice, individual, region), and appropriate data submission mechanisms. The PVBP Workgroup will use public comment to inform its development of the Plan and Report toCongress. 5. Section 132: Incentives for Electronic Prescribing (E-Prescribing)--The E-Prescribing Incentive Program a. Program Background and Statutory AuthorityAs defined in Sec. 423.159(a), e-prescribing is the transmission using electronic media, of prescription or prescription-related information between a prescriber, dispenser, pharmacy benefit manager(PBM), or health plan, either directly or through an intermediary, including an e-prescribing network. E-prescribing includes, but is not limited to, two-way transmissions between the point of care and the dispenser.As discussed in the CY 2009 PFS final rule with comment period (73FR 69847), there are many potential advantages to e-prescribing. Yet, there has been limited adoption and use of electronic prescribing by physicians and other professionals who prescribe medications. It is estimated that only 12 percent of office-based prescribers currently use e-prescribing (Surescripts. ``National Progress Report on E-Prescribing.'' Welcome to the E-Prescribing Resource Center. 2008.Surescripts. 15 May 2009. http://www.surescripts.com/downloads/NPR/ national-progress-report.pdf).As described in the CY 2009 PFS final rule with comment period (73FR 69847 through 69848), the MMA and the creation of the MedicarePrescription Drug Benefit Program (Part D) promoted the use of e- prescribing by requiring the adoption of uniform standards for theMedicare Part D electronic prescribing (``e-prescribing'') program. As required by section 1860D-4(e) of the Act, ``foundation standards'' were adopted on November 7, 2005 (70 FR 67568) and additional Part D e- prescribing standards were adopted on April 7, 2008, and were implemented April 1, 2009 (73 FR 18918). Section 1848(m) of the Act, as amended by section 132 of the MIPPA, further promotes the use of e- prescribing by authorizing incentive payments to eligible professionals or group practices who are ``successful electronic prescribers.'' ThisE-Prescribing Incentive Program is expected to encourage significant expansion of the use of e-prescribing by
Page 33594authorizing a combination of financial incentives and payment adjustment and is separate from, and in addition to, any incentive payment that eligible professionals may earn through the PQRI program discussed in section II.G.2. of this proposed rule. Eligible professionals do not have to participate in PQRI to participate in theE-Prescribing Incentive Program (and vice versa).For 2010, which is the second year of the E-Prescribing IncentiveProgram, the Secretary is authorized to provide successful e- prescribers, as defined in section 1848(m)(3)(B) of the Act and further discussed below in this section, an incentive payment equal to 2.0 percent of the total estimated (based on claims submitted not later than 2 months after the end of the reporting period) allowed charges for all covered professional services furnished during the 2010 reporting period. Covered professional services are defined under the statute to be services for which payment is made under, or is based on, the PFS and which are furnished by an eligible professional. The applicable electronic prescribing percent (2 percent) authorized for the 2010 E-Prescribing Incentive Program is the same as that authorized for the 2009 E-Prescribing Incentive Program.Subject to section 1848(m)(2)(D) of the Act, as added by section 4101(f)(2)(B) of the HITECH Act (Title IV of Division B of the RecoveryAct, together with Title XIII of Division A of the Recovery Act) (Pub.L. 111-5), which was enacted on February 17, 2009, the incentive payments for successful electronic prescribers for future years are authorized under section 1848(b)(2)(C) of the Act as follows: 1.0 percent for 2011. 1.0 percent for 2012. 0.5 percent for 2013.Section 1848(m)(2)(D) of the Act, as added by section 4001(f)(2)(B) of the Recovery Act, specifies a limitation to the e-prescribing incentive in relation to whether the EHR incentive authorized by theRecovery Act is earned. Section 1848(m)(2)(D) of the Act specifically provides that the e-prescribing incentive does not apply to an eligible professional (or group practice), if, for the EHR reporting period, the eligible professional (or group practice) earns an incentive payment under the new Health Information Technology (HIT) incentive program authorized by the Recovery Act for eligible professionals who are meaningful EHR users. The new HIT incentive program for meaningful EHR users begins in 2011. Therefore, beginning in 2011, eligible professionals who earn an incentive under the new HIT incentive program for meaningful EHR users, with respect to a certified EHR technology that has e-prescribing capabilities, would not be eligible to earn a separate incentive payment for being a successful electronic prescriber under the E-prescribing Incentive Program.In addition, under section 1848(a)(5)(A) of the Act, as added by section 132(b) of the MIPPA and amended by section 4001(f)(1) of theRecovery Act, a PFS payment adjustment applies beginning in 2012 to those who are not successful electronic prescribers. Specifically, for 2012, 2013, and 2014, if the eligible professional is not a successful electronic prescriber for the reporting period for the year, the fee schedule amount for covered professional services furnished by such professionals during the year shall be less than the fee schedule amount that would otherwise apply by: 1.0 percent for 2012. 1.5 percent for 2013. 2.0 percent for 2014.We note that the criteria for determination of successful electronic prescriber proposed herein may not necessarily be the criteria that will be used to determine the applicability of the payment adjustment in the future. Policy considerations underlying the application of the incentive payment are not necessarily the same as those in applying a payment adjustment. In general, we believe that an incentive should be broadly available to encourage the widest possible adoption of e-prescribing, even for low volume prescribers. On the other hand, a payment adjustment should be applied primarily to assure that those who have a large volume of prescribing do so electronically, without penalizing those for whom the adoption and use of an e- prescribing system may be impractical given the low volume of prescribing. We will discuss the application of the payment adjustment in future notice and comment rulemaking, but prior to the beginning of the reporting period that will be used to determine the applicability of the payment adjustment.Under section 1848(m)(6)(A) of the Act, the definition of``eligible professional'' for purposes of eligibility for the E-Prescribing Incentive Program is identical to the definition of``eligible professional'' for the PQRI under section 1848(k)(3)(B) of the Act. In other words, eligible professionals include physicians, other practitioners as described in section 1842(b)(18)(C) of the Act, physical and occupational therapists, qualified speech-language pathologists, and qualified audiologists. However, for purposes of theE-prescribing Incentive Program, eligibility is further restricted by scope of practice to those professionals who have prescribing authority. Detailed information about the types of professionals that are eligible to participate in the E-Prescribing Incentive Program is available on the ``Eligible Professionals'' page of the E-PrescribingIncentive Program section of the CMS Web site at http:// www.cms.hhs.gov/ERXIncentive.Similar to the PQRI, the E-Prescribing Incentive Program, in 2009, is an incentive program in which determination of whether an eligible professional is a successful electronic prescriber will be made at the individual professional level, based on the NPI. Inasmuch as some individuals (identified by NPIs) may be associated with more than one practice or TIN, the determination of whether an eligible professional is a successful electronic prescriber will be made to the holder of each unique TIN/NPI combination. Then, payment will be made to the applicable holder of the TIN. For 2010, the determination of whether an eligible professional is a successful electronic prescriber will continue to be made for each unique TIN/NPI combination. However, section 1848(m)(3)(C) of the Act requires the Secretary by January 1, 2010 to establish and have in place a process under which eligible professionals in a group practice (as defined by the Secretary) shall be treated as meeting the requirements for submitting data on electronic prescribing quality measures for covered professional services for a reporting period (or, for purposes of the payment adjustment under section 1848(a)(5) of the Act, for a reporting period for a year) if, in lieu of reporting the electronic prescribing measure, the group practice reports measures determined appropriate by the Secretary, such as measures that target high-cost chronic conditions and preventive care, in a form and manner, and at a time specified by the Secretary. Therefore, in addition to making incentive payments for 2010 to group practices based on separately analyzing whether the individual eligible professionals within the group practice are successful electronic prescribers, we will also begin making incentive payments to group practices based on the determination that the group practice, as a whole, is a successful electronic prescriber. b. The Proposed 2010 Reporting Period for the E-Prescribing IncentiveProgramSection 1848(m)(6)(C)(i)(II) of the Act defines ``reporting period'' for the 2010
Page 33595E-Prescribing Incentive Program to be the entire year. Section 1848(m)(6)(C)(ii) of the Act, as added by the MIPPA, however, authorizes the Secretary to revise the reporting period for years after 2009 if the Secretary determines such revision is appropriate, produces valid results on measures reported, and is consistent with the goals of maximizing scientific validity and reducing administrative burden. We propose the 2010 E-Prescribing Incentive Program reporting period will be the entire year (January 1, 2010-December 31, 2010). We believe that keeping the 2010 E-Prescribing Incentive Program reporting period consistent with the 2009 E-Prescribing Incentive Program reporting period will help to maintain program stability and be less confusing for eligible professionals.Successful electronic prescribers would be eligible to receive an incentive payment equal to 2.0 percent of the total estimated allowed charges (based on claims submitted by no later than February 28, 2011) for all covered professional services furnished January 1, 2010 throughDecember 31, 2010. c. Proposed Criteria for Determination of Successful E-Prescriber forEligible ProfessionalsUnder section 1848(m)(3)(B) of the Act, in order to qualify for the incentive payment, an eligible professional must be a ``successful electronic prescriber,'' which the Secretary is authorized to identify using 1 of 2 possible criteria. One criterion, under section 1848(m)(3)(B)(ii) of the Act, is based on the eligible professional's reporting, in at least 50 percent of the reportable cases, on any e- prescribing quality measures that have been established under the physician reporting system under subsection 1848(k) (which, as noted previously, we have named ``PQRI'' for ease of reference) and are applicable to services furnished by the eligible professional during a reporting period. The second criterion, under section 1848(m)(3)(B)(iii) of the Act, is based on the electronic submission by the eligible professional of a sufficient number (as determined by theSecretary) of prescriptions under Part D during the reporting period.If the Secretary decides to use the latter standard, then, in accordance with section 1848(m)(3)(B)(iv) of the Act, the Secretary is authorized to use Part D drug claims data to assess whether a``sufficient'' number of prescriptions has been submitted by eligible professionals. However, under section 1848(m)(3)(B)(i) of the Act, if the standard based on a sufficient number (as determined by theSecretary) of electronic Part D prescriptions is applied for a particular reporting period, then the standard based on the reporting on e-prescribing measures would no longer apply.For 2009, as described in the CY 2009 PFS final rule with comment period (73 FR 69847 through 69852), we required eligible professionals to report on the e-prescribing measure that had been previously used in the 2008 PQRI. For 2010, we propose to continue to require eligible professionals to report on the electronic prescribing measure used in the 2009 E-Prescribing Incentive Program to determine whether an eligible professional is a successful e-prescriber, but we propose to use modified reporting criteria.As we stated in the CY 2009 PFS final rule with comment period (73FR 69848), we intend to consider the use of a certain number of Part D prescribing events as the basis for the incentive payment in future years. However, we do not believe that it is feasible to move to this substitute requirement in 2010. The accuracy and completeness of thePart D data with respect to whether a prescription was submitted electronically is unknown. Information on whether a prescription was submitted electronically by an individual eligible professional will not be collected on the Part D claims, or prescription drug event (PDE) data, until 2010. Also, prescription drug plan sponsors were not required to send PDE data with an individual prescriber's NPI untilApril 1, 2009. We currently have no information on the accuracy and completeness of the NPI data that is submitted with the PDE data. TheNPI is needed in order for us to be able to link an eligible professional's PDE data to his or her Medicare Part B claims to calculate the incentive payment amount. During 2010, we expect to evaluate the adequacy of Part D data to determine the feasibility of its use for determining whether an eligible professional qualifies as a successful e-prescriber in future years.(1) Reporting the Electronic Prescribing MeasureFor 2009, we limited the reporting mechanism for the electronic prescribing measure to claims-based reporting. For 2010, we propose 3 reporting mechanisms for individual eligible professionals. First, we propose to retain the claims-based reporting mechanism that is used in the 2009 E-Prescribing Incentive Program. In addition, similar to thePQRI, for the E-prescribing Incentive Program, we propose to implement a registry-based reporting mechanism and, depending on whether we finalize the proposed EHR-based reporting mechanism for PQRI, we are also proposing that an EHR-based reporting mechanism be available for the electronic prescribing measure. In other words, eligible professionals would be able to choose whether to submit data on the electronic prescribing measure through claims, a qualified registry, or a qualified EHR product. As we stated in our discussion of the proposedPQRI reporting mechanisms for 2010 in section II.G.2.d. of this proposed rule, we recognize that one mode of quality reporting does not suit all practices. Similar to the PQRI, we believe that having multiple reporting mechanisms for the reporting of the electronic prescribing measure should increase opportunities for eligible professionals to successfully report the electronic prescribing measure. We invite comments on our proposal to provide alternatives to the claims-based reporting mechanism for reporting the electronic prescribing measure.We propose that only registries qualified to submit quality measure results and numerator and denominator data on quality measures on behalf of eligible professionals for the 2010 PQRI would be qualified to submit measure results and numerator and denominator data on the electronic prescribing measure on behalf of eligible professionals for the 2010 E-Prescribing Incentive Program. We note that not all registries qualified to submit quality measure results and numerator and denominator data on quality measures on behalf of eligible professionals for the 2010 PQRI would be qualified to submit quality measure results and numerator and denominator data on the e-prescribing measure. PQRI qualified registries will be qualified to submit specific types of measures. The electronic prescribing measure is reportable by an eligible professional any time he or she bills for one of the procedure codes for Part B services included in the measure's denominator. Some registries who self-nominate to become a qualified registry for PQRI may not choose to self-nominate to become a qualified registry for submitting measures that require reporting at each eligible visit. Registries will need to indicate their desire to qualify to submit measure results and numerator and denominator data on the electronic prescribing measure for the 2010 E-Prescribing IncentiveProgram at the time that they submit their self-nomination letter for the 2010 PQRI. The self-nomination process and
Page 33596requirements for registries for the PQRI, which also would apply to the registries for the 2010 E-Prescribing Incentive Program, are discussed in section II.G.2.d.(4) of this proposed rule. We will post a list of qualified registries for the 2010 E-Prescribing Incentive Program on the E-Prescribing Incentive Program section of the CMS Web site at http://www.cms.hhs.gov/ERXIncentive when we post the list of qualified registries for the 2010 PQRI on the PQRI section of the CMS Web site.Similarly, we propose that only EHR products ``qualified'' to potentially be able to submit clinical quality data extracted from theEHR to CMS for the 2010 PQRI would be considered ``qualified'' for the purpose of an eligible professional potentially being able to submit data on the electronic prescribing measure for the 2010 E-PrescribingIncentive Program. The self-nomination process and requirements for EHR vendors for the PQRI, which also would apply to the EHR vendors for the 2010 E-Prescribing Incentive Program are discussed in sectionII.G.2.d.(5) of this proposed rule. EHR vendors will need to indicate their desire to have one or more of their EHR products qualified for the purpose of an eligible professional potentially being able to submit data on the electronic prescribing measure for the 2010 E-Prescribing Incentive Program at the time that they submit their self- nomination letter for the 2010 PQRI. If we finalize the EHR-based reporting mechanism for the 2010 PQRI, we will post a list of qualifiedEHR vendors and their products (including the version that is qualified) for the 2010 E-Prescribing Incentive Program, on the E-Prescribing Incentive Program section of the CMS Web site at http:// www.cms.hhs.gov/ERXIncentive when we post the list of qualified EHR products for the 2010 PQRI on the PQRI section of the CMS Web site. We welcome comments on our proposal to limit the registries and EHR products qualified to submit the electronic prescribing measure for the 2010 E-Prescribing Incentive Program to those that are qualified registries and EHR products, respectively, for the 2010 PQRI.(2) The Reporting Denominator for the Electronic Prescribing MeasureThe electronic prescribing measure, similar to the PQRI measures, has 2 basic elements. These include: (1) A reporting denominator that defines the circumstances when the measure is reportable; and (2) a reporting numerator.The denominator for the electronic prescribing measure consists of specific billing codes for professional services. The measure becomes reportable when any one of these procedure codes is billed by an eligible professional as Part B covered professional services. For 2009, the codes included in the measure's denominator were codes that are typically billed for services in the office or outpatient setting furnished by physicians or other eligible professionals. There are no diagnosis codes or age/gender requirements in order to be included in the measure's denominator (that is, reporting of the e-prescribing measure is not further limited to certain ages or a specific gender).However, as discussed further under section II.G.5.c.(5) of this proposed rule, eligible professionals are not required to report this measure in all cases in which the measure is reportable. Physicians and other eligible professionals who do not bill for one of the procedure codes for Part B covered professional services included in the measure's denominator will have no occasion to report the electronic prescribing measure.Currently, the denominator codes for the electronic prescribing measure consist of the following CPT and G-codes: 90801; 90802; 90804; 90805; 90806; 90807; 90808; 90809; 92002; 92004; 92012; 92014; 96150; 96151; 96152; 99201; 99202; 99203; 99204; 99205; 99211; 99212; 99213; 99214; 99215; 99241; 99242; 99243; 99244; 99245; G0101; G0108; G0109.As initially required under section 1848(k)(2)(A)(ii) of the Act, and further established through rulemaking and under section 1848(m)(2)(B) of the Act, however, we may modify the codes making up the denominator of the electronic prescribing measure. As such, we propose, in response to public comments received, to expand the scope of the denominator codes for 2010 to professional services outside the professional office and outpatient setting, such as professional services furnished in skilled nursing facilities or the home care setting. We propose to add the following CPT codes to the denominator of the electronic prescribing measure for 2010: 99304; 99305; 99306; 99307; 99308; 99309; 99310; 99315; 99316; 99341; 99342; 99343; 99344; 99345; 99347; 99348; 99349; 99350; and 90862. The proposed expansion of the electronic prescribing measure denominator is expected to provide more eligible professionals the opportunity to report the measure, and thus, provide more opportunities for eligible professionals to participate in the E-Prescribing Incentive Program. We invite comments on the proposed changes to codes identified for the electronic prescribing measure denominator.By December 31, 2009, we will post the final specifications of the measure on the ``E-Prescribing Measure'' page of the E-PrescribingIncentive Program section of the CMS Web site at http:// www.cms.hhs.gov/ERXIncentive.(3) Qualified Electronic Prescribing System--Required Functionalities and Part D E-Prescribing StandardsTo report the electronic prescribing measure in 2010, we propose that the eligible professional must report 1 of 3 ``G'' codes, as will be discussed below. However, in reporting any of the G-codes and thereby qualifying for the incentive payment for e-prescribing in 2010, the professional must have and regularly use a ``qualified'' electronic prescribing system as defined in the electronic prescribing measure specifications. If the professional does not have general access to an e-prescribing system in the practice setting, there is nothing to report. Required Functionalities for a ``Qualified'' ElectronicPrescriber System. What constitutes a ``qualified'' electronic prescribing system is based upon certain required functionalities that the system can perform. As currently specified in the measure, a``qualified'' electronic prescribing system is one that can:(a) Generate a complete active medication list incorporating electronic data received from applicable pharmacies and PBMs, if available.(b) Allow eligible professionals to select medications, print prescriptions, electronically transmit prescriptions, and conduct alerts (written or acoustic signals to warn the prescriber of possible undesirable or unsafe situations including potentially inappropriate dose or route of administration of a drug, drug-drug interactions, allergy concerns, or warnings and cautions). This functionality must be enabled.(c) Provide information related to lower cost, therapeutically appropriate alternatives (if any). The ability of an electronic prescribing system to receive tiered formulary information, if available, would suffice for this requirement for 2010 and until this function is more widely available in the marketplace.(d) Provide information on formulary or tiered formulary medications, patient eligibility, and authorization requirements received electronically from the patient's drug plan (if available).
Page 33597Part D E-Prescribing Standards. Section 1848(m)(3)(B)(v) of theAct, to the extent practicable, in determining whether an eligible professional is a successful e-prescriber, ``the Secretary shall ensure that eligible professionals utilize electronic prescribing systems in compliance with standards established for such systems pursuant to thePart D Electronic Prescribing Program under section 1860D-4(e)'' of theAct. The Part D standards for electronic prescribing systems establish which electronic standards Part D sponsors, providers, and dispensers must use when they electronically transmit prescriptions and certain prescription related information for Part D covered drugs that are prescribed for Part D eligible individuals. To be a qualified electronic prescribing system under the E-prescribing IncentiveProgram, electronic systems must convey the information listed above under (a) through (d) using the standards currently in effect for thePart D e-prescribing program. Additional Part D e-prescribing standards were implemented April 1, 2009. These latest Part D e-prescribing standards, and those that had previously been adopted, can be found on the CMS Web site at http://www.cms.hhs.gov/eprescribing.To ensure that eligible professionals utilize electronic prescribing systems that meet these requirements, the electronic prescribing measure requires that those functionalities required for a``qualified'' electronic prescribing system must utilize the adoptedPart D e-prescribing standards. The Part D e-prescribing standards relevant to the four functionalities for a ``qualified'' system in the electronic prescribing measure, described above and listed as (a), (b),(c), and (d), are:(a) Generate medication list--Use the National Council forPrescription Drug Programs (NCPDP) Prescriber/Pharmacist InterfaceSCRIPT Standard, Implementation Guide, Version 8, Release 1, October 2005 (hereinafter ``NCPDP SCRIPT 8.1'') Medication History Standard;(b) Transmit prescriptions electronically--Use the NCPDP SCRIPT 8.1 for the transactions listed at Sec. 423.160(b)(2);(c) Provide information on lower cost alternatives--Use the NCPDPFormulary and Benefits Standard, Implementation Guide, Version 1,Release 0 (Version 1.0), October 2005 (hereinafter ``NCPDP Formulary and Benefits 1.0'');(d) Provide information on formulary or tiered formulary medications, patient eligibility, and authorization requirements received electronically from the patient's drug plan--use:(1) NCPDP Formulary and Benefits 1.0 for communicating formulary and benefits information between prescribers and plans.(2) Accredited Standards Committee (ASC) X12N 270/271--Health CareEligibility Benefit Inquiry and Response, Version 4010, May 2000,Washington Publishing Company, 004010X092 and Addenda to Health CareEligibility Benefit Inquiry and Response, Version 4010A1, October 2002,Washington Publishing Company, 004010X092A1 for communicating eligibly information between the plan and prescribers.(3) NCPDP Telecommunication Standard Specification, Version 5,Release 1 (Version 5.1), September 1999, and equivalent NCPDP BatchStandard Batch Implementation Guide, Version 1, Release 1 (Version 1.1), January 2000 for communicating eligibility information between the plan and dispensers.There are, however, Part D e-prescribing standards that are in effect for functionalities that are not commonly utilized at this time.Such functionalities are not currently required for a ``qualified'' system under the electronic prescribing measure. One example is Rx FillNotification, which is discussed in the Part D e-prescribing final rule(73 FR 18918, 18926). For purposes of the 2010 Electronic PrescribingProgram and incentive payments, it is not required that the electronic prescribing system contain all functionalities for which there are available Part D e-prescribing standards. Rather, the only required functionalities are those stated in the measure and described above in the section entitled ``Required Functionalities for a `Qualified'Electronic Prescribing System.'' For those required functionalities described above, we propose that a ``qualified'' system must use the adopted Part D e-prescribing standards for electronic messaging.There are other aspects of the functionalities for a ``qualified'' system that are not dependent on electronic messaging and are part of the software of the electronic prescribing system, for which Part D standards for electronic prescribing do not pertain. For example, the requirements in qualification (b) listed above that require the system to allow professionals to select medications, print prescriptions, and conduct alerts are functions included in the particular software, for which Part D standards for electronic messaging do not apply.We are aware that there are significant numbers of eligible professionals who are interested in earning the incentive payment, but currently do not have an electronic prescribing system. The electronic prescribing measure does not require the use of any particular system or transmission network; only that the system be a ``qualified'' system having the functionalities described above based on Part D e- prescribing standards.(4) The Reporting Numerator for the Electronic Prescribing MeasureCurrently, to report for an applicable case where 1 of the denominator codes is billed for Part B services, an eligible professional must report one of 3 G-codes specified in the electronic prescribing measure. Currently, the G-codes are the following:One G-code is used to report that all prescriptions in connection with the visit billed were electronically prescribed(G8443);Another G-code indicates that no prescriptions were generated during the visit (G8445); andA third G-code is used when some or all prescriptions were written or phoned in due to patient request, State or Federal law, the pharmacy's system being unable to receive the data electronically or because the prescription was for a narcotic or other controlled substance (G8446).However, for 2010, we propose to modify the first G-code (G8443) to indicate that at least 1 prescription in connection with the visit billed was electronically prescribed. In addition, we propose to eliminate the 2 remaining G-codes from the measure's numerator: G8445; and G8446. We believe these modifications to the electronic prescribing measure will simplify reporting of the measure because the measure will only be reportable when an eligible professional has electronically prescribed. We invite comments on the proposed modifications to the electronic prescribing measure numerator.The e-prescribing quality measure would not apply unless an eligible professional furnishes services indicated by one of the codes included in the measure's denominator. Therefore, for claims-based reporting, for example, it is not necessary for an eligible professional to report G-codes for the electronic prescribing measure on claims not containing one of the denominator codes. However, if reporting a G-code, the G-code data submission will only be considered valid if it appears on the same Part B claim containing one of the e- prescribing quality measure's denominator codes.
Page 33598(5) Criteria for Successful Reporting of the Electronic PrescribingMeasureAs discussed above, section 1848(m)(3)(B)(ii) of the Act specifies that an eligible professional shall be treated as a successful electronic prescriber for a reporting period based on the eligible professional's reporting of the electronic prescribing measure in at least 50 percent of applicable cases. However, section 1848(m)(3)(D) of the Act permits the Secretary in consultation with stakeholders and experts to revise the criteria for submitting data on electronic prescribing measures under section 1848(3)(B)(ii) of the Act for years after 2009. Therefore, we propose to revise the criteria for submitting data on the electronic prescribing measure. For 2010, rather than requiring that the electronic prescribing measure be reported for a certain proportion of reportable cases, we propose to make the determination of whether an eligible professional is a successful electronic prescriber based on a count of the number of times an eligible professional reports that at least one prescription created during the encounter was generated using a qualified e-prescribing system (that is, reports the modified G8443 code). We believe that modifying the criteria for submitting the electronic prescribing measure in this manner will bring us closer to our stated intention to transition to using a certain number of electronic Part D prescribing events as the basis for the incentive payment in future years. In proposing to revise the criteria for successful reporting of the electronic prescribing measure in this manner, we also assume that once an eligible professional has invested in an e-prescribing system, integrated the use of the e-prescribing system into the practice's work flows, and has used the system to some extent, he or she is likely to continue to use the e-prescribing system for most of the prescriptions he or she generates.Preliminary data from the 2008 PQRI through September 2008 indicate that half of the eligible professionals who were eligible to report the electronic prescribing measure under the 2008 PQRI (measure 125) had 132 or more instances in which they were eligible to report the measure, with a maximum of 12,655 reporting instances.Therefore, in order to successfully report the measure under the 2009 criteria for successful e-prescribing (that is, reporting the measure for at least 50 percent of applicable cases), half of eligible professionals would have had to report measure 125 66 times or more (that is, 50 percent of 132 reporting instances), with a maximum of 6,328 times (that is, 50 percent of 12,655 reporting instances). For structural measures such as the electronic prescribing measure, once an eligible professional has demonstrated that he or she has integrated use of an e-prescribing system into his or her practice's work flow, requiring the eligible professional to continue to report the measure represents an administrative burden with little added benefit to the reliability and validity of the data being reported. In contrast, for clinical quality measures, the reliability and validity of the performance rates depends on the adequacy of the sample. Therefore, we propose that an eligible professional would be required to report that at least 1 prescription for a Medicare Part B FFS patient created during an encounter that is represented by 1 of the codes in the denominator of the electronic prescribing measure was generated using a qualified e-prescribing system for at least 25 times during the 2010 reporting period.The proposed minimum reporting threshold of 25 is based on the notion that an eligible professional would need to e-prescribe, on average, for approximately 2 Medicare Part B FFS patient encounters per month during the reporting period in order to be considered a successful e-prescriber. The proposed reporting threshold of 25 also takes into consideration that prescriptions are not generated with every Medicare Part B FFS patient encounter and some prescriptions, such as narcotics, cannot be prescribed electronically.We welcome comments on the proposed criteria for determination of successful electronic prescriber. We are particularly interested in comments related to the following:Our proposal to change the criteria for determining whether an eligible professional is a successful e-prescriber from requiring reporting of the electronic prescribing measure in 50 percent of applicable cases to a count of the number of times the eligible professional electronically prescribed; andThe proposed threshold number of 25 times in which an eligible professional would be required to report that he or she electronically prescribed during the reporting period. d. Determination of the 2010 Incentive Payment Amount for IndividualEligible Professionals Who Are Successful E-PrescribersSection 1848(m)(2)(B) of the Act imposes a limitation on the E- prescribing incentive payment. The Secretary is authorized to choose 1 of 2 possible criteria for the limitation. The first criterion, under section 1848(m)(2)(B)(i) of the Act, is based upon whether the MedicarePart B allowed charges for covered professional services to which the electronic prescribing quality measure applies are less than 10 percent of the total Part B allowed charges for all covered professional services furnished by the eligible professional during the reporting period. The second criterion, under section 1848(m)(2)(B)(ii) of theAct, is based on whether the eligible professional submits (both electronically and nonelectronically) a sufficient number (as determined by the Secretary) of prescriptions under Part D (which can, again, be assessed using Part D drug claims data). If the Secretary decides to use the latter criterion, then, in accordance with section 1848(m)(2)(B) of the Act, the criterion based on the reporting on electronic prescribing measures would no longer apply. The statutory limitation also applies to the future application of the payment adjustment.As discussed above, for 2010, we propose to make the determination of whether an eligible professional is a ``successful e-prescriber'' based on submission of the electronic prescribing measure. As a result, we propose to apply the criterion under section 1848(m)(2)(B)(i) for the limitation for the 2010 E-Prescribing Incentive Program. Therefore, in determining whether an eligible professional will receive an e- prescribing incentive payment for 2010, we would determine whether the 10 percent threshold is met based on the claims submitted by the eligible professional at the TIN/NPI level. This calculation is expected to take place in the first quarter of 2011 and would be performed by dividing the individual's total 2010 allowed charges for all such covered professional services submitted for the measure'sHCPCS codes by the individual's total allowed charges for all covered professional services (as assessed at the TIN/NPI level). If the result is 10 percent or more, then the statutory limitation will not apply and a successful e-prescriber would earn the e-prescribing incentive payment. If the result is less than 10 percent, then the statutory limitation will apply and the eligible professional would not earn an e-prescribing incentive payment--even if he or she electronically prescribes and reports G8443 at least 25 times for those eligible cases that occur during the 2010 reporting period. Although an individual eligible professional may
Page 33599decide to conduct his or her own assessment of how likely this statutory limitation is expected to apply to him or her before deciding whether or not to report the electronic prescribing measure, an individual eligible professional may report the electronic prescribing measure without regard to the statutory limitation for the incentive payment. e. Proposed Reporting Option for Satisfactory Reporting of the E-Prescribing Measure by Group PracticesAs discussed previously, section 1848(m)(3)(C)(i) requires that byJanuary 1, 2010, the Secretary shall establish and have in place a process under which eligible professionals in a group practice (as defined by the Secretary) shall be treated as meeting the requirements for submitting data on electronic prescribing quality measures for covered professional services for a reporting period (or, for purposes of the payment adjustment under subsection (a)(5), for a reporting period for a year) if, in lieu of reporting the electronic prescribing measure, the group practice reports measures determined appropriate by the Secretary, such as measures that target high-cost chronic conditions and preventive care, in a form and manner, and at a time specified by the Secretary.Section 1848(m)(3)(C)(ii) of the Act requires that the process established under section 1848(m)(3)(C)(i) of the Act provide for the use of a statistical sampling model to submit data on measures, such as the model used under the Physician Group Practice demonstration project under section 1866A of the Act. In addition, section 1848(m)(3)(C)(iii) of the Act specifies that payments to a group practice by reason of the process established under section 1848(m)(3)(C)(ii) of the Act shall be in lieu of the payments that would otherwise be made under this subsection to eligible professionals in the group practice for being a successful e-prescriber. Therefore, while we will be making incentive payments to group practices based on the determination that the group practice, as a whole, is a successful e-prescriber for 2010, an individual eligible professional who is affiliated with a group practice participating in the group practice reporting option that successfully meets the proposed requirements for group practices would not be eligible to earn a separate e-prescribing incentive payment for 2010 on the basis of his or her successfully reporting the electronic prescribing measure at the individual level.(1) Definition of ``Group Practice''As stated above, section 1848(m)(3)(C)(i) of the Act authorizes theSecretary to define ``group practice.'' For purposes of determining whether a group practice is a successful e-prescriber, we propose that a ``group practice'' would consist of a physician group practice, as defined by a TIN, with at least 200 or more individual eligible professionals (or, NPIs) who have reassigned their billing rights to the TIN to be consistent with definition of ``group practice'' proposed for the PQRI group practice reporting option.However, we propose to limit the group practices eligible to participate in the 2010 E-Prescribing Incentive Program through the group practice reporting option to those group practices selected to participate in the PQRI group practice reporting option. At this time, we would like to limit the number of groups participating in the group practice reporting option until we get further experience with the group practice reporting option. Therefore, unlike individual eligible professionals who are not required to participate in the PQRI to be eligible to earn an e-prescribing incentive and vice versa, group practices would be required to participate in both PQRI and the E-Prescribing Incentive Program. As discussed in section II.G.2.g. of this proposed rule, group practices interested in participating in the 2010 PQRI through the group practice reporting option would be required to submit a self-nomination letter to CMS or a CMS designee requesting to participate in the 2010 PQRI group practice reporting option.Instructions for submitting the self-nomination letter will be posted on the PQRI section of the CMS Web site by November 15, 2009. In addition to meeting the eligibility requirements proposed in sectionII.G.2.g.(1) of this proposed rule, a group practice would also have to indicate how they intend to report the electronic prescribing measure(that is, which proposed reporting mechanism the group practice intends to use) for purposes of participating in the 2010 E-PrescribingIncentive Program group practice reporting option.(2) Process for Group Practices to Participate as Group Practices andCriteria for Successful Reporting of the E-Prescribing Measure by GroupPracticesFor group practices selected to participate in the e-prescribing group practice reporting option for 2010, we propose the reporting period would be January 1, 2010 to December 31, 2010.We propose that physician groups selected to participate in the 2010 E-Prescribing Incentive Program through the group practice reporting option would be able to choose to report the electronic prescribing measure through the claims-based, the registry-based, or, contingent upon us finalizing this reporting mechanism for the 2010PQRI, the EHR-based reporting mechanism. As we proposed for individual eligible professionals, only registries and EHR products qualified to participate in the 2010 PQRI would be qualified for purposes of the 2010 e-prescribing group practice reporting option.In order for a group practice to be considered a successful e- prescriber, we propose the group practice would have to report that at least 1 prescription during an encounter was generated using a qualified e-prescribing system in at least 2,500 instances during the reporting period.In the absence of information about the composition of the group practices that may wish to participate in the E-Prescribing IncentiveProgram through the group practice reporting option rather than as individual eligible professionals, we assumed that the average group practice consists of 200 eligible professionals and that as many as half of the members of an average group practice do not furnish the services represented by the electronic prescribing measure's denominator codes, and thus, would not have an opportunity to report the electronic prescribing measure. Second, to be consistent with the proposed reporting criteria for individual eligible professionals, we also believe that each eligible professional in a group practice should be required to report that at least 1 prescription generated during an encounter that is represented by 1 of the electronic prescribing measure's denominator codes was generated electronically at least 25 times. Thus, for a group of 200 eligible professionals, we could extrapolate from our assumption that only half of the eligible professionals in an average practice of 200 eligible professionals would have the opportunity to report the electronic prescribing measure per group practice, the total number of reporting instances for the 100 remaining eligible professionals would be 2,500. We invite comments on the proposed criteria for determining whether a group practice is a successful e-prescriber. We also invite feedback on our underlying assumptions.Section 1848(m)(2)(B) of the Act specifies that the limitation on the applicability of the e-prescribing incentive discussed in sectionII.G.5.d.
Page 33600of this proposed rule applies to group practices as well as individual eligible professionals. Therefore, in determining whether a group practice will receive an e-prescribing incentive payment for 2010 by meeting the proposed reporting criteria described above, we would determine whether the 10 percent threshold is met based on the claims submitted by the group practice. This calculation is expected to take place in the first quarter of 2011 and would be determined by dividing the group practice's total 2010 allowed charges for all covered professional services submitted for the measure's HCPCS codes by the group practice's total Medicare Part B allowed charges for all covered professional services. If the result is 10 percent or more, then the statutory limitation will not apply and a group practice that is determined to be a successful e-prescriber would qualify to earn the e- prescribing incentive payment. If the result is less than 10 percent, then the statutory limitation will apply and the group practice would not qualify to earn the e-prescribing incentive payment. f. Public Reporting of Names of Successful E-PrescribersAs discussed in section II.G.2.k. of this proposed rule, section 1848(m)(5)(G) of the Act requires the Secretary to post on the CMS Web site, in an easily understandable format, a list of the names of eligible professionals (or group practices) who satisfactorily submit data on quality measures for the PQRI and the names of the eligible professionals (or group practices) who are successful e-prescribers. In accordance with section 1848(m)(5)(G) of the Act, we indicated in theCY 2009 PFS final rule with comment period (73 FR 69851 through 69852) our intent, in 2010, to post the names of eligible professionals who are successful e-prescribers for the 2009 E-Prescribing IncentiveProgram at http://www.medicare.gov.As required by section 1848(m)(5)(G) of the Act, we propose to make public the names of eligible professionals and group practices who are successful electronic prescribers for the 2010 E-Prescribing IncentiveProgram on the Physician and Other Health Care Professionals Directory.The names of individual eligible professionals and group practices who are successful electronic prescribers for the 2010 E-PrescribingIncentive Program will be available in 2011 after the 2010 incentive payments are paid.For purposes of publicly reporting the names of individual eligible professionals on the Physician and Other Health Care ProfessionalsDirectory, we propose to post the names of individual eligible professionals: (1) Whose 2010 PFS allowed charges make up at least 10 percent of the eligible professional's Medicare Part B charges for 2010; (2) who report that at least 1 prescription generated during an encounter included in the electronic prescribing measure denominator was generated electronically (that is, who reported the G8443 code) at least 25 times during the 2010 reporting period; and (3) who receive an e-prescribing incentive payment for covered professional services furnished January 1, 2010 through December 31, 2010. Since the PQRI and the E-Prescribing Incentive Program are two separate incentive programs and individual eligible professionals are not required to participate in both programs to earn an incentive under either program, it is possible for an eligible professional who participates in both incentive programs to be listed both as an individual eligible professional who satisfactorily submits data on quality measures for the PQRI and a successful electronic prescriber if he or she meets the criteria for both incentive programs.For purposes of publicly reporting the names of group practices on the Physician and Other Health Care Professionals Directory, we propose to post the names of group practices who: (1) Report that at least 1 prescription generated during an encounter included in the electronic prescribing measure denominator was generated electronically (that is, who reported the G8443 code) at least 2500 times during the 2010 reporting period; and (2) receive an e-prescribing incentive payment for covered professional services furnished January 1, 2010 throughDecember 31, 2010. Although group practices would be required to participate in both programs to earn an incentive under either program, the criteria for satisfactory reporting of PQRI measures for group practices are different from the criteria for successful reporting of the electronic prescribing measure by group practices. Therefore, it is possible for a group practice to be listed as a group practice that satisfactorily submits data on quality measures for the PQRI but not as a successful electronic prescriber or vice versa. 6. Section 135: Implementation of Accreditation Standards for SuppliersFurnishing the Technical Component (TC) of Advanced Diagnostic ImagingServicesSection 1834(e) of the Act, as added by section 135(a) of theMIPPA, requires that beginning January 1, 2012, Medicare payment may only be made for the technical component (TC) of advanced diagnostic imaging services for which payment is made under the fee schedule established in section 1848(b) of the Act to a supplier who is accredited by an accreditation organization designated by theSecretary. a. Accreditation RequirementThis proposed rule would set forth the criteria for designating organizations to accredit suppliers furnishing the technical component(TC) of advanced diagnostic imaging services as specified in section 1834(c) of the Act. In addition, it would set forth the required procedures to ensure that the criteria used by an accreditation organization meet minimum standards for each imaging modality. These statutory requirements would be codified in Sec. 414.68 of the payment rules for physicians and other practitioners.The CMS-designated accreditation organization would apply standards that set qualifications for medical personnel who are not physicians but who furnish the TC. The standards would describe the qualifications and responsibilities of medical directors and supervising physicians including the following: Recognizing whether a particular medical director or supervising physician received training in advanced imaging services in a residency program; and has attained, through experience, the necessary expertise to be a medical director or supervising physician; has completed any continuing medical education courses related to advanced imaging services; or has met such other standards as the Secretary determines appropriate. In addition, the standards would require suppliers to: (1) Establish and maintain a quality control program to ensure the technical quality of diagnostic images produced by the supplier; (2) ensure the equipment used meets performance specifications; and (3) ensure safety of personnel. While the statute authorizes the Secretary to establish as criteria for accreditation any other standards or procedures the Secretary determines appropriate, we are not proposing to establish other standards or procedures at this time.We expect to publish a notice to solicit applications from entities for the purposes of becoming a designated accreditation organization the same day that this proposed rule's subsequent final rule is issued, on or before November 1, 2009. Due to the tight timeframe, we expect to meet the January 1, 2010 statutory deadline in
Page 33601order to designate organizations to accredit suppliers furnishing theTC of advanced diagnostic imaging services by waiving the 60-day delay in the imaging accreditation provisions of the final rule. b. Accreditation for SuppliersSection 1834(e) of the Act requires the Secretary to designate and approve accreditation organizations to accredit suppliers of the TC of advanced diagnostic imaging services. To promote consistency in accrediting providers and suppliers throughout the Medicare program, we are proposing to use existing procedures for the application, selection, and oversight of accreditation organizations detailed at 42CFR part 488, subparts A and D and apply them to organizations accrediting suppliers of the TC of advanced diagnostic imaging services. We are proposing modifications to the existing part 488 requirements to meet the specialized needs of the advanced imaging industry. These modifications will require an independent accreditation organization applying for approval as a designated accreditation organization to include in their application:A detailed description of how the organization's accreditation criteria satisfy the statutory standards at section 1834(e)(3) of the Act, specifically:+ Qualifications of medical personnel who are not physicians and who furnish the TC of advanced diagnostic imaging services;+ Qualifications and responsibilities of medical directors and supervising physicians, such as training in advanced diagnostic imaging services in a residency program, expertise obtained through experience, or continuing medical education courses;+ Procedures to ensure the safety of persons who furnish the TC of advanced diagnostic imaging services and individuals to whom such services are furnished;+ Procedures to ensure the reliability, clarity, and accuracy of the technical quality of diagnostic images produced by the supplier.An agreement to conform accreditation requirements to any changes in Medicare statutory requirements in section 1834(e) of theAct.Information to demonstrate the accreditation organization's knowledge and experience in the advanced diagnostic imaging arena.The organization's proposed fees for accreditation for each modality in which the organization intends to offer accreditation and any plans for reducing the burden and cost of accreditation to small and rural suppliers.Any specific documentation requirements and attestations requested by CMS as a condition of designation under this part.If, after review of an accreditation organization's submission of information, we determine that additional information is necessary to make a determination for approval or denial of the accreditation organization's application to be designated as an accreditation organization for suppliers of the TC of advanced diagnostic imaging services, the organization will be notified and afforded an opportunity to provide the additional information. We may visit the organization's offices to verify representations made by the organization in its application, including, but not limited to, review of documents and interviews with the organization's staff. The accreditation organization will receive a formal notice from CMS stating whether the request for designation has been approved or denied. If approval was denied, the notice will include the basis for denial and outline the reconsideration procedures. We will make every effort to issue a final decision no more than 30 calendar days from the time the completed reapplication is received by CMS. An accreditation organization may withdraw its application for designation under section 1834(e) of theAct at any time before the formal notice of approval is received. An accreditation organization that has been notified that its request for designation has been denied may request reconsideration in accordance with Sec. 488.201 through Sec. 488.211 in Subpart D. Any accreditation organization whose request for designation has been denied may resubmit its application if the organization (1) revises its accreditation program to address the rationale for denial of its previous request; (2) provides reasonable assurance that its accredited companies meet applicable Medicare requirements; and (3) resubmits the application in its entirety. If an accreditation organization has requested a reconsideration of our determination that its request for designation under section 1834(e) of the Act is denied, it may not submit a new application for the type of modality that is at issue in the reconsideration until the reconsideration is final.A panel will evaluate all proposals from accreditation organizations seeking designation under section 1834(e) of the Act using existing CMS survey and certification processes as established inSec. 488.4. c. Payment Rules for Suppliers of the TC of Advanced Diagnostic ImagingServices (Sec. 414.68)We would specify in Sec. 414.68 the statutory requirement of section 1834(e) of the Act that all suppliers of the TC of advanced diagnostic imaging services be accredited by a CMS-designated accreditation organization by January 1, 2012 for payments made under the fee schedule established under section 1848(b). In Sec. 414.68(a), we are proposing to define the following:``Accredited supplier'' as a supplier that has been accredited by a CMS-approved accreditation organization.``Advanced Diagnostic Imaging Services'' as diagnostic magnetic resonance imaging, computed tomography, nuclear medicine, and positron emission tomography. We are not proposing at this time to include other diagnostic imaging services in this definition under section 1834(e)(1)(B)(ii) of the Act.``CMS-approved accreditation organization'' as an independent accreditation organization designated by CMS to perform the accreditation function established in section 1834(e) of the Act. d. Ongoing Responsibilities of CMS-Approved Accreditation OrganizationsWe are proposing to require a CMS-approved accreditation organization to perform the following activities on an ongoing basis.Provide to CMS in written form and on an ongoing basis all of the following:Copies of all accreditation surveys of specific suppliers along with any survey-related information that we may require(including corrective action plans and summaries of CMS requirements that were not met).Notice of all accreditation decisions.Notice of all complaints related to suppliers of the TC of advanced diagnostic imaging service.Information about any suppliers of the TC of advanced diagnostic imaging service for which the accrediting organization has denied the supplier's accreditation status.Notice of any proposed changes in its accreditation standards or requirements or survey process. If the organization implemented the changes before or without CMS approval, we could withdraw approval of the accreditation organization.Permit its surveyors to serve as witnesses if CMS takes an adverse action based on accreditation findings.Provide CMS with written notice of any deficiencies and adverse actions
Page 33602implemented by the CMS-approved accreditation organization against an accredited supplier of the TC of advanced diagnostic imaging within 2 days of identifying such deficiencies, if the deficiencies pose immediate jeopardy to a beneficiary or to the general public.Provide written notice of the withdrawal to all accredited suppliers within 10 days of CMS' notice to withdraw approval of the accreditation organization.Provide, on an annual basis, summary data specified by CMS that are related to the past year's accreditation activities and trends. e. Continuing CMS Oversight of CMS-Approved Accreditation OrganizationsWe are proposing to add Sec. 414.68 to establish specific criteria and procedures for continuing oversight and for withdrawing approval of an approved accreditation organization.(1) Validation AuditsWe are proposing to audit the accredited organizations in order to validate the survey accreditation process of approved accreditation organizations in the TC of advanced imaging. The audits would be conducted on a representative sample of suppliers who have been accredited by a particular accrediting organization or in response to allegations of supplier noncompliance with the standards. When conducted on a representative sample basis, we are proposing that the audit would be comprehensive and address all of the standards or would focus on a specific standard in issue. When conducted in response to an allegation, we will specify that the CMS team or our contractor would audit for any standard that we determined was related to the allegations. We are proposing to require a supplier selected for a validation audit to authorize the validation audit to occur and authorize the CMS team or our contractor to monitor the correction of any deficiencies found through the validation audit. If a supplier selected for a validation audit failed to comply with the requirements at Sec. 414.68, the supplier would no longer meet the Medicare requirements and, under this proposal, the supplier's accreditation for the TC of the advanced medical imaging would be revoked.We are proposing that a CMS team or our contractor would conduct an audit of an accredited organization, examine the results of the accreditation organization's own survey procedure onsite, or observe the accreditation organization's survey, in order to validate the organization's accreditation process. At the conclusion of the review, we would identify any accreditation programs for which validation audit results indicated the following:A 10 percent rate of disparity between findings by the accreditation organization and findings by CMS or our contractor on standards that did not constitute immediate jeopardy to patient health and safety if not met;Any disparity between findings by the accreditation organization and findings by CMS or our contractor on standards that constituted immediate jeopardy to patient health and safety if not met; orThere were widespread or systemic problems in the organization's accreditation process such that the accreditation no longer provided assurance that suppliers met or exceeded the Medicare requirements, irrespective of the rate of disparity.(2) Notice of Intent To Withdraw Approval for Designating AuthorityIf a validation audit, onsite observation, or our concerns with the ethical conduct (that impacts the health and safety of the beneficiary) of an accreditation organization suggest that the accreditation organization is not meeting the requirements of proposed Sec. 414.68, we would provide the organization written notice of its intent to withdraw approval of the accreditation organization's designating authority.(3) Withdrawal of Approval for Designating AuthorityWe are proposing to withdraw approval of an accreditation organization at any time if we determine that:Accreditation by the organization no longer provides sufficient assurance that the suppliers of the TC of advanced imaging meet the requirements of section 1834(e) of the Act and the failure to meet those requirements could pose an immediate jeopardy to the health and safety of Medicare beneficiaries;Constitutes a significant hazard to the public health; orThe accreditation organization failed to meet its obligations for application and reapplication procedures.(4) ReconsiderationWe are proposing to implement requirements under part 488 without substantive changes as the requirements have been utilized for the health care providers covered under part 488 since 1992. We are proposing that an accreditation organization dissatisfied with a determination that its accreditation requirements did not provide or do not continue to provide reasonable assurance that the suppliers accredited by the accreditation organization met the applicable standards would be entitled to a reconsideration. We are also proposing to reconsider any determination to deny, remove, or not renew the approval of the designating authority to accreditation organizations if the accreditation organization filed a written request for reconsideration through its authorized officials or through its legal representative.We are proposing to require the accreditation organization to file the request within 30 calendar days of the receipt of CMS notice of an adverse determination or non-renewal. We propose to require the request for reconsideration to specify the findings or issues with which the accreditation organization disagreed and the reasons for the disagreement. A requestor could withdraw its request for reconsideration at any time before the issuance of a reconsideration determination. In response to a request for reconsideration, we would provide the accrediting organization the opportunity for an informal hearing that would be conducted by a hearing officer appointed by theCMS Administrator and provide the accrediting organization the opportunity to present, in writing and in person, evidence or documentation to refute the determination to deny approval, or to withdraw or not renew its designating authority.We would provide written notice of the time and place of the informal hearing at least 10 business days before the scheduled date.The informal reconsideration hearing would be open to CMS and the organization requesting the reconsideration, including authorized representatives, technical advisors (individuals with knowledge of the facts of the case or presenting interpretation of the facts), and legal counsel. The hearing would be conducted by the hearing officer who would receive testimony and documents related to the proposed action.Testimony and other evidence could be accepted by the hearing officer.However, it would be inadmissible under the usual rules of court procedures. The hearing officer would not have the authority to compel by subpoena the production of witnesses, papers, or other evidence.Within 45 calendar days of the close of the hearing, the hearing officer would
Page 33603present the findings and recommendations to the accrediting organization that requested the reconsideration. The written report of the hearing officer would include separate numbered findings of fact and the legal conclusions of the hearing officer. The hearing officer's decision would be final.We are interested in obtaining additional information on the role of radiology assistants (RA) and radiology practitioner assistants(RPA), including the level of physician supervision that would be appropriate when RAs and RPAs are involved in the performance of the TC of advanced medical imaging, whether the role varies by State, and related information. It would be particularly helpful for the commenter to identify specific clinical scenarios with associated CPT codes that would represent such services involving RAs and RPAs. 7. Section 139: Improvements for Medicare Anesthesia Teaching ProgramsSection 139 of the MIPPA establishes a ``special payment rule for teaching anesthesiologists'' and provides a directive to the Secretary regarding payments for the services of ``teaching certified registered nurse anesthetists'' (teaching CRNAs). It also specifies the periods when the teaching anesthesiologist must be present during the procedure in order to receive payment for the case at 100 percent of the fee schedule amount (the regular fee schedule rate). These provisions are effective for services furnished on or after January 1, 2010. a. Teaching Anesthesiologists: Special Payment RuleThe criteria for the payment of teaching anesthesiology services and the special rule for the teaching anesthesiologist are similar to the current criteria for payment of teaching surgeon services and the payment rule for the teaching surgeon involved in overlapping resident cases. Thus, there is a similarity in the payment rules for these physician specialties who work closely together.(1) Payment for Anesthesia Services Furnished by a PhysicianIf the physician, usually an anesthesiologist, is involved in furnishing anesthesia services to a patient, the services can be furnished under one of three different scenarios. The anesthesiologist may--Personally perform the anesthesia services alone;Be involved in the case as a teaching anesthesiologist with an anesthesia resident; orProvide medical direction of the performance of anesthesia services for two, three or four concurrent cases involving a qualified individual (who may be a CRNA, an anesthesiologist assistant (AA), an anesthesia resident, or a student nurse anesthetist under certain circumstances).Under the statute and CMS policy, if the anesthesiologist personally performs the anesthesia service alone or is involved in the case as a teaching anesthesiologist with an anesthesia resident, payment for the anesthesiologist's service is made at the regular fee schedule rate.If the anesthesiologist furnishes medical direction for two, three or four concurrent anesthesia procedures, then payment for the anesthesiologist's service is made, in accordance with section 1848(a)(4)(B) of the Act, at 50 percent of the otherwise applicable fee schedule amount.(2) Methodology for Payment of Anesthesia ServicesPayment for anesthesia services furnished by a physician is made under the PFS, under section 1848(b)(2)(B) of the Act. The methodology for the calculation of the allowable amount is unique to anesthesia service only. Payment is made on the basis of anesthesia base units and time units, calculated from the actual anesthesia time of the case, instead of on the basis of work, PE, and malpractice RVUs. Payment for anesthesia services is also based on the anesthesia CF instead of the general PFS CF.(3) Section 139(a) of the MIPPASection 139(a) of the MIPPA adds a new paragraph at section 1848(a)(6) of the Act to establish a ``special payment rule for teaching anesthesiologists''. This provision allows payment to be made at the regular fee schedule rate for the teaching anesthesiologist's involvement in the training of residents in either a single anesthesia case or in two concurrent anesthesia cases furnished on or afterJanuary 1, 2010. We will refer to anesthesia cases involving the training of residents as ``resident cases'' below in this section.(4) DiscussionThe Accreditation Council on Graduate Medical Education (ACGME) is a branch of the AMA, and it accredits allopathic residency programs. In order for a hospital to receive Medicare graduate medical education payments for its training programs, the residents must be in an``approved medical residency program'' Under Sec. 413.75(b), an approved medical residency program is one approved by one of the national organizations listed in Sec. 415.152. One of the national organizations is the ACGME.ACGME's policies and procedures require that each accredited residency program comply with the institutional requirements and the specialty program requirements. For approved anesthesia residency programs, ACGME requirements for faculty supervision and training of anesthesia residents specify that faculty members not direct anesthesia at more than two anesthetizing locations in the clinical setting. (See the ACGME Web site at http://www.acgme.org.)Consistent with this requirement, the American Society ofAnesthesiologists (ASA) has advised us that, when providing services in two concurrent cases, a teaching anesthesiologist might be engaged in two concurrent anesthesia resident cases, or in two mixed concurrent cases, one a resident case and the other a CRNA or AA case.The statute applies the special payment rule for teaching anesthesiologists to the single resident case or two concurrent cases involving anesthesia residents as long as the teaching anesthesiologist meets the requirements in sections 1848(6)(A) and 1848(6)(B) of theAct. However, the statute does not directly address a single resident case that is concurrent to another case involving a CRNA, AA, or other qualified individual who can be medically directed. The issue is whether the medical direction payment rules apply to each of these cases or whether an alternative payment policy may apply.One option in implementing this provision would be to strictly limit the special payment rule for teaching anesthesiologists to the single resident case (which is not concurrent to any other case) or the two concurrent resident cases (which are not concurrent to any other cases). For the mixed concurrent case, we could continue to apply our current medical direction payment policy to both the resident case and the other concurrent case. This would represent a continuation of our current medical direction payment policy, and would be predicated on the assumption that this is consistent with Congressional intent since the medical direction payment provisions at section 1848(a)(4) of theAct were left largely unchanged by section 139(a) of the MIPPA.The other option would be to apply the special payment rule for teaching
Page 33604anesthesiologists to the resident case when it is concurrent to a medically directed case, and to apply the medical direction payment policy to the medically directed case. While this represents a broader interpretation, it still limits the applicability of the special payment rule for teaching anesthesiologists to resident cases consistent with the terms of section 139 of the MIPPA.The special payment rule under section 1848(a)(6) of the Act clearly applies for two concurrent anesthesia resident cases. The ACGME requirements also allow the supervision of two concurrent cases, but are not specific regarding whether the requirements relate only to two resident cases, or also to mixed concurrent cases. However, both the statute and ACGME requirements seem amenable to a policy that would allow the special teaching payment rule to apply in mixed concurrent cases, that is, the single resident case that is concurrent to another case not involving a resident. Additionally, we are concerned that if we continued to apply the medical direction payment policy to mixed concurrent cases, then financial differences in payment policy might cause teaching anesthesiologists to make changes in the scheduling of mixed resident and CRNA cases. This might limit the utilization ofCRNAs in certain scenarios.Accordingly, we are proposing to delete the current regulatory language at Sec. 414.46(e) (which is no longer relevant) and add new language to specify that the special payment rule for teaching anesthesiologists applies to resident cases under the following scenarios:The teaching anesthesiologist is involved in one resident case (which is not concurrent to any other anesthesia case);The teaching anesthesiologist is involved in each of two concurrent resident cases (which are not concurrent to any other anesthesia case); orThe teaching anesthesiologist is involved in one resident case that is concurrent to another case paid under medical direction payment rules.Other than the application of the special payment rule for teaching anesthesiologists in the mixed concurrent case described above, we are not proposing any other revisions to our medical direction payment policies. b. Teaching Anesthesiologists: Criteria for Payment(1) Criteria for Payment of Teaching AnesthesiologistsCurrently, the teaching anesthesiologist can be paid at the regular fee schedule rate for his or her involvement in a single resident case.As specified in Sec. 415.178, the teaching anesthesiologist must be present with the anesthesia resident during all critical portions of the anesthesia procedure and be immediately available to furnish services during the entire procedure. Our manual instructions permit different physicians in the same anesthesia group to provide parts of the anesthesia service, and for the group to bill for the single anesthesia service. We refer to this practice as an ``anesthesia handoff.'' (See Medicare Claims Processing Manual 100-04, Chapter 12,Section 50 C.) Of course, the medical record must document those individual physicians who furnished the services.This manual instruction is not limited in scope to nonteaching hospitals. Thus, it is possible that teaching anesthesiologists have interpreted it to permit handoffs during resident cases.Our manual instructions state that for two overlapping surgeries, the teaching surgeon must be present during the critical or key portions of both operations (See Medicare Claims Processing Manual 100- 04, Chapter 12, Section 100.1.2). It is our understanding that teaching surgeons do not hand off to another teaching surgeon during a key or critical portion of the surgical resident case.(2) Section 139(a)(2) of the MIPPAThis section adds a new paragraph at section 1848(a)(6) of the Act which requires, in order for the special payment rule for teaching anesthesiologists to apply, that the teaching anesthesiologist is present during all critical or key portions of the anesthesia service or procedure and the teaching anesthesiologist (or another anesthesiologist with whom the teaching anesthesiologist has entered into an arrangement) is immediately available to furnish anesthesia services during the entire procedure. The new MIPPA provision regarding payment for services of a teaching anesthesiologist for two concurrent resident cases is similar to our current policy regarding payment for services of a teaching surgeon for two overlapping surgical resident cases.(3) DiscussionThe ASA has informed us that teaching anesthesiologists who work in the same anesthesia group sometimes provide different parts of the key or critical portions of a single anesthesia procedure. This type of a handoff situation might occur within an anesthesia group practice when there is an anesthesia procedure of long duration, but would not be limited to that circumstance.From a quality standpoint, we do not believe multiple handoffs among teaching anesthesiologists during a case that involves the training of an anesthesia resident would be optimal. We do not have data on the extent to which anesthesia handoffs occur during resident or other cases, or whether quality of anesthesia care is affected. We note that section 1848(a)(6)(A) of the Act refers only to ``the'' teaching anesthesiologist, and requires that the teaching anesthesiologist be present during all critical or key portions of the service. However, section 1848(a)(6)(B) of the Act seems to contemplate some level of handoffs between teaching anesthesiologists, at least between those who have entered into an arrangement for such handoffs.One option would be to permit different anesthesiologists in the same anesthesia group practice to be considered ``the teaching physician'' for purposes of being present at the key or critical portions of the anesthesia case. (These physicians must have reassigned their benefits to the group practice in order for the group to bill.)Although this option would be less disruptive to the current anesthesia practice arrangements (as reported by the ASA), it would establish rules for teaching anesthesiologists that are different from those for teaching surgeons.Another option would be to require that, in order to meet the requirement of section 1848(a)(6)(A) of the Act, only one individual teaching anesthesiologist must be present during all of the key or critical portions of the procedure. However, another teaching anesthesiologist with whom ``the teaching anesthesiologist'' under subparagraph (A) has an arrangement could be immediately available to furnish services during a non-critical or non-key portion of the procedure in order to meet the requirement under subparagraph (B). We believe this is the most logical reading of the statute and would be consistent with the way the teaching surgeon payment policy is applied for overlapping surgical cases.In addition to explaining available options for implementing this provision, we are also soliciting specific comments on how the continuity of care and the quality of anesthesia care are preserved during handoffs. We are interested in whether there is an accepted maximum number of handoffs and whether there are any industry studies that have examined this issue. We would like to hear from anesthesia practices that do not use handoffs and what procedures they have implemented to achieve this
Page 33605result. Finally, we would like to know what factors or variables are contributing to anesthesia handoffs and what short term adjustments can be made to affect these factors.Although we are interested in receiving comments on these topics, we are proposing to more narrowly interpret the law and require that only one individual teaching anesthesiologist be present during all of the key or critical portions of the anesthesia procedure. We are also proposing that another teaching anesthesiologist with whom the teaching anesthesiologist has an arrangement could be immediately available to furnish services during a non-critical or non-key portion of the procedure. c. Teaching CRNAs(1) Payment for Anesthesia Services Furnished by a CRNACurrently, a CRNA who provides anesthesia services while under the medical direction of an anesthesiologist is paid at 50 percent of the regular fee schedule rate as specified in section 1833(l)(4)(B)(iii) of the Act. A CRNA who provides anesthesia services without the medical direction of a physician is paid the regular fee schedule rate as specified in section 1833(l)(4)(A) of the Act.(2) Payment for Anesthesia Services Furnished by a Teaching CRNA With aStudent Nurse AnesthetistThe legislation that created the CRNA fee schedule payment system(that is, section 9320 of the Omnibus Budget Reconciliation Act of 1986(Pub. L. 99-509)) did not address payment for services furnished by teaching CRNAs involved in the training of student nurse anesthetists.In the preamble to the CRNA fee schedule final rule published in the July 31, 1992 Federal Register (57 FR 33888), we stated that we would pay the teaching CRNA who is not medically directed by a physician at the regular fee schedule rate for his or her involvement in a single case with a student nurse anesthetist as long as he or she was present with the student throughout the anesthesia case. No payment would be made if the teaching CRNA divided his or her time between two concurrent cases involving student nurse anesthetists.In August 2002, based on the recommendations of the AmericanAssociation of Nurse Anesthetists (AANA), we modified our policy to allow the teaching CRNA not medically directed by a physician to be paid a portion of the regular fee schedule rate for each of two concurrent cases involving student nurse anesthetists. If the teachingCRNA is present with the student nurse anesthetist during the pre- and post-anesthesia care for each of the cases involving student nurse anesthetists, the teaching CRNA can bill the full base units (comprised of pre- and post-anesthesia services not included in the anesthesia time units) for each case and the actual amount of anesthesia time per case. The resulting payment for each of these anesthesia cases is greater than 50 percent, but less than 100 percent, of the regular fee schedule amount because the full base units plus the actual anesthesia time units spent by the teaching CRNA in each of the two cases yields a payment that is greater than 50 percent of the regular fee schedule amount.(3) Comparison of Payment Policies for Teaching CRNAs and TeachingAnesthesiologistsFor several years, the American Society of Anesthesiologists (ASA) requested that we revise our payment regulations to allow the teaching anesthesiologist to be paid the regular fee schedule amount for each of two concurrent resident cases. In the CY 2004 PFS final rule with comment period (68 FR 63224), we finalized a policy to permit the teaching anesthesiologist to be paid similarly to a teaching CRNA for each of two concurrent resident cases. This policy took effect for services furnished on or after January 1, 2004.Thus, the payment policy is the same for a teaching CRNA for each of two concurrent student nurse anesthetist cases, and for a teaching anesthesiologist for each of two concurrent resident cases. The policy is that the anesthesia provider is paid the full base units plus time units, based on the actual anesthesia time, relating to each of two concurrent cases.(4) Payment Policy for an Anesthesiologist, or an Anesthesiologist andCRNA Jointly, With a Student Nurse AnesthetistCurrently, there are circumstances where an anesthesiologist may be involved in the training of student nurse anesthetists in two concurrent anesthesia cases. These anesthesia cases are not paid under the teaching anesthesiologist payment policy, but are paid under the usual medical direction payment policy. Payment can be made for the physician's medical direction (that is, 50 percent of the regular fee schedule amount) for each of two concurrent cases.If an anesthesiologist is medically directing two concurrent cases involving student nurse anesthetists and a CRNA is also jointly involved with the two student nurse anesthetist cases, then the physician service, in each case, can be paid under the medical direction rules at 50 percent of the regular fee schedule. Payment for the CRNA services would also be made at the medically directed rate(that is, 50 percent of the regular fee schedule) for CRNA services, but the time units used to compute the anesthesia fee would be based on the actual time the CRNA is involved in each case.(5) Section 139(b) of the MIPPASection 139(b) of the MIPPA instructs the Secretary to make appropriate adjustments to Medicare teaching CRNA payment policy so that it--Is consistent with the adjustments made by the special payment rule for teaching anesthesiologists under section 139(a) of theMIPPA; andMaintains the existing payment differences between teaching anesthesiologists and teaching CRNAs.We are proposing to implement the first directive (under section 139(b)(1) of the MIPPA) by establishing a new payment policy for teaching CRNAs that is similar to the special payment rule for teaching anesthesiologists, and to limit applicability of the rule to teachingCRNAs who are not medically directed. We are proposing to add a new regulation at Sec. 414.61 to explain the conditions under which the special payment rule will apply and the method for calculating the amount of payment for anesthesia services furnished on or after January 1, 2010, by teaching CRNAs involved in the training of student nurse anesthetists. Under this proposal, we would pay the teaching CRNA at the regular fee schedule rate for each of two concurrent student nurse anesthetist cases. Our medical direction payment policy would continue to apply if both an anesthesiologist and a CRNA are involved in a student nurse anesthetist case that is concurrent to other anesthesia cases.We believe the second directive in section 139(b)(2) of the MIPPA will be satisfied as a result of these proposals. Section 139(b)(1) of the MIPPA instructs CMS to make appropriate adjustments to implement a payment policy for teaching CRNAs that is consistent with the special payment rule for teaching anesthesiologists. Section 139(b)(2) of theMIPPA instructs CMS to maintain the existing payment differences between teaching anesthesiologists and teaching CRNAs. There currently are no substantive differences in payment
Page 33606between teaching anesthesiologists and teaching CRNAs, and there would continue to be no such differences under our proposed policies.(6) Payment for Teaching CRNAs Involved in Anesthesia Cases WithStudent Nurse AnesthetistsUnder current policy, when a CRNA is involved in a single student nurse anesthetist case, the teaching CRNA must be present with the student throughout the case in order to be paid at the regular fee schedule rate. We are not proposing any change to this policy.When the teaching CRNA is involved in two concurrent student nurse anesthetist cases, payment is based on the amount of anesthesia time the teaching CRNA spends with the student in each case. For example, if the teaching CRNA spends 40 percent of his or her time in concurrent case 1 and 60 percent of his or her time in concurrent case 2, and the total anesthesia time in both cases is 3 hours (or 180 minutes), then we would currently pay as follows:Case 1: (Base units + (0.4 x 180/15)) xAnesthesia CFCase 2: (Base units + (0.6 x 180/15)) xAnesthesia CFThe current payment policy has been predicated on paying the teaching CRNA for his or her actual time spent in the student nurse anesthetist case. We are now proposing to pay the teaching CRNA at the regular fee schedule rate for his or her involvement in two concurrent cases. If our goal is to minimize the effect of this change on teachingCRNAs' practice arrangements and time devoted to cases, then we would propose that the teaching CRNA continue to devote 100 percent of his or her time to the two concurrent cases. The teaching CRNA would decide how to allocate his or her time to optimize patient care in the two cases based on the complexity of the anesthesia case, the experience and skills of the student nurse anesthetist, the patient's health status, and other factors.An alternative to this policy would be to apply the same criteria for teaching CRNAs as we use in Sec. 415.178 with respect to teaching anesthesiologists. These criteria require the teaching anesthesiologist to be present during all critical or key portions of the anesthesia service. However, we believe these criteria are relevant and appropriate only for teaching anesthesiologists due to significant differences in experience, education and other qualifications between anesthesia residents and student nurse anesthetists. The anesthesia resident has completed medical school and is typically a licensed physician. In contrast, the student nurse anesthetist is an RN who usually has some clinical experience in ICU or critical care nursing prior to starting the CRNA training program. Thus, we believe the resident is more qualified through medical training and education than the student nurse anesthetist to provide elements of the anesthesia service without the immediate presence of the teaching anesthesiologist. Therefore, we propose to retain our current policy.We note that the Congress did not amend the statutory provisions relating to medical direction at section 1848(a)(4) of the Act. We do not believe the directives at section 139(b) of the MIPPA extend to other arrangements in which anesthesiologists alone or both anesthesiologists and CRNAs jointly supervise student nurse anesthetists during concurrent anesthesia cases. Therefore, we are not proposing any changes to our current payment policies for anesthesia services furnished under other circumstances. We are proposing that when an anesthesia provider (physician or CRNA) furnishes anesthesia services in concurrent cases under other circumstances, the current policies regarding medical direction will continue to apply. 8. Section 144(a): Payment and Coverage Improvements for Patients WithChronic Obstructive Pulmonary Disease and Other Conditions--CardiacRehabilitation ServicesSection 144(a) of the MIPPA amended Title XVIII of the Act, in pertinent part, to provide for coverage of cardiac rehabilitation (CR) and intensive cardiac rehabilitation (ICR) under Medicare Part B. The statute specifies certain conditions for these services, with coverage to begin on January 1, 2010. The addition of the new CR and ICR programs is designed to improve the health care of Medicare beneficiaries with cardiovascular disease. This proposed rule implements these MIPPA provisions in order to ensure services enhance the patient's clinical outcomes. a. BackgroundIntensive cardiac rehabilitation (ICR) is a relatively new practice that is also commonly referred to as a ``lifestyle modification'' program. These programs typically involve the same elements as generalCR programs, but are furnished in highly structured environments in which sessions of the various components may be combined for longer periods of CR and also may be more rigorous. b. Cardiac Rehabilitation Coverage Under MedicareOne mechanism we use to establish coverage for certain items and services is the national coverage determination (NCD) process. An NCD is a determination by the Secretary with respect to whether or not a particular item or service is covered nationally under Title XVIII.Since 1982, Medicare has covered, under an NCD, cardiac rehabilitation for patients who experience stable angina, have had coronary artery bypass grafts, or have had an acute myocardial infarction within the past 12 months. The NCD is located in theMedicare NCD Manual (Pub. 100-03), section 20.10. Effective March 22, 2006, we modified the NCD language to cover comprehensive cardiac rehabilitation programs for patients who experience one of the following:A documented diagnosis of acute myocardial infarction within the preceding 12 months.A coronary bypass surgery.Stable angina pectoris.A heart valve repair/replacement.A percutaneous transluminal coronary angioplasty (PTCA) or coronary stenting.A heart or heart-lung transplant.Comprehensive programs must include a medical evaluation, a program to modify cardiac risk factors, prescribed exercise, education, and counseling and may last for up to 36 sessions over 18 weeks or no more than 72 sessions over 36 weeks if determined appropriate by the localMedicare contractors. Facilities furnishing cardiac rehabilitation must have immediately available necessary cardio-pulmonary, emergency, diagnostic, and therapeutic life-saving equipment and be staffed with personnel necessary to conduct the program safely and effectively who are trained in advanced life support techniques and exercise therapy for coronary disease. The program must also be under the direct supervision of a physician. Until section 144(a) of the MIPPA is effective, ICR programs are covered under this NCD and are subject to the same coverage requirements.We are proposing to implement section 144(a) of the MIPPA and refine coverage for CR and ICR through this rulemaking process. When the rulemaking is completed, we will take the necessary steps to withdraw and/or modify the NCD. c. Statutory AuthoritySection 144(a) of the MIPPA amended the Medicare Part B program by adding new sections 1861(s)(2)(CC) and
Page 336071861(s)(2)(DD) of the Act to include items and services furnished under a ``cardiac rehabilitation program'' and an ``intensive cardiac rehabilitation program,'' respectively. A cardiac rehabilitation program is defined in new section 1861(eee)(1) of the Act and an intensive cardiac rehabilitation program is defined in new section 1861(eee)(4)(A) of the Act.A cardiac rehabilitation program is a physician-supervised program that furnishes the following: Physician-prescribed exercise; cardiac risk factor modification, including education, counseling, and behavioral intervention; psychosocial assessment; outcomes assessment; and other items or services as determined by the Secretary under certain conditions. These items and services must be furnished in a physician's office, in a hospital on an outpatient basis, or in other settings as determined appropriate by the Secretary. A physician must be immediately available and accessible for medical consultation and emergencies at all times items and services are being furnished in a CR program except when provided in a hospital setting where such availability is presumed. The items and services furnished by a CR program are individualized and set forth in written treatment plans that describe the patient's individual diagnosis; the type, amount, frequency, and duration of items and services furnished under the plan; and the goals set for the individual under the plan. These written plans must be established, reviewed, and signed by a physician every 30 days.We are proposing that ICR programs must provide the same items and services under the same conditions as CR programs but must demonstrate, as shown in peer-reviewed published research, that they have accomplished one or more of the following: Positively affected the progression of coronary heart disease, or reduced the need for coronary bypass surgery, or reduced the need for percutaneous coronary interventions (PCIs). The peer-reviewed published research must also show that the ICR program has resulted in a statistically significant reduction in 5 or more measures from their levels before ICR services to their levels after receipt of such services. These measures include low density lipoprotein; triglycerides; body mass index; systolic blood pressure; diastolic blood pressure; or the need for cholesterol, blood pressure, and diabetes medications.Beneficiaries eligible for ICR must have experienced the following:An acute myocardial infarction within the preceding 12 months; a coronary bypass surgery; current stable angina pectoris; a heart valve repair or replacement; a PTCA or coronary stenting; or a heart or heart-lung transplant. Section 1861(eee)(4)(C) of the Act, as added by section 144(a)(1)(B) of the MIPPA, states that an ICR program may be provided in a series of 72, 1-hour sessions (as defined in section 1848(b)(5) of the Act), up to 6 sessions per day, over a period of up to 18 weeks.The statute directs the Secretary to establish standards for the physician(s) supervising the ICR and/or CR programs to ensure that the physician has expertise in the management of individuals with cardiac pathophysiology and is licensed by the State in which the CR program(or ICR program) is offered. These standards ensure that the physician is responsible for the program and, in consultation with appropriate staff, is involved substantially in directing the progress of individuals in the program. d. Proposals for ImplementationWe are proposing to create new Sec. 410.49, ``CardiacRehabilitation Program and Intensive Cardiac Rehabilitation Program:Conditions of Coverage.''(1) DefinitionsIn this section, we are proposing several definitions for the terms used with respect to the programs and services required by section 144(a) of the MIPPA. These terms include the following:Cardiac rehabilitation program.Individualized treatment plan.Intensive cardiac rehabilitation.Physician.Physician-prescribed exercisePsychosocial assessment.Outcomes assessment.(2) Covered BeneficiariesIn Sec. 410.49, we are proposing to establish coverage for CR andICR programs for beneficiaries who have experienced any of the following: An acute myocardial infarction within the preceding 12 months; a coronary bypass surgery; current stable angina pectoris; a heart valve repair or replacement; a PTCA or coronary stenting; or a heart or heart-lung transplant. We are proposing to maintain and refine coverage of general CR programs for beneficiaries with these six conditions as originally established in Pub. 100-03, section 20.10 as this coverage was determined to be reasonable and necessary under section 1862(a)(1)(A) of the Act due to a high level of supporting clinical evidence. We are also proposing through this rulemaking to use the NCD process in the future to identify additional medical indications for patients who could obtain CR under Medicare Part B.While CR programs include certain mandatory services, the written plans are highly individualized, and we propose to allow some flexibility in the type, amount, frequency, and duration of services provided in each session. However, as supported by medical literature and statements of the American Heart Association (AHA) and the American Association ofCardiovascular and Pulmonary Rehabilitation (AACVPR),\4\ aerobic exercise training using the muscles of ambulation is a mandatory component of any CR or ICR program. We recommend both low- and high- intensity exercise to produce optimal benefits, and suggest a combination of endurance, strengthening and stretching exercises.Patients in general CR programs must participate in a minimum of 2, 1- hour CR sessions a week, and a maximum of 2, 1-hour sessions a day.Patients in ICR programs may participate in up to 6, 1-hour sessions per day not to exceed 72, 1-hour sessions over an 18-week period. By a 1-hour session, we mean that each session must last a minimum of 60 minutes. Each day CR or ICR items and services are provided to a patient, aerobic exercises along with other exercises must be included(that is, a patient must exercise aerobically every day he or she attends a CR or ICR session). Exercise may include the use of treadmills, bicycles, light weights or other equipment, and should be intended to improve cardiovascular function, strength, endurance, and flexibility.\4\ Balady G, Williams M, Ades P, et al. Core Components ofCardiac Rehabilitation/Secondary Prevention Programs: 2007 Update. AScientific Statement From the American Heart Association Exercise,Cardiac Rehabilitation, and Prevention Committee, the Council onClinical Cardiology; the Councils on Cardiovascular Nursing,Epidemiology and Prevention, and Nutrition, Physical Activity, andMetabolism; and the American Association of Cardiovascular andPulmonary Rehabilitation. Journal of Cardiopulmonary Rehabilitation and Prevention 2007;27:121-129.Section 144(a) of the MIPPA requires CR and ICR programs to furnish items and services including ``cardiac risk factor modification.'' This includes education, counseling, and behavioral intervention to the extent these services are closely related to the individual's care and treatment and tailored to patients' individual needs. We are proposing that patients must be provided with the information and tools to improve their overall cardiovascular health. Items and services furnished as part of the risk factor modification component should be highly
Page 33608individualized as multiple risk factors contribute to poor cardiovascular health. For example, these items and services may include smoking cessation counseling or referral, nutritional education and meal planning, stress management, prescription drug education and management information, disease history education in order to foster a better understanding of disease origins and disease symptomatology, and any other education, counseling and behavioral intervention deemed appropriate in each patient's individualized treatment plan.The MIPPA provisions require a psychosocial assessment as part of the CR and ICR programs defined above. We are proposing that the initial assessment by program staff evaluate aspects of the individual's family and home situation that may affect their treatment, and consider at the outset if referrals to support groups, community and/or home care services are necessary. Prior to each 30-day review of the individualized treatment plan, the supervising physician or program staff will conduct an evaluation of the individual's response to, and rate of progress under, the treatment plan and make recommendations to the physician as necessary. While the individualized treatment plan discussed below will assist in ensuring that patients begin CR with a program tailored to their needs, a periodic re-evaluation is necessary to ensure that their psychosocial needs are in fact being met.The MIPPA provisions also require that CR and ICR programs include outcomes assessment. Professional groups, such as the AHA and AACVPR, recognize a number of relevant patient outcomes that may be expected to accrue from the various components of cardiac rehabilitation.\5\ We propose to define outcomes assessment as an evaluation of the patient's progress in the program using assessments from the commencement and conclusion of CR and ICR programs that are based upon patient centered outcomes. Patient centered outcomes must be measured at the beginning of the CR program, prior to each 30-day review of the individualized treatment plan, and at the end of the CR program. All assessments are considered part of the CR program and, as such, are conducted in the appropriate settings and not billed separately. These measures should include resting and exercising heart rate, resting and exercising systolic and diastolic blood pressure, weight, BMI, amount and dosage of medications required, self-reported quality of life, and behavioral measures (for example, smoking cessation, increased activity levels, change in exercise levels during CR). As CR programs must be highly individualized, alternate or additional measures may be appropriate.Patients' individualized treatment plans should be altered accordingly with changes and/or progress in each of the outcome measurements.Programs may also develop performance standards which measure the overall quality of the program, by assessing the group as a whole.\5\ Balady G, Williams M, Ades P, et al. Core Components ofCardiac Rehabilitation/Secondary Prevention Programs: 2007 Update. AScientific Statement From the American Heart Association Exercise,Cardiac Rehabilitation, and Prevention Committee, the Council onClinical Cardiology; the Councils on Cardiovascular Nursing,Epidemiology and Prevention, and Nutrition, Physical Activity, andMetabolism; and the American Association of Cardiovascular andPulmonary Rehabilitation. Journal of Cardiopulmonary Rehabilitation and Prevention 2007;27:121-129.The MIPPA provisions require that CR services be provided under written individualized treatment plans. As CR programs are highly individualized, we propose that the physician define and set the parameters, including the individual's diagnosis, the types of services appropriate, and the treatment goals. The MIPPA provisions require the physician to establish the written individualized treatment plan and conduct subsequent reviews every 30 days. This plan may initially be developed by the referring physician or the CR physician. If the plan is developed by the referring physician who is not the CR physician, the CR physician must also review and sign the plan prior to initiation of CR. Direct physician contact is not always required to meet the 30- day review standards, but might be necessary depending upon specific patient factors. Regardless, CR staff must provide both outcome and psychosocial assessments to the supervising physician prior to the 30- day deadline and the physician must evaluate the information provided by the CR staff. The CR staff may make recommendations for modifications to the program, but the physician will still modify the plan as needed, and review and sign the plan. The MIPPA provisions require written specificity relating to the type, amount, frequency, and duration of the items and services furnished under the individual's plan. As CR patients have had or may develop disabling cardiovascular disease, they require individual attention and assessments that address their individualized needs and meet realistic individualized goals through a specifically designed treatment plan. The individualized treatment plan should specify the combination of services necessary to address the patient's needs, as identified through the initial assessment and based upon changes in the patient's condition. It must include measurable and expected outcomes and estimated timetables to achieve these outcomes. The outcomes specified in the individualized treatment plan should be consistent with current evidence-based professionally-accepted clinical practice standards such as those identified by the AHA and AACVPR.The MIPPA provisions also authorize the Secretary to include other mandatory items and services within the scope of the CR program under certain conditions. We are not proposing to require any other items and services at the present time. If the Secretary determines that the addition of any other items and services is appropriate, additions will be made and implemented through future rulemaking.Section 144(a) of the MIPPA provides for coverage of CR and ICR services in various settings which include a physician's office, a hospital on an outpatient basis or other settings determined appropriate by the Secretary. We are not proposing to cover CR or ICR in other settings at this time. If the Secretary determines that the addition of settings is appropriate, additions will be made through rulemaking. All settings should have all equipment and staff necessary, consistent with cardiac rehabilitation professional society recommendations, to provide statutorily-mandated items and services.Section 144 of the MIPPA includes requirements for immediate and ongoing physician availability and accessibility for both medical consultations and medical emergencies at all times items and services are being furnished under the program. Professional groups such as theAHA and AACVPR recognize the need to provide appropriate patient supervision and, where appropriate, monitoring. We are proposing that such availability be met through existing definitions for direct physician supervision in physician offices and hospital outpatient departments at Sec. 410.26(a)(2) (defined through cross reference toSec. 410.32(b)(3)(ii)) and Sec. 410.27(f), respectively. Direct supervision, as defined in the regulations, is consistent with the language of the MIPPA because the physician must be present and immediately available where the services are being furnished. The physician must also be able to furnish
Page 33609assistance and direction throughout the performance of the services, which would include medical consultations and medical emergencies.For CR and ICR services provided in physicians' offices and otherPart B settings paid under the PFS, the physician must be present in the office suite and immediately available to furnish assistance and direction throughout the performance of the service or procedure in accordance with the Sec. 410.26(b)(5). This does not mean that the physician must be in the room when the service or procedure is performed. For CR and ICR services provided to hospital outpatients, direct physician supervision is the standard set forth in the April 7, 2000 OPPS final rule with comment period (68 FR 18524 through 18526) for supervision of hospital outpatient therapeutic services covered and paid by Medicare in hospitals and provider-based departments of hospitals. We currently define and specify the requirement for direct supervision for services furnished in provider-based departments of hospitals at Sec. 410.27(f). For this purpose, the physician must be on the premises of the location (meaning the provider-based department) and immediately available to furnish assistance and direction throughout the performance of the procedure. This does not mean that the physician must be present in the room when the procedure is furnished. If we were to propose future changes to the physician office or hospital outpatient policies for direct physician supervision, we would provide our assessment of the implications of those proposals for the supervision of cardiac rehabilitation services at that time.The MIPPA provisions state that in the case of items and services furnished under such a program in a hospital, physician availability shall be presumed. As we have stated in the CY 2009 OPPS/ASC final rule with comment period (73 FR 68702 through 68704), the longstanding presumption relating to direct physician supervision for hospital outpatient services means that direct physician supervision is the standard for supervision of hospital outpatient therapeutic services covered and paid by Medicare in hospitals and provider-based departments of hospitals, and we expect that hospitals are providing services in accordance with this standard.New section 1861(eee)(4) of the Act requires ICR programs, to be qualified for Medicare coverage, to meet several standards. To become qualified, an ICR program must demonstrate through peer-reviewed, published research that it has accomplished one or more of the following: (1) Positively affected the progression of coronary heart disease; (2) reduced the need for coronary bypass surgery; or (3) reduced the need for percutaneous coronary interventions (PCIs). A qualified ICR program must also demonstrate through peer-reviewed published research that the ICR program accomplished a statistically significant reduction for patients in 5 or more specific measures from the individual's levels before ICR services to their levels after receipt of such services. These measures include: (1) Low density lipoproteins; (2) triglycerides; (3) body mass index; (4) systolic blood pressure; (5) diastolic blood pressure; and (6) the need for cholesterol, blood pressure, and diabetes medications. To ensure thatICR programs in fact meet these standards, we are proposing that programs intending to operate as ICR programs apply to CMS to receive designation as qualified ICR programs. Only designated programs would then be eligible for Medicare coverage and would be required to undergo regular re-evaluation to maintain such status. We are requesting public comments on establishing an annual re-evaluation process.We are proposing that programs may apply to CMS to be designated qualified programs to provide ICR. To meet this designation, programs must submit to CMS detailed literature describing the program and the precise manner in which the program meets MIPPA provisions. Each program must also submit peer-reviewed, published research specific to the actual program applying for approval. The research must clearly demonstrate that the program under examination accomplishes at least the minimum outcomes as defined above. We are proposing, based on our general rulemaking authority that each ICR program must submit a detailed description of the items and services available to ICR patients and the capabilities of the facility in which the program takes place as well as the responsibilities of program staff. All materials shall be submitted to: Director, Coverage and Analysis Group,Centers for Medicare & Medicaid Services, 7500 Security Boulevard, MailStop C1-09-06, Baltimore, Maryland 21244.Following CMS review, ICR programs will either be notified of any missing information or inadequacies in their submissions (so they may resubmit in the future) or be notified of CMS designation as an ICR program. Designated programs will be identified in a list of ICR programs posted on the CMS Web site and in the Federal Register. We are proposing that all designated programs must demonstrate continued compliance with MIPPA standards every year in order to maintain qualified status.We are proposing that for an ICR program to maintain its designation by CMS as a qualified ICR program, the program must submit specific outcomes assessment information. Programs shall submit information for all patients who initiated and completed the full ICR program during the initial year-long CMS designation. For each patient, programs must identify the following: (1) The medical condition qualifying the patient for eligibility to participate in ICR; (2) the patient's improvement in coronary heart disease, reduced need for coronary bypass surgery, and/or reduced need for PCIs; and (3) the levels of the 5 or more measures identified above at the beginning and end of the program. Programs must also submit average beginning and ending levels of at least those 5 measures for the program as a whole.If any changes are made to the ICR program during the initial year-longCMS designation, such changes must be documented and submitted with the outcomes assessment information. Programs will have 30 days to submit this information to CMS following the end of the initial approval period. In the month following receipt, we will review the submitted information and determine whether the program continues to meet the payment standards. We believe that re-evaluations of designated programs will assist CMS in ensuring that programs continue to demonstrate the outcome measures identified for initial designation. We are requesting public comments on annual program re-evaluations requirements, the required information for re-evaluation proposed above and if an administrative appeals process should be established for ICR programs that no longer meet outcomes standards. We are also asking for public comments on the time period for re-evaluations of ICR programs.Section 144(a)(1)(B) of the MIPPA requires CR and ICR programs to be physician-supervised. In addition, section 144(a)(5) of the MIPPA requires the Secretary to establish standards to ensure that the physician, who has the appropriate expertise in the management of individuals with cardiac pathophysiology and is licensed to practice medicine in the State in which the CR or ICR program is offered, is responsible for the CR or ICR program. We propose to identify this physician who oversees or supervises the CR and ICR program in its entirety as the Medical Director. As required by
Page 33610144(a)(5), we are proposing that the Medical Director must have training and proficiency in cardiovascular disease management and exercise training of heart disease patients. We also propose that theMedical Director, in consultation with other staff, must be involved substantially in directing the progress of individuals in the program.We are expressly seeking public comments on the precise level of expertise that is necessary for the Medical Director.As discussed above, section 144(a)(2)(B) of MIPAA requires that a physician must be immediately available and accessible for medical consultations and medical emergencies at all times items and services are being furnished under the program. For purposes of this proposed rule we are identifying this physician as the supervising physician(that is, the physician that must be immediately available to furnish assistance and direction throughout the performance of CR and ICR services); we believe this physician also requires expertise in cardiac pathophysiology resulting from training or experience in cardiovascular disease management and exercise training of heart disease patients.This includes a physician billing Medicare Part B for providing services directly to a patient during a CR or ICR session. We are proposing standards for these physicians based on our general rulemaking authority which include expertise in the management of individuals with cardiac pathophysiology and licensure to practice medicine in the State in which the CR or ICR program is offered. We are expressly inviting public comments about the precise level of expertise that is necessary.Please note that the program Medical Director may fulfill both roles of Medical Director and supervising physician (of individual CR and ICR services furnished to patients) provided that the requirements for direct physician supervision as required in Sec. Sec. 410.26 and 410.27 are met when CR or ICR items and services are furnished, as discussed above.We are requesting public comments regarding whether specific training and expertise standards are needed for the cardiac rehabilitation staff.Section 1861(eee)(4)(C) of the Act provides for coverage of ICR programs that are provided in a series of 72 1-hour sessions (as defined in section 1848(b)(5) of the Act), up to 6 sessions per day, over a period of up to 18 weeks. Specific provisions for the number, duration, and time period for general CR programs are not identified in the MIPPA; however we propose to maintain, with slight refinements, coverage requirements previously established in Pub. L. 100-03, section 20.10 through this rulemaking process. For eligible beneficiaries, general CR is provided for up to 36 1-hour sessions, up to 2 sessions per day with no fewer than 2 sessions per week, over up to 18 weeks, with contractor discretion to expand these limitations to not exceed 72 sessions for 36 weeks. This is based on section 1862(a)(1)(A) of theAct and our general rulemaking authority. By 1-hour session, we mean that each session must last a minimum of 60 minutes. e. Coding and Payment(1) CR PaymentCurrently, the following CPT codes are used for CR services described in section 144(a) of the MIPPA: CPT code 93797, Physician services for outpatient cardiac rehabilitation; without continuous ECG monitoring (per session); and CPT code 93798, Physician services for outpatient cardiac rehabilitation; with continuous ECG monitoring (per session). We are not proposing to revise these codes under the PFS because the CR program authorized by the existing NCD is essentially the same as that included in the MIPPA.(2) ICR PaymentThe statute requires that the hospital Outpatient ProspectivePayment System (OPPS) payment amount for CR services be substituted forICR under the PFS, specifically the payment for CPT codes 93797 and 93798 or any succeeding HCPCS codes for CR. We are proposing to create two new HCPCS codes for ICR services. These codes may only be billed byICR programs that have been approved by CMS. The proposed codes are as follows:GXX28, Intensive cardiac rehabilitation; with or without continuous ECG monitoring with exercise, per session.GXX29, Intensive cardiac rehabilitation; with or without continuous ECG monitoring; without exercise, per session.These HCPCS codes will be recognized under the PFS and the OPPS.Under the OPPS the existing CR HCPCS codes, CPT codes 93797 and 93798, are assigned to APC 0095 (Cardiac Rehabilitation) for CY 2009. Because the payment under the PFS for the two proposed ICR G-codes is required to be the same as the payment for CR services under OPPS, we are proposing to pay the same amount as will be established through rulemaking for CY 2010. The proposed OPPS payment amount for CR services will be announced in the CY 2010 OPPS/ASC proposed rule. We are proposing that this amount will be adjusted for the appropriate locality by applying the GPCI under the PFS. The CY 2010 proposed APC assignments and payment rates for these two ICR G-codes will be published in the CY 2010 OPPS/ASC proposed rule. The proposed payment rate for the associated APC(s) will be included in Addendum A to the CY 2010 OPPS/ASC proposed rule.We note that when a CR/ICR service is furnished in a hospital outpatient department, a physician cannot bill the Medicare contractor for CR/ICR unless the physician personally performs the CR/ICR service.To personally perform the CR/ICR service, the physician would provide direct care to a single patient for the entire session of CR/ICR that is being reported. In this case, the hospital would report the CR/ICR service and be paid the OPPS payment for the facility services associated with the CR/ICR session and the physician would report and be paid the PFS amount for the CR/ICR service. A physician cannot bill under the PFS for CR/ICR services furnished in a hospital for which the physician furnishes only supervision or for services furnished in part by others. If the physician furnishes no direct CR/ICR services for a given session or on a given day or provides direct CR/ICR services for less than the full session, then only the hospital would report the CR/ICR services and these services would be paid under the OPPS. 9. Section 144(a): Payment and Coverage Improvements for Patients WithChronic Obstructive Pulmonary Disease and Other Conditions--PulmonaryRehabilitation ServicesSection 144 of the MIPPA amended Title XVIII of the Act to provide for coverage of pulmonary rehabilitation (PR) under Part B, under certain conditions, for services furnished on or after January 1, 2010.This proposed rule would implement the new Medicare pulmonary rehabilitation program and establish the requirements for providing such services to Medicare beneficiaries with a diagnosis of moderate to severe chronic obstructive pulmonary disease (COPD). COPD is not only one of the more common of the diseases in the category of chronic respiratory diseases, it is one of the more severely debilitating, characterized by chronic bronchitis and emphysema. Other diseases and conditions in this category include persistent asthma, bronchiectasis, primary pulmonary hypertension, obesity-related respiratory
Page 33611disease, and ventilator dependency. This rule provides direction in implementing the MIPPA in order to ensure services are covered and enhance the patient's clinical outcomes. a. BackgroundA PR program is typically a multidisciplinary program of care for patients with chronic respiratory impairment that is individually tailored and designed to optimize physical and social performance and autonomy. The main goal of an individualized PR training program is to empower and facilitate the individuals' ability to exercise independently; exercise is the cornerstone of the PR program. Exercise is combined with other training and support mechanisms necessary to integrate prevention and encourage long-term adherence to the treatment plan. The appropriate PR program will train and motivate the patient to his or her maximum potential in self-care, and improve his or her overall quality of life. b. Provisions of Section 144 of the MIPPAIn pertinent part, section 144 of the MIPPA amended section 1861(s)(2) of the Act to add a new subparagraph (CC) establishing coverage of items and services furnished under a ``pulmonary rehabilitation program.'' Pulmonary rehabilitation program is defined in new subsection (fff)(1) to mean a physician supervised program that furnishes several specific items and services. These include all of the following:Physician-prescribed exercise.Education or training (to the extent that the education and training is closely and clearly related to the individual's care and treatment and is tailored to such individual's needs).Psychosocial assessment.Outcomes assessment.Other items and services determined by the Secretary to be appropriate under certain conditions.These components are to be provided in physicians' offices, hospital outpatient settings, and other settings determined appropriate by the Secretary. A physician must be immediately available and accessible for medical consultation and medical emergencies at all times when PR items and services are being furnished under the program.The individual's treatment is furnished under a written treatment plan that is developed by the physician for each beneficiary participating in a PR program. A physician must establish and review the plan and it must be signed by the physician every 30 days. This plan must include the individual's diagnosis, the scope of services to be provided in terms of type, amount, frequency and duration, and the goals set for the individual. To be covered and paid by Medicare, the PR program must provide all of the specified mandatory items and services. With respect to the Secretary's authority to require additional items and services, we are not proposing any additional services at the present time; however, we may propose additional items and services in the future. c. ProposalsUnder section 144 of the MIPPA, we are proposing to create a newSec. 410.47, ``Pulmonary Rehabilitation Program: Conditions forCoverage'' under Part B to add the PR program as a Medicare-covered service. The new section 1861(fff) of the Act outlines the mandatory components of a PR program. In accordance with this new section, any facility providing a PR program must meet all of the requirements outlined herein. The MIPPA provides for coverage of PR services in two specific settings (physician's office, hospital outpatient) and authorized the agency to consider the addition of other settings. We are not proposing any other settings at the present time.The PR provisions defined by section 144 of the MIPPA are effectiveJanuary 1, 2010.(1) DefinitionsWe are proposing the following definitions for the programs and services required by MIPPA as related to PR provisions.Individualized treatment plan: A written plan which describes the individual's diagnosis; the type, amount, frequency and duration of the items and services to be furnished under the plan, including specifics related to the individual's particular needs for education and training; and the goals set for the individual under the plan.Outcomes assessment: A physician's evaluation of the patient's progress as it relates to his or her rehabilitation. The outcomes assessment is in writing and includes the following: (1) Pre- and post-assessments, based on patient-centered outcomes which are conducted by the physician at the beginning of the program and at the end of the program; and (2) objective clinical measures of exercise performance and self-reported measures of shortness of breath and behavior.Physician: A doctor of medicine or osteopathy as defined in section 1861(r)(1) of the Act.Physician-prescribed exercise: Physical activity, including aerobic exercise, prescribed and supervised by a physician that improves or maintains an individual's pulmonary functional level.Psychosocial assessment: A written evaluation of an individual's mental and emotional functioning as it relates to the individual's rehabilitation or respiratory condition.This includes: (1) An assessment of those aspects of an individual's family and home situation that affect the individual's rehabilitation treatment; and (2) a psychosocial evaluation of the individual's response to and rate of progress under the treatment plan.Pulmonary rehabilitation: A short term physician- supervised program for COPD and certain other chronic respiratory diseases designed to optimize physical and social performance and autonomy.(2) CoverageWe are proposing that Medicare Part B would cover PR for beneficiaries with moderate to severe COPD when ordered by the physician treating chronic respiratory diseases. A comprehensive PR program may be adapted for any person with chronic respiratory disease.The medical literature describes conditions associated with the possible need for PR including COPD, obesity-related respiratory disease, lung cancer, and neuromuscular diseases. However, the benefits of a PR program most strongly support its use for patients with moderate to severe COPD.(a) Definition of Moderate to Severe COPDModerate to severe COPD is defined as GOLD classification II andIII. The GOLD classification utilizes indices that measure airflow limitation and lung hyperinflation to determine severity of COPD.Specifically, the measurement of Forced Expiratory Volume (FEV) in the first second divided by the Forced Expiratory Vital Capacity (liters)(FEV1/FVC) gives a clinically useful index of airflow limitation. In other words, the volume of air exhaled that can be forced out in one second after taking a deep breath divided by the maximum volume of air exhaled as rapidly, forcefully and completely as possible from the point of maximum inhalation equals a numerical value used to grade COPD severity. Moderate and severe COPD are defined as:GOLD classification II (Moderate COPD)) is defined asFEV1/FVC=30 percent to GOLD classification III (Severe COPD) is defined as FEV1/FVC The management of comorbidities, including delaying the need for dialysis;Prevention of uremic complications;Options for renal replacement therapy (including hemodialysis and peritoneal dialysis, at home and in-center, as well as vascular access options and transplantation);Ensuring that the beneficiary has the opportunity to actively participate in his or her choice of therapy; andTailored to meet the needs of the beneficiary involved. c. Public MeetingsSection 1861(ggg)(3), as added by section 152(b) of the MIPPA, requires that the Secretary set standards for the content of the KDE services after consulting with various stakeholders, who to the extent possible, had not received industry funding from a drug or biological manufacturer or dialysis facility. On November 6, 2008, and December 16, 2008, we held two feedback sessions to solicit stakeholder comments regarding the implementation of section 152(b) of the MIPPA. Both feedback sessions were open to the public. In addition to the feedback sessions, we conducted an internal review of the available medical evidence, literature, and currently available CKD patient education programs. Transcripts from both events are available on the CMS Web site at http://www.cms.hhs.gov/CoverageGenInfo/08_CKD.asp#TopOfPage.(1) The November 6, 2008 Feedback SessionThe first feedback session was conducted as a Special Open DoorForum (ODF) at the CMS Headquarters on November 6, 2008. Approximately 200 people, representing approximately 70 organizations, participated via teleconference.The majority of stakeholders cited the National Kidney FoundationDisease Outcomes Quality Initiative (NKF KDOQI) guidelines that defineStage IV CKD as a GFR measurement of 15-29 ml/min/1.73m\2\, for purposes of classification and evaluation of CKD. Stakeholders recommended a variety of modalities for providing education services.One-on-one sessions between the educator and the patient were recommended to facilitate comprehension of the information.Stakeholders indicated that diagnoses of CKD can be devastating for some patients and patient outbursts, crying, and other disruptions can derail the educational process for large groups. Since all patients do not have the same learning styles or need for information, one stakeholder recommended that each individual be assessed by the treating physician or nonphysician practitioner (NPP) under the supervision of the treating physician for their learning needs and style preferences before or upon referral for KDE services.Some stakeholders suggested that group education sessions would be appropriate and beneficial for patients, but did not comment specifically on the applicability to the Medicare population.Stakeholders reported that within existing programs, patients were going through a shared experience and group sessions helped facilitate discussion. Other stakeholders recommended that initial education sessions be performed in a group setting, with one-on-one follow-up sessions. We received recommendations
Page 33616regarding session length from 15 minutes to 2 hours, or as long as deemed necessary by the educator or the patient.Some stakeholders recommended against using the Web or telemedicine since these modalities may not be appropriate or facilitate effective comprehension of material in older adults. Other stakeholders indicated that we needed to keep in mind that a patient's uremia may impair comprehension of the materials, that these patients are sick, and that the elderly often need to have information provided in a simplistic, repetitive manner.Regarding the clinically appropriate topics and content standards for KDE services, various stakeholders indicated that the following information should be included in the curriculum:Basic overview of kidney functions and CKD pathophysiology.Survival rates based on choice of treatment or if the patient declines treatment.Quality of life and psychosocial adjustments.Structured, unbiased, uniform information about all renal replacement modalities, with no appropriateness assumptions presented by the educator.The right to decline treatment.Evidence-based content.Prolonging remaining kidney function.Patient participation in management of kidney disease.Sexuality and fertility issues.Transplant options.Smoking cessation.Medication compliance.Financial support and insurance coverage.Diet and exercise.Vocational rehabilitation.Treatment and management of comorbidities.(2) The December 16, 2008 Feedback SessionOn December 16, 2008, the second feedback session was hosted at theAgency for Healthcare Research and Quality (AHRQ). Approximately 60 people representing approximately 40 organizations participated. In preparing for this meeting, we researched and developed a list of approximately 30 experts and educators that are currently providing kidney disease education to individuals or treating patients with CKD, only 10 of which were able to participate. To accommodate those stakeholders that were unable to attend the AHRQ stakeholders meeting, we accepted additional feedback at the following e-mail address:CKDEducation@cms.hhs.gov.We asked each meeting attendee to fill out a disclosure statement that described any industry funding he or she had received from a drug/ biological manufacturer or dialysis facilities, since the MIPPA requested that we consult with various stakeholders, to the extent possible, that had not received such industry funding. The majority of the meeting participants or the organizations represented had received industry funding with few exceptions.When asked about the accepted clinical criteria for classifying someone with Stage IV CKD, most stakeholders stated that Stage IV CKD is best defined as an individual with an estimated GFR of between 15 and 29 or 30 ml/min/1.73m\2\. One stakeholder suggested that to decrease variability between creatinine methodologies, they recommended using a laboratory that traces its serum creatinine technique to IDMS(Isotope dilution mass spectrometry reference measurement procedure).This stakeholder also indicated that the MDRD (modification of diet in renal disease) study equation has been slightly modified to account for labs that are traceable to IDMS.We asked the stakeholders to report on the different modalities of education that would be appropriate for kidney disease patient education. One stakeholder indicated that considerations need to be made regarding the educational needs of different communities and cultures. Several stakeholders indicated that face-to-face or group sessions are the preferred modalities for providing education services.One stakeholder indicated that groups larger than 20 may make it harder for all participants to ask questions. Stakeholders recommended that we allow flexibility to balance the needs of individual CKD patients that have varying degrees of need for information and education. Several stakeholders indicated that curriculum content should include information regarding all renal replacement therapy options (including no treatment), vascular access options, available support services, and management of co-morbidities including diabetes, blood pressure management, bone disease, and mineral metabolism.Stakeholders recommended numerous frequency and duration combinations. One stakeholder recommended a variety of combinations of six 1-hour classroom group sessions including one session per week(over a 6-week period); six sessions over a weekend (3 sessions onSaturday; 3 sessions on Sunday); or all 6 sessions on 1 day during a weekend. This stakeholder also recommended that sessions should be standardized so that an individual can take sessions when they are offered to meet their scheduling needs. Stakeholders recommended sessions that lasted between 15 minutes and 2.5 hours. One stakeholder indicated that pre- and post-assessments should be included as part of the education programs.When asked what factors in existing education programs have led to the best patient outcomes, we received a variety of responses such as varying the training format, providing information repetitively, and presenting information at the appropriate reading level for the audience. Stakeholders recommended that all aspects of the education services be provided in an objective and neutral manner, not skewing the information toward one or more renal replacement therapy modalities. d. ImplementationConsistent with section 1861(ggg) of the Act, we are proposing to amend 42 CFR part 410 to add new Sec. 410.48 for KDE services as aMedicare Part B benefit.(1) Definitions (proposed Sec. 410.48(a))As related to the implementation of section 1861(ggg) of the Act, we are proposing the following definitions in Sec. 410.48:Kidney Disease Patient Education Services: Consistent with section 1861(ggg)(1) of the Act, we are proposing to define KidneyDisease Patient Education Services as face-to-face educational services provided to patients with Stage IV CKD. We are proposing that the services be provided in a face-to-face manner based on stakeholder feedback received during the consultation meetings and our general rulemaking authority. Face-to-face education is consistent with sections 1861(ggg)(C)(ii) and (iii) of the Act, which provide that the services should be designed to ensure that the beneficiary has the opportunity to actively participate in the choice of therapy, and that the services be designed to be tailored to meet the needs of the beneficiary involved.Some stakeholders recommended that sessions be conducted face-to- face due to varying patient literacy levels. Other stakeholders recommended against using Web-based education resources since the elderly may not be as comfortable with or lack access to the Internet.In light of these considerations, we believe that face-to-face education services are the most appropriate means for providing these services.Physician: For purposes of KDE services, a physician will be defined using the definition in section 1861(r)(1)
Page 33617of the Act; it defines ``physician'' as ``a doctor of medicine or osteopathy legally authorized to practice medicine and surgery by theState in which he or she performs such function or action (including a physician within the meaning of section 1101(a)(7) [of the Act].''Qualified Person: Consistent with section 1861(ggg)(2)(A) of the Act, for purposes of KDE services, we are proposing to define a``qualified person'' as a physician (as defined in section 1861(r)(1) of the Act); a physician assistant, nurse practitioner, or clinical nurse specialist (as defined in section 1861(aa)(5) of the Act, and implemented in Sec. 410.74, Sec. 410.75, and Sec. 410.76 of this subpart). A provider of services located in a rural area is also included in the statute's definition of a qualified person. Section 1861(u) of the Act defines ``provider of services'' to be ``a hospital, critical access hospital, skilled nursing facility, comprehensive outpatient rehabilitation facility, home health agency, hospice program or, for purposes of sections 1814(g) and section 1835(e) [of the Act], a fund''. We are proposing to define a ``qualified person'' to include a provider of services located in a rural area and would include each of these healthcare entities except for a ``fund.''We do not believe that it would be appropriate to recognize a fund described by sections 1814(g) and 1835(e) of the Act as a ``qualified person''. These funds are defined as providers of services only for the limited purpose of paying for the services of faculty physicians when they furnish certain services under the authority of sections 1814(g) and 1835(e) of the Act. These funds are not licensed as hospitals; they do not bill Medicare and do not receive payment. Moreover, these funds do not comply with Medicare conditions of participation and do not have provider agreements with Medicare. Because we do not believe that it would be appropriate to include ``funds'' in the definition of a``qualified person'' for purposes of the KDE benefit, we are proposing to exclude funds described by sections 1814(g) and section 1835(e) of the Act from our definition of a provider of services located in a rural area as defined in section 1886(d)(2)(D) of the Act.In order for a provider of services to be a ``qualified person,'' the entity must be located in a rural area. We are proposing to include in the definition of a ``qualified person'', only those hospitals, critical access hospitals (CAHs), skilled nursing facilities (SNFs), comprehensive outpatient rehabilitation facilities (CORFs), home health agencies (HHAs), and hospice programs that are located in a rural area under section 1886(d)(2)(D) of the Act (as defined in our regulations at Sec. 412.64(b)(ii)(C)) and to include hospitals and CAHs that are reclassified from urban to rural status pursuant to section 1886(d)(8)(E) of the Act, as defined in Sec. 412.103. Specifically,Sec. 412.64(b)(ii)(C) defines ``rural'' to mean any area outside an urban area, which Sec. 412.64(b)(ii)(A) defines as a metropolitan statistical area (MSA) as defined by the President's Office ofManagement and Budget (OMB). Therefore, we believe that a hospital,CAH, SNF, CORF, HHA, or hospice program that is not physically located in an MSA should be considered ``rural'' for this benefit.Section 1886(d)(8)(E) of the Act, implemented in Sec. 412.103, requires us to treat hospitals that meet specified criteria as geographically rural under section 1886(d)(2)(D) of the Act even though they are physically located in an MSA. Because the statute identifies these hospitals as rural, we believe that it is appropriate to consider these hospitals a qualified person for purposes of the KDE benefit. TheConditions of Participation for CAHs in Sec. 485.610 also include a provision to allow a hospital located in an urban area to reclassify as rural for purposes of becoming a CAH through section 1886(d)(8)(E) of the Act, as defined in Sec. 412.103. Because a hospital or CAH specified under section 1886(d)(8)(E) of the Act is treated as being located in a rural area under section 1886(d)(2)(D) of the Act, we are proposing to recognize those hospitals or CAHs as a ``qualified person'' for purposes of the KDE benefit.Renal Dialysis Facility: The Congress has provided in section 1861(ggg)(2)(B) of the Act that a ``renal dialysis facility'' may not be a ``qualified person.'' We are defining this term, consistent with Sec. 405.2102 of this title, as ``a unit which is approved to furnish dialysis service(s) directly to ESRD patients.''Stage IV Chronic Kidney Disease: Section 1861(ggg)(1)(A) of the Act states that KDE services shall be furnished to beneficiaries diagnosed with Stage IV CKD, who according to accepted clinical guidelines identified by the Secretary, will require dialysis or a kidney transplant. Based on stakeholder feedback, we are proposing to define Stage IV CKD as kidney damage with a severe decrease in GFR quantitatively defined by a GFR value of 15-29 ml/min/1.73 m\2\, using the Modification of Diet in Renal Disease (MDRD) Study formula.\7\Because there are currently no agreed upon accepted clinical guidelines that describe the stage IV patients who would eventually require dialysis or a kidney transplant, we are proposing to cover all stage IV patients.\7\ Levey, A.S., Greene, T., Kusek, J., and Beck, G.A. J Am SocNephrol. 2000. 11: p. 155A.; Levey, A.S., Bosch, J.P., Lewis, J.B.,Greene, T., Rogers, N., and Roth, D. Ann Intern Med. 1999 Mar 16; 130(6):461-70.During both the November 6, 2008, and the December 16, 2008 feedback sessions, the majority of stakeholders indicated that Stage IVCKD is currently determined as kidney damage with a severe decrease in the estimated GFR value (15 to 29 mL/min/1.73 m\2\). While there appeared to be agreement among the stakeholders regarding the estimatedGFR values for the diagnosis of Stage IV CKD, some stakeholders indicated that only using the estimated GFR value to determine the severity of a beneficiary's CKD may be insufficient. To decrease variability between creatinine methodologies, stakeholders recommended using a laboratory that traces its serum creatinine technique to IDMS and that the MDRD study equation has been slightly modified to account for labs that are traceable to IDMS.(2) Covered Beneficiaries (Proposed Sec. 410.48(b))Consistent with section 1861(ggg)(1)(A) of the Act, we are proposing that KDE services be furnished to beneficiaries with Stage IVCKD based on the definition of Stage IV CKD defined in proposed Sec. 410.48(a), and have been referred for such services by the physician managing the beneficiary's kidney condition.(3) Standards for Qualified Persons and Exclusions (Proposed Sec. 410.48(c))We are proposing to require that a qualified person be able to properly receive Medicare payment under 42 CFR part 424 (Conditions forMedicare Payment). In Sec. 410.48(c), we are proposing to establish exclusions from the term ``qualified person.'' Consistent with section 1861(ggg)(2)(B) of the Act, we specifically exclude a hospital, CAH,SNF, CORF, HHA, or hospice that is physically located outside of a rural area under Sec. 412.64(b)(ii)(C), except for a hospital or CAH that is treated as being located in a rural area under Sec. 412.103.In addition, consistent with section 1861(ggg)(2)(B) of the Act, a renal dialysis facility is not a qualified person.While we are not proposing specific education, experience, training, and/or certification requirements at this time,
Page 33618we are specifically seeking public comments on the appropriate level of education, experience, training, and/or certification appropriate for a qualified person to effectively provide KDE services and may provide such provisions in the final issuance of this rule or in future rulemaking. Factors to consider include specific education and expertise regarding the topic and ability to explain these areas for the purpose of patient education:General kidney physiology and test results that would be associated with CKD.Psychological impact of the disease on the beneficiary, and impact on family, social life, work, and finances.The management of comorbidities (such as cardiovascular disease, diabetes, hypertension, anemia, bone disease, and impairments in functioning) common in persons diagnosed with CKD.Renal replacement therapeutic options, treatment modalities and settings, and advantages and disadvantages of each treatment option.Diet, fluid restrictions, and medication usage to include side effects and informed decisionmaking.Encouragement of patient active participation in decisionmaking and the ability to tailor educational needs to the individual beneficiary.Other areas of health deemed important to patients withCKD.(4) Standards for Content of Kidney Disease Patient Education Services(Proposed Sec. 410.48(d))We believe that patient education needs vary by severity of the disease, the age of the patient, the patient's comorbid conditions and disabilities, the patient's primary language and culture, and desire to learn more about the disease and treatment options. Education services are more effective if the services are tailored to meet an individual beneficiary's needs. We are proposing that KDE services include the content as specified in proposed Sec. 410.48(d). According to an article by Paula Ormandy \8\ in the Journal of Renal Care, patients are most interested in receiving information on the following topics, which was echoed by many stakeholders during the feedback sessions.\8\ Ormandy, P., ``Information Topics Important to ChronicKidney Disease Patients: A Systematic Review.'' Journal of RenalCare 34(1), 19-27, 2008.Basic information regarding CKD, how the kidneys work, what happens when the kidneys fail, and the permanence of the disease.Survival rates with and without renal replacement therapy and survival rates if the patient refused treatment for their CKD.The need for kidney transplantation.Unbiased information about renal replacement therapy (RRT) options including advantages and disadvantages for all modalities.Adequate information regarding why some RRT options were not viable for a patient.How different RRT options affected the patient's co-morbid conditions.Effect of RRT choices on lifestyle, such as treatment flexibility and treatment session length.Whether a patient will need assistance based on RRT modality choice and training requirements for helpers.The right to refuse treatment.Effects of the disease, and the subsequent treatment, on the patient's physical appearance.Patient recognition of the symptoms that would empower the patient with the knowledge to seek help.Disease and treatment complications related to renal replacement therapy such as hypertension, catheter migration, temporary/permanent loss of dialysis access, and risk of infection at the access sight.How to control and manage consequences of complications and symptoms (for example: treatment for itchy skin or insomnia).The ability to travel and organize holidays depending onRRT choice.Maintenance of social relationships, activities, and commitments.How the disease and RRT may affect the patient's ability to continue working.Available support services.Medication management, including side effects and risks related to non-compliance to prescribed medication regimen.(5) Session Specifications (Proposed Sec. 410.48(e))(a) Limitations on the number of sessions: Consistent with section 1861(ggg)(4) of the Act, we will limit the number of KDE sessions to six (6).(b) Session Length: In the absence of supporting evidence for session length, we are proposing to define the session length as 60 minutes which coincides with the session length of some programs in existence and is the approximate average of stakeholder suggested session lengths.(c) Individual and Group Session Format: Consistent with section 1861(ggg)(C)(iii) of the Act, we are proposing that the qualified person tailor the design of the education services to meet the needs of the beneficiary based on whether the beneficiary needs more individualized education, would benefit more from a group environment, or a combination; and consider any communication accessibility needs based on disability, language and health literacy.During the feedback sessions, we received a variety of recommendations regarding how education services should be provided, including a combination of group sessions, one-on-one sessions, and multi-media presentations. Stakeholders recommended that one-on-one sessions, between the beneficiary and the educator, facilitated quicker comprehension of the education materials than group sessions, and provided the best opportunity to tailor the sessions to meet the patient's needs. Other stakeholders indicated that group sessions provide patients with the benefit of responses to questions posed by different group participants.Medical services, generally speaking, are provided to beneficiaries on an individual basis. Beneficiaries can also benefit from the interaction in a group setting. We believe that the beneficiary, in consultation with the referring physician, will be able to best determine the education services modality that most effectively meets his or her needs.(6) Outcomes AssessmentThe intent of the education services is for the beneficiary to take the information he or she has learned during the educational sessions in order to facilitate active participation by the beneficiary in the healthcare decisionmaking process with the physician managing his or her kidney condition. We believe that it is important that beneficiaries be assessed at the conclusion of the education sessions and are proposing that program assessments be used by the educators andCMS to assess the effectiveness of the education services, to help improve the programs for future participants, and better facilitate patient understanding of the material.During the AHRQ stakeholders meeting, various stakeholders indicated that it was important to monitor the effectiveness of the education services to improve the content and delivery of KDE services.Assessing the effectiveness of the KDE services through assessments can be an effective way of measuring how beneficiary needs are being met.Some existing education programs have pre- and post-education session assessments and are usually administered immediately
Continued on page 33619From the Federal Register Online via GPO Access [wais.access.gpo.gov]]
pp. 33619-33668Medicare Program; Payment Policies Under the Physician FeeSchedule and Other Revisions to Part B for CY 2010
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Page 33619following the conclusion of the education sessions.We are proposing, based on stakeholder feedback and our general rulemaking authority, that qualified persons develop outcomes assessments and that each beneficiary be assessed during one of the education sessions. We are proposing that the outcomes assessment measure beneficiary knowledge about CKD and its treatment for the purpose, and as a contributor to, the beneficiary's ability to make informed decisions regarding their healthcare and treatment options.According to an article by Gerald Devins in the Journal of ClinicalEpidemiology, an outcomes assessment or test should be able to``measure the adaptive value of ESRD-related knowledge as a contributor to psychosocial and physical well-being, * * * reliably and validly assess patient knowledge about ESRD and its treatment,'' * * * ``be easy to administer and score,'' and * * * ``require only basic reading skills.'' \9\\9\ Devins, G., et al. ``The Kidney Disease Questionnaire: ATest for Measuring Patient Knowledge about End-Stage RenalDisease.'' J Clin Epidemiol. Vol. 43, No. 3. pp. 297-307, 1990.After completing the KDE services, the beneficiary should be able to take the information learned and use it to make informed choices about their healthcare during future consultations with the physician managing the beneficiary's kidney condition. It is important that the assessments be tailored to the beneficiary's reading level and language if the assessment is not administered by the qualified person that provided the education services, and be made available to CMS in a summarized format upon request.We are specifically seeking public comments regarding the development and administration of the outcomes assessments. Factors to consider include:Specific topics that should be included as part of the assessment;Whether standardization of the outcomes assessment is feasible and/or should be considered;The applicability of any standardized assessments that may currently be in existence;The feasibility of providing both pre- and post-education assessments; andMethods for collecting assessments and disseminating best practices for KDE services. e. Payment for KDE ServicesSection 152(b) of the MIPPA creates a new benefit category for KDE services. The MIPPA amends section 1848(j)(3) of the Act, which allows for payment of KDE services under the PFS. KDE services are covered when they are furnished by a qualified person as defined in proposedSec. 410.48(a) and that meets the requirements of proposed Sec. 410.48(c). We note that there is a possibility that a beneficiary may receive services from more than one ``qualified person''; however, payment should be made to only one qualified person on the same day for the same beneficiary.The ``incident to'' requirements for physician services at section 1861(s)(2)(A) of the Act do not apply to KDE services because the MIPPA requirements are explicit, in that the education services must be provided by a qualified person, which is defined as a physician, nurse practitioner, clinical nurse specialist or physician assistant, and also includes a provider of services located in a rural area. In the past, we have taken the position that the ``incident to'' provision does not apply to the implementation of a new service with a distinct benefit category under the PFS. Therefore, the ``incident to'' requirements will not apply to KDE services.Rural health clinics (RHCs) do not meet the statutory definition of a provider of services (as defined in 1861(u) of the Act) and cannot be separately paid for furnishing KDE services.Section 1861(ggg)(4) of the Act limits the number of KDE services that a beneficiary may receive to six sessions. We are proposing to create two HCPCS codes, GXX26 (individual) and GXX27 (group), to describe and to bill for KDE services. The two G-codes consist of 1- hour face-to-face KDE services for an individual or group. We are proposing to pay both GXX26 and GXX27 at the nonfacility rate. We are also proposing that GXX26 educational services related to the care of chronic kidney disease; individual per session will be crosswalked toCPT code 97802; and that GXX27, educational services related to the care of chronic kidney disease; group, per session will be crosswalked to CPT code 97804. The rationale for the proposed pricing of the G- codes is based on the similarity of this service to medical nutrition therapy in the individual (97802) and group (97804) setting.In the CY 2010 OPPS/ASC proposed rule, we discuss our proposed payment for KDE to qualified persons who are hospitals, CAHs, SNFs,CORFs, HHAs, or hospices. Commenters should submit specific comments on our payment proposal for this benefit, including the method and amount of payment, for qualified hospitals, CAHs, SNFs, CORFs, HHAs, or hospices in response to the CY 2010 OPPS/ASC proposed rule. We will discuss our final payment policy for these qualified providers in theCY 2010 OPPS/ASC Final Rule. f. Effective DateMedicare Part B coverage of outpatient kidney disease patient education services will be effective for services furnished on or afterJanuary 1, 2010. 11. Section 153: Renal Dialysis ProvisionsSection 153 of the MIPPA requires changes to ESRD facilities forESRD services effective January 1, 2010. The following is a summary of these changes.Section 153(a)(1) of the MIPPA increases the current ESRD composite rate by 1.0 percent for services furnished on or after January 1, 2010.This also requires us to update the adjusted drug add-on. Since we compute the drug add-on adjustment as a percentage of the composite rate, the drug add-on percentage is decreased to account for the higherCY 2010 composite payment rate and results in a 15.0 percent drug add- on adjustment for CY 2010. As a result, the drug add-on amount of$20.33 per treatment remains the same for CY 2010, which results in a 15.0 percent increase to the base composite payment rate of $135.15.(See section II.I.6. of this proposed rule for further discussion.)The composite rate paid to hospital-based facilities will be the same as the composite rate paid to independent renal dialysis facilities for services furnished on or after January 1, 2010. In addition, section 153(a)(2) of the MIPPA requires that in applying the geographic index to hospital-based facilities, the labor share shall be based on the labor share otherwise applied for renal dialysis facilities.These MIPPA provisions are self-implementing and require no substantive exercise of discretion on the part of the Secretary. A detailed discussion of the MIPPA provisions can be found in sectionIII. of the CY 2009 PFS final rule with comment period (73 FR 69881).
Page 3362012. Section 182(b): Revision of Definition of Medically-AcceptedIndication for Drugs; Compendia for Determination of Medically-AcceptedIndications for Off-Label Uses of Drugs and Biologicals in an Anti- cancer Chemotherapeutic Regimen a. Background(1) Process for Revising the List of Statutorily Named CompendiaGenerally, compendia are ``pharmacopeia providing information on drugs, their effectiveness, safety, toxicity, and dosing--are frequently used to determine whether a medication has a role in the treatment of a particular disease; these roles include both therapeutic uses approved by the U.S. Food and Drug Administration (FDA) and off- label indications'' (Agency of Healthcare Research and Quality (AHRQ),Potential Conflict of Interest in the Production of Drug CompendiaWhite Paper).\10\ Compendia are published by various institutions and by traditional reference book publishing houses.\10\ Agency for Healthcare Research and Quality. White Paper:Potential Conflict of Interest in the Production of Drug Compendia.(2009, April 27). Available online at http://www.cms.hhs.gov/mcd/ viewtechassess.asp?from2=viewtechassess.asp&where=index&tid=64.Section 1861(t)(2)(B)(ii)(I) of the Act lists the following compendia as authoritative sources for use in the determination of a``medically-accepted indication'' of drugs and biologicals used off- label in an anticancer chemotherapeutic regimen: American MedicalAssociation Drug Evaluations (AMA-DE); United States Pharmacopoeia-DrugInformation (USP-DI) or its successor publication; and AmericanHospital Formulary Service-Drug Information (AHFS-DI). Due to changes in the pharmaceutical reference industry, AHFS-DI is the only statutorily-named compendium that is currently in publication.In addition to these compendia, the statute provides an alternative method for identifying medically-accepted off-label uses of drugs and biologicals in an anti-cancer chemotherapeutic regimen. Section 1861(t)(2)(B)(ii)(II) of the Act provides that local contractors may use ``supportive clinical evidence in peer-reviewed medical literature'' to make such determinations. Thus these medically-accepted uses could be identified even if there were no compendia recognized for this purpose. We discussed this in our response to comments in the CY 2008 PFS final rule with comment period (72 FR 66305).Section 1861(t)(2)(B) of the Act provides the Secretary the authority to revise the list of compendia in section 1861(t)(2)(B)(ii)(I) for determining medically-accepted indications for off-label use of drugs and biologicals in an anti-cancer chemotherapeutic regimen. Consequently, in Sec. 414.930, we established an annual process to revise the list and establish a definition of ``compendium'' in the CY 2008 PFS final rule with comment period (72 FR 66222, 66303 through 66306, and 66404).On March 30, 2006, the Medicare Evidence Development and CoverageAdvisory Committee or MEDCAC (formerly the Medicare Coverage AdvisoryCommittee (MCAC)) met in public session to advise CMS on the appropriate criteria for the recognition of compendia for the identification of medically-accepted indications of drugs and biologicals used in an anti-cancer therapy, and the degree to which the then listed and other available compendia displayed those criteria. The evidence the MEDCAC considered to derive its recommendations included a presentation of the technology assessment (TA) performed for AHRQ by staff of the Tufts-New England Medical Center (Tufts-NEMC) and DukeEvidence-based Practices Centers (EPCs), scheduled stakeholder presentations, as well as testimony from members of the public. As is customary, the MEDCAC panelists elicited additional information from the presenters and discussed the evidence in preparation for a formal vote. The MEDCAC recommended that the following criteria, referred to as ``desirable characteristics,'' should be used to recognize compendia for identification of medically-accepted indications of drugs and biologicals in anti-cancer therapy:Extensive breadth of listings.Quick processing from application for inclusion to listing.Detailed description of the evidence reviewed for every individual listing.Use of pre-specified published criteria for weighing evidence.Use of prescribed published process for making recommendations.Publicly transparent process for evaluating therapies.Explicit ``Not recommended'' listing when validated evidence is appropriate.Explicit listing and recommendations regarding therapies, including sequential use or combination in relation to other therapies.Explicit ``Equivocal'' listing when validated evidence is equivocal.Process for public identification and notification of potential conflicts of interests of the compendia's parent and sibling organizations, reviewers, and committee members, with an established procedure to manage recognized conflicts.We incorporated the MEDCAC recommended desirable characteristics into the compendia review process. All information on this MEDCAC meeting can be found on the CMS Web site at http://www.cms.hhs.gov/mcd/ viewmcac.asp?where=index&mid=33.Although we did not rank these ten MEDCAC desirable characteristics, the MEDCAC desirable characteristics that addressed transparency and conflict of interest of compendia were considered to be of high priority (72 FR 66304 through 66305). In addition, we considered the need to enhance transparency in the compendia review process to preserve the integrity of the review process (72 FR 66222, 66303 through 66306, and 66404).During the 2008 compendium review cycle, we considered requests regarding the following five compendia: The AMA-DE Compendium; NationalComprehensive Cancer Network Drugs and Biologics (NCCN) Compendium;Thomson Micromedex DrugDex Compendium; Thomson Micromedex DrugPointsCompendium; and Clinical Pharmacology Compendium. Our decisions are posted on the CMS Web site at http://www.cms.hhs.gov/CoverageGenInfo/ 02_compendia.asp#TopOfPage. In summary, we issued the following decisions regarding those compendia requests:NCCN was added to the list of compendia.Thomson Micromedex DrugDex was added to the list of compendia.Clinical Pharmacology was added to the list of compendia.Thomson Micromedex DrugPoints was not added to the list of compendia.AMA-DE was removed from the list of compendia.(2) MIPPA Requirement for CompendiaSection 182(b) of the MIPPA amended section 1861(t)(2)(B) of theAct (42 U.S.C. 1395x(t)(2)(B)) by adding the sentence, ``On and afterJanuary 1, 2010, no compendia may be included on the list of compendia under this subparagraph unless the compendia has a publicly transparent process for evaluating therapies and for identifying potential conflicts of interests.'' There is a growing body of literature, including that from the Institute of Medicine (IOM),\11\ that discusses the conflict of interest between research funding and
Page 33621research results. Some authors have stated that there is a conflict of interest if an entity has a financial, legal, or political interest that is counterproductive to the performance of their legal or ethical responsibilities.\12\ Although this widely discussed correlation depicts a classic representation of a financial conflict of interest, we believe nonfinancial conflicts of interests also deserve attention.Nonfinancial conflicts of interests have the potential to interfere with honest reporting, transparency and fair review of applications submitted to compendia publishers.\13\ Therefore, in light of such concerns, the existence of financial and nonfinancial conflicts of interests would threaten the impartiality of the recommendations made in the compendia. We believe that section 182(b) of the MIPPA,``Revision of definition of medically-accepted indication for drugs * ** Conflict of Interest'' is designed, in part, to address this issue in the compendia review process.\11\ Institute of Medicine. Conflict of Interest in MedicalResearch, Education, and Practice. Available online at http:// www.nap.edu/catalog.php?record_id=12598.\12\ Resnik, D. (2007, April). Conflicts of Interest inScientific Research Related to Regulation and Litigation. TheJournal of Philosophy, Science & Law. 7:1-16.\13\ The PloS Medicine Editors. (2008, September). Making Sense of Non-Financial Competing Interests. PloS Medicine. 5(9):1299-1301,Retrieved March 19, 2009 from http://www.plosmedicine.org.(3) Proposed Revisions of Compendia StandardsWe believe that the implementation of this statutory provision that compendia have a ``publicly transparent process for evaluating therapies and for identifying potential conflicts of interests'' is best accomplished by amending the current definition of a compendium atSec. 414.930(a) to include the MIPPA requirements and by defining the key components of publicly transparent processes for evaluating therapies and for identifying potential conflicts of interests. In order to implement the MIPPA requirements concerning a publicly transparent process for evaluating therapies, we propose that a compendium could meet this standard by publishing materials used in its evaluation process on its Web site. This mode of publication provides broad contemporaneous public access to relevant materials. We believe that public access to such materials will increase transparency of the process used by compendia publishers for evaluating therapies and facilitate independent review of recommendations by interested parties.In addition, as discussed in the CY 2008 PFS final rule with comment period (72 FR 66305 through 66306), such disclosure may assist beneficiaries and their physicians in choosing among treatment options.As expressed in the February 14, 2008 letter from the U.S. SenateCommittee on Finance to the CMS Acting Administrator Kerry Weems,``conflicts of interest have been proven in peer-reviewed studies to have a significant impact on scientific outcomes and medical care.''\14\ Since compendia recommendations are generally dependent on evidence from peer-reviewed studies, we believe that conflicts of interests may arise from relationships between individuals who substantively participate, such as individuals who contribute more than a clerical role, in the development of compendia recommendations and the applicants (for example, the manufacturer or seller of the drug or biological being reviewed by the compendium) for the inclusion of drug or biological recommendations in compendia. These relationships may involve, for example, publishers of compendia and peer-reviewed journals, their editorial or advisory boards, drug manufacturers, physicians or providers that derive income from the prescribing or administration of drugs, researchers that have a personal or academic interest in the drug study, or others who may provide incentives to influence the prescribing behaviors of physicians.\15\ As illustrated in the AHRQ Potential Conflict of Interest in the Production of DrugCompendia White Paper, these potential financial and nonfinancial conflicts exist at the various stages of the evaluation process. TheWhite Paper also describes compendia publication users (for example, the public, physicians, other caregivers, and public/private insurers) and the objectives of each user when referencing the compendia.Therefore, these potential financial and nonfinancial conflicts may be problematic for users of the compendia to rely on the validity of the compendia recommendations.\16\\14\ United States Senate Committee on Finance Correspondence.(2008, February 14). CMS Process and Actions Concerning Approval ofAnti-Cancer Drug Compendia.\15\ The PloS Medicine Editors. (2008, September). Making Sense of Non-Financial Competing Interests. PloS Medicine. 5(9):1299-1301,Retrieved March 19, 2009 from http://www.plosmedicine.org.\16\ Agency for Healthcare Research and Quality. White Paper:Potential Conflict of Interest in the Production of Drug Compendia.(2009, April 27). Available online at http://www.cms.hhs.gov/mcd/ viewtechassess.asp?from2=viewtechassess.asp&where=index&tid=64&.Section 182(b) of the MIPPA requires a publicly transparent process for: (1) Evaluating therapies, and (2) identifying potential conflicts of interests. In light of these provisions, we are proposing regulatory safeguards to require that the publicly transparent process for evaluating therapies and identifying potential conflicts of interests include disclosure of certain relevant information. All currently listed compendia will be required to comply with these provisions, as of January 1, 2010, to remain on the list of recognized compendia. We view compendia publishers as generally responsible for the integrity of their publications. Therefore, we urge currently listed compendia publishers to submit evidence demonstrating compliance with the MIPPA provisions that ``no compendia may be included on the list of compendia'' unless the compendium has a publicly transparent process for therapy evaluation and conflict of interest identification to CMS no later than December 31, 2009. In addition, any compendium that is the subject of a future request for inclusion on the list of recognized compendia will be required to comply with these provisions. We believe that the statute is clear that no compendium can be on the list if it does not fully meet the standard described in section 1861(t)(2)(B) of the Act, as revised by section 182(b) of the MIPPA. b. Revisions to Sec. 414.930, ``Compendia for Determination ofMedically-Accepted Indications for Off-Label Uses of Drugs andBiologicals in an Anti-Cancer Chemotherapeutic Regimen''We are proposing the following amendments to Sec. 414.930(a):To revise the definition of ``compendium'' by adding an additional requirement that a compendium have a publicly transparent process for evaluating therapies and for identifying potential conflicts of interests.To add the definition of ``publicly transparent process'' for evaluating therapies. We propose that assurance of a publicly transparent evaluation process is best achieved by establishing a process that provides for public disclosure of the evidence considered and the review of that evidence leading to the development of compendia recommendations.\17\ By providing for this disclosure, we hope to ensure validity in the use of compendia for identifying medically- accepted uses of off-label treatments for purposed of section 1861(t)(2)(B) of the Act. Thus, we believe that in the interest of providing a publicly transparent process
Page 33622for evaluating therapies and maximizing that transparency, a compendium should publish the complete application for inclusion, exclusion, or deletion of a therapy including criteria used to evaluate the request, on its Web site. We believe that in accordance with that publicly transparent process, a compendium should similarly publish the names of the individuals who have substantively participated in the development of compendia recommendations, along with transcripts of meetings and records of votes. This provides an opportunity for the public to consider the process used by the compendia in evaluating a specific therapy and independently reach conclusions about the adequacy of the application in light of the compendium's final recommendation. We request comments on the requirement for publication of a transcript and the suitability of other alternatives such as minutes or other documents.\17\ Resnik, D. (2007, April). Conflicts of Interest inScientific Research Related to Regulation and Litigation. TheJournal of Philosophy, Science & Law. 7:1-16.To add a definition regarding a ``publicly transparent process for identifying potential conflicts of interests,'' and clarify the essential elements of such a process. We propose that a publicly transparent process for identifying potential conflicts of interests is best demonstrated by a process that requires public transparency regarding the competing financial and nonfinancial interests that may give rise to such conflicts. Thus, we believe that a compendium should have a process for disclosing by publication on its publicly accessibleWeb site, certain information regarding potential conflicts of interests associated with individuals who are responsible for the compendium's recommendations as well as their immediate family members(as defined in Sec. 411.351). A process for providing disclosure of interests by immediate family members is necessary because such interests could represent potentially competing financial conflicts that could influence the review and individuals responsible for the compendium's recommendations.\18\\18\ The PloS Medicine Editors. (2008, September). Making Sense of Non-Financial Competing Interests. PloS Medicine. 5(9):1299-1301,Retrieved March 19, 2009 from http://www.plosmedicine.org.We believe that the process for identifying potential conflicts of interests should include information regarding ownership and investment interests of those individuals who are responsible for the compendium's recommendation. Such information should include the names of those entities with which the individual has an ownership or investment relationship (similar to those relationships defined in Sec. 411.354), the nature and length of the relationships, other financial relationships that may derive fron either a direct or indirect relationship (similar to thise relationships identified in 42 CFR 411.354, and the significance (for example, dollar value) of those relationships. By requiring a process for identification of such relationships, we are providing a process for the public to have access to information regarding potential conflicts of interests. We believe that information concerning the value of financial relationships is necessary because it would permit the public to assess the degree of influence that a relationship may have over an individual's decisions or judgments.\19\ We request comments on the suitability of this process or whether the compendia should prescribe its own process. In addition, we request comments specifically addressing whether information regarding immediate family members is necessary for conflict of interest determinations.\19\ Resnik, D. (2007, April). Conflicts of Interest inScientific Research Related to Regulation and Litigation. TheJournal of Philosophy, Science & Law. 7:1-16.We note that the publishers of the four compendia that are currently recognized for this purpose have already adopted conflict of interest disclosure policies that are similar to our proposal. Though there are individual differences among the publishers, we note that these policies commonly include publication on the compendia publisher's Web site of the name of the individuals that participate in the generation of the compendia recommendation and the entity with which there is a relationship, the nature of the relationship (for example, salary, ownership, grant support), and the value of the relationship. Some include this information as it relates to family members of the individual.Additional information with respect to the conflict of interest policies of those compendia we reviewed during the 2008 review cycle can be found on their Web sites. For the convenience of the reader we have listed below the Web sites where these policies may be found for each of the four currently recognized compendia.AHFS Drug Information: http://www.ahfsdruginformation.com/ off_label/interest_disclosure.aspx.Thomson Micromedex DrugDex: http://www.micromedex.com/ about_us/editorial/ed_ConflictofInterest.pdf.Gold Standard Clinical Pharmacology: http:// www.goldstandard.com/editorial_conflict.html.The National Comprehensive Cancer Network: http:// www.nccn.org/about/disclosure.asp?p=about.In general, certain disclosure policies of the compendia provide for public disclosure of individuals involved in the recommendation to ensure against the appearance of potential conflicts of interests. We believe that a publicly transparent process which provides for the identification of potential conflicts of interest protects the interests of the public, as well as those individuals who participate in the compendia process.Disclosures of conflicts of interests are triggered by the recommendation regarding the use of the drug or biological rather than by the application for the recommendation. Disclosures published in conjunction with compendia recommendation updates should remain publicly viewable for a reasonable period of time. Specifically, we believe that the disclosures remain available for a period of not less than 5 years. It is not uncommon that serious questions about the use of a drug do not arise until the drug has been used for several years.Thus the relevance of information regarding the development of compendia recommendations may not be recognized until several years after the clinical use in question. We believe that a period of 5 years is a reasonable balance between the burden of maintaining this information and the public's interest in timely access to this information. We welcome comments regarding whether or not a period of not less than 5 years is an adequate timeframe for this balance to occur.We recognize that some individuals may participate substantively in the development of more than one recommendation. For example, an individual might participate in the review of several drugs or biologicals for a single compendia publisher. We recognize that a single relationship may present a significant conflict of interest in some cases but not others. For example, a process for disclosure by the compendium publisher would be required if an individual whose only conflicted relationship arises from significant income related to the use of a particular drug for lung cancer substantively participated in the compendia review of that drug for lung cancer or for a competitor treatment for lung cancer. If that same individual substantively participated in the compendia review of a different drug for a different disease, the compendia publisher might determine that there is no conflict of interest to disclose.
Page 33623In Sec. 414.930(b)(1), we are revising the CMS process for listing compendia for determining medically-accepted uses of drugs and biologicals in anti-cancer treatment to include consideration of a compendium's meeting of the regulatory definitions. We are also proposing to renumber the subparagraphs of Sec. 414.930(b)(1) to accommodate this change.Current Sec. 414.930(b)(2) gives CMS the authority to generate an internal request to revise the list of compendia at any time.H. Part B Drug Payment 1. Average Sales Price (ASP) Issues a. Immunosuppressive Drugs Period of EligibilitySection 9335(c) of the Omnibus Budget Reconciliation Act of 1986(Pub. L. 99-509) (OBRA '86) added subparagraph (J) to section 1861(s)(2) of the Act to define a benefit category for immunosuppressive drugs furnished to an individual who receives an organ transplant for which Medicare payment is made, for a period not to exceed 1 year after the transplant procedure. Coverage of these drugs under Medicare Part B began January 1, 1987.Section 13565 of the Omnibus Budget Reconciliation Act of 1993 (PubL. 103-66) (OBRA '93) amended section 1861(s)(2)(J) of the Act to specify that the benefit category included immunosuppressive drugs furnished: During 1995, within 18 months after the date of the transplant procedure; during 1996, within 24 months after the date of the transplant procedure; during 1997, within 30 months after the date of the transplant procedure; and during any year after 1997, within 36 months after the date of the transplant procedure. Beginning January 1, 2000, section 227 of the Medicare, Medicaid and SCHIP Balanced BudgetRefinement Act of 1999 (Pub. L. 106-113) (BBRA) extended the benefit period to eligible beneficiaries whose coverage for drugs used in immunosuppressive therapy expired during the calendar year.Section 113 of the Medicare, Medicaid and SCHIP BenefitsImprovement and Protection Act of 2000 (Pub. L. 106-554) (BIPA) revised section 1861(s)(2)(J) of the Act to eliminate the time limits for coverage of prescription drugs used in immunosuppressive therapy under the Medicare program. Effective with immunosuppressive drugs furnished to an individual who receives an organ transplant for which Medicare payment is made on or after December 21, 2000, there is no longer any time limit for Medicare benefits. Although the statutory benefit category no longer includes a time limit, our regulations at Sec. 410.30(b) continue to reflect the time limits that applied previously.Therefore, we are proposing to make conforming changes to Sec. 410.30(b) to remove the references to the time limits that applied under previous iterations of the statute. This technical change will reduce the potential for confusion about the scope of the benefit. We note that this proposal does not substantively affect Medicare coverage or benefits because it merely conforms the regulations text to the current benefit category, as specified in section 1861(s)(2)(J) of theAct. As noted above, under section 113 of the BIPA, immunosuppressive drugs have not been subject to a time limit since December 21, 2000. b. WAMP/AMP ThresholdSection 1847A(d)(1) of the Act states that ``the Inspector General of HHS shall conduct studies, which may include surveys to determine the widely available market prices (WAMP) of drugs and biologicals to which this section applies, as the Inspector General, in consultation with the Secretary, determines to be appropriate.'' Section 1847A(d)(2) of the Act states that, ``Based upon such studies and other data for drugs and biologicals, the Inspector General shall compare the ASP under this section for drugs and biologicals with--The widely available market price (WAMP) for these drugs and biologicals (if any); andThe average manufacturer price (AMP) (as determined under section 1927(k)(1) of the Act for such drugs and biologicals).''Section 1847A(d)(3)(A) of the Act states that, ``The Secretary may disregard the ASP for a drug or biological that exceeds the WAMP or theAMP for such drug or biological by the applicable threshold percentage(as defined in subparagraph (B)).'' The applicable threshold is specified as 5 percent for CY 2005. For CY 2006 and subsequent years, section 1847A(d)(3)(B) of the Act establishes that the applicable threshold is ``the percentage applied under this subparagraph subject to such adjustment as the Secretary may specify for the WAMP or theAMP, or both.'' In CY 2006 through CY 2009, we specified an applicable threshold percentage of 5 percent for both the WAMP and AMP. We based this decision on the limited data available to support a change in the current threshold percentage.For CY 2010, we propose to specify an applicable threshold percentage of 5 percent for the WAMP and the AMP. At present, the OIG is continuing its comparisons of both the WAMP and the AMP. In April 2008, we implemented a change in the weighting methodology for calculating ASP. Information on how recent changes to the calculation of the ASP may affect the comparison of ASP to WAMP or AMP is limited at this time. Since we do not have sufficient data that suggest another level is more appropriate, we believe that continuing the 5 percent applicable threshold percentage for both the WAMP and AMP is appropriate for CY 2010. Therefore, we are proposing to revise Sec. 414.904(d)(3) to include the CY 2010 date.As we noted in the CY 2009 PFS final rule with comment period (73FR 69752), we understand that there are complicated operational issues associated with potential payment substitutions. We will continue to proceed cautiously in this area and provide stakeholders, including providers and manufacturers of drugs impacted by potential price substitutions with adequate notice of our intentions regarding such, including the opportunity to provide input with regard to the processes for substituting the WAMP or the AMP for the ASP. We welcome comments on our proposal to continue the applicable threshold at 5 percent for both the WAMP and AMP for CY 2010. 2. Competitive Acquisition Program (CAP) IssuesSection 303(d) of the MMA requires the implementation of a competitive acquisition program (CAP) for certain Medicare Part B drugs not paid on a cost or PPS basis. The provisions for acquiring and billing drugs under the CAP were described in the CompetitiveAcquisition of Outpatient Drugs and Biologicals Under Part B proposed rule (March 4, 2005, 70 FR 10746) and the interim final rule (July 6, 2005, 70 FR 39022), and certain provisions were finalized in the CY 2006 PFS final rule with comment period (70 FR 70236). The CY 2007 PFS final rule with comment period (72 FR 66260) then finalized portions of the July 6, 2005 IFC that had not already been finalized.The CAP is an alternative to the ASP (buy and bill) methodology of obtaining certain Part B drugs used incident to physicians' services.Physicians who choose to participate in the CAP obtain drugs from vendors selected through a competitive bidding process and approved byCMS. Under the CAP, participating physicians agree to obtain all of the approximately 180 drugs on the CAP drug list from an approved CAP
Page 33624vendor. The approved CAP vendor retains title to the drug until it is administered, bills Medicare for the drug, and bills the beneficiary for cost sharing amounts once the drug has been administered. The participating CAP physician bills Medicare only for administering the drug to the beneficiary. The initial implementation of the CAP operated with a single CAP drug category from July 1, 2006 to December 31, 2008.After the CAP was implemented, section 108 of the MIEA-TRHCA made changes to the CAP payment methodology. Section 108(a)(2) of the MIEA-TRHCA requires the Secretary to establish (by program instruction or otherwise) a post payment review process (which may include the use of statistical sampling) to assure that payment is made for a drug or biological only if the drug or biological has been administered to a beneficiary. The Secretary is required to recoup, offset, or collect any overpayments. This statutory change took effect on April 1, 2007.Conforming changes were proposed in the CY 2008 PFS proposed rule (72FR 38153) and finalized in the CY 2008 PFS final rule with comment period (72 FR 66260).In the CY 2009 PFS proposed rule, we proposed several refinements to the CAP regarding the annual CAP payment amount update mechanism, the definition of a CAP physician, the restriction on physician transportation of CAP drugs, and the dispute resolution process (73 FR 38522). However, after the publication of the proposed rule, we announced the postponement of the CAP for 2009 due to contractual issues with the successful bidders. As a result, CAP physician election for participation in the CAP in 2009 was put on hold, and CAP drugs have not been available from an approved CAP vendor for dates of service after December 31, 2008. Physicians who participated in the CAP have transitioned back into the Average Sales Price (ASP) method of acquiring part B drugs for dates of service after December 31, 2008.After the postponement was announced, we solicited public feedback on the CAP from participating physicians, potential vendors, and other interested parties. We solicited public comments on several issues, including, but not limited to the following: The categories of drugs provided under the CAP; the distribution of areas that are served by the CAP; and procedural changes that may increase the program's flexibility and appeal to potential vendors and participating physicians. We also hosted a CAP Open Door Forum (ODF) on December 3, 2008, where participants had an opportunity to discuss the postponement and suggest changes to the program. We appreciate the comments that we have received.In the CY 2009 PFS final rule with comment period, we stated that we would review the public comments and consider implementing changes to the CAP before proceeding with another bid solicitation for approvedCAP vendor contracts. Based on this information, in this proposed rule, we are addressing items that were not finalized in the CY 2009 PFS final rule with comment period, and making additional proposals for theCAP. Our approach seeks to better define certain aspects of the program based on our experience. We also seek to continue to increase participation by minimizing the administrative burden for physicians and vendors who choose to participate. a. Frequency of Drug Payment Amount UpdatesAs described in the July 6, 2005 IFC (70 FR 39070 through 39071) and Sec. 414.906(c), payment amounts for drugs furnished under the CAP are set through a competitive bidding process, and as described inSec. 414.908(b), bids that exceed a composite bid threshold of 106 percent of the weighted ASP for the drugs in the CAP category are not accepted. The CAP payment amounts that are calculated from successful bids are updated from the time of the bidding period to the payment year. During the 2006 through 2008 CAP contract period, the initial update calculation used the change in the Producer Price Index (PPI) for prescription preparations to account for the time period between the bidding and the period in which the payment amounts were to be in effect, which was the middle of the first year of the three year CAP contract period (70 FR 39074). Finally, as specified in Sec. 414.906(c), CAP payment amounts are updated again during the second and third year of the contract period based on the approved CAP vendor's reported reasonable net acquisition costs (RNAC). The annual updates are limited by payment amounts described in section 1847A of the Act and codified in Sec. 414.906(c).Section 1847B(c)(7) of the Act gives the Secretary the discretion to establish an appropriate schedule for the approved CAP vendor's disclosure of RNAC information to us, provided that disclosure is not required more frequently than quarterly. In the July 6, 2005 IFC (70 FR 39075 through 39076), we specified that each approved CAP vendor will disclose its RNAC for the drugs covered under the contract annually during the period of its contract and that we would calculate an annual payment adjustment based on this information. We specified an annual disclosure of RNAC because it imposes the minimal burden on approvedCAP vendors. In 2005, some commenters suggested that more frequent updates would be desirable. Additional feedback about the CAP that was obtained after the program's postponement in 2008, as well as comments on previous rules, indicated that potential vendors would like the frequency of price adjustments to increase. Various commenters have suggested a quarterly price adjustment in order to parallel to the ASP process, to better match payment amounts with increases or decreases in drug costs, and to attract vendor interest. We believe that quarterly adjustments would also lower approved CAP vendors' financial risks because CAP payment amounts will be better able to keep up with unanticipated drug cost increases and would benefit the Medicare program by reacting to significant cost decreases more promptly.Quarterly price updates also will eliminate the PPI-based increase that currently occurs between the time bids are submitted and the first day of CAP claims processing. The application of the PPI-based payment adjustment described in the July 6, 2005 IFC (70 FR 39074) has resulted in situations where the ASP+6 percent payment amount has been exceeded during the first year of the 3-year approved CAP vendor contract. We do not believe that CAP payment amounts should exceed ASP+6 percent. In our discussion of bid ceilings in the July 6, 2005 IFC, we stated that the bid ceiling ``ensures that the CAP will be no more costly to theMedicare program than the alternative method of paying for drugs at 106 percent of ASP. This ceiling is thus consistent with the possibility of realizing savings to the Medicare program. It would also serve to maintain a level of parity between the two systems, preventing a situation in which significant payment differentials might skew incentives and choices (70 FR 39070).'' For this reason, and to remain consistent with current regulation text at Sec. 414.906, we believe that all payment amounts calculated under the update process should be limited by the weighted payment amount established under section 1847A of the Act. We also believe that this approach will continue to provide for an ``appropriate price adjustment'' as required under section 1847B(c)(7) of the Act by improving responsiveness to unexpected price
Page 33625changes, and continuing a prudent limitation on the magnitude of payment amount adjustments.Our approach for implementing quarterly updates consistent with theASP+6 percent limit on payment amounts would be based on composite bid price calculations, as described in the July 6, 2005 IFC (70 FR 39072 through 39073). Additional details about the process are described in further detail in section II.H.2.f. of this proposed rule (Annual CAPPayment Amount Update Mechanism). Briefly stated, the ASP+6 percent limit would be applied by comparing the (weighted) composite update payment amount, calculated from participating approved CAP vendors' reasonable net acquisition cost data, to most recent available weightedASP prices for the same drugs. If the composite drug update payment amount exceeds the weighted ASP+6 percent payment limit, the composite payment amount for that group of drugs would be reduced to equal theASP+6 percent limit by applying an equal percent reduction to each drug in the group. By way of example only, if a quarter's composite update payment was calculated as +2.3 percent, based on the median of all participating approved CAP vendors' data, but the calculated weightedASP+6 percent limit for that group of drugs was +2.1 percent, the payment amounts for all HCPCS codes in the composite group would be increased by 2.1 percent in order to account for reported increases to the vendor's acquisition cost, but not to exceed the ASP+6 percent limit. This means that a 2.1 percent increase would be applied to CAP payment amounts for all HCPCS codes that are in the composite drug list and are being supplied under the CAP by one or more approved CAP vendors. For HCPCS codes that are priced separately, each code available through the CAP will be compared to the most recent ASP+6 percent limit for that code. CAP payment amounts for codes that exceed the ASP+6 percent limit will be reduced to ASP+6 percent. Each ``NotOtherwise Classified'' (NOC) drug described in Sec. 414.906(f)(2)(iv), would also be updated on an individual (rather than composite) basis.We are proposing to discontinue annual CAP payment amount updates and to implement quarterly CAP payment amount updates at Sec. 414.906(c). Because of this proposed change, the special quarterly adjustments described at Sec. 414.906(c)(2) (for the introduction of new drugs, expiration of drug patents or availability of generic drugs, material shortages, or withdrawal of a drug from the market) will no longer be needed, so we propose deleting those provisions from the regulation, and instead adding details about the payment amount update process described in section II.H.2.f. of this proposed rule (AnnualCAP Payment Amount Update Mechanism). A quarterly RNAC reporting and payment adjustment process would begin as soon as we entered into contracts with the approved CAP vendor(s); that is, beginning with the first quarter during which CAP claims are submitted under the contract.Thus, under this proposal, we would also eliminate the PPI-based adjustment for the time period between the time bids are submitted and the time claims processing begins under the contract, because that adjustment would no longer be necessary. We believe using one payment update process will be easier to administer and would minimize the potential for CAP payment amounts to exceed ASP+6 percent for the first contract year. In order to provide sufficient time for the calculation of payment amount updates, we are proposing that approved CAP vendors report quarterly RNAC data for drug purchased for use under the CAP during the previous quarter within 30 days of the close of that quarter. We have made corresponding changes to regulation text at Sec. 414.906(c) and we welcome comments on these proposed changes. b. Changes to the CAP Drug List(1) CAP Drug ListIn the July 6, 2005 IFC, we responded to comments on our proposed approach for determining the CAP drug categories and how we select the specific drugs in the CAP drug list (70 FR 39026 through 39034). As stated in the CY 2006 PFS final rule with comment period (70 FR 70237), the CAP is intended to provide beneficiaries with access to MedicarePart B drugs and maintain physician flexibility when prescribing medications. Our approach incorporated drugs commonly administered by the range of physician specialties that bill for Part B drugs (70 FR 39030) and resulted in a list of about 180 drugs that were available through the CAP during the CY 2006 through CY 2008 contract period. We also developed a number of methods by which an approved CAP vendor'sCAP drug list could be changed (see Table 26 at 70 FR 70242).We believe that our general approach, to provide a wide variety of drugs to a variety of physicians over a large portion of the UnitedStates, is on target. Although we believe that the CAP is a means for physicians to minimize their drug inventory costs, we acknowledge that participation in the CAP cannot completely eliminate the need for participating CAP physicians to maintain at least a minimal drug inventory at the office. Many physicians who participate in Medicare also provide services to non-Medicare patients, and even physicians with a predominantly Medicare patient population may find it useful to keep a small stock of drugs on hand for unforeseen situations, such as emergencies and breakage.During the CAP postponement, we became aware that both participating CAP physicians and potential vendors supported narrowing the CAP drug list. Both agreed that low cost drugs should be removed from the CAP. Although these items were initially included in the CAP so that an approved CAP vendor would be in a position to supply many of the Part B drugs that an office might administer, CAP physicians and the vendor community have stated that the inclusion of these items in the CAP creates an accounting, tracking, and claims submission burden for some participants. Based on these comments, we believe that low- cost, frequently utilized items, such as corticosteroid injections, could be removed from the list without significant impact on the CAP's utility to participating CAP physicians. Furthermore, it appears that physicians would be more interested in obtaining expensive products, such as biologicals, through the CAP. However, we are also mindful that narrowing the CAP drug list significantly also would decrease an approved CAP vendor's overall purchase volume, and we believe that this could limit the approved CAP vendor's ability to obtain volume-based discounts from the manufacturers or distributors from which it obtains drugs for use in the CAP. Creating a more tailored CAP drug category also could limit physician participation to one or several specialties, and may create a situation where sudden supply interruptions and unexpected changes to distribution channels could affect a greater proportion of drugs in the program than would be the case with a broader CAP drug category.Nevertheless, we are proposing to create a new CAP drug category for the next round of CAP contracting. Our approach is intended to address comments about the administrative burden of tracking and billing low cost/high volume items while maintaining access to a variety of high cost items. We are proposing to identify the new CAP drug category using the existing CAP drug category as a starting point.
Page 33626The 2008 drug list was compiled based on Part B drug claims data, the identification of specialties that frequently administer drugs underPart B, and public comment during rulemaking in 2005 (70 FR 39026 through 39033). We believe that using the 2008 CAP drug list as a starting point would maintain prescribing flexibility for a wide range of specialties and would also maintain access to a wide spectrum of drugs that have been utilized under the program previously.Furthermore, we do not believe it is necessary to develop a new approach because the 2008 CAP drug list was based on heavily utilized drugs in Medicare Part B physician practices; we believe that this approach is on target.We propose to amend our list based on CAP physician participation, claims data, and comments indicating that the list should be narrowed to higher cost items. First, we would ``filter'' the original CAP drug category (drugs furnished in 2006 through 2009) by the specialties that most frequently prescribe drugs under the CAP, and the highest dollar volume CAP drugs (top 20 percent of allowed charges) compiled from 2008 claims data. This filtered list appears in Table 35, and we are proposing it as the starting point for the updated CAP drug category. A filtering process based on frequency of claims from a subset of physicians who might participate in the CAP cannot fully capture all drugs that may be used by certain specialties. In other words, the filtering steps described above narrow the CAP drug list based on physician specialties and dollar volume and do not necessarily preserve groups of drugs that certain prescribers may utilize, especially the less frequently utilized items in such groups. Therefore, we are also proposing to ``fill in'' groups of drugs with related items that do not appear on our list. We will consider ``filling in'' any drug or biological product that is physician-administered, has a reasonably high utilization in the Medicare population, is related to drugs already in the CAP (for example, because of similar clinical uses), and is otherwise appropriate for inclusion in the program.For example, we could consider adding a fourth hyaluronan viscosupplement to the drugs in Table 35, expanding the list of antibiotics, or antiemetics, or by adding a list of ``new'' and unweighted drugs as in 2006 by using simple claims data thresholds (70FR 70238). The concept of ``filling in'' drug groups is supported by feedback from former participating CAP physicians who suggested that certain categories of drugs, such as antibiotics, be more fully represented. We are seeking comments on specific drugs that should be added to the draft list in Table 35.We also are seeking comment on the method to assess whether a particular drug should be ``filled in'' so that it is included in the new, narrowed CAP drug category. For example, one process that we have considered and would like comment on is adding drugs from the 2009 through 2011 CAP vendor bidding list that did not pass the``filtering'' step described above. The 180 item 2009 through 2011 bidding list was used during the approved CAP vendor bidding for the 2009-2011 contract, and includes CMS-approved items added to the original contract's bid list, as well as items approved for addition during the 2006-2008 contract period. (See the Downloads section at http://www.cms.hhs.gov/CompetitiveAcquisforBios/03a_ vendorbackground.asp#TopOfPage). This list's weighting is based on claims volume data by HCPCS code units rather than dollar volume and provides a different perspective than a dollar volume sorting. We would add drugs from the 2009-2011 CAP Vendor bid list to the CAP drug category if the drug's weight is in the top 25 percent of the 2009-2011CAP vendor bidding list, indicating frequent claims submission, and if the drug's clinical uses are similar to a drug on the proposed list inTable 35. This method would result in the addition of a number of several commonly used antibiotics, two antiemetic) and several chemotherapeutic agents. Potential additions to our draft list identified by this method appear in Table 36. Although this method helps ``fill in'' the proposed CAP drug list, this method still does not fully capture less frequently used drugs, or newly approved drugs.We welcome comments on this method and alternative methods of filling this proposed list.In order to provide additional flexibility for participating CAP physicians and approved CAP vendors, and to allow for participants to further tailor the program to meet their needs, we are also proposing to add Sec. 414.906(f)(2)(v) to allow approved CAP vendors to submit a request to CMS to add drugs (or biologicals) to the list of drugs furnished by the requesting vendor if there is sufficient demand and if the drug has therapeutic uses that are similar to other drugs already available through the CAP. The request and approval process would follow the existing regulations at Sec. 414.906(f), and HCPCS code additions that are requested under this process would still be subject to CMS approval. This proposed process adds to the process for adding newly issued HCPCS codes under Sec. 414.906(f)(2)(iii) and newly approved drugs without HCPCS codes (NOC drugs)under Sec. 414.906(f)(2)(iv). It is intended to facilitate more complete access to groups of drugs that may be used by certain specialties, and drugs used to treat certain disease states without having to rely on rigid definitions of classes of drugs that may not apply well to actual clinical practice across a large and diverse geographic area. We believe that this addition to the methods for changing an approved CAP vendor's drug list (see Table 26 in the November 21, 2006 final rule(70 FR 70242)) will add to the flexibility of the program. We welcome comments on our proposal to update the CAP drug list.Table 35--Draft CAP Drug List for Next Contract PeriodCodeProcedure code descriptionJ0129......................... INJECTION, ABATACEPT, 10 MGJ0215......................... INJECTION, ALEFACEPT, 0.5 MGJ0585......................... BOTULINUM TOXIN TYPE A, PER UNITJ0587......................... BOTULINUM TOXIN TYPE B, PER 100 UNITSJ0696......................... INJECTION, CEFTRIAXONE SODIUM, PER 250MGJ0878......................... DAPTOMYCIN INJECTION, 1 MGJ0881......................... INJECTION, DARBEPOETIN ALFA, 1 MCG (NON-ESRD USE)J0885......................... INJECTION, EPOETIN ALPHA, (FOR NON ESRDUSE), PER 1000 UNITSJ0894......................... INJECTION, DECITABINE, 1MGJ1440......................... INJECTION, FILGRASTIM (G-CSF), 300 MCGJ1441......................... INJECTION, FILGRASTIM (G-CSF), 480 MCGJ1740......................... INJECTION, IBANDRONATE SODIUM, 1 MG
Page 33627J1745......................... INJECTION INFLIXIMAB, 10 MGJ2323......................... INJECTION, NATALIZUMAB, 1 MGJ2353......................... INJECTION, OCTREOTIDE, DEPOT FORM FORINTRAMUSCULAR INJECTION, 1 MGJ2357......................... OMALIZUMAB INJECTION, 5 MGJ2405......................... INJECTION, ONDANSETRON HYDROCHLORIDE,PER 1 MGJ2469......................... PALONOSETRON HCL, 25MCGJ2503......................... PEGAPTANIB, 0.3MGJ2505......................... INJECTION, PEGFILGRASTIM, 6 MGJ2778......................... INJECTION, RANIBIZUMAB, 0.1 MGJ2794......................... RISPERIDONE, LONG ACTING, 0.5MGJ3240......................... INJECTION, THYROTROPIN ALPHA, 0.9 MG,PROVIDED IN 1.1 MG VIALJ3315......................... INJECTION, TRIPTORELIN PAMOATE, 3.75 MGJ3396......................... INJECTION, VERTEPORFIN, 0.1 MGJ3487......................... INJECTION, ZOLEDRONIC ACID, 1 MGJ3488......................... INJECTION, ZOLEDRONIC ACID (RECLAST), 1MGJ7321......................... HYALURONAN OR DERIVATIVE, HYALGAN ORSUPARTZ, FOR INTRA-ARTICULAR INJECTION,Per DoseJ7322......................... HYALURONAN OR DERIVATIVE, SYNVISC, FORINTRA-ARTICULAR INJECTION, PER DOSEJ7324......................... HYALURONAN OR DERIVATIVE, ORTHOVISC, FORINTRA-ARTICULAR INJECTION, PER DOSEJ9010......................... ALEMTUZUMAB, 10 MGJ9035......................... BEVACIZUMAB INJECTION, 10MGJ9041......................... BORTEZOMIB INJECTION, 0.1MGJ9055......................... CETUXIMAB INJECTION, 10MGJ9170......................... DOCETAXEL, 20 MGJ9201......................... GEMCITABINE HCL, 200 MGJ9206......................... IRINOTECAN, 20 MGJ9263......................... INJECTION, OXALIPLATIN, 0.5 MGJ9305......................... PEMETREXED INJECTION, 10MGJ9310......................... RITUXIMAB, 100 MGJ9355......................... TRASTUZUMAB, 10 MGTable 36--Potential Additions to the Draft CAP Drug List for NextContract Period (that is, Table 35)CodeProcedure code descriptionJ3370......................... INJECTION, VANCOMYCIN HCL, 500 MGJ9264......................... PACLITAXEL PROTEIN BOUND PARTICLES, 1MGJ0690......................... INJECTION, CEFAZOLIN SODIUM, 500 MGJ1260......................... INJECTION, DOLASETRON MESYLATE, 10 MGJ0692......................... INJECTION, CEFEPIME HYDROCHLORIDE, 500MGJ1626......................... INJECTION, GRANISETRON HYDROCHLORIDE, 100 MCGJ0640......................... INJECTION, LEUCOVORIN CALCIUM, PER 50 MGJ9265......................... PACLITAXEL, 30 MGJ9190......................... FLUOROURACIL, 500 MGJ9045......................... CARBOPLATIN, 50 MGJ0290......................... INJECTION, AMPICILLIN SODIUM, 500 MGJ9214......................... INTERFERON, ALFA-2B, RECOMBINANT, 1MILLION UNITS2. Removing Drugs From the CAP listAlthough there are several methods under the CAP to add drugs to an approved CAP vendor's drug list, the current regulations do not specify a process for removing drugs from an approved CAP vendor's list. Our experience has shown that interruptions in availability can affect an approved CAP vendor's ability to supply CAP drugs during the course of a 3-year contract. For example, during the first contract period, we became aware of long-term and permanent drug unavailability, sometimes at the HCPCS level, due to removal of drugs from the market, or interruption of supply to an approved CAP vendor for reasons beyond the approved CAP vendor's control, such as changes to drug distribution methods, changes in agreements between manufacturers and distributors and/or pharmacies regarding who may purchase certain drugs, and direct distribution arrangements.In order to better respond to sudden, long-term changes in drug supply that are beyond the control of the approved CAP vendor, we are proposing to allow an approved CAP vendor to request the permanent removal from its CAP drug list of a HCPCS code for which no NDCs are available. Our proposal is intended to better manage situations where all NDCs from an entire HCPCS code unexpectedly become unavailable to an approved CAP vendor, and we would require the approved CAP vendor(1) to document the situation in writing, including the unavailability of all NDC codes in a HCPCS code that is supplied under the CAP, (2) to describe the reason for the unavailability and its anticipated duration, and (3) to attest that the unavailability is beyond the approved CAP vendor's control. Approval of the deletion would apply only to the approved CAP vendor or vendors that requested the deletion.Our proposal is not intended to be used frequently, or to permit an approved CAP vendor to remove a HCPCS code from its CAP drug list simply because it has become unprofitable to provide it--we believe the payment amount adjustment proposals discussed in sections II.H.2.a. and f. of this proposed rule would address that concern.
Page 33628Furthermore, our proposal is also not intended to be used for managing short-term unavailability, or unavailability of a finite duration--we believe the existing drug substitution policy described in Sec. 414.906(f) already addresses those concerns. We are proposing to add this process as Sec. 414.906(g) because those regulations currently provide for additions and substitutions to the CAP drug list, and would therefore require a written request to CMS, as well as CMS' approval.Participating CAP physicians who are affected by the deletion of aHCPCS code from an approved CAP vendor's drug list would have the option of remaining with their selected approved CAP vendor and using the ASP (buy and bill) methodology for obtaining the drug that has been deleted, or selecting another approved CAP vendor under the exigent circumstances provision at Sec. 414.908(a)(2). We believe that the deletion of an expensive and highly utilized CAP drug by one approvedCAP vendor in the middle of a physician election period could cause hardship for a practice if it had to revert to the ASP methodology of acquiring and billing for that drug. Such a situation would constitute an exigent circumstance. Given CAP's goal of improving access to drugs, allowing the participating CAP physician to switch approved CAP vendors outside of a regular election period in this instance would be prudent.We welcome comments on our proposals. c. Geographic Area Served by the CAPIn the July 6, 2005 IFC (70 FR 39034 through 39036), we established a single, national competitive acquisition area for the initial stage of the CAP. This national distribution area included the 50 States, theDistrict of Columbia, Puerto Rico, and U.S. territories. We recognized that designating a single national area might limit participation to those vendors that could compete to bid and supply drugs nationally, but we indicated this approach was a part of the phase-in plan for theCAP. We also discussed potential phase-in options for the future, stating that smaller areas might become a solution as the program expanded.According to the vendor community, certain areas of the UnitedStates (especially Alaska, Hawaii, and the Territories) currently present logistical challenges and are associated with high drug shipping costs. Moreover, physician participation in these areas has been low; in 2008, physicians from Alaska, Hawaii, and the Territories represented less than 2 percent of total participating CAP physicians.Temporarily limiting the geographic areas served by the CAP could help limit costs and risks for approved CAP vendors associated with shipping drugs to distant parts of the country. However, we believe that the CAP is intended to provide services to all Medicare physicians (including those in distant parts of the country), and therefore, we do not believe that a limitation on the geographic area in which the CAP is available should be permanent.Section 1847B(a)(1)(B) of the Act specifically requires theSecretary to phase-in the CAP with respect to the categories of drugs and biologicals in the program, in such a manner as the Secretary determines to be appropriate. We believe that this provision, particularly in conjunction with the statutory definition of a competitive acquisition area as ``an appropriate geographic region established by the Secretary'' provides broad authority for theSecretary to phase in the CAP with respect to the geographical areas in which the program would be implemented. As stated in the July 6, 2005IFC, we considered several factors when defining geographic areas for the CAP, including aspects of vendors and their distribution systems, such as current geographic service areas, the density of distribution centers, the distances drugs and biologicals are typically shipped, and costs associated with shipping and handling (70 FR 39035). Taking these factors into consideration again, and considering entities who have bid on, or expressed interest in bidding on approved CAP vendor contracts, we believe that it is appropriate to use the authority granted under the Statute to temporarily narrow the area served by the CAP during the program's re-implementation. We appreciate the logistical issues associated with shipping drugs to remote areas and the uncertainties associated with transportation costs that have been described by the potential vendor community; however, we are reluctant to significantly reduce the area served by the CAP because at some point, the approvedCAP vendor's volume would be affected and the likelihood of obtaining volume based discounts would decrease.At this time, we are proposing to designate the CAP competitive acquisition area as the 48 contiguous States and the District ofColumbia for the next round of CAP contracting. This change in the geographic area that is served by the CAP is meant as an interim measure under our phase-in authority and the statutory definition of a competitive acquisition area. We believe that omitting Alaska, Hawaii, and the Territories from the CAP competitive acquisition area at this time will balance the need to revise the CAP to attract more vendors with the need to offer the maximum number of physicians a meaningful opportunity to participate. We believe that this proposal will encourage potential vendors to participate in the CAP because it would temporarily omit areas associated with low physician participation, long shipping times, and high shipping costs. Furthermore, this measure is unlikely to significantly decrease CAP drug order volume relative to historical physician participation in the CAP. However, we are aware that our proposal temporarily eliminates the CAP option for physicians in the areas not included in this CAP competitive acquisition area.Therefore, we are not proposing this definition of the CAP geographical area as a permanent solution. We will continue to assess the CAP and update plans for phase in activity in future rulemaking efforts, including determining the circumstances under which CAP participation will be offered to physicians in Alaska, Hawaii, and the Territories.We will also continue to consider modifying the definition of competitive acquisition area on the basis of regions, States, or some smaller geographic area, which might expand the number of vendors that could bid to participate in the program (70 FR 39036). We welcome comments on our proposal. d. CAP Drug Stock at the Physician's OfficeOur discussion about the CAP emergency restocking option in theJuly 6, 2005 IFC indicated that a participating CAP physician could not maintain a stock of an approved CAP vendor's drug in his or her inventory. This was done because we had reservations about potential program integrity and drug diversion issues (70 FR 39047).Since that time, we have gained operational experience with the CAP and a better understanding of the ordering and drug delivery process.We have also received additional public feedback about the different ways that the program could be refined. Further, our experience with the CAP indicates that our concerns over program integrity and drug diversion have not come to pass. For example, we have received no complaints and have no information indicating that diversion has been a concern. Also, we have not received any negative feedback from the vendor community indicating a concern about
Page 33629storing CAP drugs in physicians' offices. Therefore, we believe at this time it is appropriate to consider allowing additional flexibility to encourage CAP participation.Our experience with the CAP, and our increased understanding about the options approved CAP vendors might have for furnishing drugs to a participating CAP physician's office also support considering additional flexibility in this area. For example, we are aware of electronic inventory control and charge capture devices that could be utilized in ways that conform to CAP regulations and are compliant with applicable State and Federal laws. Such devices utilize an electronic transaction based on a physician's order to track the administration of drugs from inventory to a specific patient and to document appropriate charges for the drug. We believe that such systems could fit into the current CAP framework when transactions in such systems are based on a physician's order, because such systems can track inventory, and can be used to capture patient charge data.For these reasons, we are seeking to clarify our requirements for the manner in which CAP drugs are supplied to participating CAP physicians. Specifically, we are proposing to allow approved CAP vendors to utilize electronic transactions to furnish CAP drugs from nominal quantities of approved CAP vendor-owned stock located at the physician's office in response to specific prescription orders and to capture charges related to such transactions. Our proposal is also intended to clarify that entities with alternative approaches to supplying drugs that utilize an electronic transaction are welcome to participate in the CAP bidding process. We believe that this will allow for additional flexibility and efficiency in the ordering and delivery of drugs within the program because it allows for more efficient shipping of approved CAP vendor-owned stock and provides the option ofCAP participation for physicians who use or may choose to use such drug inventory management platforms. This proposal does not change our position that a participating CAP physician shall not take title to or pay for CAP drugs, nor does it alter the requirements for information that must be submitted with a prescription order under Section 414.908(a) or the application of HIPAA to such data.Furthermore, our proposal does not affect the applicability ofState licensing requirements for an approved CAP vendor. As stated in the July 6, 2005 IFC (70 FR 39066), either the approved CAP vendor, its subcontractor under the CAP, or both, must be licensed appropriately by each State to conduct its operations under the CAP. Therefore, if aState requires it, an approved CAP vendor would be required to be licensed as a pharmacy, as well as a distributor. We are not revising the requirements at Sec. 414.908(c) and Sec. 414.914(f)(9), and we note that sections 1847B(b)(6) and 1847B(b)(2)(B) of the Act continue to apply. In order to participate in the CAP successful bidders must continue to submit proof of pharmacy licensure, consistent with applicable State requirements.Also, this proposal would not modify our definition of ``emergency delivery'' or its corresponding requirements at Sec. 414.902. As we stated in our July 6, 2005 IFC, the intent of the 1-business-day timeframe for emergency deliveries is to address the participating CAP physician's need for more rapid delivery of drugs in certain clinical situations with the approved CAP vendor's ability to ship the drug and have it delivered promptly in a nationwide delivery area (70 FR 39045).The emergency delivery timeframe still applies in situations when CAP drugs are not available in the office for electronic delivery.Moreover, this proposal does not seek to change the CAP inventory requirements. CAP drugs belong to the approved CAP vendor, and as indicated in the July 6, 2005 IFC (70 FR 39048), participating CAP physicians are required to maintain a separate electronic or paper inventory for each CAP drug obtained. CAP drugs must be tracked separately in some way (for example, an electronic spreadsheet). CAP drugs do not have to be stored separately from a physician's own stock; that is, co-mingling of CAP drug with drug from a participating CAP physician's own private stock is acceptable as long as a record of approved CAP vendor-owned drug is kept in a manner that is consistent with Sec. 414.908(a)(3)(x) and the approved CAP vendor-owned drug can be accounted for, as needed.Also, this proposal does not affect the CAP emergency restocking requirements. Section 1847B(b)(5) of the Act and Sec. 414.906(e) provide criteria for the replacement of drugs taken from a participating CAP physician's inventory in the event of an emergency situation. When the emergency resupply criteria are met, a participating CAP physician can replace the drugs that were used from his or her own inventory by submitting a prescription order to the approved CAP vendor.Our proposal seeks to clarify the potential approaches that a bidder may use (separately or in combination) to supply drugs under theCAP. Our proposal does not seek to specify a particular approach that bidders must use in future responses to CAP bid solicitations or to strictly define the types of entities that could bid on CAP vendor contracts; for example, whether bidders must be pharmacies, drug distributors, or a hybrid of the two; whether bidders must utilize just in time shipping, or electronic inventory transactions to supply CAP drugs. We will consider approving bidders' approaches that are consistent with the statutory framework, applicable laws, and regulations. We welcome comments on this issue. e. Exclusion of CAP Sales From ASP CalculationsIn response to the March 4, 2005 proposed rule, many commenters requested clarification about whether the prices determined under theCAP will be taken into account in computing the ASP under section 1847A of the Act. In the July 6, 2005 IFC, we responded that prices offered under the CAP must be included in ASP calculations (70 FR 39077). This was done because we initially believed that we did not have the statutory authority to exclude prices determined under the CAP from the computation of ASP under section 1847A of the Act. Section 1847A(c)(2) of the Act contains a specific list of sales that are exempt from theASP calculation, and sales to approved CAP vendors operating under CAP are not included on that list (70 FR 39077). Comments received in response to the July 6, 2005 IFC opposed this policy (70 FR 70479).Ultimately, as stated in the November 21, 2005 IFC, we recognized commenters' concerns about the effect of including CAP prices in the calculation of ASP and agreed that the best outcome for both the ASP methodology and the CAP programs would be one in which prices under CAP did not affect payment amounts under the ASP methodology. In particular, we found compelling arguments from commenters about the separation of the ASP and CAP programs and that the two programs are intended to be alternatives to each other. Therefore, we excluded units of CAP drugs that are administered to beneficiaries by participatingCAP physicians from the ASP calculation for the initial 3-year approvedCAP vendor contract period (70 FR 70479). Accordingly, the definition of ``Unit'' at Sec. 414.802 was also revised to reflect this exclusion.In our August 18, 2006 interim final rule, we further addressed concerns
Page 33630pertaining to our definition of Unit. We published a PRA notice regarding a proposed modification of the OMB-approved ASP information collection requirements (CMS Form 10110 (OMB 0938-0921) about the collection of the number of CAP units excluded from the ASP calculation. In response, a commenter expressed concern over manufacturers' reliance on approved CAP vendors for information about the number of units of CAP drugs that are administered to beneficiaries by participating CAP physicians (71 FR 48132). Since approved CAP vendors are the only entities with direct information on CAP units administered, the commenter believed that the requirement to exclude units of CAP drugs administered to beneficiaries by participating CAP physicians placed the manufacturer in the untenable position of reporting ASP and certifying reports of ASP based on second-hand information from approved CAP vendors. Further, the commenter noted that manufacturers may not have timely access to this information and that they could not independently confirm its accuracy (71 FR 48132).Additional feedback received as part of our ongoing work with manufacturers also indicated that they were concerned that they would have difficulty obtaining information from approved CAP vendors that would be necessary to accurately exclude administered CAP units from the ASP calculation (71 FR 48132).Therefore, we further revised the definition of unit to clarify that for the initial 3-year contract period under the CAP units of CAP drugs sold to an approved CAP vendor for use under the CAP would be excluded from the calculation of ASP (70 FR 48132).In the July 6, 2005 and August 18, 2006 IFCs, we stated that we would examine the effect of this exclusion and, if necessary, revisit our decision at the end of the initial 3-year period of the CAP (70 FR 70480 and 71 FR 48132, respectively). Since then, operational experience has not indicated a reason for changing our policy of excluding CAP units sold to approved CAP vendors for use under the CAP from ASP calculations. Therefore, we are proposing to permanently exclude drugs supplied under the CAP from ASP calculations and make conforming changes to the definition of unit at Sec. 414.802. We believe that this proposal will continue to promote the separation and independence of the two drug payment models. We welcome comments on this proposal. f. Annual CAP Payment Amount Update MechanismIn the July 6, 2005 IFC (70 FR 39076), we described a two-step process to calculate RNAC-based price adjustment if there is a change in the RNAC reported by a particular approved CAP vendor. We stated that ``we would adjust the bid price that the vendor originally submitted by the percentage change indicated in the cost information that the vendor disclosed. Next, we would recompute the single price for the drug as the median of all of these adjusted bid prices.'' The two-step process contemplated that there would be more than one approved CAP vendor at the time prices were to be adjusted and that all successful bidders would participate in the CAP.However, during the first round of CAP contracting, after offering more than one contract, we entered into a contract with only one successful bidder. Thus, during the 2008 price update calculation process, we developed an approach to account for the lack of RNAC data for bidders who chose not to participate in the CAP. In the CY 2009 PFS proposed rule, we stated that the approach we used to adjust prices for the 2008 contract year is consistent with Sec. 414.906(c) and with theJuly 6, 2005 IFC because it retains a two-step calculation based on the approved CAP vendor's RNAC, as well as the calculation of a median of adjusted bid prices.We also posted our approach on the Approved CAP Vendor page of theCMS CAP Web site at http://www.cms.hhs.gov/CompetitiveAcquisforBios/ 15_Approved_Vendor.asp. The percent change in RNAC for 2008 was calculated based on data supplied by the approved CAP vendor. This percent change in RNAC was used as a proxy for the percent change inRNAC for successful bidders that chose not to become approved CAP vendors.Then, in the CY 2009 PFS proposed rule (73 FR 38522 through 38523), we proposed to continue using this approach for future CAP payment amount updates where the number of approved CAP vendors is less than the number of successful bidders. We proposed that the average of the approved CAP vendor-supplied RNAC data would be used as a proxy for data from vendors who bid successfully but are not participating in theCAP. For example, if the payment amounts for the first year of a CAP contract are based on five successful bidders, but only four have signed contracts to supply drugs under the CAP (that is, there are four approved CAP vendors), only RNAC data collected from the four approvedCAP vendors would be used to calculate the percent change in the RNAC.The average of the four approved CAP vendors' adjusted payment amounts would be used as a proxy for the RNAC of the successful bidder that is not participating in the CAP. The updated CAP payment amount would then be calculated as the median of the five data points (one data point for each approved CAP vendor's updated payment amount, and one data point calculated using the average of the approved CAP vendors' RNAC).Similarly, if there were five successful bidders but only three chose to become approved CAP vendors, the average of the three approved CAP vendors' RNAC would be the proxy for the RNAC of the two bidders who did not participate. The median of those five data points would become the updated CAP payment amount.Our approach in the CY 2009 PFS proposed rule was intended to provide us with a flexible method for updating CAP prices, to be consistent with our original policy as stated in the July 6, 2005 IFC, and to account for bidders or approved CAP vendors who are not participating in the program at the time the price updates are calculated. However, our approach was limited in scope because it was made during a contract period and during bidding for an upcoming contract and we did not want to make any significant changes to the CAP program which could affect contractual obligations. Furthermore, we received a comment in response to the CY 2009 PFS proposed rule that suggested the elimination of the proxy procedure so that payments would be based on actual data from participating vendors and would better reflect experience within the program. After additional consideration, we believe that it would be prudent to simplify and update our 2009 proposal in order to account for successful bidders who choose not to participate in the CAP, possible changes in the number of approved CAP vendors over the life of a 3-year CAP contract, and to allow for flexibility in setting the frequency of payment amount adjustments as described in section a. above. We believe that our updated proposal is easier for the vendor community to understand and for us to implement.Furthermore, our revised proposal is not constrained by concerns about the impact of changes on an active contract.We are proposing to clarify that the RNAC-based adjustment calculations are intended to apply only to approved CAP vendors (not all bidders), and that the most recent CAP payment amount
Page 33631(for example, the previous year's or the previous quarter's payment amount) will be the starting point for making the subsequent period's adjustment. Simply put, we are proposing to eliminate the use of proxy data for bidders that are no longer participating in the program.Instead, we propose to use RNAC data only from approved CAP vendors that are participating in the CAP at the time that an RNAC-based price update is being calculated. We are also clarifying that the starting point for the payment amount adjustment is the most recent payment amount. The percent change calculated from each participating approvedCAP vendor's RNAC data will be applied to the most recent payment amount by recomputing the single price using the median of all participating vendors' adjusted prices.For example, if quarterly adjustments beginning at the start of claims processing approved CAP vendor's contract as described in section a. above are implemented, and the post bid period's CAP payment amounts are calculated based on five successful bids, but only four approved CAP vendors are participating when CAP claims processing begins, the RNAC-based payment amount adjustment for the first quarter of CAP claims would be based on RNAC data provided by the four approvedCAP vendors that will be furnishing drugs under the CAP. The four approved CAP vendors would be required to submit a quarter of RNAC data within thirty days of the close of the quarter to which the data applied, prior to the beginning of CAP claims processing for the new contract. We would apply the percentage change in RNAC reported by each of the four approved CAP vendors to the CAP payment amounts calculated from successful bids, and the adjusted payment amount would be the median of those four adjusted amounts. Assuming that these four vendors are still furnishing drugs during the second quarter, calculations for the second quarter would apply the RNAC-based adjustment calculated from the four vendors' data to the first quarter's payment amount.This process would apply to the composite bid drug list as amended by rulemaking, meaning that a single weighted percent change in RNAC is calculated for all drugs in the composite bid list and that single percent change is applied to all drugs in the list. For drugs that are bid as separate line items, such as drugs that were included in addendum B of the 2006 bidding period (see 70 FR 39072 and updated as addendum G in 70 FR 70238) or for drugs that are added during a contract period, each HCPCS code will be adjusted as a separate line item. Such codes will not be included in the composite, weighted drug list. Our process will continue to assign a single payment amount to all approved CAP vendors that supply a given HCPCS code; we do not intend to have more than one payment amount for any HCPCS code under the CAP or for individual ``NOC'' drugs described in Sec. 414.906(f)(2)(iv).This updated approach is flexible, and we believe it can accommodate a variety of scenarios, including a changing number of approved CAP vendors and changes to the frequency with which payment amount updates are made. It provides a straightforward and accurate clarification of the price adjustment mechanism described in regulation text. We believe that this proposal remains consistent with our original preamble language and with our CY 2009 PFS proposal, because it retains the two-step calculation using the percent change in RNAC.Finally, we believe that our approach will eliminate any perception that nonparticipating vendors can significantly affect CAP payment amount adjustments. We welcome comments on our proposal and corresponding regulation text changes at Sec. 414.906(c). g. 2009 PFS Proposals(1) Definition of a CAP PhysicianIn the July 6, 2005 IFC, we stated that section 1847B of the Act most closely describes a system for the provision of and the payment for drugs provided incident to a physician's service (70 FR 39026). In the November 21, 2005 IFC (70 FR 70258), we stated that for the purposes of the CAP, a physician includes all practitioners that meet the definition of a ``physician'' in section 1861(r) of the Act. This definition includes doctors of medicine, osteopathy, dental surgery, dental medicine, podiatry, and optometry, as well as chiropractors.However, this definition does not include other health care professionals, such as nurse practitioners (NPs), clinical nurse specialists (CNSs), and other professions such as physician assistants(PAs) who may be able to legally prescribe medications and enroll inMedicare. Our 2005 CAP definition was not intended to exclude these practitioners who are appropriately billing Medicare for legally prescribed medications administered in a capacity that would be classified as incident to a physician's services if the medications were administered by a physician. We are concerned that the existingCAP definition of a physician is unnecessarily restrictive and could potentially affect access to the CAP for a small segment of providers that should be eligible for participation in the CAP in situations where they currently bill Medicare separately and appropriately.In the CY 2009 PFS proposed rule (73 FR 38523), we proposed to further clarify that, for the purposes of the CAP, the definition of a physician included all practitioners that meet the definition of a``physician'' in section 1861(r) of the Act, as well as practitioners(such as NPs, CNSs and PAs) described in section 1861(s)(2)(K) of theAct and other practitioners who legally prescribe drugs associated with services under section 1861(s) of the Act if those services and the associated drugs are covered when furnished incident to a physician's service. While we believed that most practitioners described in section 1861(s)(2)(K) of the Act would bill under specific physician provider numbers, it was not our intent to exclude practitioners who are able to bill independently for drugs associated with services that are covered when provided by a physician and legally authorized to be performed.In response to our CY 2009 proposed rule, only a few commenters were concerned about the inclusion of inadequately trained practitioners and risks to patient safety under this expanded definition. Another commenter stated that this definition goes beyond the scope of the provisions in the MMA and the strict definition of``physician'' in the statute. However, the majority of comments supported this proposal.We did not receive any feedback during the CAP postponement that would lead us to reconsider this proposal. Therefore, we are again proposing to further clarify that, for the purposes of the CAP, the definition of a physician included all practitioners that meet the definition of a ``physician'' in section 1861(r) of the Act, as well as practitioners (such as NPs, CNSs and PAs) described in section 1861(s)(2)(K) of the Act and other practitioners who legally prescribe drugs associated with services under section 1861(s) of the Act if those services and the associated drugs are covered when furnished incident to a physician's services.Our proposal is specific to the Part B Drug CAP and does not affect the definition of physician in section 1861(r) of the Act, or the definition of ``Medical and Other Health Services'' described in section 1861(s) of the Act. This proposal also does not seek to expand the scope of the CAP beyond
Page 33632what has been described in previous rules, other than to clarify that a small number of providers who are enrolled in Medicare, and who legally prescribe drugs associated with services under section 1861(s) of theAct and can be paid by Medicare may elect to participate in the CAP if billing independently. In short, the CAP remains a program that provides Part B drugs furnished incident to a physician's services. We welcome additional comments on the proposal.(2) Easing the Restriction on Physicians Transporting CAP DrugsAlthough section 1847B(b)(4)(E) of the Act provides for the shipment of CAP drugs to settings other than a participating CAP physician's office under certain conditions, in initially implementing the CAP, we did not propose to implement the CAP in alternative settings. We implemented the CAP with a restriction that CAP drugs be shipped directly to the participating CAP physician, as stated in Sec. 414.906(a)(4), and that participating CAP physicians may not transportCAP drugs from one location to another, as stated in Sec. 414.908(a)(3)(xii). However, we were aware that physicians may desire to administer drugs in alternative settings. Therefore, in the July 6, 2005 IFC, we sought comment on how this could be accommodated under theCAP in a way that addresses the potential vendors' concerns about product integrity and damage to the approved CAP vendors' property (70FR 39048). We discussed comments submitted in response to the July 6, 2005 IFC in the CY 2008 PFS proposed rule (72 FR 38158). We also requested comments in the CY 2008 PFS proposed rule (72 FR 38157) on the potential feasibility of easing the restriction on transporting CAP drugs where this is permitted by State law and other applicable laws and regulations. We responded to submitted comments in the CY 2008 PFS final rule with comment period (72 FR 66268).In the CY 2009 PFS proposed rule (70 FR 38523), we proposed to permit the transportation of CAP drug between a participating CAP physician's practice locations subject to voluntary agreements between the approved CAP vendor and the participating CAP physician. Because of the 2009 CAP postponement, we did not address this issue in the CY 2009PFS final rule. However, we did receive the following comments in response to our proposed rule on easing transportation restrictions in the CAP:Many commenters indicated that this change would increase program flexibility and facilitate patient treatment.Some commenters were supportive, but also raised concerns about drug integrity and liability, and requested that appropriate safeguards be in place before transportation restrictions were eased.Generally, commenters wanted CMS to explicitly delineate standards about voluntary agreements that address concerns about product integrity, liability, transportation procedures, and documentation. One commenter indicated that such standards should be developed through a separate rulemaking period to allow for public comment.Several commenters cited State pedigree laws as possible impediments to physician transport of drugs.We also requested and received feedback about the program during the 2009 postponement period. One member of the potential vendor community urged us to be mindful of increased legal liability for an approved CAP vendor if this policy were to be implemented, but also acknowledged that the proposal might substantially increase physician interest in the program.We continue to be mindful of the concerns expressed by the commenters, and have evaluated both the advantages and disadvantages of easing the restriction on transportation of CAP drugs. Thus, we are again proposing to permit transport of CAP drug between a participatingCAP physician's practice locations subject to voluntary agreements between the approved CAP vendor and the participating CAP physician. As indicated in our CY 2009 PFS proposed rule, we continue to propose that such agreements must comply with all applicable State and Federal laws and regulations and product liability requirements, and be documented in writing.We would again like to reiterate the voluntary nature of these proposed agreements. Approved CAP vendors would not be required to offer and participating CAP physicians would not be required to accept such agreements when selecting an approved CAP vendor. An approved CAP vendor may not refuse to do business with a participating CAP physician because the participating CAP physician has declined to enter into such an agreement with the approved CAP vendor. Furthermore, we are not seeking to define which CAP drugs may be subject to the proposed voluntary agreements. In other words, each approved CAP vendor could specify which CAP drug(s) could be transported.However, our proposal continues to contain certain limitations. In previous rulemaking, we have described requirements for voluntary agreements between approved CAP vendors and participating CAP physicians. In the July 6, 2005 IFC (70 FR 39050) and the CY 2006 PFS final rule (70 FR 70251 through 70252), we stated that we will not dictate the breadth of use or the specific obligations contained in voluntary arrangements between approved CAP vendors and participatingCAP physicians, other than to note that they must comply with applicable law and to prohibit approved CAP vendors from coercing participating CAP physicians into entering any of these arrangements.Parties to such arrangements must also ensure that the arrangements do not violate the physician self-referral (``Stark'') prohibition(section 1877 of the Act), the Federal anti-kickback statute (section 1128B(b) of the Act), or any other Federal or State law or regulation governing billing or claims submission. We are proposing to apply these standards to any agreement for the transport of CAP drugs.We remain concerned about opportunities for disruption in the drug's chain of custody and appropriate storage and handling conditions that may ultimately affect patient care or increase the risk of drug theft or diversion. Therefore, in order to maintain safety and drug integrity in the CAP and to protect against the fraudulent diversion ofCAP drugs, we are reproposing that any voluntary agreements between an approved CAP vendor and a participating CAP physician regarding the transportation of CAP drug must include requirements that drugs are not subjected to conditions that will jeopardize their integrity, stability, and/or sterility while being transported. We again welcome comments on these issues, including the identification of who may transport the drugs, how documentation of transportation activities could be accomplished, and how the oversight of such agreements will be carried out.In conclusion, we believe that this proposal to ease the restriction on transporting CAP drugs between a participating CAP physician's practice locations--when agreed upon by the participatingCAP physician and the approved CAP vendor--will make the CAP more flexible and ultimately more appealing to participating CAP physicians.Additionally, we believe that this proposal will facilitate the participation of CAP physicians who
Page 33633have office locations in rural areas and/or have satellite offices with limited hours. Moreover, we believe that this proposal will promote beneficiary care, particularly for beneficiaries who live in rural locations. Since participating CAP physicians would be able to transport CAP drugs to another office location in accordance with a voluntary agreement with their approved CAP vendor, beneficiaries would have more flexibility in scheduling the location of their appointments.We invite comments about this proposal.(3) Dispute Resolution ProcessIn the CY 2009 PFS proposed rule (73 FR 38524 through 38525), we discussed two changes to the CAP dispute resolution process. Section 1847B(b)(2)(A)(ii)(II) of the Act requires an approved CAP vendor to have a grievance and appeals process for the resolution of disputes. In the July 6, 2005 IFC (70 FR 39054 through 39058), we described the process for the resolution of participating CAP physicians' drug quality and service complaints and approved CAP vendors' complaints regarding noncompliant participating CAP physicians. We encouraged participating CAP physicians, beneficiaries, and vendors to use informal communication as a first step to resolve service-related administration issues. However, we recognized that certain disputes would require a more structured approach, and therefore, we established processes under Sec. 414.916 and Sec. 414.917.(i) Approved CAP Vendor's Status During the Reconsideration ProcessSection 414.917 outlines the dispute resolution process for participating CAP physicians. As discussed in the July 6, 2005 IFC (70FR 39057 through 39058), if a participating CAP physician finds an approved CAP vendor's service or the quality of a CAP drug supplied by the approved CAP vendor to be unsatisfactory, then the physician may address the issues first through the approved CAP vendor's grievance process, and second through an alternative dispute resolution process administered by the designated carrier and CMS. In turn, the designated carrier would gather information about the issue as outlined in Sec. 414.917(b)(2) and make a recommendation to CMS on whether the approvedCAP vendor has been meeting the service and quality obligations of itsCAP contract. We would then review and act on that recommendation after gathering any necessary, additional information from the participatingCAP physician and approved CAP vendor. If we suspend an approved CAP vendor's CAP contract for noncompliance or terminate the CAP contract in accordance with Sec. 414.914(a), the approved CAP vendor may request a reconsideration in accordance with Sec. 414.917(c).In the July 6, 2005 IFC (70 FR 39058), we indicated that the approved CAP vendor's participation in the CAP would be suspended while the approved CAP vendor's appeal of our decision is pending. This suspended status is also implied in Sec. 414.917(c)(9), which states that the ``approved CAP vendor may resume participation in CAP'' if the final reconsideration determination is favorable to the approved CAP vendor. In order to improve the clarity of our regulations, we proposed in the CY 2009 PFS proposed rule that the approved CAP vendor's contract will remain suspended during the reconsideration period inSec. 414.917 (73 FR 38525). We believed that this proposed technical change is consistent with basic contracting concepts and with our current practices for the CAP. This proposal was not finalized due to the 2009 CAP postponement.Comments submitted in response to our CY 2009 PFS proposed rule supported this proposed clarification and we did not receive additional feedback about this issue after the CAP was postponed. Based on this and our continued need to improve the clarity of our regulations, we are reproposing that the approved CAP vendor's contract will remain suspended during the reconsideration period in Sec. 414.917. We invite additional comments regarding this proposed issue.(ii) Termination of CAP Drug Shipments to Suspended CAP PhysiciansSection 414.916 provides a mechanism for approved CAP vendors to address noncompliance problems with participating CAP physicians. As stated at Sec. 414.916(a), ``Cases of an approved CAP vendor's dissatisfaction with denied drug claims are resolved through a voluntary alternative dispute resolution process delivered by the designated carrier, and a reconsideration process provided by CMS.''Once the decision is made to suspend a participating CAP physician'sCAP election agreement, the participating CAP physician will be suspended from the CAP as described in Sec. 414.916(b)(3).Physicians whose participation in the CAP has been suspended are not eligible to receive CAP drugs. This is implied in Sec. 414.906(a)(4), which speaks of approved CAP vendors providing CAP drugs directly to ``[a] participating CAP physician.'' However, we believe that the clarity of our dispute resolution regulations would be improved if this drug delivery issue were stated explicitly. Therefore, in the CY 2009 PFS proposed rule, we proposed to revise Sec. 414.916 to specify that approved CAP vendors shall not deliver CAP drugs to participating CAP physicians whose participation in the CAP has been suspended after an initial determination by CMS. Our proposal also applied to physicians engaged in the reconsideration process outlined in Sec. 414.916(c) and included a conforming change at Sec. 414.914(f)(12). We believed that these changes were in accord with the underlying intent of Sec. 414.916, namely to provide a mechanism for approved CAP vendors to address noncompliance problems with participating CAP physicians, and we believe that these changes will increase the clarity of our regulations. We also noted that the participating CAP physicians who are suspended from participation in the CAP will be able to obtain drugs and bill for them under the ASP payment system provided they have not been excluded from participation in Medicare and/or their billing privileges have not been revoked.Comments submitted in response to the CY 2009 PFS proposed rule agreed with our proposal. Though we did not finalize this proposal due to the 2009 CAP postponement, we received no comments from the public in response to our request for feedback during the CAP 2009 postponement. Based on positive public feedback and our continued belief that the clarity of our dispute resolution regulations would be improved by being explicit about this issue, we are reproposing to revise Sec. 414.916 to specify that approved CAP vendors shall not deliver CAP drugs to participating CAP physicians whose participation in the CAP has been suspended after an initial determination by CMS.This suspension in drug shipment would also apply to physicians engaged in the reconsideration process outlined in Sec. 414.916(c). We have also proposed a conforming change to Sec. 414.914(f)(12). Physicians who are suspended from participation in the CAP will be able to obtain drugs and bill for them under the ASP payment system provided they have not been excluded from participation in Medicare and/or their billing privileges have not been revoked. We welcome comments on this proposal.
Page 33634I. Provisions Related to Payment for Renal Dialysis Services Furnished by End-Stage Renal Disease (ESRD) FacilitiesSince August 1, 1983, payment for dialysis services furnished by end-stage renal disease (ESRD) facilities has been based on a composite rate payment system that provides a fixed, prospectively determined amount per dialysis treatment, adjusted for geographic differences in area wage levels. In accordance with section 1881(b)(7) of the Act, separate composite rates were established for hospital-based and independent ESRD facilities. The composite rate is designed to cover a package of goods and services needed to furnish dialysis treatments that include, but not be limited to, certain routinely provided drugs, laboratory tests, supplies, and equipment. Unless specifically included in the composite rate, other injectable drugs and laboratory tests medically necessary for the care of the dialysis patient are separately billable. Effective on August 1, 1983, the base composite rates per treatment were $123 for independent ESRD facilities and $127 for hospital-based ESRD facilities. The Congress has enacted a number of adjustments to the composite rate since that time.Section 623 of the MMA amended section 1881 of the Act to require changes to the composite rate payment methodology, as well as to the pricing methodology for separately billable drugs and biologicals furnished by ESRD facilities. Section 1881(b)(12) of the Act, as added by section 623(d) of the MMA, requires the establishment of a basic case-mix adjusted composite payment system that includes services comprising the composite rate and an add-on to the composite rate component to account for the difference between current payments for separately billed drugs and the revised drug pricing specified in the statute. In addition, section 1881(b)(12) of the Act requires that the composite rate be adjusted for a number of patient characteristics(case-mix) and section 1881(b)(12)(D) of the Act gives the Secretary discretion to revise the wage indices and the urban and rural definitions used to develop them. Finally, section 1881(b)(12)(E) of the Act imposes a budget neutrality (BN) adjustment, so that aggregate payments under the basic case-mix adjusted composite payment system forCY 2005 equal the aggregate payments for the same period if section 1881(b)(12) of the Act did not apply.Before January 1, 2005, payment to both independent and hospital- based facilities for the anti-anemia drug, erythropoietin (EPO) was established under section 1881(b)(11) of the Act at $10.00 per 1,000 units. For independent ESRD facilities, payment for all other separately billable drugs and biologicals is based on the lower of actual charges or 95 percent of the average wholesale price (AWP).Hospital-based ESRD facilities were paid based on the reasonable cost methodology for separately billed drugs and biologicals (other thanEPO) furnished to dialysis patients. Changes to the payment methodology for separately billed ESRD drugs and biologicals that were established by the MMA affected payments in both CY 2005 and CY 2006. 1. CY 2005 RevisionsIn the CY 2005 PFS final rule with comment period (69 FR 66319 through 66334), we implemented section 1881(b) of the Act, as amended by section 623 of the MMA, and revised payments to ESRD facilities.These revisions were effective January 1, 2005, and included an update of 1.6 percent to the composite rate component of the payment system; and a drug add-on adjustment of 8.7 percent to the composite rate to account for the difference between pre-MMA payments for separately billable drugs and payments based on revised drug pricing for 2005 which used acquisition costs. Effective April 1, 2005, the CY 2005 PFS final rule with comment period also implemented case-mix adjustments to the composite rate for certain patient characteristics (that is, age, low body mass index, and body surface area).In addition, to implement section 1881(b)(13) of the Act, we revised payments for drugs billed separately by independent ESRD facilities, paying for the top 10 ESRD drugs based on acquisition costs(as determined by the OIG) and for other separately billed drugs at the average sales price +6 percent (hereafter referred to as ASP+6 percent). Hospital-based ESRD providers continued to receive cost-based payments for all separately billable drugs and biologicals except forEPO which was paid based on average acquisition cost. 2. CY 2006 RevisionsIn the CY 2006 PFS final rule with comment period (70 FR 70161), we implemented additional revisions to payments to ESRD facilities under section 623 of the MMA. For CY 2006, we further revised the drug payment methodology applicable to drugs furnished by ESRD facilities.All separately billed drugs and biologicals furnished by both hospital- based and independent ESRD facilities are now paid based on ASP+6 percent.We recalculated the 2005 drug add-on adjustment to reflect the difference in payments between the pre-MMA AWP pricing and the revised pricing based on ASP+6 percent. The recalculation did not affect the actual add-on adjustment applied to payments in 2005, but provided an estimate of what the adjustment would have been had the 2006 payment methodology been in effect in CY 2005. The drug add-on adjustment was then updated to reflect the expected growth in expenditures for separately billable drugs in CY 2006.As of January 1, 2006, we also implemented a revised geographic adjustment authorized by section 1881(b)(12) of the Act. As part of that change, we--Revised the labor market areas to incorporate the Core-Based Statistical Area (CBSA) designations established by the Office ofManagement and Budget (OMB);Eliminated the wage index ceiling and reduced the floor to 0.8500; andRevised the labor portion of the composite rate to which the geographic adjustment is applied.We also provided a 4-year transition from the previous wage- adjusted composite rates to the current wage-adjusted rates. For CY 2006, 25 percent of the payment was based on the revised geographic adjustments, and the remaining 75 percent of payment was based on the old metropolitan statistical area-based (MSA-based) payments.In addition, section 5106 of the DRA provided for a 1.6 percent update to the composite rate component of the basic case-mix adjusted composite payment system, effective January 1, 2006. As a result, the base composite rate was increased to $130.40 for independent ESRD facilities and $134.53 for hospital-based providers. For 2006, the drug add-on adjustment (including the growth update) was 14.5 percent. 3. CY 2007 Updates In the CY 2007 PFS final rule with comment period(71 FR 69681), we implemented the following updates to the basic case- mix adjusted composite payment system:An update to the wage index adjustments to reflect the latest hospital wage data, including a BN adjustment of 1.052818 to the wage index for CY 2007.A method to annually calculate the growth update to the drug add-on adjustment required by section 1881(b)(12) of the Act, as well as a growth update to the drug add-on adjustment of 0.5 percent for CY 2007. Therefore, effective January 1, 2007 the
Page 33635drug add-on adjustment was increased to 15.1 percent.In addition, section 103 of the MIEA-TRHCA established a 1.6 percent update to the composite rate portion of the payment system, effective April 1, 2007. As a result, the current base composite rate was $132.49 for independent facilities and $136.68 for hospital-based providers. Also, the effect of this increase in the composite rate portion of the payment system was a reduction in the drug add-on adjustment to 14.9 percent, effective April 1, 2007. Since the statutory increase only applied to the composite rate, an adjustment to the drug add-on percent was needed to maintain the drug add-on amount constant. 4. CY 2008 UpdatesIn the CY 2008 PFS final rule with comment period (72 FR 66280), we implemented the following updates to the basic case-mix adjusted payment system:A growth update to the drug add-on adjustment of 0.5 percent. As a result, the drug add-on adjustment to the composite payment rate increased from 14.9 percent to 15.5 percent.An update to the wage index adjustments to reflect the latest hospital wage data, including a wage index BN adjustment of 1.055473 to the wage index for CY 2008.For CY 2008, consistent with the transition blends announced in theCY 2006 PFS final rule with comment period (70 FR 70170), we implemented the third year of the transition to the CBSA-based wage index. In addition, the wage index floor was reduced from 0.8000 to 0.7500. After applying the wage index BN adjustment of 1.055473, the wage index floor was 0.7916. 5. CY 2009 UpdatesSubsequent to the July 7, 2008 publication of the CY 2009 PFS proposed rule, section 153 of the MIPPA mandated changes in ESRD payment including a 1 percent increase to the composite rate, effective for services furnished on or after January 1, 2009 and 2010 and beforeJanuary 1, 2010.Specifically, section 153(a) of the MIPPA updated sections 1881(b)(12)(G) and 1881(b)(12)(A) of the Act to revised payments toESRD facilities. The revisions that were effective January 1, 2009, included the update of 1 percent to the composite rate component of the payment system noted above, and the establishment of a site neutral composite rate for both hospital-based and independent dialysis facilities that reflected the labor share based on the labor share otherwise applied to independent dialysis facilities. The labor share for both hospital-based and independent dialysis facilities was 53.711.In the CY 2009 final rule with comment period (73 69754 through 69761), we implemented the following updates to the basic case-mix adjusted composite payment system:As required by updated sections 1881(b)(12)(G) and 1881(b)(12)(A) of the Act, we applied a 1 percent increase to the independent dialysis facility's CY 2008 composite rate of $132.49, which resulted in a CY 2009 base composite rate for both hospital-based and independent dialysis facilities of $133.81;A zero growth update to the drug add-on adjustment of 15.2 percent to the composite rates for 2009 as required by section 1881(b)(1)(F) of the Act (resulted in a $20.33 per treatment drug add- on amount);Prior to MIPPA, the proposed drug add-on adjustment was 15.5 percent. Since we compute the drug add-on adjustment as a percentage of the weighted average base composite rate, the effect of the one percent increase in the composite rate portion of the payment system, effectiveJanuary 1, 2009, reduced the drug add-on adjustment from 15.5 to 15.2 percent. Since the statutory increase only applied to the composite rate, this adjustment to the drug add-on percent was needed to ensure that the total drug add-on dollars remained constant.An update to the wage index adjustment to reflect the latest available wage data, including a wage index BN adjustment of 1.056672 to the wage index for CY 2009;For CY 2009, the completion of the 4-year transition from the previous wage-adjusted composite rates to the CBSA wage-adjusted rates, where payment is based on 100 percent of the revised geographic adjustments; andA reduction of the wage index floor from 0.7500 to 0.7000.After applying the wage index BN adjustment of 1.056672, the wage index floor was 0.7397. 6. CY 2010 ProposalsFor CY 2010, we are proposing the following updates to the composite rate payment system:An update to the drug add-on adjustment to the composite rate, using a refined methodology for projecting growth in drug expenditures;An update to the wage index adjustment to reflect the latest available wage data, including a revised BN adjustment; andA reduction to the ESRD wage index floor from 0.7000 to 0.6500.As stated above, section 1881(b)(12)(G)(iv) of the Act, as added by section 153(a)(1) of the MIPPA, increased the composite rate by 1.0 percent for ESRD services furnished on or after January 1, 2010. The 1.0 percent increases the current composite rate of $133.81 to $135.15 for services furnished on or after January 1, 2010. a. Proposed Update to the Drug Add-on Adjustment to the Composite RateSection 623(d) of the MMA added section 1881(b)(12)(B)(ii) of theAct which requires establishing an add-on to the composite rate to account for changes in the drug payment methodology stemming from enactment of the MMA. Section 1881(b)(12)(C) of the Act provides that the drug add-on must reflect the difference in aggregate payments between the revised drug payment methodology for separately billableESRD drugs and the AWP payment methodology. In 2005, we generally paid for ESRD drugs based on average acquisition costs. Thus the difference from AWP pricing was calculated using acquisition costs. However, in 2006 when we moved to ASP pricing for ESRD drugs, we recalculated the difference from AWP pricing using ASP prices.In addition, section 1881(b)(12)(F) of the Act requires that, beginning in CY 2006, we establish an annual increase to the drug add- on to reflect estimated growth in expenditures for separately billable drugs and biologicals furnished by ESRD facilities. This growth update applies only to the drug add-on portion of the case-mix adjusted payment system. The CY 2009 drug add-on adjustment to the composite rate was 15.2 percent. The drug add-on adjustment for CY 2009 reflected a zero increase. This computation is explained in detail below and in the CY 2009 PFS final rule with comment period (73 FR 69755 through 69757).(i) Estimating Growth in Expenditures for Drugs and Biologicals for CY 2009Section 1881(b)(12)(F) of the Act specifies that the drug add-on increase must reflect ``the estimated growth in expenditures for drugs and biologicals (including erythropoietin) that are separately billable* * *'' By referring to ``expenditures'', we stated previously that we believe the statute contemplates that the update would account for both increases in drug prices, as well as increases in utilization of those drugs.In the CY 2007 PFS final rule with comment period (71 FR 69682), we established an interim methodology for annually estimating the growth in ESRD drugs and biological expenditures that
Page 33636uses the Producer Price Index (PPI) for pharmaceuticals as a proxy for pricing growth in conjunction with 2 years of ESRD drug data to estimate per patient utilization growth. We indicated that this interim methodology would be used to update the drug add-on to the composite rate until such time that we had sufficient ESRD drug expenditure data to project the growth in ESRD drug expenditures.However, due to the declining ASP prices, we no longer believed that using the PPI as a proxy for pricing growth was appropriate.Accordingly, for CY 2009, we revised the interim methodology for estimating the growth in ESRD drug expenditures by using ASP pricing to estimate the price component of the update calculation. Due to the declining trend in ASP pricing and utilization, we calculated a decrease in the drug add-on adjustment, and applied a zero update to the drug add-on adjustment (73 FR 69755 through 69757).(ii) Estimating Growth in Expenditures for Drugs and Biologicals in CY 2010Since we now have 3 years of drug expenditure data based on ASP pricing, we have reevaluated our methodology for estimating growth in drug expenditures. We believe that 3 years of drug expenditure data based on ASP pricing is sufficient to project drug expenditure growth based on trend analysis. Therefore, for CY 2010, we are proposing to use trend analysis from drug expenditure data to update the per treatment drug add-on adjustment. In the CY 2008 PFS final rule with comment period, we stated that when we had 3 consecutive years of ASP- based historical drug expenditure data, we intended to reevaluate our methodology for estimating growth in drug add-on adjustment (72 FR 66281). We also stated that we expected 2010 would be the earliest we could consider using trend analysis to update the drug add-on adjustment (72 FR 66281).For CY 2010, we propose to estimate per patient growth in drug expenditures by removing growth in ESRD enrollment from growth in total drug expenditures.To estimate drug expenditure growth using trend analysis, we looked at the average annual growth in total drug expenditures between 2006 and 2008. First we had to estimate the total drug expenditures for allESRD facilities in CY 2008. For this proposed rule, we used the finalCY 2006 and the final CY 2007 ESRD claims data and the latest availableCY 2008 ESRD facility claims, updated through December 31, 2008 (that is, claims with dates of service from January 1 through December 31, 2008, that were received, processed, paid, and passed to the NationalClaims History File as of December 31, 2008). For the CY 2010 PFS final rule, we plan to use additional updated CY 2008 claims with dates of service for the same timeframe. This updated CY 2008 data file will include claims received, processed, paid, and passed to the NationalClaims History File as of June 30, 2009.While the December 2008 update of CY 2008 claims used in this proposed rule is the most current available claims data, we recognize that it does not reflect a complete year, as claims with dates of service towards the end of the year have not all been processed. To more accurately estimate the update to the drug add-on, aggregate drug expenditures are required. Based on an analysis of the 2007 claims data, we inflated the CY 2008 drug expenditures to estimate the June 30, 2009 update of the 2008 claims file. We used the relationship between the December 2007 and the June 2008 versions of 2007 claims to estimate the more complete 2008 claims that will be available in June 2009 and applied that ratio to the 2008 claims data from the December 2008 claims file. In previous years, we did this separately for EPO, the other top 10 Part B separately billable drugs, and the remaining separately billable drugs for independent and hospital-based ESRD facilities. All components were then combined to estimate aggregate CY 2008 ESRD drug expenditures. However, we do not believe that creating this estimate using this level of detail (by separately estimating EPO, the other top 10 separately billable drugs, and the remaining separately billable drug for independent and hospital-based ESRD facilities and then combining these components) provides more accuracy.For this reason, we are making this adjustment in aggregate for all separately billable drugs for CY 2008 ESRD drug expenditures. The net adjustment to the CY 2008 claims data is an increase of 11.1 percent to the 2008 expenditure data. This adjustment allows us to more accurately compare the 2007 and 2008 drug expenditure data to estimate per patient growth. As stated earlier in this section, we plan to use additional updated CY 2008 claims in the CY 2010 PFS final rule with comment period. We also note that the top 11 drugs continue to represent 99.7 percent of total expenditures in CY 2008 for separately billable drugs furnished to ESRD patients.Using the full-year 2008 drug expenditure figure, we calculated the average annual change in drug expenditures from 2006 through 2008. This average annual change showed a decrease of 2.2 percent for this timeframe. We propose to use this 2.2 percent decrease to project drug expenditures for both 2009 and 2010.(iii) Estimating Per Patient GrowthOnce we had the projected growth in drug expenditures from 2009 to 2010, we then removed growth in enrollment for the same time period from the expenditure growth, so that the residual reflects per patient expenditure growth, (which includes price and utilization combined) which is what we believe that section 1881(b)(12)(F) of the Act requires us to use to update the drug add-on adjustment. As we described in section II.I.6.a.(ii) of this proposed rule, we now have 3 years of drug expenditure data based on ASP pricing, and for CY 2010 we are proposing to use trend analysis from this data to update the per treatment drug add-on adjustment. To calculate the per patient growth between CYs 2009 and 2010, we removed the enrollment component by using the estimated growth in enrollment data between CY 2009 and CY 2010.This was approximately 1.3 percent. To do this, we divided the total drug expenditure change between 2009 and 2010 (1.000-0.222 = 0.978) by enrollment growth of 1.3 percent (1.013) for the same timeframe. The result is a per patient growth factor equal to 0.965, (0.978/1.013 = 0.965). Thus we are projecting a 3.5 percent decrease in per patient growth in drug expenditures between 2009 and 2010. b. Applying the Proposed Growth Update to the Drug Add-On AdjustmentIn CY 2006, we applied the projected growth update percentage to the total amount of drug add-on dollars established for CY 2005 to establish a dollar amount for the CY 2006 growth update. In addition, we projected the growth in dialysis treatments for CY 2006 based on the projected growth in ESRD enrollment. We divided the projected total dollar amount of the CY 2006 growth by the projected growth in total dialysis treatments to develop the per treatment growth update amount.This growth update amount, combined with the CY 2005 per treatment drug add-on amount, resulted in an average drug add-on amount per treatment of $18.88 (or a 14.5 percent adjustment to the composite rate) for CY 2006.In the CY 2007 PFS final rule with comment period (71 FR 69684), we revised our update methodology by applying the growth update to the per treatment drug add-on amount. That is, for CY 2007, we applied the growth
Page 33637update factor of 4.03 percent to the $18.88 per treatment drug add-on amount for an updated amount of $19.64 per treatment (71 FR 69684). ForCY 2008, the per treatment drug add-on amount was updated to $20.33. In the CY 2009 PFS final rule with comment period (73 FR 69755 through 69757), we applied a zero update to per treatment drug add-on amount which left it at $20.33. As discussed in detail below, for CY 2010, we are again proposing no update to the per treatment drug add-on amount of $20.33 established in CY 2008. c. Proposed Update to the Drug Add-on AdjustmentAs discussed previously in this section, we estimate a 2.2 percent reduction in drug expenditures between CY 2009 and CY 2010. Combining this reduction with a 1.3 percent increase in enrollment, as described in section (a)(iii) above, we are projecting a 3.5 percent decrease in per patient growth of drug expenditures between CY 2009 and CY 2010.Therefore, we are projecting that the combined growth in per patient utilization and pricing for CY 2010 would result in a negative update equal to -3.5 percent. However, similar to last year and as indicated above, we are proposing a zero update to the drug add-on adjustment.We believe this approach is consistent with the language under section 1881(b)(12)(F) of the Act which states in part that ``theSecretary shall annually increase'' the drug add-on amount based on the growth in expenditures for separately billed ESRD drugs. Our understanding of the statute contemplates ``annually increase'' to mean a positive or zero update to the drug add-on. Therefore, we propose to apply a zero update, and to maintain the $20.33 per treatment drug add- on amount for CY 2010. The current $20.33 per treatment drug add-on reflected a 15.2 percent drug add-on adjustment to the composite rate in effect for CY 2009. Given that the MIPPA mandates a 1 percent increase to the composite rate (effective January 1, 2010), however, as discussed earlier in this section, this results in a decrease in the CY 2009 drug add-on adjustment of 15.2 to 15.0 to keep the drug add-on at$20.33. Therefore, we are proposing that the drug add-on adjustment to the composite rate for CY 2010 is 15.0 percent. d. Proposed Update to the Geographic Adjustments to the Composite RateSection 1881(b)(12)(D) of the Act, as amended by section 623(d) of the MMA, gives the Secretary the authority to revise the wage indexes previously applied to the ESRD composite rate. The purpose of the wage index is to adjust the composite rates for differing wage levels covering the areas in which ESRD facilities are located. The wage indexes are calculated for each urban and rural area. In the CY 2006PFS final rule with comment period (70 FR 70167), we announced our adoption of the OMB CBSA-based geographic area designations to develop revised urban/rural definitions and corresponding wage index values for purposes of calculating ESRD composite rates. In addition, we generally have followed wage index policies related to these definitions as used under the inpatient hospital prospective payment system (IPPS), but without regard to any approved geographic reclassification authorized under sections 1886(d)(8) and (d)(10) of the Act or other provisions that only apply to hospitals paid under the IPPS (70 FR 70167). For purposes of the ESRD wage index methodology, the hospital wage data we use is pre-classified, pre-floor hospital data and unadjusted for occupational mix. e. Proposed Updates to Core-Based Statistical Area (CBSA) DefinitionsIn the CY 2006 PFS final rule with comment period (70 FR 70167), we announced our adoption of the OMB's CBSA-based geographic area designations to develop revised urban/rural definitions and corresponding wage index values for purposes of calculating ESRD composite rates. The CBSA-based geographic area designations are described in OMB Bulletin 03-04, originally issued June 6, 2003, and is available online at http://www.whitehouse.gov/omb/bulletins/b03- 04.html. In addition, OMB has published subsequent bulletins regardingCBSA changes, including changes in CBSA numbers and titles. We wish to point out that this and all subsequent ESRD rules and notices are considered to incorporate the CBSA changes published in the most recentOMB bulletin that applies to the hospital wage index used to determine the current ESRD wage index. The OMB bulletins may be accessed online at http://www.whitehouse.gov/omb/bulletins/index.html. f. Proposed Updated Wage Index ValuesIn the CY 2007 PFS final rule with comment period (71 FR 69685), we stated that we intended to update the ESRD wage index values annually.The ESRD wage index values for CY 2010 were developed from FY 2006 wage and employment data obtained from the Medicare hospital cost reports.As we indicated, the ESRD wage index values are calculated without regard to geographic classifications authorized under sections 1886(d)(8) and (d)(10) of the Act and utilize pre-floor hospital data that is unadjusted for occupational mix. We propose to use the same methodology for CY 2010, with the exception that FY 2006 hospital data would be used to develop the CY 2010 wage index values. For a detailed description of the development of the proposed CY 2010 wage index values based on FY 2006 hospital data, see the FY 2010 IPPS proposed rule (74 FR 24145). Section III.G, of the preamble to the FY 2010 IPPS proposed rule, ``Method for Computing the Proposed FY 2010 UnadjustedWage Index'', describes the cost report schedules, line items, data elements, adjustments, and wage index computations. The wage index data affecting the ESRD composite rate for each urban and rural locale may also be accessed on the CMS Web site at http://www.cms.hhs.gov/AcuteInpatientPPS/WIFN/list.asp. The wage data are located in the section entitled, ``FY 2010 Proposed Rule Occupational Mix Adjusted andUnadjusted Average Hourly Wage and Pre-reclassified Wage Index byCBSA.''In the CY 2009 final rule with comment period (73 FR 69758 and 69759), we indicated that the CY 2009 was the final year of the transition period and each ESRD facility's composite payment rate would be based entirely on its applicable CBSA-based wage index value. g. Proposed Reduction to the ESRD Wage Index FloorIn the CY 2009 PFS final rule with comment period, we stated our intention to continue to reassess the need for a wage index floor (73FR 63758). We also stated that a gradual reduction in the floor is needed to support continuing patient access to dialysis in areas that have low wage index values, especially in Puerto Rico where the wage index values are below the current wage index floor. For CY 2010, we are proposing to reduce the wage index floor from 0.70 to 0.65. We also anticipate that we may reduce the floor gradually until full implementation of the ESRD PPS required by section 1881(b)(14) of theAct. h. Proposed Wage index Values for Areas With No Hospital DataIn CY 2006, while adopting the CBSA designations, we identified a small number of ESRD facilities in both urban and rural geographic areas where there
Page 33638are no hospital wage data from which to calculate ESRD wage index values. The affected areas were rural Puerto Rico, and the urban area of Hinesville, GA (CBSA 25980), and rural Massachusetts. For CY 2006,CY 2007, CY 2008, and CY 2009, we calculated the ESRD wage index values for those areas as follows:For the urban area of Hinesville, GA, we calculated the CY 2006, CY 2007, CY 2008, and CY 2009 wage index value based on the average wage index value for all urban areas within the State ofGeorgia.For rural Massachusetts, because we had not determined a reasonable wage proxy, we used the FY 2005 wage index value in CY 2006 and CY 2007. As discussed below, we adopted an alternative methodology for CYs 2008 and 2009.For rural Puerto Rico, because all geographic areas inPuerto Rico were subject to the wage index floor in CYs 2006 through 2009, we applied the ESRD wage index floor to rural Puerto Rico as well. We note that there are currently no ESRD facilities located in rural Puerto Rico.For CY 2008, we adopted an alternative methodology for establishing a wage index value for rural Massachusetts and continued to apply this methodology in CY 2009. Because we used the same wage index value for 2 years with no update, we believed it was appropriate to establish a methodology which employed reasonable proxy data for rural areas(including rural Massachusetts) and also permitted annual updates to the wage index based on that proxy data. For rural areas without hospital wage data, we used the average wage index values from all contiguous CBSAs as a reasonable proxy for that rural area.In determining the imputed rural wage index, we interpreted the term ``contiguous'' to mean sharing a border. In the case ofMassachusetts, the entire rural area consists of Dukes and NantucketCounties. We determined that the borders of Dukes and Nantucket counties are contiguous with CBSA 12700, Barnstable Town, MA and CBSA 39300, Providence-New Bedford-Fall River, RI-MA. We are proposing to use the same methodology for CY 2010. Under this methodology, the CY 2010 proposed wage index values for CBSA 12700 (Barnstable Town, MA-- 1.2629) and CBSA 39300 (Providence-New Bedford-Fall River, RI-MA-- 1.0792) averages results in an imputed proposed wage index value of 1.1711 for rural Massachusetts in CY 2010.For rural Puerto Rico, for CY 2010, all areas in Puerto Rico that have a wage index are eligible for the proposed ESRD wage index floor of 0.65. Therefore, we propose to continue applying the proposed ESRD wage index floor of 0.65 to facilities that are located in rural PuertoRico.For Hinesville-Fort Stewart, GA (CBSA 25980), which is an urban area without specific hospital wage data, we propose to apply the same methodology used to impute a wage index value that we used in CY 2009.Specifically, we utilize the average wage index value for all urban areas within the State of Georgia. That results in a proposed CY 2010 wage index value of 0.9029 for the Hinesville-Fort Stewart GA CBSA.In the CY 2009 PFS final rule with comment period (73 FR 69759 through 69760), we stated that we would continue to evaluate existing hospital wage data and possibly wage data from other sources such as the Bureau of Labor Statistics, to determine if other methodologies might be appropriate for imputing wage index values for areas without hospital wage data for CY 2010 and subsequent years. To date, no data from other sources, superior to that currently used in connection with the IPPS wage index has emerged. Therefore, for ESRD purposes, we continue to believe this is an appropriate policy.For CY 2010, we are proposing to use the FY 2010 wage index data(collected from cost reports submitted by hospital for cost reporting periods beginning FY 2006) to compute the ESRD composite payment rates effective beginning January 1, 2010. i. Budget Neutrality AdjustmentSection 1881(b)(12)(E)(i) of the Act, as added by section 623(d) of the MMA, required that any revisions to the ESRD composite rate payment system as a result of the MMA provision (including the geographic adjustment) be made in a budget neutral manner. Given our application of the ESRD wage index, this means that aggregate payments to ESRD facilities in CY 2010 would be the same as aggregate payments that would have been made if we had not made any changes to the geographic adjusters. We note that this BN adjustment only addresses the impact of changes in the geographic adjustments. A separate BN adjustment was developed for the case-mix adjustments required by the MMA. As we are not proposing any changes to the case-mix measures for CY 2010, the current case-mix BN adjustment of 0.9116 would remain in effect for CY 2010. As in CY 2009, for CY 2010, we propose to apply the wage-index BN adjustment factor of 1.057888 directly to the ESRD wage index values.Because the ESRD wage index is only applied to the labor-related portion of the composite rate, we computed the BN adjustment factor based on that proportion (53.711 percent).To compute the proposed CY 2010 wage index BN adjustment factor(1.057888), we used the FY 2006 pre-floor, pre-reclassified, non- occupational mix-adjusted hospital data to compute the wage index values, 2008 outpatient claims (paid and processed as of December 31, 2008), and geographic location information for each facility which may be found through Dialysis Facility Compare Web page on the CMS Web site at http://www.cms.hhs.gov/DialysisFacilityCompare/. The FY 2006 hospital wage index data for each urban and rural locale by CBSA may also be accessed on the CMS Web site at http://www.cms.hhs.gov/AcuteInpatientPPS/WIFN/list.asp. The wage index data are located in the section entitled, ``FY 2010 Proposed Rule Occupational Mix Adjusted andUnadjusted Average Hourly Wage and Pre-Reclassified Wage Index byCBSA.''Using treatment counts from the 2008 claims and facility-specificCY 2009 composite rates, we computed the estimated total dollar amount each ESRD provider would have received in CY 2009. The total of these payments became the target amount of expenditures for all ESRD facilities for CY 2010. Next, we computed the estimated dollar amount that would have been paid for the same ESRD facilities using the proposed ESRD wage index for CY 2010. The total of these payments became the new CY 2010 amount of wage-adjusted composite rate expenditures for all ESRD facilities. Section 153(a) of the MIPPA revised section 1881(b)(12)(G) of the Act and provided for an update of 1 percent to the composite rate component of the payment system effective January 1, 2010. We note that when computing the new CY 2010 amount, we did not include this 1 percent increase because the BN adjustment would negate the increase.After comparing these two dollar amounts (target amount divided by the new CY 2010 amount), we calculated an adjustment factor that, when multiplied by the applicable CY 2010 ESRD wage index value, would result in aggregate payments to ESRD facilities that would remain within the target amount of composite rate expenditures. When making this calculation, the ESRD wage index floor value of 0.6500 is applied whenever appropriate. The proposed wage BN adjustment factor is 1.057888.To ensure BN, we also must apply the BN adjustment factor to the proposed
Page 33639wage index floor of 0.6500 which results in a proposed adjusted wage index floor of 0.6876 (0.6500 x 1.057888) for CY 2010. j. ESRD Wage Index TablesThe CY 2010 ESRD wage index tables are located in Addenda F and G of this proposed rule.J. Discussion of Chiropractic Services Demonstration 1. BackgroundSection 651 of the Medicare Prescription Drug, Improvement, andModernization Act of 2003 (MMA) (Pub. L. 108-173) requires theSecretary to evaluate the feasibility and advisability of expanding coverage for chiropractic services under Medicare. Under Medicare, coverage for chiropractic services is limited to manual manipulation of the spine to correct a subluxation described in section 1861(r)(5) of the Act. The demonstration expanded current Medicare coverage to include ``care for neuromusculoskeletal conditions typical among eligible beneficiaries and diagnostic and other services that a chiropractor is legally authorized to perform by the State or jurisdiction in which such treatment is provided.'' The 2-year demonstration was conducted in four geographically diverse sites, two rural and two urban regions, with each type including a HealthProfessional Shortage Area (HPSA). The two urban sites were 26 counties in Illinois and Scott County, Iowa, and 17 counties in Virginia. The two rural sites were the States of Maine and New Mexico. The demonstration, which ended on March 31, 2007, was required to be budget neutral as section 651(f)(1)(B) of the MMA requires the Secretary to ensure that ``the aggregate payments made by the Secretary under theMedicare program do not exceed the amount which the Secretary would have paid under the Medicare program if the demonstration projects under this section were not implemented.''In the CY 2006, 2007, and 2008 PFS final rules with comment period(70 FR 70266, 71 FR 69707, 72 FR 66325, respectively), we included a discussion of the strategy that would be used to assess budget neutrality (BN) and how chiropractor fees would be adjusted should the demonstration result in costs higher than those that would occur in the absence of the demonstration. We stated we would assess BN by determining the change in costs based on a pre-post comparison of costs and the rate of change for specific diagnoses that are treated by chiropractors and physicians in the demonstration sites and control sites. We also stated we would not limit our analysis to reviewing only chiropractor claims because the costs of the expanded chiropractor services may have an impact on other Medicare costs. If the demonstration was not budget neutral, we anticipated making reductions in the CY 2010 and CY 2011 physician fee schedules. We proposed that if we determined that the adjustment for BN was greater than 2 percent of spending for the chiropractor fee schedule codes, we would implement the adjustment over a 2-year period. However, if the adjustment was less than 2 percent of spending under the chiropractor fee schedule codes, we would implement the adjustment over a 1-year period. 2. Analysis of DemonstrationBrandeis University, the demonstration evaluator, used two approaches in examining BN. The ``All Neuromusculoskeletal Analysis(NMS)'' reflects an intent-to-treat approach whereby the utilization of all beneficiaries who received any Medicare covered services for neuromusculoskeletal conditions in the demonstration areas was examined. This method is potentially subject to large external forces because of its inclusion of all beneficiaries including those who did not use chiropractic services and who would not become users of chiropractic services even with expanded coverage for them. Therefore, a second analysis, termed the ``Chiropractic User Analysis'' was conducted to examine only the subset of beneficiaries who used chiropractic services for the treatment of their neuromusculoskeletal conditions. Both approaches use hierarchical linear modeling of costs over 3 years--1 year prior to the demonstration and the 2 years of the demonstration. We posted a report describing these analyses on CMS Web site at http://www.cms.hhs.gov/reports/downloads/MMA651_BudgetNeutrality.pdf.The results of both analyses indicate that the demonstration was not budget neutral. In the ``All NMS Analysis,'' which measured the costs of the demonstration on all beneficiaries who received services for a neuromusculoskeletal condition in the demonstration areas in comparison to beneficiaries with similar characteristics from similar geographic areas that did not participate in the demonstration, the total effect of the demonstration to Medicare was $114 million. In the``Chiropractic User Analysis,'' which measured the costs of the demonstration among beneficiaries who used expanded chiropractic services to treat a neuromusculoskeletal condition in the demonstration areas, in comparison to beneficiaries with similar characteristics who used chiropractic services as currently covered by Medicare to treat a neuromusculoskeletal condition from similar geographic areas that did not participate in the demonstration, the total effect of the demonstration to Medicare was $50 million.Both approaches to assessing BN have strengths and limitations. The``All NMS Analysis'' provides the broadest view of the Medicare population that would have been eligible for the demonstration's expanded coverage of chiropractic services. Because it includes all beneficiaries with neuromusculoskeletal conditions, it guards against validity threats of selection. However, this approach creates a large heterogeneous group which may only include a small proportion of chiropractic service users. Basing estimates of BN on such a large heterogeneous group increases the potential for changes in the use of services seldom affected by chiropractors to be falsely attributed to the demonstration, which could result in the costs of the demonstration appearing to be larger than they actually were.We believe the BN estimate should be based on the ``ChiropracticUser Analysis'' because of its focus on users of chiropractic services rather than all Medicare beneficiaries with neuromusculoskeletal conditions, including those who did not use chiropractic services and who would not have become users of chiropractic services even with expanded coverage for them. Users of chiropractic services are most likely to have been affected by the expanded coverage provided by this demonstration. Cost increases and offsets, such as reductions in hospitalizations or other types of ambulatory care, are more likely to be observed in this group. Therefore, we are proposing to adjust theMedicare PFS for all chiropractors using the estimate provided in the``Chiropractic User Analysis.''The CMS Office of the Actuary (OACT) estimates chiropractic expenditures in CY 2010 to be approximately $487 million based on actual Medicare spending for chiropractic services for the most recent available year. Because the costs of this demonstration were higher than expected and we did not anticipate a reduction to the PFS of greater than 2 percent per year, we are proposing to recoup the $50 million in expenditures from this demonstration over a 5-year period rather than over a 2-year period.
Page 33640This approach reflects a change from our BN discussion in the CY 2006, 2007, and 2008 PFS rules, which was described previously in this section. We would recoup $10 million each year through adjustments to the PFS for all chiropractors in CYs 2010 through 2014. We believe that spreading this adjustment over a longer period of time and in equal increments will minimize its potential negative impact on chiropractic practices. 3. Payment AdjustmentTo implement the required BN adjustment, we propose to reduce the payment amount under the PFS for the chiropractic CPT codes (that is,CPT codes 98940, 98941, and 98942). Payment under the PFS for these codes would be reduced by 2 percent. As stated in prior PFS rules, application of the BN adjustment would be specific to these three codes which represent the ``chiropractic fee schedule'' because they are the only chiropractic codes recognized under the PFS. We are proposing to reflect this reduction only in the payment files used by the Medicare contractors to process Medicare claims rather than through adjusting the RVUs. This would preserve the integrity of the PFS, particularly since many private payers also base payment on the RVUs. The RVUs published in Addendum B and posted on our Web site would not show this reduction but would be annotated to state that the reduction resulting from the chiropractic demonstration is not reflected in the RVUs.K. Comprehensive Outpatient Rehabilitation Facilities (CORF) andRehabilitation Agency IssuesA Comprehensive Outpatient Rehabilitation Facility (CORF) is aMedicare provider that furnishes respiratory therapy services among other services. In Sec. 485.70, we set forth the personnel qualifications that must be satisfied by a CORF as a condition of participation under Sec. 485.58 and as a condition of coverage of CORF services, including personnel qualifications for respiratory therapists providing CORF respiratory therapy services.In the CY 2009 PFS proposed rule (73 FR 38502) and subsequent final rule with comment period (73 FR 69942), we revised the definition of a respiratory therapist under Sec. 485.70(j). The change in the definition of respiratory therapist was intended to ensure accuracy in reference to persons who are qualified to perform respiratory therapy and to ensure that language regarding these professionals is consistent with current industry requirements for education, training, and practice.Prior to its modification by the CY 2009 PFS final rule with comment period, Sec. 485.70(j) reflected the qualifications for``Certified Respiratory Therapists (CRTs)'' and ``RegisteredRespiratory Therapists (RRTs)'' as terms commonly used by the professional industry to identify persons furnishing respiratory therapy services.Since publication of the CY 2009 PFS final rule with comment, we have been informed by the industry that the changes made in the definition of respiratory therapist exclude a category of professional that has completed the requirements of a CRT, has completed a nationally accredited educational program that confers eligibility for the National Board for Respiratory Care (NBRC) registry exam for respiratory therapists (RTs), and is eligible to sit for the national registry examination administered by the National Board for RespiratoryCare (NBRC), but has not yet passed the examination. These persons are referred to in the industry as Certified Respiratory Therapists (CRTs).Because it is our policy that Medicare payment is available for respiratory services provided to Medicare beneficiaries in a CORF only if provided by a respiratory therapist meeting the qualifications set forth in Sec. 485.70(j), payment is not available for respiratory services provided by CRTs in the CORF setting. We note that personnel qualifications for respiratory therapists previously set forth at Sec. 485.70(j) prior to its modification by the CY 2009 PFS final rule with comment period did not exclude this category of personnel from the definition of respiratory therapist. We have also heard from CRTs and from CORFs that this change has limited the availability of respiratory therapy services to Medicare beneficiaries in certified CORFs, as many of these services were provided by CRTs. Thus, in modifying the definition of respiratory therapist in the CY 2009 PFS final rule with comment period, we may have inadvertently impacted access to respiratory therapy services for some Medicare beneficiaries.Thus, we are proposing to modify the definition of respiratory therapist and to clarify the terms that are used to identify those persons who furnish respiratory services in CORFs in Sec. 485.70(j) to include CRTs, that is those individuals who have completed a nationally accredited educational program for respiratory therapists and are eligible to sit for the national registry examination administered by the National Board for Respiratory Care (NBRC), but who have not yet passed the examination. The change in the definition we are proposing would permit CRTs to furnish respiratory therapy services to Medicare beneficiaries in the CORF setting.In this proposed rule, we intend to assure that persons who were qualified to furnish respiratory therapy services to patients in CORFs prior to the finalization of CY 2009 PFS final rule with comment period(73 FR 69942), will continue to qualify to furnish RT services to CORF patients under this proposed rule.We invite public comment on the proposed change to Sec. 485.70(j).We are also seeking comments from the industry regarding the difference in services furnished by the different levels of professionals who provide RT services in CORFs. We welcome such comments to be descriptive and both quantitative and qualitative in nature to the extent possible.L. Ambulance Fee Schedule: Technical Correction to the Rural AdjustmentFactor Regulations (Sec. 414.610)Section 1834(l)(9) of the Act provides that for ``ground ambulance services furnished on or after July 1, 2001, and before January 1, 2004, for which transportation originates in a rural area * * * or in a rural census tract of a metropolitan statistical area * * * the fee schedule established under this subsection shall provide that, with respect to the payment rate for mileage for a trip above 17 miles, and up to 50 miles, the rate otherwise established shall be increased by not less than \1/2\ of the additional payment per mile established for the first 17 miles of such a trip originating in a rural area.'' Thus, the statute authorized a rural mileage bonus for miles 18 through 50 for ground ambulance services furnished on or after July 1, 2001 and prior to January 1, 2004. This provision was implemented in Sec. 414.610(c)(5)(i), but the regulation text does not currently specify the statutory time period during which this rural mileage bonus was effective. In the ``Medicare Program; Coverage and Payment of AmbulanceServices; Inflation Update for CY 2004'' final rule with comment period(68 FR 67960, 67961), we acknowledged that we inadvertently omitted from the regulation text the time period during which this statutory adjustment was applicable, and stated we were ``revising Sec. 414.610(c) to reflect that this bonus payment applies only for services furnished during the statutory period.'' Thus, in the ``MedicareProgram; Coverage and Payment of Ambulance Services; Inflation Update for CY 2004'' final rule with comment period, we
Page 33641revised the regulation to include the time period during which the adjustment is applicable (68 FR 67963). However, the revised language specifying the statutory time period was dropped inadvertently from the regulation text when Sec. 414.610(c)(5) was later republished in the``Medicare Program; Medicare Ambulance MMA Temporary Rate IncreasesBeginning July 1, 2004'' interim final rule (69 FR 40288, 40292).In this proposed rule, we are reinstating the language that was originally finalized in ``Medicare Program; Coverage and Payment ofAmbulance Services; Inflation Update for CY 2004'' final rule with comment period (68 FR 67963) but then inadvertently omitted again whenSec. 414.610(c)(5) was later republished, so that Sec. 414.610(c)(5)(i) correctly sets forth the statutory time period during which this rural mileage bonus was applicable. This revision to the regulation is a technical correction to conform the regulation to the statute. For further information, see program instruction, TransmittalAB-03-110; Date August 1, 2003; Change Request 2767 which was issued to inform contractors to discontinue paying such bonuses effective January 1, 2004 in accordance with the statute.M. Clinical Laboratory Fee Schedule: Signature on RequisitionIn the March 10, 2000 Federal Register, we published the ``MedicareProgram; Negotiated Rulemaking: Coverage and Administrative Policies for Clinical Diagnostic Laboratory Services'' proposed rule (65 FR 13082) announcing and soliciting comments on the results of our negotiated rulemaking committee tasked to establish national coverage and administrative policies for clinical diagnostic laboratory tests under Part B of Medicare. In our final rule published in the November 23, 2001 Federal Register (66 FR 58788), we explained our policy on ordering clinical diagnostic laboratory services and amended Sec. 410.32 to make our policy more explicit. Our regulation at Sec. 410.32(a) included the requirement that ``[a]ll diagnostic x-ray tests, diagnostic laboratory tests, and other diagnostic tests must be ordered by the physician who is treating the beneficiary.'' In the November 23, 2001 final rule, we added paragraph (d)(2) to Sec. 410.32 to require that the physician or qualified nonphysician practitioner (NPP) who orders the service must maintain documentation of medical necessity in the beneficiary's medical record (66 FR 58809). In the preamble discussions to the March 10, 2000 proposed rule and November 23, 2001 final rule (65 FR 13089 and 66 FR 58802, respectively), we noted that``[w]hile the signature of a physician on a requisition is one way of documenting that the treating physician ordered the test, it is not the only permissible way of documenting that the test has been ordered.''In those preambles, we described the policy of not requiring physician signatures on requisitions for clinical diagnostic laboratory tests, but implicitly left in place the existing requirements for a written order to be signed by the ordering physician or NPP for clinical diagnostic laboratory tests, as well as other types of diagnostic tests. We further stated in the preambles of the proposed and final rules that we would publish an instruction to Medicare contractors clarifying that the signature of the ordering physician is not required for Medicare purposes on a requisition for a clinical diagnostic laboratory test (65 FR 13089 and 66 FR 58802).On March 5, 2002, we published a program transmittal implementing the administrative policies set forth in the final rule, including the following instruction: ``Medicare does not require the signature of the ordering physician on a laboratory service requisition. While the signature of a physician on a requisition is one way of documenting that the treating physician ordered the service, it is not the only permissible way of documenting that the service has been ordered. For example, the physician may document the ordering of specific services in the patient's medical record.'' (Transmittal AB-02-030, ChangeRequest 1998, dated March 5, 2002).On January 24, 2003, we published a program transmittal in order to manualize the March 5, 2002 Transmittal. (Transmittal 1787, ChangeRequest 2410, dated January 24, 2003). The cover note to the transmittal states, ``Section 15021, Ordering Diagnostic Tests, manualizes Transmittal AB-02-030, dated March 5, 2002. In accordance with negotiated rulemaking for outpatient clinical diagnostic laboratory services, no signature is required for the ordering of such services or for physician pathology services.'' In the manual instructions in that transmittal in a note, we stated: ``No signature is required on orders for clinical diagnostic services paid on the basis of the physician fee schedule or for physician pathology services.'' The manual instructions did not explicitly reference clinical diagnostic laboratory tests as the cover note did. Rather, the transmittal seemed to extend the policy set forth in the FederalRegister (that no signature is required on requisitions for clinical diagnostic laboratory tests paid under the Clinical Laboratory FeeSchedule) to also apply to clinical diagnostic tests paid on the basis of the PFS and physician pathology services. In addition, the manual instructions used the term ``order'' instead of ``requisition,'' which some members of the industry have asserted caused confusion.When we transitioned from paper manuals to the current electronicInternet Only Manual system, these manual instructions were inadvertently omitted from the new Benefit Policy Manual (BPM).In August 2008, we issued a program transmittal (Transmittal 94,Change Request 6100, dated August 29, 2008) to update the BPM to incorporate language that was previously contained in section 15021 of the Medicare Carriers Manual. The reissued language states, ``No signature is required on orders for clinical diagnostic tests paid on the basis of the clinical laboratory fee schedule, the physician fee schedule, or for physician pathology services.'' Based on further review, we have determined that there are no clinical laboratory tests paid under the PFS. After Transmittal 94 was published, we received numerous inquiries from laboratory, diagnostic testing, and hospital representatives who had questions about whether the provision applied to all diagnostic services, including x-rays, MRIs, and other nonclinical laboratory fee schedule diagnostic services.To resolve any existing confusion surrounding the implementation of the policy in 2001 and subsequent transmittals, we are restating and seeking public comments on our policy. We may further clarify our policy in the final rule, taking into consideration public comments.Our policy is that a physician's signature is not required on a requisition for clinical diagnostic laboratory tests paid on the basis of the Clinical Laboratory Fee Schedule; however, it must be evident, in accordance with our regulations at Sec. 410.32(d)(2) and (3), that the physician ordered the services. The policy that signatures are not required on requisitions applies to requisitions for clinical diagnostic laboratory tests paid under the Clinical Laboratory FeeSchedule.We note that we solicited and received comments on this signature requirement during the notice and comment period for the March 10, 2000 proposed rule in the context of our proposal to add paragraph (d)(2)(i) to Sec. 410.32 to require that the practitioner who orders a diagnostic laboratory test
Page 33642must maintain documentation of medical necessity in the beneficiary's medical record. The majority of comments supported the adoption of a policy that the signature of the practitioner on a requisition for a clinical diagnostic laboratory test paid under the Clinical LaboratoryFee Schedule is not the only way of documenting that the test has been ordered and, thus, should not be required provided such documentation exists in an alternate form.This policy regarding requisitions for clinical diagnostic laboratory tests does not supersede other applicable Medicare requirements (such as those related to hospital Conditions ofParticipation (CoPs)) which require the medical record to include an order signed by the physician who is treating the beneficiary. Nor do we believe that anything in our policy regarding signatures on requisitions for clinical diagnostic lab tests supersedes other requirements mandated by professional standards of practice or obligations regarding orders and medical records promulgated byMedicare, the Joint Commission, or State law; nor do we believe the policy would require providers to change their business practices.Because of the confusion surrounding the implementation of the policy in 2001 and subsequent transmittals, we invite the general public to comment on this policy and its impacts on operations.We also are restating and seeking public comment on our long- standing policy consistent with the principle in Sec. 410.32(a) that a written order for diagnostic tests including those paid under the clinical laboratory fee schedule and those that are not paid under the clinical laboratory fee schedule (for example, that are paid under thePFS or under the OPPS), such as X-rays, MRIs, and the TC of physician pathology services, must be signed by the ordering physician or NPP.That is, the policy that signatures are not required on requisitions for clinical diagnostic laboratory tests paid based on the ClinicalLaboratory Fee Schedule applies only to requisitions (as opposed to written orders).'' While there may be additional questions about the policy for physician pathology servicess, we are not addressing these issues in rulemaking at this time.Additionally, we welcome comments from the public about the distinction between an order and a requisition. We note that an``order'' as defined in our IOM, 100-02, Chapter 15, Section 80.6.1 is a communication from the treating physician/practitioner requesting that a diagnostic test be performed for a beneficiary. The order may conditionally request an additional diagnostic test for a particular beneficiary if the result of the initial diagnostic test ordered yields to a certain value determined by the treating physician/practitioner(for example, if test X is negative, then perform test Y). An order may be delivered via the following forms of communication:A written document signed by the treating physician/ practitioner, which is hand-delivered, mailed, or faxed to the testing facility.A telephone call by the treating physician/practitioner or his or her office to the testing facility; orAn electronic mail, or other electronic means, by the treating physician/practitioner or his or her office to the testing facility.If the order is communicated via telephone, both the treating physician/practitioner, or his or her office, and the testing facility must document the telephone call in their respective copies of the beneficiary's medical records.A ``requisition'', conversely, as we understand it, is the actual paperwork, such as a form, which is provided to a clinical diagnostic laboratory that identifies the test or tests to be performed for a patient. It may contain patient information, ordering physician information, referring institution information, information about where to send reports, billing information, specimen information, shipping addresses for specimens or tissue samples, and checkboxes for test selection. We believe it is ministerial in nature, assisting labs with billing and handling of results, and serves as an administrative convenience to providers and patients. We believe that a written order, which may be part of the medical record, and the requisition are two different documents; although a requisition that is signed may serve as an order. We welcome comments from the public about the distinction between requisitions and orders.N. Physician Self-Referral 1. General BackgroundSection 1877 of the Act, also known as the physician self-referral law, prohibits the following: (1) A physician from making referrals for certain designated health services (``DHS'') payable by Medicare to an entity with which he or she (or an immediate family member) has a direct or indirect financial relationship (an ownership/investment interest or a compensation arrangement), unless an exception applies; and (2) The entity from presenting or causing a claim to be presented to Medicare (or billing another individual, entity, or third party payor) for those referred services. The statute establishes a number of exceptions and grants the Secretary the authority to create regulatory exceptions for financial relationships that pose no risk of program or patient abuse.Determining whether an entity furnishing DHS and a physician have a direct or indirect compensation arrangement is a key step in applying the statute because it affects which compensation exceptions may apply to the arrangement. Section 411.354(c) governs when a physician``stands in the shoes'' of his or her physician organization and may therefore, depending on the circumstances, have a direct, rather than an indirect, compensation arrangement with an entity furnishing DHS.Our proposal seeks to clarify one aspect of the physician stand in the shoes provisions at Sec. 411.354(c). Specifically, we are proposing to clarify the second sentence of Sec. 411.354(c)(3)(i) to provide that, ``[w]hen applying the exceptions in Sec. 411.355 andSec. 411.357 to arrangements in which a physician stands in the shoes of his or her physician organization, the relevant referrals and other business generated ``between the parties' are referrals and other business generated between the entity furnishing DHS and the physician organization (including all members, employees, and independent contractor physicians).'' A detailed discussion of this proposed clarification may be found in section II.N.2.b. of this proposed rule. 2. Physician Stand in the Shoes a. BackgroundOne of the first significant physician stand in the shoes provisions was finalized in the ``Medicare Program; Physicians'Referrals to Health Care Entities With Which They Have FinancialRelationships (Phase II),'' interim final rule with comment period published in the March 26, 2004 Federal Register (69 FR 16054) (``PhaseII''). In Phase II, we revised the definition of ``referring physician'' at Sec. 411.351 to clarify that a referring physician is treated as ``standing in the shoes'' of his or her professional corporation (69 FR 16058, 16060). Our revision to the definition of``referring physician'' clarified that it was not necessary to treat a referring physician as separate from his or her wholly-owned professional corporation. We noted that the revised regulations should make it simpler for physicians and others to evaluate their financial relationships and to apply exceptions
Page 33643under section 1877 of the Act. We also solicited comments on whether to permit a physician to stand in the shoes of a group practice of which he or she is a member (69 FR 16060).We addressed certain provisions of section 1877 of the Act, including provisions relating to direct and indirect compensation arrangements, in the ``Medicare Program; Physicians' Referrals toHealth Care Entities With Which They Have Financial Relationships(Phase III),'' final rule published in the September 5, 2007 FederalRegister (72 FR 51012) (``Phase III''). Phase III extended the Phase II rule that treated referring physicians as standing in the shoes of their wholly-owned professional corporations only (72 FR 51026).Specifically, we amended Sec. 411.354(c) to add a provision under which all referring physicians will be treated as ``standing in the shoes'' of their physician organizations for purposes of applying the rules that describe direct and indirect compensation arrangements inSec. 411.354 (72 FR 51026 through 51029). Phase III defined a``physician organization'' at Sec. 411.351 to be ``a physician(including a professional corporation of which the physician is the sole owner), a physician practice, or a group practice that complies with the requirements of Sec. 411.352.'' Under Phase III, when determining whether a direct or indirect compensation arrangement existed between a physician and an entity to which the physician refersMedicare patients for DHS, the referring physician would stand in the shoes of: (1) Another physician who employs the referring physician;(2) his or her wholly-owned professional corporation; (3) a physician practice (that is, a medical practice) that employs or contracts with the referring physician; or (4) a group practice of which the referring physician is a member or independent contractor. We specified in Sec. 411.354(c)(3)(i) that a physician who stands in the shoes of his or her physician organization would be considered to have the same compensation arrangements (with the same parties and on the same terms) as the physician organization in whose shoes the referring physician stands. In addition, we specified in the second sentence of Sec. 411.354(c)(3)(i) that ``[f]or purposes of applying the exceptions inSec. 411.355 and Sec. 411.357 to arrangements in which a physician stands in the shoes of his or her physician organization, the `parties' to the arrangements are considered to be the entity furnishing DHS and the physician organization (including all members, employees, or independent contractor physicians).''The Phase III stand in the shoes rules were made in an effort to address two issues. First, industry representatives had asserted that resorting to the indirect compensation definition and exception added an unnecessary step when determining compliance with the physician self-referral prohibition. These representatives believed that it would be easier, more efficient, and consistent with the intent of the physician self-referral law to examine the relationship between the hospital and the group practice for compliance with a physician self- referral exception. The representatives urged that a referring physician should stand in the shoes of his or her group practice, which acts on behalf of its physician members and contractors. Depending on the circumstances, this would enable the parties to analyze the arrangement between the entity furnishing DHS and the group practice(for example, a lease of office space, a personal service arrangement, or a fair market value compensation arrangement) to determine its compliance with one of the various direct compensation arrangement exceptions, rather than the indirect compensation arrangements exception at Sec. 411.357(p). We agreed and permitted a physician to stand in the shoes of his or her group practice, thereby permitting physicians and entities furnishing DHS to use a direct compensation arrangement exception in some circumstances.Second, we were informed that parties may have construed the definition of an indirect compensation arrangement too narrowly, resulting in erroneous determinations that some arrangements involving financial incentives for referring physicians would fall outside the ambit of the physician self-referral law. In particular, we were concerned that some arrangements between entities furnishing DHS and group practices were viewed as outside the application of the statute.The stand in the shoes provisions set forth in Phase III were designed to address this concern by treating compensation arrangements between entities furnishing DHS and group practices as if the arrangements were with the group's referring physicians.In response to concerns raised by some industry representatives, we published a final rule in the November 15, 2007 Federal Register (72 FR 64161) delaying the date of applicability of the Phase III stand in the shoes provisions with respect to certain compensation arrangements involving physician organizations and academic medical centers or certain integrated 501(c)(3) health care systems, from December 4, 2007 until December 4, 2008.We finalized revisions to Sec. 411.354(c)(1)(ii) to deem (so as to require) a physician who has an ownership or investment interest in a physician organization to stand in the shoes of that physician organization in the ``Medicare Program; Changes to the HospitalInpatient Prospective Payment Systems and Fiscal Year 2009 Rates;Payments for Graduate Medical Education in Certain EmergencySituations; Changes to Disclosure of Physician Ownership in Hospitals and Physician Self-Referral Rules; Updates to the Long-Term CareProspective Payment System; Updates to Certain IPPS-Excluded Hospitals; and Collection of Information Regarding Financial Relationships BetweenHospitals'' final rule (``FY 2009 IPPS final rule'') published in theAugust 19, 2008 Federal Register (73 FR 48434). Physicians with only a titular ownership interest (that is, physicians without the ability or right to receive the financial benefits of ownership or investment, including, but not limited to, the distribution of profits, dividends, proceeds of sale, or similar returns on investment) are not deemed to stand in the shoes of their physician organizations. We also addedSec. 411.354(c)(1)(iii) to permit (but not require) a titular owner and a physician who does not have an ownership or investment interest in a physician organization to stand in the shoes of his or her physician organization. This rule became effective October 1, 2008. b. Proposed Clarification to Sec. 411.354(c)--Applying Exceptions inSec. 411.355 and Sec. 411.357 to Arrangements in Which a PhysicianStands in the Shoes of His or Her Physician OrganizationSection 411.354(c)(3)(i) addresses the application of the general exceptions to the referral prohibition related to both ownership/ investment and compensation (Sec. 411.355) and the exceptions to the referral prohibition related to compensation arrangements (Sec. 411.357), to arrangements in which a physician stands in the shoes of his or her physician organization. Many of these exceptions require the arrangement to be in writing and signed by the parties and prohibit the compensation from taking into account the volume or value of referrals or other business generated by the referring physician.Under Sec. 411.354(c)(3)(i), a physician who stands in the shoes of his or her
Page 33644physician organization is deemed to have the same compensation arrangements with the same parties and on the same terms as the physician organization. The second sentence of Sec. 411.354(c)(3)(i) provides that ``[f]or purposes of applying the exceptions in Sec. 411.355 and Sec. 411.357 to arrangements in which a physician stands in the shoes of his or her physician organization, the `parties' to the arrangements are considered to be the entity furnishing DHS and the physician organization (including all members, employees, or independent contractor physicians).''After the publication of Phase III, some members of the industry questioned whether the second sentence of Sec. 411.354(c)(3)(i) defined the term ``parties'' everywhere it appears in the physician self-referral regulations, including the requirement in many exceptions that a compensation arrangement be in writing and ``signed by the parties.'' Specifically, these members believed it was necessary for everyone within a physician organization (that is, all members, employees, and independent contractor physicians) to sign a myriad of different arrangements with an entity furnishing DHS. This was not our intent. In January 2008, we posted a frequently asked question (FAQ) on our Web site to address this issue (see question 8885 at https://questions.cms.hhs.gov/cgi-bin/cmshhs.cfg/php/enduser/std_ adp.php?p_faqid=8885.) In the FAQ, we explained that a physician who stands in the shoes of his or her physician organization need not become a signatory to a written agreement between the physician organization and an entity furnishing DHS because ``we consider a physician who is standing in the shoes of his or her physician organization to have signed the written agreement when the authorized signatory of the physician organization has signed the agreement.''After the FY 2009 IPPS final rule, under which only physician owners are deemed to stand in the shoes of their physician organizations, some industry representatives questioned whether physicians who did not stand in the shoes remained ``parties'' under Sec. 411.354(c)(3)(i) and would therefore need to become signatories to any compensation arrangement that was required to be in writing and ``signed by the parties.''We are proposing to clarify the second sentence of Sec. 411.354(c)(3)(i) to provide that, ``[w]hen applying the exceptions inSec. 411.355 and Sec. 411.357 to arrangements in which a physician stands in the shoes of his or her physician organization, the relevant referrals and other business generated `between the parties' are referrals and other business generated between the entity furnishingDHS and the physician organization (including all members, employees, and independent contractor physicians).'' We believe this proposed language clarifies the regulation text and is consistent with our intent to minimize the potential for abuse without imposing undue burden on the provider community.Our proposed change clarifies that we are not defining the term``parties'' and should eliminate any possible public misconception that all physicians in a physician organization (whether or not they stand in the shoes of the physician organization) must sign the writing(s) memorializing a compensation arrangement between their physician organization and an entity furnishing DHS. Furthermore, we note that some members of the industry have erroneously applied the second sentence of Sec. 411.354(c)(3)(i) by analyzing whether the compensation takes into account the referrals between the entity furnishing DHS and the physician who stands in the shoes of the physician organization only, not the referrals of all members, employees, and independent contractor physicians in the physician organization. As we indicated in the Phase III final rule (72 FR at 51028), the second sentence of Sec. 411.354(c)(3)(i) was intended to require (where applicable) an analysis of whether a compensation arrangement takes into account referrals or other business generated by the physician organization as a whole and not merely referrals or other business generated by the physicians who stand in its shoes. Thus, we reiterate that the relevant referrals and other business generated between the physician organization and the entity furnishing DHS are the referrals of all physicians in the physician organization(including all members, employees, and independent contractors), not simply the referrals made by each physician who stands in the shoes of the physician organization.We welcome public comments regarding alternative approaches to address this issue.O. Durable Medical Equipment-Related Issues 1. Damages to Suppliers Awarded a Contract under the Acquisition ofCertain Durable Medical Equipment, Prosthetics, Orthotics, and Supplies(Medicare DMEPOS Competitive Bidding Program) Caused by the Delay of the ProgramSection 1847 of the Act, as amended by section 302(b)(1) of theMMA, requires the Secretary to establish and implement a MedicareDurable Medical Equipment, Prosthetics, Orthotics, and SuppliesCompetitive Bidding Program (DMEPOS CBP). On July 15, 2008, the MIPPA was enacted. Section 154 of the MIPPA amended section 1847 of the Act to make certain limited changes to the competitive bidding program, including adding a new subsection (a)(1)(D) to section 1847 of the Act.Section 1847(a)(1)(D) terminates retroactively the competitive bidding contracts that were awarded to suppliers in 2008 for the Round 1 of competitive bidding and prohibits payment based on such contracts.Section 154 of the MIPPA effectively reinstated payment for competitively bid items and services to the Medicare fee schedule amounts, as set forth in section 1834 of the Act and 42 CFR part 414, subpart D of our regulations.Section 1847(a)(1)(D)(i)(I) of the Act, as amended by the MIPPA, stipulates that to the extent any damages may be applicable as a result of the termination of contracts, payment is to be made from the FederalSupplementary Medical Insurance Trust Fund under section 1841 of theAct. Section 1847(a)(1)(D) of the Act also states that nothing in section 1847(a)(1)(D)(i)(I) of the Act, which includes the reference to damages, shall be construed to provide an independent cause of action or right to administrative or judicial review with the regard to the termination of the Round 1 contracts.For further discussion of the Competitive Bidding Program and the bid evaluation process, see the Medicare Program; CompetitiveAcquisition for Certain Durable Medical Equipment, Prosthetics,Orthotics, and Supplies (DMEPOS) and Other Issues final rule published in the April 10, 2007 Federal Register (72 FR 17992) and the MedicareProgram; Changes to the Competitive Acquisition of Certain DurableMedical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS) byCertain Provisions of the Medicare Improvements for Patients andProviders Act of 2008 (MIPPA) interim final rule with comment period(IFC)
Page 33645published on January 16, 2009 Federal Register (74 FR 2873).In this proposed rule, we are proposing to add new Sec. 414.425 to establish a process to evaluate any claims for damages caused by the termination of contracts awarded in 2008 under the DMEPOS CBP that were terminated as a result of section 154(a)(1)(A)(iv) of the MIPPA.We offered contracts in March of 2008 to selected suppliers for the first round of the DMEPOS CBP. The contracts that were accepted were terminated by the MIPPA retroactive to June 30, 2008. We considered the terms of the contracts and other processes of the DMEPOS CBP as we developed this proposed process to determine, on a case-by-case basis, whether to award damages and, where applicable, the amount of damages to be awarded for the termination of these contracts.When considering whether to submit a claim for damages, suppliers may consider the following factors:Each contract stipulated that the contract is subject to any changes to the statute or regulations that affect the Medicare program.Each contract indicated CMS does not guarantee any amount of business or profits.Each contract stipulated that CMS shall not pay for any expenses incurred by the supplier for the work performed under the contract other than for payment of Medicare claims authorized under the contract.Upon termination of the contracts by the MIPPA, payments reverted to the CY 2008 fee schedule amount, which was on average 26 percent higher than payment amounts under the DMEPOS CBP.We will review a supplier's estimated and historic capacity and any expansion plans that were submitted as part of a supplier's bid.We will review a supplier's action to meet its obligation to mitigate its damages.We listed the winning suppliers on the Medicare.gov Web site in the supplier locator tool; a supplier is allowed to keep any new customers they may have obtained because of being listed on the supplier locator tool.This list is not intended to suggest that there are not legitimate claims for damages. However, these are factors that a supplier may consider when deciding whether to submit a claim for damages.The provisions of this proposed rule outline the information that we are proposing suppliers provide when submitting claims for damages and the process that we will follow to review these claims. The information we propose to collect from suppliers is necessary for us to make a reasonable decision on whether damages are warranted and how much in damages should be awarded. We believe the process is not overly burdensome to those suppliers choosing to participate in this review process and will ensure a thorough review of a supplier's claim for damages.The proposed process to file a claim for damage claims includes the following provisions: a. Eligibility To File a ClaimAny aggrieved supplier that was awarded a contract in 2008 for theRound 1 DMEPOS CBP and believes it has suffered damages is eligible to submit a claim. The supplier must be able to demonstrate how its company was damaged. These damages must be substantiated and be as a direct result of the termination by MIPPA of their Round I DMEPOS CBP contract. Only a contract supplier, and not a subcontractor of a contract supplier, is eligible to submit a claim for damages. b. Timeframes for Filing a ClaimA completed claim, including all documentation described below in section II.O.1.c., must be filed within 90 days of the effective date of the finalization of these damages provisions, unless the 90th day is a weekend or Federal holiday. In that case, the last date to file a claim will be the day following the weekend or Federal holiday. The date of filing is the actual date of receipt by the CBIC of a completed claim from the supplier that includes all of the information required by this rule. We strongly urge claimants to use a tracking method such as with the United States Postal Service or a carrier that requires a return receipt that indicates the date on which the claim was delivered. c. Information That Must Be Included in a ClaimAt a minimum, a claim should include all of the following:Supplier's name and bidding number.Supplier's current contact information (Name of authorized official, U.S. Post Office mailing address, phone number and e-mail address).A copy of the DMEPOS CBP Round I contract(s) the supplier signed with CMS.A detailed explanation of the damages incurred by the supplier. The explanation must document the supplier's damages through receipts and records that establish the claimant's damages directly related to meeting the terms of the DMEPOS CBP Round I contract.The supplier must also explain how it would be damaged if not reimbursed.A detailed explanation of the steps of all attempts to use for other purposes, return, or dispose of equipment or other assets purchased or rented for use in the Round I DMEPOS CBP contract performance.Damages claimed must be specifically related to carrying out the terms of the contract, and may include, but are not limited to, the following:Items or equipment purchased or rented.Additional employee costs.Additional inventory costs.Additional facility costs.The supplier must include a separate justification for any of these items for which it is claiming damages and explain how they were necessary in terms of meeting the requirements of the Round 1 DMEPOSCBP contract. This does not include expenses that would have occurred if the supplier had not been awarded a contract but only those expenses that were incurred for the Round 1 DMEPOS CBP contract performance. The claim must also detail steps taken by the supplier to mitigate damages that they may have incurred due to the contract termination. d. Items That Will Not Be Considered in a ClaimCMS will not award damages for the following:Cost of submitting a bid.Cost of preparing or submitting a claim for damages under this section.Fees or costs incurred for consulting or marketing.Cost of accreditation or licensure.Costs incurred before March 20, 2008.Costs incurred after July 14, 2008 except for costs incurred to mitigate damages.Any profits a supplier may have expected from performance of the contract.Costs that would have occurred without the supplier having been awarded a contract.Costs for items such as inventory, delivery vehicles, office space and equipment, personnel, which the supplier did not purchase specifically to perform the contract.Costs already recouped by use of personnel, material, supplies, or equipment in the supplier's business operations.We are not considering claims for expenses incurred prior to March 20, 2008 including the purchase or rental of
Page 33646items or equipment before that date, because a supplier would not have known that it was going to be offered a contract. We are not considering claims for most expenses incurred after July 14, 2008, including the purchase or rental of items or equipment, because this is the date on which MIPPA terminated all of the Round 1 contracts. e. Filing a ClaimSuppliers should submit claims, with all supporting documentation, with the CMS Competitive Bidding Implementation Contractor (CBIC) at the following address: CBIC; Bldg 200, Suite 400; 2743 PerimeterParkway; Augusta, Georgia 30909. The authorized official for the supplier must certify the accuracy of the information on the claim and all supporting documentation. The authorized official is appointed by the supplier and has the legal authority granted by the supplier to submit the claim for damages. This person may be the supplier's general partner, chairman of the board, chief financial officer, chief executive officer, president, direct owner of the supplier organization, or must hold a position of similar status and authority within the supplier's organization. The CBIC will not accept electronic submissions of claims for damages. f. Review of Claim(1) Role of the CBICThe CBIC will conduct the first level of review and make recommendations to CMS, hereafter referred to as the DeterminingAuthority regarding:Whether the claim is complete and was filed in a timely manner. The CBIC may seek further information from the claimant when making its recommendation. The CBIC may set a deadline for receipt of additional information.When the claim is incomplete or was not filed in a timely manner, the CBIC will make a recommendation to the DeterminingAuthority not to process the claim further.Whether the government owes damages because of the MIPPA.The CBIC will include an explanation supporting its recommendation. TheCBIC will recommend a reasonable amount of damages, if any, based on the claim submitted, including all accompanying documentation. The CBIC will consider the language of the contract, as well as both costs incurred and the contract supplier's attempts and actions to limit the damages.(2) CMS' Role as the Determining AuthorityCMS is the Determining Authority because we are responsible for the final review and final determination regarding claims for damages.The Determining Authority shall review the recommendation of the CBIC.The Determining Authority may seek further information from the claimant or the CBIC in making a concurrence or non- concurrence determination.The Determining Authority may set a deadline for receipt of additional information. A claimant's failure to respond timely may result in a denial of the claim.If the Determining Authority concurs with the CBIC recommendation, the Determining Authority shall submit a final signed decision to the CBIC and direct the CBIC to notify the claimant of the determination and the reasons for the final determination.If the Determining Authority nonconcurs with the CBIC recommendation, the Determining Authority may:+ Write a determination granting (in whole or in part) a claim for damages or denying a claim in its entirety; or direct the CBIC to write said determination for the Determining Authority's signature.+ Return the claim to the CBIC with further instructions.The Determining Authority's determination is final and binding; it is not subject to administrative or judicial review under section 1847(a)(1)(D) of the Act, as amended by section 154(a)(1) of the MIPPA. g. Timeframe for Final DeterminationsEvery effort will be made to make a final determination within 120 days of initial receipt of the claim for damages by the CBIC or the receipt of additional information that was requested by the CBIC, whichever is later. In the case of more complex cases, or in the event of a large workload, a decision will be issued as soon as practicable. h. Notification to Claimant of Damage DeterminationThe CBIC shall mail the final determination to the claimant by certified mail return receipt requested. If CMS determines that money is due to a claimant, this notification will indicate when and how the money will be transmitted. If a monetary award is due, the supplier will be required to provide banking information for electronic deposit. 2. Notification to Beneficiaries for Suppliers Regarding GrandfatheringSection 1847(a)(4) of the Act requires that in the case of covered durable medical equipment (DME) items for which payment is made on a rental basis under section 1834(a) of the Act, and in the case of oxygen for which payment is made under section 1834(a)(5) of the Act, the Secretary shall establish a ``grandfathering'' process under which rented DME items that were furnished prior to the start of theCompetitive Bidding Program (CBP) may be continued to be rented to the beneficiary by a noncontract supplier. Agreements for those covered items and supplies that were rented by the supplier to the beneficiary before the start of a CBP may be continued, regardless of whether the existing supplier participates in the CBP.In the April 10, 2007 final rule (72 FR 17992), in Sec. 414.408(j), we established the grandfathering process described below for rented DME and oxygen and oxygen equipment when these items are included under the Medicare DMEPOS CBP. A supplier that is furnishingDME or is furnishing oxygen or oxygen equipment on a rental basis to a beneficiary prior to the implementation of a CBP in the competitive bidding area (CBA) where the beneficiary maintains a permanent residence may elect to continue furnishing the item as a grandfathered supplier. This process only applies to suppliers that began furnishing the competitive bid items described above before the start of the CBP to beneficiaries who maintain a permanent residence in a CBA.In the case of the rented DME and oxygen and oxygen equipment identified in this section, we established in Sec. 414.408(j)(4) thatMedicare beneficiaries have the choice of deciding whether they would like to continue receiving the rented item from a grandfathered supplier or if they would like to receive the item from a contract supplier.Suppliers that agree to be a grandfathered supplier for an item must agree to be a grandfathered supplier for all current beneficiaries who request to continue to rent that item from them. The beneficiary's decision to use a grandfathered supplier depends on the decision of the noncontract supplier that is currently renting the competitive bidding item to continue renting the item as a grandfathered supplier after the start of the CBP in accordance with the terms we have specified. The payment rules for grandfathered suppliers are specified in existingSec. 414.408(j)(2).
Page 33647In addition, the beneficiary may elect, at any time, to transition from a noncontract supplier to a contract supplier. The contract supplier would be required to accept the beneficiary as a customer regardless of how many rental months had already been paid for the beneficiary to receive this item. If the grandfathered supplier is not willing to continue furnishing the item, a beneficiary must select a contract supplier to furnish the item in order to receive Medicare payment for that item. The grandfathered supplier is paid based on the payment rules outlined in the final rule on Competitive Bidding atSec. 414.408(j).As a result of what we learned from Round 1 of the CBP, we are proposing changes to the ``grandfathering'' rules by establishing notification requirements for noncontract suppliers that are furnishing rented DME competitive bid items at the time a CBP begins to beneficiaries residing in a CBA. We are also proposing a new definition for a grandfathered item to include all rented item(s) in a competitive bidding product category that a supplier currently provides to its beneficiaries. Under the current regulation, suppliers may choose the items within a product category for which they want to become a grandfathered supplier. Under this proposed rule, a noncontract supplier would have to choose to be either a grandfathered supplier for all or for none of the rented DME items within a product category that the supplier currently provides.For further discussion of the CBP and the bid evaluation process, see the April 10, 2007 final rule and the January 16, 2009 interim final rule with comment period.We are proposing to revise the definition of ``grandfathered item'' in Sec. 414.402 so that the term would refer to all rented items within a competitive bid product category that the supplier currently rents to beneficiaries. In addition, we are proposing to redesignate the current Sec. 414.408(j)(5) as Sec. 414.408(j)(7) and add newSec. 414.408(j)(5)and (j)(6). The new Sec. 414.408(j)(5)and (j)(6) will specify the notification requirements that apply to noncontract suppliers that are renting DME competitive bid items in a CBA at the time of implementation of the CBP. a. Definition of a Grandfathered ItemWe are proposing to revise the definition of a ``grandfathered item'' in Sec. 414.402 to avoid confusion, on the part of beneficiaries, regarding rented DME items for which a noncontract supplier is willing or not willing to be a grandfathered supplier.Under the current regulations, a supplier may make separate choices regarding grandfathering for each individual HCPCS code. For example, a supplier may choose to be a grandfathered supplier for a particular type of walker within the product category instead of all of the walkers included in that product category that are furnished on rental basis.Under the revised definition, a noncontract supplier would have to choose to be either a grandfathered supplier for all or for none of theDME rented items within a product category that the supplier currently provides. We believe that it would be easier for beneficiaries to recognize which items a supplier is grandfathering or not grandfathering if the supplier's election concerning grandfathering was made by product category rather than making separate choices for each individual HCPCS code. In addition, this proposed revision would prevent suppliers from choosing to be a grandfathered supplier for only the more profitable items, which could disadvantage certain beneficiaries. b. Notification of Beneficiaries and CMS by Suppliers That Choose ToBecome Grandfathered SuppliersWe are proposing to add a new Sec. 414.408(j)(5) to require suppliers furnishing items to be included in a CBP that are eligible for grandfathering to notify beneficiaries in the CBA and CMS regarding their decision whether to become grandfathered suppliers.The notification requirements we are proposing will prohibit certain inappropriate practices of noncontract suppliers. These inappropriate practices include: (1) Suppliers attempting to receive additional monthly rental payments from Medicare by circumventing the grandfathering requirements; and (2) suppliers not formally notifying beneficiaries before picking up the rented item from the beneficiary's home. We are also proposing to require a notification process to protect beneficiaries and to ensure less confusion during the transition period prior to implementation of the CBP. The proposed requirements will help ensure that beneficiaries are contacted and informed about the grandfathering process and what choices they have concerning their choice of supplier. Moreover, the notice will help to ensure that beneficiaries do not have medically necessary DME equipment taken from them unexpectedly by a noncontract supplier.(1) Notification of Beneficiaries by Suppliers That Choose to BecomeGrandfathered SuppliersWe are proposing to add Sec. 414.408(j)(5)(i) which requires a noncontract supplier that elects to become a grandfathered supplier in a CBA to provide a written notification to each Medicare beneficiary in that CBA who is currently renting a grandfathered item from that supplier. The notification must state that the supplier is willing to continue to rent the grandfathered item(s) to the beneficiary as a grandfathered supplier. The notice must identify the DME grandfathered rented items for which the supplier will be a grandfathered supplier.To ensure that beneficiaries are sufficiently informed and prepared for competitive bidding changes that affect rented DME, we are proposing in Sec. 414.408(j)(5) to require that the notification of the beneficiary must meet the following requirements. The notification must:Be sent by the supplier to the beneficiary at least 30 business days before the start date of the implementation of the CBP in the CBA in which the beneficiary resides. The 30-day notice is necessary to give the beneficiary sufficient time before the start of the CBP to consider whether to continue to use their current supplier.Suppliers will be given sufficient time to meet the 30-day notification requirement.Identify the grandfathered items that the supplier is willing to continue to rent to the beneficiary.Be in writing (for example, by letter or postcard) and the supplier must maintain proof of delivery.State that the supplier is offering to continue to furnish certain rented DME, oxygen and oxygen equipment, and supplies that the supplier is currently furnishing to the beneficiary (that is, before the start of the CBP) and is willing to continue to provide these items to the beneficiary for the remaining rental months.State that the beneficiary has the choice to continue to receive a grandfathered item(s) from the grandfathered supplier or may elect to receive the item(s) from a contract supplier after the end of the last month for which a rental payment is made to the noncontract supplier.Provide the supplier's telephone number and instruct the beneficiaries to call the supplier with questions regarding grandfathering and to notify the supplier of his or her election.State that the beneficiary can obtain information about the CBP by calling
Page 336481-800-MEDICARE or accessing http://www.medicare.gov on the Internet.In Sec. 414.408(j)(i)(B), we propose that the supplier should obtain an election from the beneficiary and maintain a record of its attempts to communicate with the beneficiary to obtain the beneficiary's election regarding grandfathering. We are also proposing that the supplier maintain a record of the beneficiary's choice, the date on which the choice was made, and how the beneficiary communicated his or her choice to the supplier. The 30-day notice to the beneficiary must be in writing to ensure that there is a record that the notification was made.We are proposing to add paragraphs Sec. 414.408(j)(5)(i)(C)(1) through (3) which state if the beneficiary chooses not to continue to receive a grandfathered item(s) from the noncontract supplier, the supplier must provide the beneficiary with 2 additional notices prior to picking up its equipment. These notices are described below as the 10-Day Notification and the 2-Day Notification.(i) 10-Day NotificationTen business days prior to picking up the item, the supplier should have direct contact (for example, a phone call) with the beneficiary or the beneficiary's caregiver and receive acknowledgement that the beneficiary understands their equipment will be picked up and that this should occur on the first anniversary date after the start of the CBP or another date agreed to by the beneficiary. The noncontract supplier must bill and will be paid for the furnishing of the equipment up to the first anniversary date after the start of the CBP and the new supplier cannot bill for furnishing the equipment prior to this anniversary date. This requirement still applies if a date other than the anniversary date is chosen.The beneficiary's anniversary date occurs every month on the date of the month on which the item was first delivered to the beneficiary by the current supplier. The anniversary date marks the date of every month on which a new monthly rental period begins. For example, usingJuly 1 as the beginning date of the Medicare DMEPOS CBP:If a beneficiary's last anniversary date before the beginning of the CBP is June 29, the noncontract supplier must submit a claim for the rental month beginning June 29 and ending July 28. The noncontract supplier should not pick up the equipment prior to July 29.In this case, the noncontract supplier has been paid up to July 29 and therefore should pick up its equipment on July 29, and the contract supplier would deliver its equipment on July 29 and begin billing for the next month's rental as of that date.If a beneficiary's anniversary date is July 1, also the beginning date for the CBP, the noncontract supplier should not pick up the equipment before July 1 and should not submit a claim for the July rental period. The contract supplier should deliver the equipment to the beneficiary on July 1 and submit a claim for this month.When a DME supplier submits a monthly bill for capped rental DME items, the date of delivery (``from'' date) on the first claim must be the ``from'' or anniversary date on all subsequent claims for the item.For example, if the first claim for a wheelchair is dated September 15, all subsequent bills must be dated for the 15th of the following months(October 15, November 15, etc.). In cases where the anniversary date falls at the end of the month (for example, January 31) and a subsequent month does not have a day with the same date (for example,February), the final date in the calendar month (for example, February 28) will be used.(ii) 2-Day NotificationTwo business days prior to picking up the item, the supplier must contact the beneficiary by phone to remind the beneficiary of the date the supplier will pick up the item. This supplier should not pick up the item before the beneficiary's first anniversary date that occurs after the start of the CBP.There may be unusual circumstances that make it difficult to contact certain beneficiaries. However, we do not expect this to occur often because these suppliers have been submitting monthly rental claims for providing services to these beneficiaries. Therefore, the supplier should have an ongoing relationship with the beneficiary and be aware of how to contact them and any changes in their circumstances.However, under no circumstance should a supplier pick up a rented item prior to the supplier's receiving acknowledgement from the beneficiary that they are aware of the date on which the supplier is picking up the item and that arrangements have been made to have the item replaced on that date by a contract supplier. The pickup of the noncontract supplier's equipment and the delivery of the new contract supplier's equipment should occur on the same date. The pick up by the noncontract supplier and the delivery by the contract supplier should occur on the first rental anniversary date of the equipment that occurs after the start of the CBP. When a beneficiary chooses to switch to a new contract supplier, the current noncontract supplier and the new contract supplier must make arrangements that are suitable to the beneficiary. This provides some latitude, for the pickup and the delivery date but not in terms of billing. The new equipment cannot be billed for until the anniversary date and the old equipment cannot be taken from the beneficiary before the anniversary date. c. Notification to CMS for Suppliers That Choose To BecomeGrandfatheredWe are proposing to add Sec. 414.408(j)(5)(ii) to state that suppliers that have chosen to become grandfathered suppliers must also notify CMS of that decision at least 30 business days before the start of the CBP. We believe that 30 business days is a reasonable period to allow us to compile a list of grandfathered suppliers and to answer questions about the availability of these suppliers. Unless the supplier notifies CMS consistent with this subsection, the supplier will not be considered a grandfathered supplier. Having a list of grandfathered suppliers is important to assist CMS in administering the grandfathering process. The list will be used to answer questions from beneficiaries concerning which suppliers have chosen the grandfathering option. The notification requirement will also help us to ensure that suppliers are not offering the grandfathering option to only a select number of beneficiaries. Also, having a list of suppliers that have chosen to be grandfathered suppliers will assist us in reviewing whether only noncontract suppliers that have elected to be grandfathered suppliers have received Medicare payment for rented competitive bid items in a CBA.The notice that a noncontract supplier must provide to CMS if it elects to become a grandfathered supplier must meet the following requirements:State that the supplier agrees to continue to furnish certain rented DME, oxygen and oxygen equipment that it is currently furnishing to beneficiaries (that is, before the start of the CBP) in aCBA and will continue to provide these grandfathered items to these beneficiaries for the remaining months of the rental period.Include all of the following: Name and address of the supplier; 6-digit NSC number of the supplier; and product category(s) by CBA for which the supplier is willing to be a grandfathered supplier.Suppliers with multiple locations must submit one notification for the company rather than for each individual location.
Page 33649State that the supplier agrees to meet all the terms and conditions applicable to grandfathered suppliers.Be provided by the supplier to CMS in writing at least 30 business days before the start date of the implementation of a CBP. d. Notifications of Beneficiaries by Suppliers That Choose Not ToBecome Grandfathered SuppliersWe propose to clarify under Sec. 414.408(j)(6) that a noncontract supplier that elects not to become a grandfathered supplier is required to pick up the item it is currently renting to the beneficiary from the beneficiary's home after proper notice to the beneficiary. A noncontract supplier that decides not to become a grandfathered supplier does not have the option of leaving its equipment in the beneficiary's home. The noncontract supplier is responsible for picking up the item from the beneficiary.Proper notification by a supplier who chooses not to become a grandfathered supplier must include a 30-day, a 10-day, and a 2-day notice of its decision not to be a grandfathered supplier. These notifications must meet all of the requirements listed above for the 30-day, 10-day and 2-day notices that must be sent by suppliers who decide to be grandfathered suppliers, except for the following differences for the 30-day notice.The 30-day notice must indicate the items for which the supplier has decided not to become a grandfathered supplier and indicate the date upon which the equipment will be picked up.It must state that the supplier will only continue to rent these competitively bid item(s) up to the beneficiary's first anniversary date, as defined in Sec. 414.408(j)(5), that occurs after the start of the Medicare DMEPOS CBP.It must also state that the beneficiary must select a contract supplier for Medicare to continue to pay for these items.It must state that the beneficiary can obtain information about the CBP by calling 1-800-MEDICARE or accessing http:// www.medicare.gov on the Internet.It must also refer him or her to the supplier locator tool on http://www.medicare.gov.The supplier must also provide the beneficiary with the 10-day and the 2-day notices prior to picking up their equipment.When a beneficiary chooses to switch to a new contract supplier, the current noncontract supplier and the new contract supplier must make arrangements that are suitable to the beneficiary. This provides some latitude, but the new equipment may not be billed by the contract supplier until the first anniversary date following the start of theCBP. Also, the old equipment may not be taken from the beneficiary before proper arrangements are made and the date of service cannot occur before the anniversary date.As discussed above, under no circumstance should a supplier pick up the rented item prior to the supplier making an arrangement with the new contract supplier for the delivery of the new equipment at a time suitable to meet the beneficiary's medical needs. The noncontract supplier has been furnishing services to the beneficiary and receiving payments from the program. To ensure that the beneficiary has continued access to medically necessary equipment, the noncontract supplier is expected to assist the beneficiary in locating a contract supplier. The noncontract supplier should communicate with the beneficiary the urgency of arranging to have the new equipment delivered as soon as possible.P. Physician Fee Schedule Update for CY 2010Since 1999, PFS rates have been updated under the sustainable growth rate (SGR) system. The general concept under the SGR system is that growth in total expenditures for physicians' services should be limited to sustainable levels. If expenditures exceed a statutorily determined percentage increase amount, the PFS update for the following year is reduced. If expenditures are less than the percentage increase amount, the PFS update is increased in the following year. There is a recognized tendency for physicians to increase the volume and intensity of their services over time. Incentives under SGR system were intended to encourage physicians to regulate their collective behavior in that regard in order to avoid decreases in future updates. The SGR is also a cumulative system. The update is adjusted based on a comparison of cumulative actual spending to target spending from a base period through the current year. Thus, if spending exceeds the target in a single year, the following year's update must be adjusted to reduce annual expenditures, as well as recoup the difference between target and actual spending in the prior year. Under a cumulative system, deviations between target and actual spending have the potential to result in significantly more payment rate adjustments when actual spending exceeds target spending even in a single year. \20\ Further, under a cumulative system, past increases in spending levels above the target will continue to affect future PFS updates until there have been sufficient adjustments to make target and actual spending equal.\20\ The adjustments to equate allowed and actual spending do not occur in a single year. The Balanced Budget Refinement Act of 1999 specifies a formula that makes the adjustment to account for differences between target and actual spending over multiple years.Despite the intended incentives, actual spending under the SGR system has deviated significantly from target spending. In the CY 2004PFS final rule with comment period (68 FR 63248), we estimated CY 2003 allowed expenditures at $71.7 billion and CY 2003 actual expenditures at $77.8 billion for a difference of $6.1 billion (or 8.5 percent of allowed spending). The cumulative difference between target and actual expenditures estimated at the time was $7.8 billion (that is, the $6.1 billion plus an additional $1.7 billion for past differences between target and actual spending since the 1996/1997 base year not previously accounted for through adjustments to the PFS update). Under the statutory formula, CMS was required to announce a reduction in PFS rates of 4.5 percent for CY 2004:
T he negative physician fee schedule update gives us no alternative to reducing physician fee schedule rates. Only Congress can change the law and avert a reduction in 2004 physician fee schedule rates. (68 FR 63239)On November 25, 2003, the Congress enacted the MedicarePrescription Drug, Improvement, and Modernization Act of 2003 (MMA)(Pub. L. 108-173). The President signed the MMA into law on December 8, 2003. Section 601 of MMA amended section 1848(d) of the Act to specify that the update to the single conversion factor (CF) for CYs 2004 and 2005 shall not be less than 1.5 percent. Thus, instead of applying an update of -4.5 percent in 2004, we applied an increase of 1.5 percent to PFS rates. The Congress took similar actions to avert reductions toPFS rates for CYs 2006 through 2009. Because the legislation did not affect the computation of the levels of allowed and actual expenditures for these years, there is now a substantial difference between cumulative target and actual spending that must be accounted for through future reductions to PFS rates. In a March 1, 2009 letter fromCMS to the MedPAC, we estimated the difference between cumulative target and actual spending from the 1996/1997 base year throughDecember 2009 at $69.7 billion. We estimated the PFS update would be
Page 33650-21.5 percent for CY 2010. As there are limits to how much PFS rates can be reduced in a single year and the estimated -21.5 percent PFS update will not fully account for the difference between target and actual spending, we are estimating further reductions of between 5 and 6.5 percent for the next several years.Although the Congress has acted to avert reductions in the past several years, these projections have led us to reexamine administrative actions that the Secretary could take to lessen the potential for repeated further reductions in the PFS update. TheAdministration believes that the current Medicare physician payment system, while having served to limit spending to a degree, needs to be reformed to give physicians appropriate incentives to improve the quality and efficiency of the care provided to Medicare beneficiaries.As part of health care reform, the Administration supports comprehensive, but fiscally responsible, reforms to the physician payment formula. Consistent with this goal, the Administration announced in the FY 2010 President's Budget that it would explore the breadth of options available under current authority to facilitate such reforms, including an assessment of whether the cost of physician- administered drugs should continue to be included in the payment formula.The statutory formula for calculating the update adjustment factor, which includes the SGR, was designed to establish reasonable limits on the growth of expenditures on physicians' services, and to provide incentives for physicians to keep the growth in expenditures within those limits. The SGR system was created by section 4503 of theBalanced Budget Act of 1997 (BBA) (Pub. L. 105-33). It replaced the predecessor system, the Medicare Volume Performance System (MVPS).However, the statutory definition of ``physicians' services'' for purposes of the SGR (section 1848(f)(4)(A) of the Act) is the same as that used for the MVPS (no longer in existence, but previously at section 1848(f)(5)(A) of the Act):The term ``physicians' services'' includes other items and services (such as clinical diagnostic laboratory tests and radiology services), specified by the Secretary, that are commonly performed by a physician or in a physician's office.Under the MVPS, we defined ``physicians' services'' to include physician-administered drugs. Therefore, we adopted the same regulatory definition at the outset of the SGR system:Because the scope of physicians' services covered by the SGR is the same as the scope of services that was covered by the Medicare volume performance standards, we are using the same definition of physicians' services for the SGR in this notice as we did for theMedicare volume performance standards. * * * (63 FR 59188)Physician-administered drugs are covered under section 1861(s)(2)(A) of the Act as ``services and supplies (including drugs and biologicals which are not usually self-administered by the patient) furnished as an incident to a physician's professional services, of kinds which are commonly furnished in physicians' offices.'' Physician- administered drugs are not paid for under the PFS (56 FR 25800).However, in identifying items and services to be included in the definition of ``physicians' services'' our ``practice has been to make adjustments to the SGR for medical and other health services * * * that meet the criterion of being ``commonly performed by a physician or in a physician's office'' (66 FR 55316). Because ``incident to'' drugs are commonly furnished in physicians' offices, we elected to continue to include them in the definition of ``physicians' services'' for the SGR.Similarly, clinical diagnostic laboratory tests, which are not paid for under the PFS, have always been included in the definition of``physicians' services'' for purposes of the SGR.Historically, growth in the cost of prescription drugs has far outpaced growth in the cost of other physicians' services. From the 1st quarter of 1997 through the 1st quarter of 2005, the average annual growth in Medicare spending on drugs included in the SGR was 22 percent compared to 6 percent for all services (including drugs) included in the SGR. As a result, since the inception of the SGR methodology, prescription drugs have accounted for an increasingly disproportionate amount of the growth in spending on physicians' services. At the time, we made the decision to include physician-administered drugs in the definition of ``physicians' services'' used to compute the SGR, these drugs represented a much smaller volume of Medicare spending than they have in subsequent years. In the CY 2003 PFS final rule with comment period, we estimated that drugs would represent 7.3 percent of 2001 SGR spending (67 FR 80031). In the CY 2006 PFS final rule with comment period, we estimated that drugs would represent 9.9 percent of 2004 SGR spending. In the CY 2007 PFS final rule with comment period, we stated that ``commenters noted that expenditures on these drugs increased from$1.8 billion in 1996, to $8.6 billion in 2004'' (71 FR 69755). These figures clearly demonstrate that spending on physician-administered drugs has been growing at much higher rates than spending for all otherPFS services and has contributed significantly to the deviation between target and actual spending, as well as to the large projected reductions in future PFS updates. There could be many reasons for the disproportionate growth in expenditures for drugs--many of which we could not have anticipated when we decided to include drugs in the SGR.In the CY 2006 PFS final rule with comment period (70 FR 70307), we summarized public comments on the proposed rule that stated that growth in Medicare spending on drugs is driven primarily by the introduction of expensive new drugs to the Medicare population and extensive marketing (including direct-to-consumer advertising). Given the significant and disproportionate impact that the inclusion of drugs has had on the SGR system, we believe it would be appropriate to revise the definition of physicians' services for purposes of the SGR.As previously noted, the statutory definition of ``physicians' services'' for purposes of determining allowed expenditures and the SGR(section 1848(f)(4)(A) of the Act) states:The term ``physicians' services'' includes other items and services (such as clinical diagnostic laboratory tests and radiology services), specified by the Secretary, that are commonly performed by a physician or in a physician's office.The statute clarifies that the term ``physicians' services'' includes items and services ``specified by the Secretary.'' Therefore, we believe the statute provides the Secretary with clear discretion to decide whether physician-administered drugs should be included or excluded from the definition of ``physicians' services.'' As the statute affords the Secretary clear discretion, we are proposing, in anticipation of enactment of legislation to provide fundamental reforms to Medicare physician payments, to remove physician-administered drugs from the definition of ``physicians' services'' in section 1848(f)(4)(A) of the Act for purposes of computing the SGR and levels of allowed expenditures and actual expenditures in all future years.Moreover, given the past effect of spending growth for physician- administered drugs on future PFS updates, in order to effectuate fully the Secretary's policy decision to remove drugs from the definition of
Page 33651``physicians' services'' in section 1848(f)(4)(A) of the Act, it is reasonable to remove drugs from the calculation of allowed and actual expenditures for all prior years.We note the term ``actual expenditures'' is not defined in the statute nor are there any statutory limitations on the Secretary's ability to recompute actual expenditures to reflect changes in the amount of actual expenditures. On several occasions, we have made revisions to the amount of actual expenditures to reflect new information regarding spending on physicians' services. For instance, in the CY 2002 PFS final rule with comment period (66 FR 55314), we indicated that a number of new procedures were inadvertently not included in the measurement of actual expenditures beginning in 1998.We determined that spending for these codes must be included in actual expenditures for historical, current, and future periods. Similarly, in the CY 2009 PFS final rule with comment period, we discovered that fifteen procedure codes were inadvertently omitted from the measurement of actual expenditures beginning in 1998 (73 FR 69902). Again, we stated that spending for these codes must be included in actual expenditures for historical, current, and future periods.Under section 1848(d)(3)(C)(i) of the Act, the level of allowed expenditures during the base year (April 1, 1996 through March 31, 1997) is equal to the actual expenditures for this period. Thus, as there are no statutory restrictions on the Secretary's ability to recompute actual expenditures to remove the costs associated with physician-administered drugs, the Secretary also has authority to remove these drugs from the calculation of allowed expenditures during the base year. Allowed expenditures in a year are based on the allowed expenditures in the prior year, updated by the SGR as specified in section 1848(d)(3)(C)(ii) of the Act for FY 1998 through FY 2000, and section 1848(d)(4)(C)(iii) for all subsequent years. Thus, once theSecretary has revised the level of allowed expenditures during the base year (as is authorized under the statute), it is reasonable to carry this revision through into all subsequent years. As the statute affords the Secretary flexibility to remove drugs from the calculation of allowed expenditures retrospectively to the base year, we are proposing to remove drugs from the calculation of allowed and actual expenditures under sections 1848(d)(3)(C) and 1848(d)(4) of the Act retrospectively to the 1996/1997 base year in order to eliminate the disproportionate impact that the large past increases in the costs attributable to physician-administered drugs would otherwise have upon future PFS updates. Further, the proposal would remove drugs from the calculation of the SGR beginning with 2010.We note that the Secretary may choose not to finalize the proposal described above or may choose to modify the proposal in the final rule, consistent with rulemaking principles, in light of new policy developments, new information, or changed circumstances.We currently estimate that the statutory formula used to determine the physician update will result in a CY 2010 conversion factor of$28.3208 and a PFS update of -21.5 percent. Under this proposal, removing physician-administered drugs from allowed and actual expenditures for all prior years will not change the projected -21.5 percent physician payment rate update for services furnished on or after January 1, 2010. This proposal would, however, reduce the past discrepancy between actual and target expenditures. As a result, it would reduce the number of years in which physicians are projected to experience a negative update. We note that this proposal does not mean that we are making any changes to PFS rates applicable in prior years.Rather, we are proposing to remove drugs from the calculation of allowed and actual expenditures since the 1996/1997 base year so that past year increases in drug spending would have no affect on the determination of future PFS rates.III. Collection of Information RequirementsUnder the Paperwork Reduction Act of 1995, we are required to provide 60-day notice in the Federal Register and solicit public comment before a collection of information requirement is submitted to the Office of Management and Budget (OMB) for review and approval. In order to fairly evaluate whether an information collection should be approved by OMB, section 3506(c)(2)(A) of the Paperwork Reduction Act of 1995 requires that we solicit comment on the following issues:The need for the information collection and its usefulness in carrying out the proper functions of our agency.The accuracy of our estimate of the information collection burden.The quality, utility, and clarity of the information to be collected.Recommendations to minimize the information collection burden on the affected public, including automated collection techniques.We are soliciting public comment on each of these issues for the following sections of this document that contain information collection requirements (ICRs):A. ICRs Regarding Pulmonary Rehabilitation Program: Conditions forCoverage (Sec. 410.47)Section 410.47(c) lists the components of a pulmonary rehabilitation program. Specifically, Sec. 410.47(c)(3) through (c)(5) discuss psychosocial assessments, outcome assessments and individualized treatment plans, respectively, and the role of these tools in pulmonary rehabilitation programs. The burden associated with meeting the requirements for conducting psychosocial assessments, outcome assessments, and individualized treatment plans is the time and effort necessary for providers to document the necessary information in the patient record. While these requirements are subject to the PRA, we believe the associated burden is exempt as stated under 5 CFR 1320.3(b)(2). Psychosocial assessments, outcome assessments and individualized treatment plans are routine tools used in pulmonary rehabilitation programs and the practice of using these tools is generally recognized as an industry standard as part of usual and customary business practices.B. ICRs Regarding Kidney Disease Education Services (Sec. 410.48)Proposed Sec. 410.48(f) states qualified persons will develop outcomes assessments designed to:Measure beneficiary knowledge about chronic kidney disease(CKD) and its treatment;Assess program effectiveness of preparing the beneficiary to make informed decisions about their healthcare options related toCKD; andAssess program effectiveness in meeting the communication needs of underserved populations, including persons with disabilities, persons with limited English proficiency, and persons with health literacy needs.We are proposing that the assessment will be administered to the beneficiary during one of the kidney disease education (KDE) sessions prescribed by the referring physician. The assessments will be made available to CMS upon request.The burden associated with these requirements is the time and effort necessary to conduct an outcomes assessment, maintain record of the
Page 33652assessment, and to make the documentation available to CMS upon request. At this time, CMS is not able to accurately quantify the burden because we cannot estimate the number of entities that must comply with these requirements. Additionally, we are trying to determine if the use and maintenance of outcome assessments in KDE services is a standard industry business practice. Our preliminary research gathered during a CMS Open Door Forum held on November 6, 2008 and a stakeholders meeting hosted by the Agency for Healthcare Research and Quality (AHRQ) on December 16, 2008 indicates that outcome assessments are used by most but not all of the entities bound by the proposed requirements in Sec. 410.48. We welcome comments pertaining to this issue and will reevaluate all related PRA burden issues in the final rule stage of rulemaking.C. ICRs Regarding Cardiac Rehabilitation Program and Intensive CardiacRehabilitation Program: Conditions of Coverage (Sec. 410.49)Proposed Sec. 410.49(b)(2) lists the required components of a cardiac rehabilitation program. Four of the five required components, including cardiac risk factor modification, psychosocial assessments, outcomes assessments and individualized treatment plans, impose information collection burdens. The burden associated with these requirements is the time and effort necessary to providers to customize each patient's cardiac risk modification program. Additionally, there is burden associated with conducting psychosocial assessments and outcome assessments and drafting individualized treatment plans.Although section 144(a) of the MIPPA sets forth these information collection requirements, we believe the associated information collection burden is exempt as stated under 5 CFR 1320.3(b)(2).Performing cardiac risk modification, psychosocial assessments, outcome assessments, and individualized treatment plans are routine tools used in cardiac rehabilitation programs. As stated earlier in the preamble of this proposed rule, intensive cardiac rehabilitation programs typically involve the same elements as general cardiac rehabilitation programs, but are furnished in highly structured environments in which sessions of the various components may be combined for longer periods of cardiac rehabilitation and also may be more rigorous. The ICRs and associated burden are generally recognized as an industry standard as part of usual and customary business practices.Proposed Sec. 410.49(c)(1) states that to be designated an intensive cardiac rehabilitation program, a program in an approved setting must apply for designation. To be designated as an intensive cardiac rehabilitation program, the program must demonstrate through peer-reviewed, published research that it accomplishes one or more of the requirements listed in Sec. 410.49(c)(1)(i) through (iv). As required by Sec. 410.49(c)(3), sites must demonstrate that patients enrolled continue to achieve beneficial outcomes by submitting outcomes data annually from the date of approval as an intensive cardiac rehabilitation site to ensure that intensive cardiac rehabilitation programs maintain the designated quality of rehabilitation.The burden associated with the requirements in Sec. 410.49(c) is the time and effort necessary for a program to demonstrate through peer-reviewed, published research that it accomplishes one or more of the requirements listed in Sec. 410.49(c)(1)(i) through (iv) and the time and effort necessary to annually submit outcomes data. At this time, CMS is not able to accurately quantify the burden because we cannot estimate the number of entities that will seek designation as intensive cardiac rehabilitation programs. We welcome comments pertaining to this issue and will reevaluate all related PRA burden issues in the final rule stage of rulemaking.D. ICRs Regarding Imaging Accreditation (Sec. 414.68)Proposed Sec. 414.68(b) contains the application and reapplication procedures for accreditation organizations. Specifically, an independent accreditation organization applying for approval or reapproval of authority to survey suppliers for purposes of accrediting suppliers furnishing the technical component (TC) of advanced diagnostic imaging services must furnish CMS with all of the information listed in proposed Sec. 414.68(b)(1) through (14). The requirements include but are not limited to reporting, notification, documentation, and survey requirements.The burden associated with the proposed collection requirements inSec. 414.68(b) is the time and effort necessary to develop, compile and submit the information listed in Sec. 414.68(b)(1) through (14).We believe that 3 entities will choose to comply with these requirements. We estimate that it will take each of the 3 entities, 80 hours to submit a complete application for approval or reapproval authority to become an accrediting organization approved by CMS.Proposed Sec. 414.68(c) contains the information collection requirements pertaining to CMS approved accrediting organizations. An accrediting organization approved by CMS must undertake all of the activities listed in Sec. 414.68(c)(1) through (6). The burden associated with the proposed collection requirements in Sec. 414.68(c) is the time and effort necessary to develop, compile and submit the information listed in Sec. 414.68(c)(1) through (6). We believe that 3 entities will choose to comply with these requirements. We estimate that it will take each of the 3 entities, 80 hours to submit the required information on an ongoing basis.Proposed Sec. 414.68(d)(1) states that CMS or its contractor may conduct an audit of an accredited supplier, examine the results of aCMS approved accreditation organization's survey of a supplier, or observe a CMS approved accreditation organization's onsite survey of a supplier, in order to validate the CMS approved accreditation organizations accreditation process. The burden associated with this requirement is the time and effort necessary for an accrediting organization to comply with the components of the validation audit.While this requirement is subject to the PRA, we believe the associated burden is exempt as stated in 5 CFR 1320.3(h)(6). The burden associated with a request for facts addressed to a single person, as defined in 5CFR 1320.3(j), is not subject to the PRA.As stated in proposed Sec. 414.68(e)(1), an accreditation organization dissatisfied with a determination that its accreditation requirements do not provide or do not continue to provide reasonable assurance that the suppliers accredited by the organization meet the applicable quality standards is entitled to a reconsideration. CMS reconsiders any determination to deny, remove, or not to renew the approval of deeming authority to an accreditation organization if the accrediting organization files a written request for reconsideration by its authorized officials or through its legal representative. The written request must be filed within 30 calendar days of the receipt ofCMS' notice of an adverse determination or nonrenewal. In addition, the request must also specify the findings or issues with which the accreditation organization disagrees and the reasons for the disagreement.The burden associated with this requirement is the time and effort necessary for an accrediting organization to file develop and file written request for reconsideration.
Page 33653While this requirement is subject to the PRA, the associated burden is exempt under 5 CFR 1320.4. The information in question is being collected as a result of an administrative action; accrediting organizations are submitting requests for reconsideration after receiving a notice of an adverse determination or nonrenewal.E. ICRs Regarding Payment Rules (Sec. 414.408)Proposed Sec. 414.408(j)(5) contains the notification requirements for suppliers electing to become grandfathered suppliers. Specifically,Sec. 414.408(j)(5)(i) states that a noncontract supplier that elects to become a grandfathered supplier must provide a 30-day written notification to each Medicare beneficiary that resides in a competitive bidding area and is currently renting a competitively bid item from that supplier. The 30-day notification to the beneficiary must meet the requirements as listed in Sec. 414.408(j)(5)(i)(A) through (G).Subsequent to the initial 30-day notice to the beneficiary, as required by Sec. 414.408(j)(5)(ii), suppliers must also obtain and maintain a record of the beneficiary's election choice, the date the choice was made, and the manner through which the beneficiary communicated his or her choice. Additionally, Sec. 414.408(j)(5)(iii) states that if a beneficiary chooses not to continue to receive a grandfathered item(s) from his or her current supplier, the supplier must provide the beneficiary with two more notices prior to the supplier picking up its equipment. The supplier must provide a 10-day notification and a 2-day notification. These notification requirements must meet the criteria listed in Sec. 414.408(j)(5)(iii)(A) through(C).Section Sec. 414.408(j)(5)(iv) requires suppliers that elect to become grandfathered suppliers to provide a written notification to CMS of its election decision. The notification must meet the requirements as specified in Sec. 414.408(j)(5)(iv)(A) through (D).The burden associated with the information collection requirements contained in proposed Sec. 414.408(j)(5) is the time and effort necessary for a noncontract supplier to make the aforementioned notifications to both beneficiaries and CMS. We estimate that 1,305 suppliers will elect to become grandfathered suppliers. Similarly, we estimate that each grandfathered supplier will need to make an average of 53 notifications based on an average of 52 beneficiaries per supplier and one notice to CMS. We estimate that it will take 2 hours to develop the notification to the beneficiary and 2 hours to develop the notification to CMS. Similarly, we estimate that each notification will take 15 minutes to send. The total estimated burden associated with each of the 1305 suppliers complying with the requirements in proposed Sec. 414.408(j)(5) is 17.25 hours per supplier for a total of 22,511 hours.Proposed Sec. 414.408(j)(6) contains the information collection requirements pertaining to suppliers that choose not to become grandfathered suppliers. A noncontract supplier that elects not to become a grandfathered supplier is required to pick up the item it is currently renting to the beneficiary from the beneficiary's home after proper notification. Proper notification includes a 30-day, a 10-day, and a 2-day notice of the supplier's decision not to become a grandfathered supplier to its Medicare beneficiaries who are currently renting certain DME competitively bid item(s) and who reside in a CBA.These notifications must meet all of the requirements listed in proposed Sec. 414.408(j)(5)(i) and (ii) for the 30-day, 10-day and 2- day notices that must be sent by suppliers who decide to be grandfathered suppliers. However, there are exceptions regarding the 30-day notice for noncontract suppliers electing not to become grandfathered suppliers. The exceptions are listed in proposed Sec. 414.408(j)(6)(iii)(A) through (C). In addition, suppliers must also comply with the criteria listed in proposed Sec. 414.408(j)(6)(iv).The burden associated with the proposed information collection requirements in Sec. 414.408(j)(6) is the time and effort necessary for a supplier to make the required notifications to beneficiaries. We estimate that 145 suppliers will not elect to become grandfathered suppliers. Similarly, we estimate that each nongrandfathered supplier will need to make an average of 156 notifications based on an average of 52 beneficiaries per supplier. We estimate that it will take 2 hours to develop the 30-day notification to the beneficiary and 15 minutes to send out each notification. The 10-day notification will take approximately 15 minutes and the 2-day will take approximately 15 minutes. We estimate to send out all 3 notifications it will take a total of approximately 45 minutes. The total burden associated with the requirements in proposed Sec. 414.408(j)(6) is approximately 5,945 hours.F. ICRs Regarding Claims for Damages (Sec. 414.425)Proposed Sec. 414.425(a) states that any aggrieved supplier, including a member of a network that was awarded a contract for theRound 1 Durable Medical Prosthetics, Orthotics, and SuppliesCompetitive Bidding Program (DMEPOS CBP), may file a claim under this section for certain alleged damages arising out of MIPPA's termination of the Round 1 DMEPOS CBP contracts. Section 414.425(b) states that a completed claim, including all documentation, must be filed within 90 days of the effective date of the final rule on damages, unless that day is a holiday or Sunday in which case it will revert to the next business day. Section 414.425(c) lists the required documentation for submitting a claim.The burden associated with this requirement is the time and effort necessary to gather required documentation as specified in Sec. 414.425(c) and submit a claim for damages. This requirement is for a one-time process that will only impact those suppliers who were awarded a contract and were potentially damaged by the termination of their contracts by MIPPA. We awarded contracts to 329 suppliers. We expect that it will take approximately 3 hours for a supplier to gather the necessary documents and to file a claim. We anticipate that anywhere between 5 and 250 suppliers may submit a claim for damages.While this requirement is subject to the PRA, we believe the associated burden is exempt under 5 CFR 1320.4. The information in question is being collected as a result of an administrative action; suppliers are submitting claims for damages caused by the termination of contracts awarded in 2008 under the DMEPOS Competitive Bidding program that were terminated as a result of section 154(a)(1)(A)(iv) of the MIPPA.G. ICRs Dispute Resolution and Process for Suspension or Termination ofApproved CAP Contract and Termination of Physician Participation UnderExigent Circumstances (Sec. 414.917)As stated in proposed Sec. 414.97, an approved CAP vendor may appeal that termination by requesting a reconsideration. A determination must be made as to whether the approved CAP vendor has been meeting the service and quality obligations of its CAP contract.The approved CAP vendor's contract will remain suspended during the reconsideration process.
Page 33654The burden associated with this requirement is the time and effort necessary for a CAP vendor to request a reconsideration of the termination. While this requirement is subject to the PRA, we believe the associated burden is exempt under 5 CFR 1320.4. The burden associated with collecting information subsequent to an administrative action is not subject to the PRA.H. ICRs Regarding Compendia for Determination of Medically-AcceptedIndications for Off-Label Uses of Drugs and Biologicals in an Anti-Cancer Chemotherapeutic Regimen (Sec. 414.930)As stated in the definition for a publicly transparent process for evaluating therapies in proposed Sec. 414.930(a), a compendium must make the following materials available to the public on its Web site, coincident with the compendium's publication of the related recommendation:(i) The application for inclusion of a therapy including criteria used to evaluate the request.(ii) A listing of all the evidentiary materials reviewed or considered by the compendium pursuant to the application.(iii) A listing of all individuals (and their affiliations and sources of financial support) who have substantively participated in the development of compendia recommendations.(iv) Transcripts of meetings and records of the votes, including abstentions, related to the therapeutic recommendation on the application.The definition for a publicly transparent process for identifying conflicts of interests in proposed Sec. 414.930(a), states that a compendium must make the following materials available to the public, coincident with the compendium's publication of the related recommendation:(i) Direct or indirect financial relationships that exist between individuals who have substantively participated in the development of compendia recommendations and the applicant (for example, the manufacturer or seller of the drug or biological being reviewed by the compendium). This may include compensation arrangements such as salary, grant, contract, or collaboration agreements between individuals who have substantively participated in the development of compendia recommendations.(ii) Ownership or investment interests of individuals who have substantively participated in the development of compendia recommendations and the applicant (for example, the manufacturer or seller of the drug or biological being reviewed by the compendium).The requirements in proposed Sec. 414.930(a) constitute third- party disclosures. While third-party disclosures are subject to thePRA, we believe the associated burden is exempt under 5 CFR 1320.3(c)(4). Less than 10 persons or entities within a 12-month period will be required to comply.Table 37--Estimated Annual Reporting and Recordkeeping BurdenBurden perTotal annualRegulation section(s)OMB control No.RespondentsResponsesresponseburden(hours)(hours)Sec. 414.68(b).............. 0938-New........3380240Sec. 414.68(c).............. 0938-New........3380240Sec. 414.408(j)(5).......... 0938-New........130569,16517.2522,511Sec. 414.408(j)(6).......... 0938-New........14522,620415,945Total..................... ................ .............. .............. ..............28,936If you comment on these information collection and recordkeeping requirements, please do either of the following: 1. Submit your comments electronically as specified in theADDRESSES section of this proposed rule; or 2. Submit your comments to the Office of Information and RegulatoryAffairs, Office of Management and Budget, Attention: CMS Desk Officer,
CMS-1413-P; Fax: (202) 395-6974; or E-mail: OIRA_ submission@omb.eop.gov.Additional Information Collection RequirementsThis proposed rule imposes collection of information requirements as outlined in the regulation text and specified above. However, this proposed rule also makes reference to several associated information collections that are not discussed in the regulation text contained in this document. The following is a discussion of these information collections, some of which have already received OMB approval.Part B Drug PaymentThe discussion of average sales price (ASP) issues in sectionII.H.1 of this proposed rule does not contain any new information collection requirements with respect to payment for Medicare Part B drugs and biologicals under the ASP methodology. Drug manufacturers are required to submit ASP data to us on a quarterly basis. The ASP reporting requirements are set forth in section 1927(b) of the Act. The burden associated with this requirement is the time and effort required by manufacturers of Medicare Part B drugs and biologicals to calculate, record, and submit the required data to CMS. While the burden associated with this requirement is subject to the PRA, it is currently approved under OMB control number 0938-0921. A revision of the currently approved information collection request is currently under review at OMB.Competitive Acquisition Program (CAP)Section II.H.2. of this proposed rule discusses issues related to the competitive acquisition program for Part B drug payment. There are no new information collection requirements associated with the CAP; however, there are several previously approved information collection requests (ICR) associated with the CAP.Table 38--OMB Control NumbersOMB controlExpirationProgram componentnumberdateMedicare Part B Drug and Biological CAP.0938-095406/30/2011
Page 33655Medicare Part B Drug and Biological0938-095508/31/2009Competitive Acquisition ProgramApplications \1\.......................Competitive Acquisition Program (CAP)0938-098712/31/2011 for Medicare Part B Drugs: CAPPhysician Election Agreement...........\1\ An extension of the currently approved ICR is currently in the middle of the mandatory 60-day Federal Register notice and comment period. The ICR will be submitted to OMB for review and approval prior to the expiration date.Physician Quality Reporting Initiative (PQRI)Section II.G.2. of this proposed rule discusses the background of the PQRI, provides information about the measures proposed to be available to eligible professionals who choose to participate in the 2010 PQRI, and the proposed criteria for satisfactory reporting in 2010. Beginning on January 1, 2010, the Secretary is also required by section 1848(m)(3)(C) of the Act, to establish and have in place a process under which eligible professionals in a group practice (as defined by the Secretary) shall be treated as satisfactorily submitting data on quality measures under the PQRI.With respect to satisfactory submission of data on quality measures by eligible professionals, eligible professionals include physicians, other practitioners as described in section 1842(b)(18)(c) of the Act, physical and occupational therapists, qualified speech-language pathologists, and qualified audiologists. Eligible professionals may choose whether to participate and, to the extent they satisfactorily submit data on quality measures for covered professional services, they can qualify to receive an incentive payment. To qualify to receive an incentive payment for 2010, the eligible professional must meet one of the criteria for satisfactory reporting described in sections II.G.2.e. and II.G.2.f. of this proposed rule.For individual eligible professionals, the burden associated with the requirements of this voluntary reporting initiative is the time and effort associated with eligible professionals identifying applicablePQRI quality measures for which they can report the necessary information. We believe it is difficult to accurately quantify the burden because it would vary with each eligible professional by the number of measures applicable to the eligible professional, the eligible professional's familiarity and understanding of the PQRI, and experience with participating in the PQRI. In addition, eligible professionals may employ different methods for incorporating the use of quality data codes into the office work flows.We believe the burden associated with participating in PQRI has declined for those familiar with the program and who have satisfactorily participated in the 2007 PQRI and/or the 2008 PQRI.However, because we anticipate even greater participation in the 2010PQRI, including participation by eligible professionals who are participating in PQRI for the first time in 2010, we will assign 3 hours as the amount of time needed for eligible professionals to review the list of PQRI quality measures, identify the applicable measures for which they can report the necessary information, review the measure specifications for those measures applicable to the eligible professional, and incorporate the use of quality data codes for the measures on which the eligible professional plans to report into the office work flows. Information from the Physician Voluntary ReportingProgram (PVRP), which was a predecessor to the PQRI, indicated an average labor cost of $50 per hour. To account for salary increases over time, we will use an average practice labor cost of $55 per hour in our estimates based on an assumption of an average annual increase of approximately 3 percent. Thus, we estimate the cost for an eligible professional to review the list of PQRI quality measures, identify the applicable measures for which they can report the necessary information, review the measure specifications for those measures applicable to the eligible professional, and incorporate the use of quality data codes for the measures on which the eligible professional plans to report into the office work flows to be approximately $165 per eligible professional ($55 per hour x 3 hours).We continue to expect the ongoing costs associated with PQRI participation to decline based on an eligible professional's familiarity with and understanding of the PQRI, experience with participating in the PQRI, and increased efforts by CMS and stakeholders to disseminate useful educational resources and best practices.In addition, for claims-based reporting, eligible professionals must gather the required information, select the appropriate quality data codes, and include the appropriate quality data codes on the claims they submit for payment. The PQRI will collect quality data codes as additional (optional) line items on the existing HIPAA transaction 837-P and/or CMS Form 1500. We do not anticipate any new forms and no modifications to the existing transaction or form. We also do not anticipate changes to the 837-P or CMS Form 1500 for CY 2010.Because this is a voluntary program, it is impossible to estimate with any degree of accuracy how many eligible professionals will opt to participate in the PQRI in CY 2010. Information from the ``PQRI 2007Reporting Experience Report,'' which is available on the PQRI section of the CMS Web site at http://www.cms.hhs.gov/PQRI, indicates that nearly 110,000 unique TIN/NPI combinations attempted to submit PQRI quality measures data via claims for the 2007 PQRI. Therefore, for purposes of conducting a burden analysis for the 2010 PQRI, we will assume that all eligible professionals who attempted to participate in the 2007 PQRI will also attempt to participate in the 2010 PQRI.Moreover, the time needed for an eligible professional to review the quality measures and other information, select measures applicable to his or her patients and the services he or she furnishes to them, and incorporate the use of quality data codes into the office work flows is expected to vary along with the number of measures that are potentially applicable to a given professional's practice. Since eligible professionals are generally required to report on at least 3 measures to earn a PQRI incentive, we will assume that each eligible professional who attempts to submit PQRI quality measures data is attempting to earn a PQRI incentive payment and that each eligible professional reports on an average of 3 measures for this burden analysis.Based on our experience with the PVRP, we continue to estimate that the time needed to perform all the steps necessary to report each measure (that is, reporting the relevant quality data code(s) for a measure) on claims ranges from 15 seconds (0.25 minutes) to over 12 minutes for complicated cases and/
Page 33656or measures, with the median time being 1.75 minutes. Information from the PVRP indicates that the cost associated with this burden ranges from $0.21 in labor time to about $10.06 in labor time for more complicated cases and/or measures, with the cost for the median practice being $0.90.The total estimated annual burden for this requirement will also vary along with the volume of claims on which quality data is reported.Since we propose to require eligible professionals to report at least one of their selected measures for at least 15 Medicare Part B FFS patients in order to satisfactorily report, then, for this burden analysis, we will assume that for each measure, the eligible professional reports the quality data codes on 15 cases. The actual number of cases on which an eligible professional would be required to report quality measures data will vary, however, with the eligible professional's patient population and the types of measures on which the eligible professional chooses to report (each measure's specifications includes a required reporting frequency).Based on the assumptions discussed above, we estimate the total annual burden per eligible professional associated with claims-based reporting to range from 191.25 minutes, or 3.2 hours [(0.25 minutes per measure x 3 measures x 15 cases per measure) + 3 hours] to 720 minutes, or 12 hours [(12 minutes per measure x 3 measures x 15 cases per measure) + 3 hours]. We estimate the total annual cost per eligible professional associated with claims-based reporting to range from$174.45 [($0.21 per measure x 3 measures x 15 cases per measure) +$165] to $617.70 [($10.06 per measure x 3 measures x 15 cases per measure) + $165].For registry-based reporting, there would be no additional burden for eligible professionals to report data to a registry as eligible professionals opting for registry-based reporting would more than likely already be reporting data to the registry. Little, if any, additional data would need to be reported to the registry for purposes of participation in the 2010 PQRI. However, eligible professionals would need to authorize or instruct the registry to submit quality measures results and numerator and denominator data on quality measures to CMS on their behalf. We estimate that the time and effort associated with this would be approximately 5 minutes for each eligible professional that wishes to authorize or instruct the registry to submit quality measures results and numerator and denominator data on quality measures to CMS on their behalf.Registries interested in submitting quality measures results and numerator and denominator data on quality measures to CMS on their participants' behalf in 2010 would need to complete a self-nomination process in order to be considered ``qualified'' to submit on behalf of eligible professionals unless the registry was qualified to submit on behalf of eligible professionals for the 2009 PQRI and did so successfully. We estimate that the proposed self-nomination process for qualifying additional registries to submit on behalf of eligible professionals for the 2010 PQRI involves approximately 1 hour per registry to draft the letter of intent for self-nomination. It is estimated that each self-nominated entity will also spend 2 hours for the interview with CMS officials and 2 hours for the development of a measure flow. However, the time it takes to complete the measure flow could vary depending on the registry's experience. Additionally, part of the self-nomination process involves the completion of an XML submission by the registry, which is estimated to take approximately 5 hours, but may vary depending on the registry's experience. We estimate that the registry staff involved in the registry self-nomination process have an average labor cost of $50 per hour. Therefore, assuming the total burden hours per registry associated with the registry self- nomination process is 10 hours, we estimate the total cost to a registry associated with the registry self-nomination process to be approximately $500 ($50 per hour x 10 hours per registry).The burden associated with the registry-based reporting requirements of this voluntary reporting initiative is the time and effort associated with the registry calculating quality measure results from the data submitted to the registry by its participants and submitting the quality measures results and numerator and denominator data on quality measures to CMS on behalf of their participants. The time needed for a registry to review the quality measures and other information, calculate the measures results, and submit the measures results and numerator and denominator data on the quality measures on their participants behalf is expected to vary along with the number of eligible professionals reporting data to the registry and the number of applicable measures. However, we believe that registries already perform many of these activities for their participants. The number of measures that the registry intends to report to CMS and how similar the registry's measures are to CMS' PQRI measures will determine the time burden to the registry.For EHR-based reporting, the eligible professional must review the quality measures on which we will be accepting PQRI data extracted fromEHRs, select the appropriate quality measures, extract the necessary clinical data from his or her EHR, and submit the necessary data to theCMS-designated clinical data warehouse. Because this manner of reporting quality data to CMS would be new to PQRI for 2010 and participation in this reporting initiative is voluntary, we believe it is difficult to estimate with any degree of accuracy how many eligible professionals will opt to participate in the PQRI through the EHR mechanism in CY 2010. The time needed for an eligible professional to review the quality measures and other information, select measures applicable to his or her patients and the services he or she furnishes to them is expected to be similar for EHR-based reporting and claims- based reporting (that is, 3 hours). Once the EHR is programmed by the vendor to allow data submission to CMS, the burden to the eligible professional associated with submission of data on PQRI quality measures should be minimal.An EHR vendor interested in having their product(s) be used by eligible professionals to submit quality measures results and numerator and denominator data on quality measures to CMS were required to complete a self-nomination process in order for the vendor's product(s) to be considered ``qualified'' for 2010. We are unable to accurately quantify the burden associated with the EHR self-nomination process as there is variation regarding the technical capabilities and experience among vendors. For purposes of this burden analysis, however, we estimate that the time required for an EHR vendor to complete the self- nomination process will be similar to the time required for registries to self-nominate that is approximately 10 hours at $50 per hour for a total of $500 per EHR vendor ($50 per hour x 10 hours per EHR vendor).The burden associated with the EHR-based reporting requirements of this voluntary reporting initiative is the time and effort associated with the EHR vendor programming its EHR product(s) to extract the clinical data that the eligible professional needs to submit to CMS for purposes of reporting 2010 PQRI quality measures. The time needed for an EHR vendor to review the quality measures and other information
Page 33657and program each qualified EHR product to enable eligible professionals to submit PQRI quality measures data to the CMS-designated clinical data warehouse will be dependent on the EHR vendor's familiarity withPQRI, the vendor's system capabilities, as well as the vendor's programming capabilities. Some vendors already have these necessary capabilities and for such vendors, we estimate the total burden hours to be 40 hours at a rate of $50 per hour for a total burden estimate of$2,000 ($50 per hour x 40 hours per vendor). However, given the variability in the capabilities of the vendors, we believe a more conservative estimate for those vendors with minimal experience would be approximately 200 hours at $50 per hour, for a total estimate of$10,000 per vendor ($50 per hour x 200 hours per EHR vendor).With respect to the proposed process for group practices to be treated as satisfactorily submitting quality measures data under the 2010 PQRI discussed in section II.G.2. of this proposed rule, group practices interested in participating in the 2010 PQRI through the group practice reporting option would need to complete a self- nomination process similar to the self-nomination process required of registries and EHR vendors. Therefore, we estimate that the proposed self-nomination process for the group practices for the 2010 PQRI involves approximately 2 hours per group practice to draft the letter of intent for self-nomination, gather the requested TIN and NPI information, and provide this requested information. It is estimated that each self-nominated entity will also spend 2 hours undergoing the vetting process with CMS officials. We assume that the group practice staff involved in the group practice self-nomination process have an average practice labor cost of $55 per hour. Therefore, assuming the total burden hours per group practice associated with the group practice self-nomination process is 4 hours, we estimate the total cost to a group practice associated with the group practice self-nomination process to be approximately $220 ($55 per hour x 4 hours per group practice).The burden associated with the group practice reporting requirements of this voluntary reporting initiative is the time and effort associated with the group practice submitting the quality measures data. For physician group practices, this would be the time associated with the physician group completing the proposed data collection tool. The information collection components of this data collection tool have been reviewed by OMB and are currently approved under OMB control number 0938-0941, with an expiration date of December 31, 2011, for use in the Physician Group Practice, Medicare CareManagement Performance (MCMP), and EHR demonstrations. Based on burden estimates for the PGP demonstration, which uses the same data submission methods as what we have proposed, we estimate the burden associated with a physician group completing the data collection tool would be approximately 79 hours per physician group. Therefore, we estimate the total annual burden hours per physician group would be approximately 83 hours (4 hours for self-nomination + 79 hours for data submission). Based on an average labor cost of $55 per physician group, we estimate the cost per physician group associated with participating in the proposed PQRI group practice reporting option would be $4,565($55 per hour x 83 hours per group practice).We invite comments on this burden analysis, including the underlying assumptions used in developing our estimates.The Electronic Prescribing (E-Prescribing) Incentive ProgramWe believe it is difficult to estimate with any degree of accuracy how many eligible professionals will opt to participate in the E-Prescribing Incentive Program in CY 2010. Information from the ``PQRI 2007 Reporting Experience Report,'' which is available on the PQRI section of the CMS Web site at http://www.cms.hhs.gov/PQRI, indicates that nearly 110,000 unique TIN/NPI combinations attempted to submitPQRI quality measures data via claims for the 2007 PQRI. Therefore, for purposes of conducting a burden analysis for the 2010 E-PrescribingIncentive Program, we will assume that as many eligible professionals who attempted to participate in the 2007 PQRI will attempt to participate in the 2010 E-Prescribing Incentive Program. As such, we can estimate that nearly 110,000 unique TIN/NPI combinations will participate in the 2010 E-Prescribing Incentive Program.Section II.G.5. of this proposed rule discusses the background of the E-Prescribing Incentive Program. Section II.G.5.c. of this proposed rule provides information on how we propose eligible professionals can qualify to be considered a successful e-prescriber in 2010 in order to earn an incentive payment. Similar to the PQRI, the E-PrescribingIncentive Program is a voluntary initiative. Eligible professionals may choose whether to participate and, to the extent they meet (1) certain thresholds with respect to the volume of covered professional services furnished and (2) the criteria to be considered a successful e- prescriber described in section II.G.5.c. of this proposed rule, they can qualify to receive an incentive payment for 2010.For the 2010 E-Prescribing Incentive Program, as discussed in section II.G.5. of this proposed rule, we propose that each eligible professional would need to report the G-code indicating that at least one prescription generated during an encounter was electronically submitted at least 25 instances during the reporting period. Similar toPQRI, this measure would be reportable through claims-based reporting, registry-based reporting, or through EHRs, if we finalize the proposedEHR-based reporting mechanism for PQRI.Similar to claims-based reporting for the PQRI, we estimate that the burden associated with the requirements of this new incentive program is the time and effort associated with eligible professionals determining whether the electronic prescribing quality measure applies to them, gathering the required information, selecting the appropriate quality data codes, and including the appropriate quality data codes on the claims they submit for payment. We expect the ongoing costs associated with participation in the E-Prescribing Incentive Program to decline based on an eligible professional's familiarity with and understanding of the E-Prescribing Incentive Program, experience with participating in the E-Prescribing Incentive Program, and increased efforts by CMS and stakeholders to disseminate useful educational resources and best practices. Since the E-Prescribing Incentive Program consists of only 1 quality measure, we will assign 1 hour as the amount of time needed for eligible professionals to review the e-prescribing measure and incorporate the use of quality data codes into their office work flows. At an average cost of approximately $55 per hour, we estimate the total cost to eligible professionals for reviewing the e- prescribing measure and incorporating the use of quality data codes into the office work flows to be approximately $55 ($55 per hour x 1 hour).For claims-based reporting, the quality data codes will be collected as additional (optional) line items on the existing HIPAA transaction 837-P and/or CMS Form 1500. We do not anticipate any new forms and no modifications to the existing transaction or form. We also do not anticipate
Page 33658changes to the 837-P or CMS Form 1500 for CY 2010.Based on our experience with the PVRP described in section II.G.5. of this proposed rule, we estimate that the time needed to perform all the steps necessary to report the e-prescribing measure to be 1.75 minutes. We also estimate the cost to perform all the steps necessary to report the e-prescribing measure to be $0.90 based on the experience with the PVRP described above.Based on our proposed criteria for determination of whether an eligible professional is a successful e-prescriber, we estimate that each eligible professional would report the electronic prescribing measure in 25 instances during the reporting period.Therefore, we estimate the total annual burden per eligible professional who chooses to participate in the 2010 E-PrescribingIncentive Program through claims-based reporting of the electronic prescribing measure to be 104 minutes, or 1.73 hours [(1.75 minutes per measure x 1 measure x 25 cases per measure) + 1 hour]. The total estimated cost per eligible professional to report the electronic prescribing measure is estimated to be $77.50 [($0.90 per measure x 1 measure x 25 cases per measure) + $55].Because registry-based reporting of the electronic prescribing measure to CMS would be new for 2010 and participation in this reporting initiative is voluntary, it is impossible to estimate with any degree of accuracy how many eligible professionals will opt to participate in the E-Prescribing Incentive Program through the registry-based reporting mechanism in CY 2010. We do not anticipate, however, any additional burden for eligible professionals to report data to a registry as eligible professionals opting for registry-based reporting would more than likely already be reporting data to the registry. Little, if any, additional data would need to be reported to the registry for purposes of participation in the 2010 E-PrescribingIncentive Program. However, eligible professionals would need to authorize or instruct the registry to submit quality measures results and numerator and denominator data on the electronic prescribing measure to CMS on their behalf. We estimate that the time and effort associated with this would be approximately 5 minutes for each eligible professional that wishes to authorize or instruct the registry to submit quality measures results and numerator and denominator data on the electronic prescribing measure to CMS on their behalf.Based on our proposal to consider only registries qualified to submit quality measures results and numerator and denominator data on quality measures to CMS on their participants' behalf for the 2010 PQRI to be qualified to submit results and numerator and denominator data on the electronic prescribing measure for the 2010 E-Prescribing IncentiveProgram, there would be no need for a registry to undergo a separate self-nomination process for the E-Prescribing Incentive Program and therefore, no additional burden associated with the registry self- nomination process.The burden associated with the registry-based reporting requirements of this voluntary reporting initiative is the time and effort associated with the registry calculating results for the electronic prescribing measure from the data submitted to the registry by its participants and submitting the quality measures results and numerator and denominator data on the electronic prescribing quality measure to CMS on behalf of their participants. The time needed for a registry to review the electronic prescribing measure and other information, calculate the measure's results, and submit the measure's results and numerator and denominator data on the measure on their participants behalf is expected to vary along with the number of eligible professionals reporting data to whom the measure applies.However, we believe that registries already perform many of these activities for their participants. Since the E-Prescribing IncentiveProgram consists of only one measure, we believe that the burden associated with the registry reporting the measure's results and numerator and denominator to CMS on behalf of their participants would be minimal.For EHR-based reporting, the eligible professional must review the electronic prescribing measure, extract the necessary clinical data from his or her EHR, and submit the necessary data to the CMS- designated clinical data warehouse. Because this manner of reporting quality data to CMS would be new for 2010 and participation in this reporting initiative is voluntary, it is impossible to estimate with any degree of accuracy how many eligible professionals will opt to participate in the E-Prescribing Incentive Program through the EHR- based reporting mechanism in CY 2010. The time needed for an eligible professional to review the electronic prescribing measure and other information and determine whether the measure is applicable to his or her patients and the services he or she furnishes to them is expected to be similar for EHR-based reporting and claims-based reporting (that is, 1 hour). Once the EHR is programmed by the vendor to allow data submission to CMS, the burden to the eligible professional associated with submission of data on the electronic prescribing measure should be minimal.Based on our proposal to consider only EHR products qualified for the 2010 PQRI to be qualified for the 2010 E-Prescribing IncentiveProgram, there would be no need for EHR vendors to undergo a separate self-nomination process for the E-Prescribing Incentive Program and therefore, no additional burden associated with the self-nomination process.The burden associated with the EHR-based reporting requirements of this voluntary reporting initiative is the time and effort associated with the EHR vendor programming its EHR product(s) to extract the clinical data that the eligible professional needs to submit to CMS for purposes of reporting the 2010 electronic prescribing measure. The time needed for an EHR vendor to review the measure and other information and program each qualified EHR product to enable eligible professionals to submit data on the measure to the CMS-designated clinical data warehouse will be dependent on the EHR vendor's familiarity with the electronic prescribing measure, the vendor's system capabilities, as well as the vendor's programming capabilities. Since only EHR products qualified for the 2010 PQRI would be qualified for the 2010 E-Prescribing Incentive Program and the E-Prescribing Incentive Program consists of only one measure, we believe that any burden associated with the EHR vendor to program its product(s) to enable eligible professionals to submit data on the electronic prescribing measure to the CMS-designated clinical data warehouse would be minimal.Finally, with respect to the proposed process for group practices to be treated as successful e-prescribers under the 2010 E-PrescribingIncentive Program discussed in section II.G.5. of this proposed rule, a group practice would be required to report the electronic prescribing measure in at least 2500 instances. Group practices have the same options as individual eligible professionals in terms of the form and manner for reporting the electronic prescribing measure (that is, group practices have the option of reporting the measure through claims, a qualified registry, or a qualified EHR product). The only difference between an individual eligible professional and group practice reporting of the
Page 33659electronic prescribing measure is the number of times that a group practice is required to report the electronic prescribing measure. For group practices who are selected to participate in the 2010 E-Prescribing Incentive Program group practice reporting option and choose to do so through claims-based reporting of the electronic prescribing measure, we estimate the total annual burden to be 73.92 hours [(1.75 minutes per measure x 1 measure x 2500 cases per measure)+ 1 hour]. The total estimated cost per group practice to report the electronic prescribing measure through claims-based reporting is estimated to be $2,305 [($0.90 per measure x 1 measure x 2500 cases per measure) + $55].For group practices who are selected to participate in the 2010 E-Prescribing Incentive Program group practice reporting option and choose to do so through registry-based reporting of the electronic prescribing measure, we do not anticipate any additional burden to report data to a registry as group practices opting for registry-based reporting would more than likely already be reporting data to the registry. Little, if any, additional data would need to be reported to the registry for purposes of participation in the 2010 E-PrescribingIncentive Program. However, group practices would need to authorize or instruct the registry to submit quality measures results and numerator and denominator data on the electronic prescribing measure to CMS on their behalf. We estimate that the time and effort associated with this would be approximately 5 minutes for each group practice that wishes to authorize or instruct the registry to submit quality measures results and numerator and denominator data on the electronic prescribing measure to CMS on their behalf.For group practices who are selected to participate in the 2010 E-Prescribing Incentive Program group practice reporting option and choose to do so through EHR-based reporting of the electronic prescribing measure, once the EHR is programmed by the vendor to allow data submission to CMS, the burden to the group practice associated with submission of data on the electronic prescribing measure should be minimal.In addition to the burden associated with group practices reporting the electronic prescribing measure, group practices would also be required to self-nominate in order to participate in the 2010 E-Prescribing Incentive Program under the group practice reporting option. Since we propose to limit participation in the E-PrescribingIncentive Program group practice reporting option to those group practices selected to participate in the PQRI group practice reporting option, there would not be a separate group practice self-nomination process for the E-Prescribing Incentive Program and, thus, no additional burden.We invite comments on this burden analysis, including the underlying assumptions used in developing our burden estimates.IV. Response to CommentsBecause of the large number of public comments we normally receive on Federal Register documents, we are not able to acknowledge or respond to them individually. We will consider all comments we receive by the date and time specified in the DATES section of this preamble, and, when we proceed with a subsequent document, we will respond to the comments in the preamble to that document.V. Regulatory Impact AnalysisWe have examined the impacts of this rule as required by ExecutiveOrder 12866 on Regulatory Planning and Review (September 30, 1993, as further amended), the Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-354), section 1102(b) of the Social Security Act, section 202 of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104- 4), Executive Order 13132 on Federalism (August 4, 1999), and theCongressional Review Act (5 U.S.C. 804(2)).Executive Order 12866 (as amended by Executive Order 13258) directs agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). A regulatory impact analysis (RIA) must be prepared for major rules with economically significant effects ($100 million or more in any 1 year). We estimate, as discussed below in this section, that the PFS provisions included in this proposed rule will redistribute more than $100 million in 1 year. Therefore, we estimate that this rulemaking is ``economically significant'' as measured by the $100 million threshold, and hence also a major rule under the CongressionalReview Act. Accordingly, we have prepared a Regulatory Impact Analysis that to the best of our ability presents the costs and benefits of the rulemaking.The RFA requires agencies to analyze options for regulatory relief of small businesses and other small entities, if a rule has a significant impact on a substantial number of small entities. For purposes of the RFA, we estimate that most hospitals and most other providers are small entities as that term is used in the RFA (including small businesses, nonprofit organizations, and small governmental jurisdictions). The great majority of hospitals and most other health care providers and suppliers are small entities, either by being nonprofit organizations or by meeting the Small Business Administration(SBA) definition of a small business (having revenues of $7 million to$34.5 million in any 1 year) (for details see the SBA's Web site at http://sba.gov/idc/groups/public/documents/sba_homepage/serv_sstd_ tablepdf.pdf (refer to the 620000 series).Individuals and States are not included in the definition of a small entity. The RFA requires that we analyze regulatory options for small businesses and other entities. We prepare a regulatory flexibility analysis unless we certify that a rule would not have a significant economic impact on a substantial number of small entities.The analysis must include a justification concerning the reason action is being taken, the kinds and number of small entities the rule affects, and an explanation of any meaningful options that achieve the objectives with less significant adverse economic impact on the small entities.For purposes of the RFA, physicians, NPPs, and suppliers includingIDTFs are considered small businesses if they generate revenues of $7 million or less based on SBA size standards. Approximately 95 percent of physicians are considered to be small entities. There are over 1 million physicians, other practitioners, and medical suppliers that receive Medicare payment under the PFS.For purposes of the RFA approximately 85 percent of suppliers of durable medical equipment, prosthetics, orthotics, and supplies(DMEPOS) are considered small businesses according to the SBA size standards. We estimate that approximately 66,000 entities bill Medicare for DMEPOS each year. Total annual estimated Medicare revenues forDMEPOS suppliers are approximately $10.8 billion in 2007 for which $8.3 billion was for fee-for-service (FFS) and $2.5 billion was for managed care.For purposes of the RFA, approximately 80 percent of clinical diagnostic laboratories are considered small businesses according to the SBA size standards.
Page 33660Ambulance providers and suppliers for purposes of the RFA are also considered to be small entities.In addition, most ESRD facilities are considered small entities for purposes of the RFA, either based on nonprofit status or by having revenues of $7 million to $34.5 million or less in any year. We note that a considerable number of ESRD facilities are owned and operated by large dialysis organizations (LDOs) or regional chains, which would have total revenues more than $34.5 million in any year if revenues from all locations are combined. However, the claims data we use to estimate payments for this RFA and RIA does not identify which dialysis facilities are parts of an LDO, regional chain, or other type of ownership. Each individual dialysis facility has its own provider number and bills Medicare using this number. Therefore, we consider each ESRD to be a small entity for purposes of the RFA. We consider a substantial number of entities to be significantly affected if the proposed rule has an annual average impact on small entities of 3 to 5 percent or more. The majority of ESRD facilities will experience impacts of less than 2 percent of total revenues. There are 929 nonprofit ESRD facilities with a combined increase of 0.9 percent in overall payments relative to current overall payments. We note that although the overall effect of the wage index changes is budget neutral, there are increases and decreases based on the location of individual facilities. The analysis and discussion provided in this section and elsewhere in this proposed rule complies with the RFA requirements.Because we acknowledge that many of the affected entities are small entities, the analysis discussed throughout the preamble of this proposed rule constitutes our regulatory flexibility analysis for the remaining provisions and addresses comments received on these issues.In addition, section 1102(b) of the Act requires us to prepare a regulatory impact analysis, if a rule may have a significant impact on the operations of a substantial number of small rural hospitals. Any such regulatory impact analysis must conform to the provisions of section 603 of the RFA. For purposes of section 1102(b) of the Act, we define a small rural hospital as a hospital that is located outside of a metropolitan statistical area and has fewer than 100 beds. We do not believe this proposed rule has impact on significant operations of a substantial number of small rural hospitals because most dialysis facilities are freestanding. While there are 177 rural hospital-based dialysis facilities, we do not know how many of them are based at hospitals with fewer than 100 beds. However, overall, the 177 rural hospital-based dialysis facilities will experience an estimated 1.1 percent increase in payments. As a result, this rule will not have a significant impact on small rural hospitals. Therefore, the Secretary has determined that this proposed rule will not have a significant impact on the operations of a substantial number of small rural hospitals.Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) also requires that agencies assess anticipated costs and benefits before issuing any rule whose mandates require spending in any 1 year of $100 million in 1995 dollars, updated annually for inflation. In 2009, that threshold is approximately $133 million. This proposed rule will not mandate any requirements for State, local, or Tribal governments.Medicare beneficiaries are considered to be part of the private sector and as a result a more detailed discussion is presented on the Impact of Beneficiaries in section V. of this regulatory impact analysis.We have examined this proposed rule in accordance with ExecutiveOrder 13132 and have determined that this regulation would not have any substantial direct effect on State or local governments, preemptStates, or otherwise have a Federalism implication.We have prepared the following analysis, which together with the information provided in the rest of this preamble, meets all assessment requirements. The analysis explains the rationale for and purposes of this proposed rule; details the costs and benefits of the rule; analyzes alternatives; and presents the measures we will use to minimize the burden on small entities. As indicated elsewhere in this rule, we are implementing a variety of changes to our regulations, payments, or payment policies to ensure that our payment systems reflect changes in medical practice and the relative value of services.We provide information for each of the policy changes in the relevant sections of this proposed rule. We are unaware of any relevant Federal rules that duplicate, overlap, or conflict with this proposed rule. The relevant sections of this rule contain a description of significant alternatives if applicable.A. RVU Impacts 1. Resource-Based Work PE and MP RVUsSection 1848(c)(2)(B)(ii) of the Act requires that increases or decreases in RVUs may not cause the amount of expenditures for the year to differ by more than $20 million from what expenditures would have been in the absence of these changes. If this threshold is exceeded, we make adjustments to preserve BN.Our estimates of changes in Medicare revenues for PFS services compare payment rates for CY 2009 with proposed payment rates for CY 2010 using CY 2008 Medicare utilization for all years. To the extent that there are year-to-year changes in the volume and mix of services provided by physicians, the actual impact on total Medicare revenues will be different than those shown in Table 39. The payment impacts reflect averages for each specialty based on Medicare utilization. The payment impact for an individual physician would be different from the average, based on the mix of services the physician provides. The average change in total revenues would be less than the impact displayed here because physicians furnish services to both Medicare and non-Medicare patients and specialties may receive substantial Medicare revenues for services that are not paid under the PFS. For instance, independent laboratories receive approximately 80 percent of theirMedicare revenues from clinical laboratory services that are not paid under the PFS.Table 39 shows only the payment impact on PFS services. The following is an explanation of the information represented in Table 39Specialty: The physician specialty or type of practitioner/supplier.Allowed charges: Allowed charges are the Medicare FeeSchedule amounts for covered services and include coinsurance and deductibles (which are the financial responsibility of the beneficiary.) These amounts have been summed across all services furnished by physicians, practitioners, or suppliers within a specialty to arrive at the total allowed charges for the specialty.Impact of Proposed Work RVU changes for the CY 2010 PFS.Impact of Proposed PE RVU changes for the CY 2010 PFS.Impact of Proposed MP RVU changes for the CY 2010 PFS.Combined Impact of all Proposed Changes. The impact shown is a combined impact that incorporates all proposed changes to WorkRVUs, PE RVUs, and MP RVUs, prior to the
Page 33661application of the CY 2010 negative PFS CF update under the current statute.Table 39--CY 2010 Total Allowed Charge Impact for Work, Practice Expense, and Malpractice Changes *Impact of work Impact of PEImpact of MPSpecialtyAllowedRVU changesRVU changes**RVU changesCombined charges (mil)(%)(%)(%)impact (%)(A)(B) ..............(C)(D)(E)1 TOTAL........................$77,7440101 2 ALLERGY/IMMUNOLOGY...........17100-2-3 3 ANESTHESIOLOGY...............1,7130516 4 CARDIAC SURGERY..............371-1-13-2 5 CARDIOLOGY...................7,1790-10-1-11 6 COLON AND RECTAL SURGERY.....129-1515 7 CRITICAL CARE................2210313 8 DERMATOLOGY..................2,5040203 9 EMERGENCY MEDICINE...........2,3950202 10 ENDOCRINOLOGY................370-1303 11 FAMILY PRACTICE..............5,0552518 12 GASTROENTEROLOGY.............1,779-1100 13 GENERAL PRACTICE.............7191506 14 GENERAL SURGERY..............2,213-1414 15 GERIATRICS...................1671618 16 HAND SURGERY.................89-1403 17 HEMATOLOGY/ONCOLOGY..........1,8880-5-1-6 18 INFECTIOUS DISEASE...........549-1413 19 INTERNAL MEDICINE............10,0611416 20 INTERVENTIONAL PAIN352-1706MANAGEMENT..................... 21 INTERVENTIONAL RADIOLOGY.....2270-100-10 22 NEPHROLOGY...................1,7890112 23 NEUROLOGY....................1,417-2603 24 NEUROSURGERY.................586-1312 25 NUCLEAR MEDICINE.............720-12-2-13 26 OBSTETRICS/GYNECOLOGY........6150101 27 OPHTHALMOLOGY................4,736011011 28 ORTHOPEDIC SURGERY...........3,2570403 29 OTOLARNGOLOGY................926-13-11 30 PATHOLOGY....................9850-100 31 PEDIATRICS...................641404 32 PHYSICAL MEDICINE............8160707 33 PLASTIC SURGERY..............278-1515 34 PSYCHIATRY...................1,0710213 35 PULMONARY DISEASE............1,753-1313 36 RADIATION ONCOLOGY...........1,7990-17-1-19 37 RADIOLOGY....................5,2540-10-1-11 38 RHEUMATOLOGY.................494000-1 39 THORACIC SURGERY.............389-1032 40 UROLOGY......................1,9890-60-7 41 VASCULAR SURGERY.............685-1-10-1 42 AUDIOLOGIST..................350-4-7-10 43 CHIROPRACTOR***..............7000415 44 CLINICAL PSYCHOLOGIST........5330-70-7 45 CLINICAL SOCIAL WORKER.......3530-61-6 46 NURSE ANESTHETIST............7720202 47 NURSE PRACTITIONER...........1,0041517 48 OPTOMETRY....................834111012 49 ORAL/MAXILLOFACIAL SURGERY...35-13-11 50 PHYSICAL/OCCUPATIONAL THERAPY1,857010010 51 PHYSICIAN ASSISTANT..........7490405 52 PODIATRY.....................1,65617-16 53 DIAGNOSTIC TESTING FACILITY..1,0440-19-5-24 54 INDEPENDENT LABORATORY.......9600-4-1-5 55 PORTABLE X-RAY SUPPLIER......850-8-2-11* Does not include the impact of the current law CY 2010 negative update. Rows may not sum to total due to rounding.** Note: The law caps the MFS imaging payment amount at the comparable payment amount in the hospital outpatient payment system (OPPS cap). In the absence of the negative current law CY 2010 MFS update, the proposed PE change to the equipment utilization rate for expensive equipment from 50 percent to 90 percent would increase expenditures by approximately 1 percent due to a loss of savings from the OPPS cap.*** Does not reflect the BN reduction in payments resulting from the chiropractic demonstration.
Page 336622. Resource-Based Work, PE, and MP RVUs Impacts a. Work RVU ImpactsThe work RVU impacts are almost entirely attributable to the proposed changes for consultation services. As described earlier in this proposed rule, we are proposing to no longer recognize the BILLINGCODEs for consultation services so we are budget neutrally eliminating the use of all consultation codes (except for telehealth) and have allocated the work RVUs that were allotted to these services to the work RVUs for new and established office visit services, initial hospital visits, and initial nursing facility visits to reflect this change. b. PE RVUs ImpactsThe PE RVU impacts are primarily attributable to the proposed incorporation of PE data from the Physician Practice Information Survey(PPIS). For a discussion of the use of this updated survey data, see section II.A.2. of this proposed rule.For two specialties, IDTFs and Radiation Oncology, the impact of our proposed change in the utilization rate for expensive equipment is also significant. We estimate that for these two specialties, the utilization rate change will result in impacts of -2 percent and -5 percent (respectively). These impacts are included in the -19 percent and -17 percent PE RVU impacts shown in Table 39 for these specialties.After taking into account the OPPS payment cap, the change in the utilization rate for expensive equipment does not substantially reduce overall payments for other specialties.Our proposals on consultation codes (see section II.E.4. of this proposed rule) and dominant specialty (see section II.C.2. of this proposed rule) do not have a significant impact on PE payments to specialties. c. Malpractice RVU ImpactsThe PE RVU impacts are attributable to the changes proposed for theFive-Year Review of MP RVUs described earlier in this proposed rule. Of particular note are the impacts on the specialties of Audiology (-7 percent), and IDTFs (-5 percent). These impacts are primarily driven by the expansion of the MP premium data collection and the proposed changes to the methodology for TC services. d. Combined ImpactColumn E of Table 39 displays the proposed combined impact of allRVU changes by specialty. These changes range from increases of +12 percent for optometry to decreases of -24 percent for IDTFs. The effect of our proposals on primary care specialties such as General Practice,Family Practice, Internal Medicine, and Geriatrics are positive with increases ranging from +6 percent to +8 percent. Again, these impacts are prior to the application of the negative CY 2010 CF update under the current statute.Table 40 shows the estimated impact on total payments for selected high-volume procedures of all of the changes discussed previously, including the effect of the CY 2010 negative PFS CF update. We selected these procedures because they are the most commonly furnished by a broad spectrum of physician specialties. There are separate columns that show the change in the facility rates and the nonfacility rates.For an explanation of facility and nonfacility PE, refer to Addendum A of this proposed rule.Table 40--Impact of Proposed Rule and Estimated Physician Update on 2010 Payment for Selected ProceduresFacilityNon-facilityCPT \1\/HCPCSMODDescriptionPercentPercent 20092010 \2\ change20092010 \2\ change11721............ ...... Debride nail, 6 or$27.77$19.82-29$40.3932.29-20 more. 17000............ ...... Destruct premalg48.6940.50-1769.9757.21-18 lesion. 27130............ ...... Total hip1,359.71 1,113.00-18NANANA arthroplasty. 27244............ ...... Treat thigh1,144.39944.21-17NANANA fracture. 27447............ ...... Total knee1,456.37 1,187.76-18NANANA arthroplasty. 33533............ ...... CABG, arterial,1,892.05 1,524.78-19NANANA single. 35301............ ...... Rechanneling of1,067.93879.63-18NANANA artery. 43239............ ...... Upper GI endoscopy,165.55130.27-21323.16243.84-25 biopsy. 66821............ ...... After cataract251.38225.15-10266.53237.89-11 laser surgery. 66984............ ...... Cataract surg w/638.74568.96-11NANANA iol, 1 stage. 67210............ ...... Treatment of561.56502.12-11580.67517.13-11 retinal lesion. 71010............ ...... Chest x-ray........NANANA23.8016.14-32 71010............26 Chest x-ray........9.026.80-259.026.80-25 77056............ ...... Mammogram, bothNANANA107.4880.15-25 breasts. 77056............26 Mammogram, both44.3633.98-2344.3633.98-23 breasts. 77057............ ...... Mammogram,NANANA81.5157.49-29 screening. 77057............26 Mammogram,35.7127.47-2335.7127.47-23 screening. 77427............ ...... Radiation tx188.27155.48-17188.27155.48-17 management, x5. 78465............26 Heart image (3d),78.9956.92-2878.9956.92-28 multiple. 88305............26 Tissue exam by37.1529.45-2137.1529.45-21 pathologist. 90801............ ...... Psy dx interview...128.0496.01-25152.92118.95-22 90862............ ...... Medication45.0835.40-2155.1845.31-18 management. 90935............ ...... Hemodialysis, one66.3654.09-18NANANA evaluation. 92012............ ...... Eye exam45.8041.35-1070.6962.87-11 established pat. 92014............ ...... Eye exam &70.3362.59-11103.1591.76-11 treatment. 92980............ ...... Insert847.93587.08-31NANANA intracoronary stent. 93000............ ...... Electrocardiogram,20.9213.03-3820.9213.03-38 complete. 93010............ ...... Electrocardiogram9.026.80-259.026.80-25 report. 93015............ ...... Cardiovascular100.2761.74-38100.2761.74-38 stress test. 93307............26 Tte w/o doppler,49.7735.97-2849.7735.97-28 complete. 93510............26 Left heart248.86169.36-32248.86169.36-32 catheterization. 98941............ ...... Chiropractic30.3024.36-2033.9028.04-17 manipulation.
Page 3366399203............ ...... Office/outpatient68.1760.04-1291.9781.00-12 visit, new. 99213............ ...... Office/outpatient44.7239.93-1161.3154.09-12 visit, est. 99214............ ...... Office/outpatient69.2561.17-1292.3380.15-13 visit, est. 99222............ ...... Initial hospital122.63106.77-13NANANA care. 99223............ ...... Initial hospital180.33156.05-13NANANA care. 99231............ ...... Subsequent hospital37.1530.87-17NANANA care. 99232............ ...... Subsequent hospital66.7256.07-16NANANA care. 99233............ ...... Subsequent hospital95.5880.43-16NANANA care. 99236............ ...... Observ/hosp same207.38170.77-18NANANA date. 99239............ ...... Hospital discharge96.3081.85-15NANANA day. 99283............ ...... Emergency dept61.3149.84-19NANANA visit. 99284............ ...... Emergency dept114.3392.89-19NANANA visit. 99291............ ...... Critical care,212.07173.89-18253.91206.74-19 first hour. 99292............ ...... Critical care, add106.0486.94-18114.6993.74-18
AElig l 30 min. 99348............ ...... Home visit, estNANANA79.3565.42-18 patient. 99350............ ...... Home visit, estNANANA160.86137.92-14 patient.G0008............ ...... Admin influenzaNANANA20.9216.99-19 virus vac.\1\ CPT codes and descriptions are copyright 2009 American Medical Association. All Rights Reserved. ApplicableFARS/DFARS apply.\2\ Based upon projected -21.5 reduction in the conversion factor.B. Geographic Practice Cost Indices (GPCIs)As discussed in section II.C. of this proposed rule, the application of the 1.000 work GPCI floor, as extended by section 134(a) of the MIPPA, expires effective January 1, 2010. As a result, 54 (out of 89) PFS localities will receive a decrease in their work GPCI.Puerto Rico receives the largest decrease (-9.6 percent), followed bySouth Dakota (-5.8 percent), North Dakota (-5.3 percent), Rest ofMissouri (-5.1 percent), and Montana (-5.0 percent).C. Medicare Telehealth ServicesIn section II.D. of this proposed rule, we are proposing to add individual health behavior and assessment services (as described byHCPCS codes 96150 through 96152) to the list of telehealth services. We are also proposing to revise Sec. 410.78 to specify that the G-codes for follow-up inpatient telehealth consultations (as described by HCPCS codes G0406 through G0408) include follow-up telehealth consultations furnished to beneficiaries in hospitals and skilled nursing facilities.The total annual Medicare payment amount for telehealth services(including the originating site facility fee) is approximately $2 million. Previous additions to the list of telehealth services have not resulted in a significant increase in Medicare program expenditures.While we believe that these proposals will provide more beneficiaries with access to these services, we do not anticipate that these proposed changes will have a significant budgetary impact on the Medicare program.D. MIPPA Provisions 1. Section 102: Elimination of Discriminatory Copayment Rates forMedicare Outpatient Psychiatric ServicesThis section of the MIPPA will have a positive impact on Medicare patients because coinsurance payment percentages for outpatient mental health services will be gradually reduced from January 1, 2010 throughJanuary 1, 2014. At the conclusion of this 5-year period, Medicare patients will pay the same coinsurance payment percentage for outpatient mental health services as they currently pay for other health services under the Medicare Part B program.Since the inception of the Medicare Part B program, Medicare patients have been required to pay for a greater percentage of the cost of outpatient mental health treatment services than for other health services because of the Medicare payment limitation (the outpatient mental health treatment limitation). While a dollar cap that previously applied to mental health services was eliminated January 1, 1991, the statute maintained the 62\1/2\ percent limitation on the recognition of incurred expenses. This limitation of 62\1/2\ percent reduces the program's payment for mental health services to 50 percent, leaving aMedicare patient responsible for paying the other half of these expenses through coinsurance. The 62\1/2\ percent limitation will remain in effect until December 31, 2009.During the transition, the Medicare Part B program will incur increased expenditures as Medicare patients pay less out-of-pocket for outpatient mental health services until, in 2014, patients will pay only the deductible (if applicable) and 20 percent coinsurance. Section 102 of the MIPPA will shift cost-sharing for mental health services from Medicare patients to the program. This provision will result in a cost impact, to the Medicare program, of approximately $100 million forCY 2010. As section 102 of the MIPPA is implemented, the impact of the changes to the coinsurance payment percentages (that is, recognized incurred expenses) for Medicare patients and the program is as shown inTable 41.Table 41--Impact of the Changes to the Coinsurance Payment PercentagesUnder Section 102 of the MIPPACY 2009 and prior calendar years--Medicare limitation, 62.50 percent of recognized incurred expenses.Medicare Patient pays--50%.Medicare Part B pays--50%.CY 2010 and CY 2011--Medicare limitation, 68.75 percent of recognized incurred expenses.Medicare Patient pays--45%.Medicare Part B pays--55%.CY 2012--Medicare limitation, 75 percent of recognized incurred expenses.Medicare Patient pays--40%.Medicare Part B pays--60%.CY 2014--No limitation, 100.00 percent of recognized incurred expenses.
Page 33664Medicare Patient pays--20%.Medicare Part B pays--80%.2. Section 131 b: Physician Payment, Efficiency, and QualityImprovements--Physician Quality Reporting Initiative (PQRI)As discussed in section II.G.2. of this proposed rule, the proposed 2010 PQRI measures satisfy the requirement of section 1848(k)(2)(D) of the Act that the Secretary shall ensure that eligible professionals have the opportunity to provide input during the development, endorsement, or selection of measures applicable to services they furnish. As discussed in section II.G.2.d. of this proposed rule, we also propose to offer options in 2010 for reporting the proposed 2010PQRI measures via submission of data to a clinical registry, options for reporting some of the proposed 2010 PQRI measures via submission of data extracted from an EHR, options for reporting on measures groups rather than individual measures, and options for group practices to be treated as satisfactorily submitting quality data under the PQRI.Although there may be some cost incurred for maintaining the measures used in the PQRI and their associated code sets, and for expanding an existing clinical data warehouse to accommodate registry- based reporting and EHR-based reporting for the PQRI, we do not anticipate a significant cost impact on the Medicare program.Participation in the PQRI by eligible professionals is voluntary and eligible professionals and group practices may have different processes for integrating the PQRI into their practices' work flows.Therefore, it is not possible to estimate with any degree of accuracy the impact of the PQRI on providers.With respect to satisfactory submission of data on quality measures by eligible professionals, one factor that influences the cost to eligible professionals is the time and effort associated with eligible professionals identifying applicable PQRI quality measures for which they can report the necessary information. We have no way to accurately quantify the burden because it would vary with each eligible professional by the number of measures applicable to the eligible professional, the eligible professional's familiarity and understanding of the PQRI, and experience with participating in the PQRI. In addition, eligible professionals may employ different methods for incorporating the use of quality data codes into the office work flows.Therefore, we will continue to assign 3 hours as the amount of time needed for eligible professionals to review the PQRI quality measures, identify the applicable measures for which they can report the necessary information, and incorporate the use of quality data codes into the office work flows. Information from the Physician VoluntaryReporting Program (PVRP), which was a predecessor to the PQRI, indicated an average labor cost of approximately $50 per hour. To account for salary increases over time, we will use an average practice labor cost of $55 per hour for our estimates based on an assumption of an average annual increase of approximately 3 percent. Thus, we continue to estimate the cost for an eligible professional to review the PQRI quality measures, identify the applicable measures for which they can report the necessary information, and incorporate the use of quality data codes into the office work flows to be approximately $165 per eligible professional ($55 per hour x 3 hours).For claims-based PQRI reporting, one factor in the cost to eligible professionals is the time and effort associated with gathering the required information, selecting the appropriate quality data codes, and including the appropriate quality data codes on the Medicare Part B claims an eligible professional submits for payment. Information from the PVRP estimates the cost to physicians to perform all the steps necessary to report 1 quality measure ranges from $0.21 in labor time to about $10.06 in labor time for more complicated cases and/or measures. For the median practice, the cost was about $0.90 in labor time per measure. Eligible professionals generally would be required to report at least 3 measures to satisfactorily report PQRI quality measures data. Therefore, for purposes of this impact analysis we will assume that eligible professionals participating in the 2010 PQRI will report an average of 3 measures each.The cost of implementing claims-based reporting of PQRI quality measures data also varies with the volume of claims on which quality data is reported. Since we propose to require eligible professionals to report at least one of their selected measures for at least 15 MedicarePart B FFS patients in order to satisfactorily report, then, for this burden analysis, we will assume that for each measure, the eligible professional reports the quality data codes on 15 cases. The actual number of cases on which an eligible professional would be required to report quality measures data will vary, however, with the eligible professional's patient population and the types of measures on which the eligible professional chooses to report (each measure's specifications includes a required reporting frequency).Based on the assumptions discussed above, we estimate the total annual cost per eligible professional associated with claims-based reporting to range from $174.45 [($0.21 per measure x 3 measures x 15 cases per measure) + $165] to $617.70 [($10.06 per measure x 3 measures x 15 cases per measure) + $165].For registry-based reporting, eligible professionals must generally incur a cost to submit data to registries. Estimated fees for using a qualified registry range from a nominal charge for an eligible professional to use the registry to costing eligible professionals several thousand dollars. Thus, we conservatively estimate the cost incurred by an eligible professional to participate in PQRI via registry-based reporting to be approximately $500 per eligible professional.In addition, an eligible professional who chooses to submit PQRI quality measures results and numerator and denominator data on quality measures through a registry more than likely is already reporting data to the registry. Little, if any, additional data would need to be reported to the registry for purposes of participation in the 2010PQRI. Therefore, there should be little additional cost to the eligible professional associated with submitting data to the registry.Registries interested in submitting quality measures results and numerator and denominator data on quality measures to CMS on their participants' behalf would need to complete a self-nomination process in order to be considered ``qualified'' to submit on behalf of eligible professionals. We estimate the registry self-nomination process to cost approximately $500 per registry ($50 per hour x 10 hours per registry).This cost estimate includes the cost of submitting the self-nomination letter to CMS and completing the CMS vetting process. Our estimate of a$50 per hour average labor cost for registries is based on the assumption that registry staff include IT professionals whose average hourly rates range from $36 to $84 per hour depending on experience, with an average rate of nearly $50 per hour for a mid-level programmer.The cost to the registry associated with the registry-based reporting requirements of this voluntary reporting initiative is the time and effort
Page 33665associated with the registry calculating quality measure results from the data submitted to the registry by its participants and submitting the quality measures results and numerator and denominator data on quality measures to CMS on behalf of their participants. The time needed for a registry to review the quality measures and other information, calculate the measures results, and submit the measures results and numerator and denominator data on the quality measures on their participants behalf is expected to vary along with the number of eligible professionals reporting data to the registry and the number of applicable measures. However, we believe that registries already perform many of these activities for their participants.For EHR-based reporting, an eligible professional generally would incur a cost associated with purchasing an EHR product. We estimate that it costs between $1,500 to over $5,000 to purchase an EHR product.Therefore, we conservatively estimate the average total cost to an eligible professional to be approximately $2,750.An EHR vendor interested in having their product(s) be used by eligible professionals to submit quality measures results and numerator and denominator data on quality measures to CMS were required to complete a self-nomination process in order for the vendor's product(s) to be considered ``qualified'' for 2010. Therefore, one factor in the cost to EHR vendors is the cost associated with completing the self- nomination process in order for the vendor's EHR product(s) to be considered ``qualified.'' Similar to the estimated cost to the registry associated with the registry self-nomination process, the estimated cost for an EHR vendor to complete the self-nomination process, including the vetting process with CMS officials, is conservatively estimated to be $500 ($50 per hour x 10 hours per EHR vendor). Our estimate of a $50 per hour average labor cost for registries is based on the assumption that registry staff include IT professionals whose average hourly rates range from $36 to $84 per hour depending on experience, with an average rate of nearly $50 per hour for a mid-level programmer.Another factor in the cost to EHR vendors is the time and effort associated with the EHR vendor programming its EHR product(s) to extract the clinical data that the eligible professional needs to submit to CMS for purposes of reporting 2010 PQRI quality measures. The cost associated with the time and effort needed for an EHR vendor to review the quality measures and other information and program each qualified EHR product to enable eligible professionals to submit PQRI quality measures data to the CMS-designated clinical warehouse will be dependent on the EHR vendor's familiarity with PQRI, the vendor's system capabilities, as well as the vendor's programming capabilities.Some vendors already have these necessary capabilities and for such vendors, we estimate the total cost to be approximately $2,000 ($50 per hour x 40 hours per vendor). However, given the variability in the capabilities of the vendors, we believe a more conservative estimate for those vendors with minimal experience would be approximately$10,000 per vendor ($50 per hour x 200 hours per EHR vendor).With respect to the proposed process for group practices to be treated as satisfactorily submitting quality measures data under the 2010 PQRI discussed in section II.G.2.g. of this proposed rule, group practices interested in participating in the 2010 PQRI through the group practice reporting option would need to complete a self- nomination process similar to the self-nomination process required of registries and EHR vendors. We estimate that the group practice staff involved in the group practice self-nomination process have an average labor cost of $55 per hour. Therefore, assuming the total burden hours per group practice associated with the group practice self-nomination process is 4 hours, we estimate the total cost to a group practice associated with the group practice self-nomination process to be approximately $220 ($55 per hour x 4 hours per group practice).The cost associated with the group practice reporting requirements of this voluntary reporting initiative is the time and effort associated with the group practice submitting the quality measures data. For physician group practices, this would be the time associated with the physician group completing the proposed data collection tool.The information collection components of this data collection tool have been reviewed by OMB and are currently approved under OMB control number 0938-0941, with an expiration date of December 31, 2011. Based on cost estimates for the Physician Group Practice (PGP) demonstration, which uses the same data submission methods as what we have proposed, we estimate the cost associated with a physician group completing the data collection tool would be approximately 79 hours per physician group. Therefore, we estimate the total annual burden hours per physician group would be approximately 83 hours (4 hours for self- nomination + 79 hours for data submission). Based on an average labor cost of $55 per physician group, we estimate the cost per physician group associated with participating in the proposed PQRI group practice reporting option would be $4,565 ($55 per hour x 83 hours per group practice). 3. Section 131(c): Physician Resource Use Measurement and ReportingProgramAs discussed in section II.G.3. of this proposed rule, section 131(c) of the MIPPA amends section 1848 of the Act by adding subsection(n), which requires the Secretary to establish and implement by January 1, 2009, a Physician Feedback Program using Medicare claims data and other data to provide confidential feedback reports to physicians (and as determined appropriate by the Secretary, to groups of physicians) that measure the resources involved in furnishing care to Medicare beneficiaries. If determined appropriate by the Secretary, theSecretary may also include information on quality of care furnished toMedicare beneficiaries by the physician (or group of physicians) in the reports. We anticipate the impact of this section to be negligible for the work completed in the phased pilot physician feedback program to date. 4. Section 132: Incentives for Electronic Prescribing (E-Prescribing)--The E-Prescribing Incentive ProgramSection II.G.5. of this proposed rule describes the proposed 2010E-Prescribing Incentive Program. To be considered a successful e- prescriber in 2010, an eligible professional would need to meet the requirements proposed in section II.G.5.c. of this proposed rule.We anticipate that the cost impact of the E-Prescribing IncentiveProgram on the Medicare program would be the cost incurred for maintaining the electronic prescribing measure and its associated code set, and for expanding an existing clinical data warehouse to accommodate registry-based reporting and, potentially, EHR-based reporting for the electronic prescribing measure. We, however, do not anticipate a significant cost impact on the Medicare program since much of this infrastructure had already been established for the PQRI.Participation in the E-Prescribing Incentive Program by eligible professionals is voluntary and eligible professionals may have different processes for integrating the E-Prescribing Incentive Program into their practices' work flows. Therefore, it is not possible to estimate with any degree of accuracy the impact of the E-
Page 33666Prescribing Incentive Program on eligible professionals. Similar to claims-based reporting for PQRI, one factor in the cost to eligible professionals, for those eligible professionals who choose to report the electronic prescribing measure through claims, is the time and effort associated with eligible professionals determining whether the quality measure is applicable to them, gathering the required information, selecting the appropriate quality data codes, and including the appropriate quality data codes on the claims they submit for payment. Since the E-Prescribing Incentive Program consists of only 1 quality measure, we will assign 1 hour as the amount of time needed for eligible professionals to review the e-prescribing measure and incorporate the use of quality data codes into their office work flows.At an average cost of approximately $55 per hour, we estimate the total cost to eligible professionals for reviewing the e-prescribing measure and incorporating the use of quality data codes into the office work flows to be approximately $55 ($55 per hour x 1 hour).Another factor in the cost to eligible professionals is the time and effort associated with gathering the required information, selecting the appropriate quality data codes, and including the appropriate quality data codes on the claims an eligible professional submits for payment. Information from the PVRP estimates the cost to physicians to perform all of the steps necessary to report 1 quality measure ranges from $0.21 in labor time to about $10.06 in labor time for more complicated cases and/or measures. For the median practice, the cost was about $0.90 in labor time per measure. Therefore, we estimate the costs to eligible professionals to perform all the steps necessary to report the electronic prescribing measure on a claim to be approximately $0.90.The cost for this requirement will also vary along with the volume of claims on which quality data is reported. Based on our proposal to require an eligible professional to report the G8443 code for the electronic prescribing measure for at least 25 instances, we estimate the total annual estimated cost per eligible professional to report the electronic prescribing measure to be $77.50 [($0.90 per measure x 1 measure x 25 cases per measure) + $55].Because registry-based reporting of the electronic prescribing measure to CMS would be new for 2010 and participation in this reporting initiative is voluntary, it is impossible to estimate with any degree of accuracy how many eligible professionals will opt to participate in the E-Prescribing Incentive Program through the registry-based reporting mechanism in CY 2010. We do not anticipate, however, any additional cost for eligible professionals to report data to a registry as eligible professionals opting for registry-based reporting would more than likely already be reporting data to the registry. Little, if any, additional data would need to be reported to the registry for purposes of participation in the 2010 E-PrescribingIncentive Program.One potential cost to some eligible professionals associated with either claims-based reporting or registry-based reporting would be the cost of purchasing and using an e-prescribing system. There are currently many commercial packages available for e-prescribing. One study indicated that a mid-range complete electronic medical record with electronic prescribing functionality costs $2500 per license with an annual fee of $90 per license for quarterly updates of the drug database after setup costs while a standalone prescribing, messaging, and problem list system costs $1200 per physician per year after setup costs. Hardware costs and setup fees substantially add to the final cost of any software package. (Corley, S.T. (2003). ``Electronic prescribing: a review of costs and benefits.'' Topics in HealthInformation Management 24(1): 29-38.). The cost to an eligible professional of obtaining and utilizing an e-prescribing system varies not only by the commercial software package selected but also by the level at which the professional currently employs information technology in his or her practice and the level of training needed.Based on our proposal to consider only registries qualified to submit quality measures results and numerator and denominator data on quality measures to CMS on their participants' behalf for the 2010 PQRI to be qualified to submit results and numerator and denominator data on the electronic prescribing measure for the 2010 E-Prescribing IncentiveProgram, we do not anticipate any cost to the registry associated with becoming a registry qualified to submit the electronic prescribing measure for 2010.The cost associated with the registry-based reporting requirements of this voluntary reporting initiative for the registry would be the time and effort associated with the registry calculating results for the electronic prescribing measure from the data submitted to the registry by its participants and submitting the quality measures results and numerator and denominator data on the electronic prescribing quality measure to CMS on behalf of their participants. The time needed for a registry to review the electronic prescribing measure and other information, calculate the measure's results, and submit the measure's results and numerator and denominator data on the measure on their participants behalf is expected to vary along with the number of eligible professionals reporting data to whom the measure applies.However, we believe that registries already perform many of these activities for their participants. Since the E-Prescribing IncentiveProgram consists of only one measure, we believe that the cost associated with the registry reporting the measure's results and numerator and denominator to CMS on behalf of their participants would be minimal.For EHR-based reporting (if we finalize an EHR-based reporting mechanism for the E-Prescribing Incentive Program), the eligible professional must review the electronic prescribing measure, extract the necessary clinical data from his or her EHR, and submit the necessary data to the CMS-designated clinical data warehouse. Because this manner of reporting quality data to CMS would be new for 2010 and participation in this reporting initiative is voluntary, it is impossible to estimate with any degree of accuracy how many eligible professionals will opt to participate in the E-Prescribing IncentiveProgram through the EHR-based reporting mechanism in CY 2010. The cost associated with an eligible professional reviewing the electronic prescribing measure and other information and determining whether the measure is applicable to his or her patients and the services he or she furnishes to them is expected to be similar for EHR-based reporting and claims-based reporting (that is, $55 at a rate of $55 per hour). Once the EHR is programmed by the vendor to allow data submission to CMS, the cost to the eligible professional associated with the time and effort to submit data on the electronic prescribing measure should be minimal.Based on our proposal to consider only EHR products qualified for the 2010 PQRI to be qualified to submit results and numerator and denominator data on the electronic prescribing measure for the 2010 E-Prescribing Incentive Program, there would be no need for EHR vendors to undergo a separate self-nomination process for the E-PrescribingIncentive Program and therefore, no additional cost associated with the self-nomination process.
Page 33667The cost to the EHR vendor associated with the EHR-based reporting requirements of this voluntary reporting initiative is the time and effort associated with the EHR vendor programming its EHR product(s) to extract the clinical data that the eligible professional needs to submit to CMS for purposes of reporting the 2010 electronic prescribing measure. The time needed for an EHR vendor to review the measure and other information and program each qualified EHR product to enable eligible professionals to submit data on the measure to the CMS- designated clinical data warehouse will be dependent on the EHR vendor's familiarity with the electronic prescribing measure, the vendor's system capabilities, as well as the vendor's programming capabilities. Since only EHR products qualified for the 2010 PQRI would be qualified for the 2010 E-Prescribing Incentive Program and the E-Prescribing Incentive Program consists of only one measure, we believe that any burden associated with the EHR vendor to program its product(s) to enable eligible professionals to submit data on the electronic prescribing measure to the CMS-designated clinical data warehouse would be minimal.With respect to the proposed process for group practices to be treated as successful e-prescribers under the 2010 E-PrescribingIncentive Program discussed in section II.G.5.e. of this proposed rule, a group practice would be required to report the electronic prescribing measure in at least 2500 instances. Group practices have the same options as individual eligible professionals in terms of the form and manner for reporting the electronic prescribing measure (that is, group practices have the option of reporting the measure through claims, a qualified registry, or a qualified EHR product). The only difference between an individual eligible professional and group practice reporting of the electronic prescribing measure is the number of times a group practice is required to report the electronic prescribing measure. For group practices who are selected to participate in the 2010 E-Prescribing Incentive Program group practice reporting option and choose to do so through claims-based reporting of the electronic prescribing measure, we estimate the total annual estimated cost per group practice to be $2,305 [($0.90 per measure x 1 measure x 2500 cases per measure) + $55].For group practices who are selected to participate in the 2010 E-Prescribing Incentive Program group practice reporting option and choose to do so through registry-based reporting of the electronic prescribing measure, we do not anticipate any additional burden to report data to a registry as group practices opting for registry-based reporting would more than likely already be reporting data to the registry. Little, if any, additional data would need to be reported to the registry for purposes of participation in the 2010 E-PrescribingIncentive Program. However, group practices would need to authorize or instruct the registry to submit quality measures results and numerator and denominator data on the electronic prescribing measure to CMS on their behalf. We estimate that the time and effort associated with this would be approximately 5 minutes for each group practice that wishes to authorize or instruct the registry to submit quality measures results and numerator and denominator data on the electronic prescribing measure to CMS on their behalf.For group practices who are selected to participate in the 2010 E-Prescribing Incentive Program group practice reporting option and choose to do so through EHR-based reporting of the electronic prescribing measure, once the EHR is programmed by the vendor to allow data submission to CMS, the burden to the group practice associated with submission of data on the electronic prescribing measure should be minimal.In addition to the burden associated with group practices reporting the electronic prescribing measure, group practices would also be required to self-nominate in order to participate in the 2010 E-Prescribing Incentive Program under the group practice reporting option. Since we propose to limit participation in the E-PrescribingIncentive Program group practice reporting option to those group practices selected to participate in the PQRI group practice reporting option, there would be no additional burden associated with the group practice self-nomination process for the E-Prescribing IncentiveProgram. 5. Section 135: Implementation of Accreditation Standards for SuppliersFurnishing the Technical Component (TC) of Advanced Diagnostic ImagingServices.As discussed in section II.G.6. of this proposed rule, suppliers that provide the TC of advanced diagnostic imaging services will have to be accredited by an approved accreditation organization in order to receive Medicare reimbursement for advanced diagnostic imaging services described in section 1848(b)(4)(B) furnished to beneficiaries. This section of the rule will impact the suppliers that provide the TC of advanced diagnostic imaging services and the organizations that accredit suppliers of such services. Suppliers that provide the TC of advanced diagnostic imaging services will incur costs for becoming accredited. Accreditation organizations will incur costs to accredit suppliers. To estimate the impact on suppliers, we calculate the total cost of accreditation as the sum of accreditation fees and other accreditation costs, and we multiply this cost by the number of providers of care requiring accreditation.Factors Affecting the Cost ImpactAccording to CMS' Services Tracking and Reporting System (STARS) database for 2008, there are a total of 1,137,278 physicians, IDTFs, hospitals and others billing Part B for the TC of advanced diagnostic imaging. This total includes both suppliers and providers that furnish items under Medicare Part B as suppliers.Currently, there are suppliers accredited by one of three of the nationally recognized accreditation. We anticipate that the following accreditation organizations will seek approval from CMS to accredit suppliers that provide the TC of advanced diagnostic imaging services:American College of Radiology;Intersocietal Accreditation Commission; andThe Joint Commission.Accreditation FeesFees vary between accreditation organizations and, in general, currently cover all of the following items: Application fee, manuals, initial accreditation fee, onsite surveys or other auditing (generally once every 3 years), and travel, when necessary for survey personnel.Accreditation costs also vary by the size of the supplier seeking accreditation, its number of locations, and the number of services it provides. Because of these factors, it is sometimes difficult to compare fees across accreditation organizations. We obtained information on total accreditation fees from the three accreditation organizations that currently accredit suppliers who provide the TC of advanced diagnostic imaging services. Based on all information we obtained, we estimate accreditation fees for each review cycle will be approximately $ 5,000 for an advanced diagnostic imaging supplier.Because accreditation is for a 3-year period, the estimated average cost per year would be approximately $1,666.
Page 33668We recognize that becoming accredited may impose a burden on suppliers that provide the TC of advanced diagnostic imaging services, especially small suppliers. We have attempted to minimize that burden.We have implemented the following options to minimize the burden of accreditation on suppliers, including small businesses:Multiple accreditation organizations: We expect that more than one accrediting organization will apply to become and be designated as an advanced diagnostic imaging accrediting organization.We believe that selection of more than one accreditation organization will introduce competition resulting in reductions in accreditation costs.Required plan for small businesses: During the application process we will require accreditation organizations to include a plan that details their methodology to reduce accreditation fees and burden for small or specialty suppliers. This will need to include that the accreditation organization's fees are based on the size of the organization.Reasonable quality standards: The quality standards that will be used to evaluate the services rendered for each imaging modality are industry standards. Many suppliers that provide the TC of advanced diagnostic imaging services already comply with the standards and have incorporated these practices into their daily operations. We have been told that that those suppliers with private insurance contracts must be accredited, thus our requirements would not be duplicative. It is our belief and has been stated by those suppliers already accredited that compliance with the quality standards will result in more efficient and effective business practices and will assist suppliers in reducing overall costs.Other Accreditation CostsIt is difficult to precisely estimate the costs of preparing for accreditation. We do recognize there is cost to the supplier in order to come into compliance initially and thus prepare for the accreditation survey. This should result in minimal preparation and cost.Additional ConsiderationsThere are at least two important sources of uncertainty in estimating the impact of accreditation on suppliers that provide the TC of advanced diagnostic imaging services. First, our estimates assume that all current suppliers with positive Medicare payments will seek accreditation. We assume that suppliers who currently receive noMedicare allowed charges will choose not to seek accreditation. It is also possible that many of the suppliers with allowed charges between$1 and $10,000 may decide not to incur the costs of accreditation.Second, it is unclear what accreditation fees will be in the future. However, we are requiring the accreditation organization to submit their fees that are based on the size of the supplier, or on the amount billed. Our experience with another accreditation program has lead us to believe that the accreditation rates will go up, although minimally, if travel costs continue to rise.In summary, suppliers of the TC of advanced diagnostic imaging services for which payment is made under the fee schedule established under section 1848(b) of the Act must become accredited by an accreditation organization designated by the Secretary beginningJanuary 1, 2012. In the options we have proposed we have attempted to minimize the burden of accreditation on suppliers, which include approving multiple accreditation organizations that consider the small suppliers. Also, the fact that the surveys will be either performed as a desk review or unannounced deletes the time and cost for the accreditation organization in travel, if required. 6. Section 139: Improvements for Medicare Anesthesia Teaching ProgramsAs discussed in section II.G.7., this proposed rule would provide for increased payments under the Medicare PFS for certain cases involving teaching anesthesiologists with anesthesia residents or for teaching CRNAs with student nurse anesthetists. This provision of theMIPPA is anticipated to have a minimal budgetary impact. 7. Section 144(a): Payment and Coverage Improvements for Patients WithChronic Obstructive Pulmonary Disease and Other Conditions: CardiacRehabilitation ServicesCurrent levels of coverage for CR programs will continue under this rule, and new ICR programs will likely develop and request designation by CMS to receive Medicare payments. Because section 144(a) of theMIPPA requires higher payments for ICR programs than for CR programs, this expansion of coverage will result in greater costs to the Medicare program. The requirements for ICR programs, also required in section 144(a) of the MIPPA, are extensive and will likely limit the number of programs that request designation as ICR programs by CMS. As a result, significantly fewer ICR programs than CR programs will function throughout the country; however, we currently do not know how many ICR programs may request designation.We believe that the proposed expansion of coverage for ICR programs will enable beneficiaries to take advantage of more focused and rigorous programs that will more quickly lead to improved cardiovascular health. Having the choice of CR and ICR programs, beneficiaries eligible for coverage will be able to determine the best manner in which to achieve improved cardiovascular health, through traditional CR or more rigorous ICR programs. We also expect this proposed expansion of coverage to bring more attention to the importance of cardiac rehabilitation and the extensive benefits these programs provide to beneficiaries. As a result, the number of beneficiaries participating in CR programs may increase. We estimate that the proposed provisions for establishing coverage of cardiac rehabilitation and intensive cardiac rehabilitation programs, as discussed in section II.G.8. of this proposed rule, will have a minimal budgetary impact on the Medicare program. 8. Section 144(a): Payment and Coverage Improvements for Patients WithChronic Obstructive Pulmonary Disease and Other Conditions: PulmonaryRehabilitation ServicesAs discussed in section II.G.9. of this proposed rule, the implementation of the Medicare pulmonary rehabilitation program will allow Medicare, for the first time, to provide for payment for exercise and other services as part of a comprehensive treatment plan for beneficiaries with moderate to severe COPD. We believe this program has the potential of not only improving the quality of life for beneficiaries who engage in it, but also reducing Medicare costs in the long range by decreasing the chances of exacerbations and further rehabilitation related to their chronic respiratory disease. We estimate this provision will have a minimal budgetary impact on theMedicare program. 9. Section 152(b): Coverage of Kidney Disease Patient EducationServicesThe implementation of Medicare coverage of kidney disease patient education services as discussed in section II.G.10. of this proposed rule will allow Medicare to provide for payment for kidney disease education services for beneficiaries with Stage IV chronic kidney disease. We believe this program can help patients achieve better
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pp. 33669-33718Medicare Program; Payment Policies Under the Physician FeeSchedule and Other Revisions to Part B for CY 2010
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Page 33669understanding of their illness, dialysis modality options, and may help delay the need for dialysis. We believe this program has the potential of improving the quality of life for beneficiaries since they will be better equipped to make informed decisions. We estimate a cost to theMedicare program of approximately $10 million for CY 2010, because the statute limits the number of kidney disease education sessions to 6, as a lifetime maximum. 10. Section 153: Renal Dialysis ProvisionsA discussion of the impact of section 153 of the MIPPA is addressed in section V.F. of this regulatory impact analysis in conjunction with the other ESRD provisions of this rule. 11. Section 182(b): Revision of Definition of Medically-AcceptedIndication for Drugs; Compendia for Determination of Medically-AcceptedIndications for Off-Label Uses of Drugs and Biologicals in an Anti-Cancer Chemotherapeutic RegimenWe anticipate that the proposals related to the compendia discussed in section II.G.12. of this proposed rule will have a negligible cost to the Medicare program and to the public. The information that is required to be collected and published on the compendia Web sites is information that is already collected in the normal course of business by the compendia publishers, which all have Web sites. The proposed changes will enable CMS to efficiently implement the provisions of section 182(b) of the MIPPA that require transparent evaluative and conflict of interest policies and practices for current and future listed compendia on and after January 1, 2010.E. Payment for Covered Outpatient Drugs and Biologicals 1. Average Sales Price (ASP) IssuesThe proposed changes discussed in section II.F.1. of this proposed rule with respect to payment for covered outpatient drugs and biologicals, are estimated to have no impact on Medicare expenditures as we are not proposing any change to the AMP/WAMP threshold and the proposed change concerning the immunosuppressive drug period of eligibility is a comforming change to reflect the statute. 2. Competitive Acquisition Program (CAP) IssuesAs discussed in section II.F.2., this proposed rule contains proposals and seeks comment on certain aspects of the CAP, specifically the frequency of drug payment amount updates, changes to the CAP drug list, the geographic area served by the CAP, CAP drug stock at the physician's office, exclusion of CAP sales from ASP calculations, the annual CAP payment amount update mechanism, and updates to proposals made in the 2009 PFS rule. Our changes and refinements may improve compliance, promote program flexibility, improve the quality, and maintain the availability of services for participating CAP physicians.We anticipate that these changes associated with the CAP will not result in significant additional cost savings or increases relative to the ASP payment system for two reasons. First, in 2006 through 2008, the dollar volume of claims paid under the CAP was small compared to the volume of claims paid under section 1847A of the Act, and although we anticipate that the CAP will continue to grow, we do not anticipate a significant change in the proportion of claims paid under these payment systems. Second, because CAP payment amounts are limited to prices calculated under section 1847A of the Act, we expect payment rates for the two programs to remain very similar.F. Provisions Related to Payment for Renal Dialysis Services Furnished by End-Stage Renal Disease (ESRD) FacilitiesThe ESRD-related provisions are discussed in sections II.G.11. andII.I. of this proposed rule. To understand the impact of the changes affecting payments to different categories of ESRD facilities, it is necessary to compare estimated payments under the current year (CY 2009 payments) to estimated payments under the revisions to the composite rate payment system (CY 2010 payments) as discussed in section II.I. of this proposed rule. To estimate the impact among various classes ofESRD facilities, it is imperative that the estimates of current payments and estimates of proposed payments contain similar inputs.Therefore, we simulated payments only for those ESRD facilities that we are able to calculate both current 2009 payments and proposed 2010 payments.ESRD providers were grouped into the categories based on characteristics provided in the Online Survey and Certification andReporting (OSCAR) file and the most recent cost report data from theHealthcare Cost Report Information System (HCRIS). We also used theDecember 2008 update of CY 2008 National Claims History file as a basis for Medicare dialysis treatments and separately billable drugs and biologicals. Since the December 2008 update of the CY 2008 NationalClaims History File is incomplete, we updated the data. The description of the updates for the separately billable drugs is described in section II.I. of this proposed rule. To update the treatment counts we used the ratio of the June 2008 to the December 2007 updates of the CY 2007 National Claims History File figure for treatments. This was an increase of 11.3 percent. Due to data limitations, we are unable to estimate current and proposed payments for 57 of the 5048 ESRD facilities that bill for ESRD dialysis treatments.Table 42 shows the impact of this year's proposed changes to CY 2010 payments to hospital-based and independent ESRD facilities. The first column of Table 42 identifies the type of ESRD provider, the second column indicates the number of ESRD facilities for each type, and the third column indicates the number of dialysis treatments.The fourth column shows the effect of all proposed changes to theESRD wage index for CY 2010 as it affects the composite rate payments to ESRD facilities. The fourth column compares aggregate ESRD wage adjusted composite rate payments in CY 2010 to aggregate ESRD wage adjusted composite rate payments in CY 2009. In CY 2009, ESRD facilities receive 100 percent of the CBSA wage adjusted composite rate and 0 percent of the MSA wage adjusted composite rate, ending a 4-year transition period in which they had received an increasing percent of payments based on the CBSA wage adjusted composite rate. The overall effect to all ESRD providers in aggregate is zero because the CY 2010ESRD wage index has been multiplied by a Budget Neutrality adjustment factor to comply with the statutory requirement that any wage index revisions be done in a manner that results in the same aggregate amount of expenditures as would have been made without any changes in the wage index.The fifth column shows the effect of proposed changes to the ESRD wage index in CY 2010 and the effect of the MIPPA provisions on ESRD facilities. Section 153(a) of the MIPPA amended section 1881(b)(12)(G) of the Act to revise payments to ESRD facilities. Effective January 1, 2010, there is an update of 1 percent to the composite rate component of the payment system.The sixth column shows the overall effect of the proposed changes in composite rate payments to ESRD providers including the drug add-on.The overall effect is measured as the difference between the proposedCY 2010 payment with all changes as
Page 33670proposed in this rule and current CY 2009 payment. This payment amount is computed by multiplying the wage adjusted composite rate with the drug add-on for each provider times the number of dialysis treatments from the CY 2008 claims. The CY 2010 proposed payment is the composite rate for each provider (with the proposed 15.0 percent drug add-on) times dialysis treatments from CY 2008 claims. The CY 2009 current payment is the composite rate for each provider (with the current 15.2 percent drug add-on) times dialysis treatments from CY 2008 claims.The overall impact to ESRD providers in aggregate is 0.8 percent as shown in Table 42. Most ESRD facilities will see an increase in payments as a result of the MIPPA provision. While the MIPPA provision includes a 1 percent increase to the ESRD composite rate, this 1 percent increase does not apply to the drug add-on to the composite rate. For this reason, the impact of all changes in this proposed rule is a 0.8 percent increase for all ESRD providers. Overall, payments to independent ESRD facilities will increase by 0.8 percent and payments to hospital-based ESRD facilities will increase by 1.0 percent.Table 42--Impact of CY 2010 Changes in Payments to Hospital Based and Independent ESRD Facilities
Percent change in composite rate payments to ESRD facilitiesEffect ofNumber ofEffect ofchanges inOverall effectNumber ofdialysischanges in wage index and of wage index facilitiestreatments wage index \1\of MIPPAMIPPA & drug(in millions)(percent)provision \2\ add-on \3\(percent)(percent)123456All Providers...................4,99137.10.01.00.8Independent.................4,43233.50.01.00.8Hospital Based..............5593.60.21.21.0By Facility Size:Less than 5,000 treatments..1,8075.30.11.10.9 5,000 to 9,999 treatments...1,99814.60.01.00.9Greater than 9,9991,18617.2-0.10.90.8 treatments.................Type of Ownership:Profit......................4,06230.50.01.00.8Nonprofit...................9296.50.11.10.9By Geographic Location:Rural.......................1,0936.00.21.21.0Urban.......................3,89831.00.01.00.8By Region:New England.................1561.30.31.31.1Middle Atlantic.............5714.6-0.20.80.6East North Central..........8085.8-0.10.90.7West North Central..........3822.00.31.31.1South Atlantic..............1,1298.50.11.10.9East South Central..........3882.80.21.21.0West South Central..........6795.30.01.00.8Mountain....................2791.60.91.91.7Pacific.....................5624.8-0.10.90.7Puerto Rico & Virgin Islands370.4-2.4-1.4-1.6\1\ This column shows the overall effect of wage index changes on ESRD providers. Composite rate payments are computed using the proposed CY 2010 wage indexes which are compared to composite rate payments using the current CY 2009 wage indexes.\2\ This column shows the effect of the changes in the Wage Indexes and the MIPPA provision which includes a 1 percent increase to the composite rate. This provision is effective January 1, 2010.\3\ This column shows the percent change between CY 2010 and CY 2009 composite rate payments to ESRD facilities.The CY 2010 payments include the CY 2010 wage adjusted composite rate, a 1 percent increase due to MIPPA effective January 1, 2010 and the drug add-on of 15.0 percent. The CY 2009 payments include the CY 2009 wage adjusted composite rate, a 1 percent increase and site neutral rates effective January 1, 2009 and the drug add-on of 15.2 percent. This column shows the effect of wage index, MIPPA, and drug add-on changes.G. Chiropractic Demonstration--Application of Budget NeutralityAs discussed in section II.J. of this proposed rule, we are proposing to recoup the $50 million in expenditures from this demonstration over a 5-year period rather than over a 2-year period. We would recoup $10 million each year through adjustments to the PFS for all chiropractors in CYs 2010 through 2014.To implement this required BN adjustment, we would reduce the payment amount under the PFS for the chiropractic CPT codes (that is,CPT codes 98940, 98941, and 98942) by 2 percent.H. Comprehensive Outpatient Rehabilitation Facilities (CORF) andRehabilitation Agency IssuesThe revisions to the conditions of participation (CoP) discussed in section II.K. of this proposed rule make technical corrections and update the regulations to reflect current industry standards for respiratory therapists. The revisions to the regulations will clarify the qualifications necessary for respiratory therapists' to continue to qualify to furnish respiratory therapy services to CORF patients. These changes are similar to prior rules and will have no impact on CORFs cost.I. Physician Self-Referral ProvisionsAs discussed in section II.N. of this proposed rule, we expect that our proposed clarification of the physician stand in the shoes provisions will assist designated health services entities in structuring legitimate compensation arrangements. Furthermore, like other physician self-referral policies, we anticipate that this clarification will
Page 33671result in savings to the Medicare program by reducing overutilization and anti-competitive business arrangements. We cannot gauge with any certainty the extent of these savings to the program.K. Durable Medical Equipment Related Issues 1. Damages ProcessIn section II.O.1. of this proposed rule, we propose to establish a one-time process that will only impact those suppliers who were awarded a contract and were potentially damaged by the termination of their supplier contracts by MIPPA. The DMEPOS Competitive Bidding Program that was implemented on July 1st, 2008, awarded contracts to 329 suppliers. The following factors may be considered by a contract supplier before deciding to submit a claim:The contract itself stipulated that the contract is subject to any changes to the statute or regulations that affect theMedicare program;The contract does not guarantee any amount of business or profits, therefore, an efficient business would not be expected to incur large expenses without any guaranteed increase in business and profits;The contract stipulates that CMS shall not pay for any expenses incurred by the supplier for the work performed under the contract other than for payment of Medicare claims authorized pursuant to the contract;Upon termination of the contracts by MIPPA, payments reverted back to the fee schedule amount, which was on average 26 percent higher than under the DMEPOS Competitive Bidding Program.There is a required responsibility under contract law for a company to take action to mitigate expenses to any stop work order.CMS listed the winning suppliers on the Medicare Web site at http://www.Medicare.gov in the supplier locator tool, a supplier is allowed to keep any new customers they may have obtained as a result of being listed on the supplier locator tool.By mentioning the list above, we are not suggesting that there would not be legitimate claims for damages. However, these are factors that a supplier may consider when deciding whether to submit a claim for damages.Based on these reasons and because there have been so few inquiries or responses to the reference in the MIPPA to damages (fewer than 7 suppliers), we believe that as few as 1 percent of the 329 winning suppliers may make a claim for damages. However, as a high estimate, we would estimate that approximately 76 percent of the suppliers (250) may submit a claim. We anticipate that it will take approximately 3 hours at $34/hour (3 x $34 = $102) for an accountant and a company official to review and gather the necessary documents to file a claim for a total of $25,500 (250 x $102). The hourly accountant rate was based on the Bureau of Labor Statistics data collected for June 2006 which was then adjusted to account for inflation. We estimate that this regulation will not have a large budgetary impact. The total cost range of $408 to $25,500 for potential claims from contract suppliers will not result in expenditures of $133 million or more annually. An analysis of the damage payments that may result would be dependent upon an evaluation of the actual claims once they are received. 2. Grandfathering ProcessIn section II.O.2. of this proposed rule, we are proposing to revise the definition of a grandfathered item to refer to all rented items within a competitively bid product category that the supplier currently rents. The proposed definition of a grandfathered item would avoid confusion, on the part of beneficiaries, regarding rented DME items for which a noncontract supplier is willing or not willing to be a grandfathered supplier. Under the revised definition, a noncontract supplier would have to choose to be either a grandfathered supplier for all or for none of the DME rented items within a product category that the supplier currently provides. We believe that it would be easier for beneficiaries to recognize which items a supplier is grandfathering or not grandfathering if the supplier's election concerning grandfathering was made by product category rather than making separate choices for each individual HCPCS code.We also believe the revision of this definition would have a negligible impact on suppliers as product categories consist of related items routinely provided by suppliers. We are only requiring a supplier to provide those rented items within a product category that the supplier was currently furnishing at the start of the competitive bidding program.While difficult to estimate, we believe that based on 2008 data, there were approximately 1,850 suppliers in the 9 CBAs, for which we will be doing the Round 1 rebid that rented competitively bid items, on average at different points in time during 2008. Therefore, we are using this number to indicate how many suppliers would be renting a DME competitively bid item at the start of the competitive bid program. We believe some suppliers may decide not to bid because of the cost of bidding and accreditation requirements while other suppliers may not qualify for a contract. Since not all suppliers will be awarded contracts and some may not choose to submit a bid, we estimate that in the worst case scenario there will be 1,450 suppliers that will not be awarded contracts, would be renting DME competitive bid items at the time the program is implemented.Based on our experience from the competitive bidding demonstrations, of the 1,450 suppliers who are not awarded a contract, we expect 90 percent or 1,305 of these noncontract suppliers will offer to be grandfathered suppliers (0.90 x 1,450 = 1,305) and 10 percent or 145 (0.10 x 1,450 = 145) of the suppliers will choose not to grandfather. We believe most suppliers will not want to pick up their items before the end of the full rental period.Based on 2008 data, we estimate that there will be 96,000 beneficiaries who reside in a CBA and are renting competitively bid items from suppliers at the start of the round 1 rebid. Based on the 2007 round 1 of the competitive bidding program, we estimate that there would be 74,880 (96,000 x 0.78 = 74,880) beneficiaries who would be renting items from a noncontract supplier.Notification Requirement for Suppliers That Choose to Grandfather a. Notification to CMSFor those suppliers that choose to grandfather (1,305), we estimate that it would take the supplier on average 2 hours to develop the 30- day notification that it is required to send to CMS. We estimate that the cost to the supplier to develop the 30-day notification to CMS would be $89.60 for skilled administrative staff (2 hours x $44.80 per hour). The $44.80 is based on 2009 data from the Bureau of LaborStatistics plus an increase for overhead of 40 percent. We estimate that the cost to the supplier to send the notification to CMS would be$5.51 for clerical staff (0.25 hour to send the notification x $22.02 per hour = $5.51). The $22.02 is based on 2009 data from the Bureau ofLabor Statistics plus an increase for overhead of 40 percent. We estimate the cost of supplies necessary to send the notification would be $2.00. The total cost for sending the notification would be $7.51 which includes the cost of clerical staff ($5.51) and supplies ($2.00).The individual costs for all suppliers to notify CMS would be
Page 33672$97.11 ($89.60 for development of the letter + $7.51 for preparing and sending each notification = $97.11). The overall cost for suppliers to notify CMS would be approximately $126,728.55 ($97.11 per supplier x 1,305 suppliers = $126,728.55). b. Notification to the BeneficiaryWe estimate based on 2008 data, we expect that there will be 74,880 beneficiaries who would have been renting competitive bid items from a noncontract supplier at the start of the round 1 rebid of the CBP. Of the 74,880, we believe that approximately 100 percent of these beneficiaries will accept the offer to continue to rent competitively bid items from the noncontract supplier that offers to be a grandfathered supplier. We believe that the beneficiaries will choose to continue to rent from a grandfathered supplier if given the choice because it would be more convenient, assure continuity of care, and eliminate the need to have equipment taken from their home.Based upon the number of suppliers and beneficiaries, we estimate that there would be an average of 52 beneficiaries per supplier that was not awarded a contract (74,880 beneficiaries/1,450 suppliers = 52).Therefore, we estimate that each noncontract supplier that chooses to grandfather would send the 30-day notification on average to 52 beneficiaries.We expect that the cost of developing the 30-day notification to a beneficiary would be equivalent to the cost of developing the 30-day notification to CMS ($89.60 per notification). We also expect the cost of sending the 30-day notification per beneficiary to be equivalent to sending the 30-day notification to CMS ($7.51 per notification). The total costs for the 30-day notification to beneficiaries for suppliers that choose the grandfathering option would be $89.60 for development of the letter, and $7.51 for preparing and sending each notification.To calculate the total cost we multiplied $7.51 x 52 beneficiaries and added the development cost for the letter of $89.60 for a total of$480.12 per supplier. The overall cost for these suppliers to provide the 30-day notification to their beneficiaries would be approximately$626,556.60 ($480.12 per supplier x 1,305 suppliers = $626,556.60).Notification Requirement for Suppliers That Choose Not to Grandfather a. 30-Day Notification to the BeneficiaryWe expect that suppliers who choose not to grandfather will incur costs equivalent to the cost of developing and sending the 30-day notification to a beneficiary by those suppliers that choose to grandfather. The overall cost for all suppliers who choose not to grandfather to provide the 30-day notification to the beneficiary is approximately $69,617.40 ($480.12 total cost per supplier x 145 non- grandfathered suppliers = $69,617.40). The estimate of 145 suppliers not choosing to be grandfathered suppliers represents 10 percent of the total number of noncontract suppliers.While the cost for the 30-day notification to beneficiaries will be exactly the same for all suppliers, those who choose not to become a grandfathered supplier will also incur the cost of the 10-day and 2-day notification. b. 10-Day and 2-Day NotificationFor the 10-day notification to a beneficiary, we estimate the supplier would make at least 1 phone call that would take an average of 15 minutes to discuss that the beneficiary must switch to a contract supplier, the schedule for picking up the current equipment by the noncontract supplier, and the delivery of new equipment by the contract supplier. For the 2-day notification to the beneficiary, we estimate that the supplier would make at least 1 phone call that would take an average of 15 minutes to ensure that all of the arrangements are finalized and to answer any last minute questions. We anticipate that clerical staff would perform both of these tasks.The estimated cost of the 10-day notification totals $5.51 (.25 of an hour x $22.02 per hour for clerical staff based on the 2009 Bureau of Labor Statistics including overhead = $5.51). The estimated cost of the 2-day notification totals $5.51 (.25 of an hour x $22.02 per hour for clerical staff based on the 2009 Bureau of Labor Statistics including overhead = $5.51). Therefore, the 10-day and 2-day notifications for each supplier would cost approximately $11.02. The total cost for each supplier would be approximately $573.04 ($11.02 x 52 beneficiaries = $573.04). The overall impact for all suppliers to make the 10-day and 2-day notifications would be approximately$83,090.80 (145 suppliers x $573.04 per supplier = $83,090.80).We anticipate that this proposed process will not place a greater burden on the overall small supplier community. This process is only going to affect those small suppliers that were renting items when the competitive bidding program begins and who did not win a contract. The burden on these suppliers would generally be less because small suppliers will have fewer beneficiaries to furnish notifications to.As an alternative, we considered relying on suppliers to develop their own schedule for informing beneficiaries regarding grandfathering. This alternative would have left the beneficiaries vulnerable to having equipment removed from the home before new equipment was delivered. The process proposed in this regulation ensures the beneficiaries can make an informed decision about the transition policy that works best for them. The alternative we selected ensures the beneficiaries will have continued access to medically necessary items and be properly informed about the steps they must take so that their services will not be interrupted.U. Alternatives ConsideredThis proposed rule contains a range of policies, including some provisions related to specific MIPPA provisions. The preceding preamble provides descriptions of the statutory provisions that are addressed, identifies those policies when discretion has been exercised, responds to comments on our proposals, presents rationale for our decisions and, where relevant, alternatives that were considered.V. Impact on BeneficiariesThere are a number of changes in this proposed rule that would have an effect on beneficiaries. In general, we believe these changes, including the refinements of the PQRI with its focus on measuring, submitting, and analyzing quality data, the coding provisions related to the IPPE and consultation services, the changes with respect to telehealth services, the kidney disease patient education, pulmonary rehabilitation and intensive cardiac rehabilitation proposals will have a positive impact and improve the quality and value of care provided toMedicare beneficiaries. Additionally, the proposed grandfathering process for DME suppliers will help ensure that beneficiaries are contacted and informed about this process and the choices they have concerning whether or not to use a grandfathered supplier. Moreover, the notice will help to ensure that beneficiaries do not have necessaryDME equipment taken from them unexpectedly by a noncontact supplier.As explained in more detail subsequently in this section, the regulatory provisions may affect beneficiary liability in some cases.Most changes aggregate in beneficiary liability due to a particular provision would be a function of the coinsurance (20 percent if applicable for the particular
Page 33673provision after the beneficiary has met the deductible). Beneficiary liability would also be impacted by the effect of the aggregate cost(savings) of the provision on the standard calculation of the MedicarePart B premium rate (generally 25 percent of the provision's cost or savings). In 2010, total cost sharing (coinsurance and deductible) perPart B enrollee associated with PFS services is estimated to be $399.In addition, the portion of the 2010 standard monthly Part B premium attributable to PFS services is estimated to be $25.00.To illustrate this point, as shown in Table 39, the 2009 national payment amount in the nonfacility setting for CPT code 99203 (Office/ outpatient visit, new), is $91.97 which means that in 2009 a beneficiary is responsible for 20 percent of this amount, or $18.39.Based on this rule, the 2010 national payment amount in the nonfacility setting for CPT code 99203, as shown in Table 39, is $81.00 which means that, in 2010, the beneficiary coinsurance for this service would be$16.20.Policies discussed in this rule, such as the coding changes with respect to the RVUs for IPPE and the changes to consultation services, would similarly impact beneficiaries' coinsurance.W. Accounting StatementAs required by OMB Circular A-4 (available at http:// www.whitehouse.gov/omb/circulars/a004/a-4.pdf), in Table 43, we have prepared an accounting statement showing the classification of the expenditures associated with this proposed rule. This estimate includes the incurred benefit impact associated with the estimated CY 2010 PFS update based on the 2009 Trustees Report baseline, as well as certainMIPPA provisions. All estimated impacts are classified as transfers.Table 43--Accounting Statement: Classification of Estimated ExpendituresCY 2010CategoryTransfersAnnualized MonetizedEstimated decrease in expenditures (fromTransfers.CY 2009 to CY 2010) of $13.3 Billion.From Whom To Whom?........... Federal Government to physicians, other practitioners and providers and suppliers who receive payment underMedicare.Annualized MonetizedEstimated increase in expenditures ofTransfers.$110 Million for MIPPA Provisions(sections 102 and 152(b)).From Whom To Whom?........... Federal Government to providers.In accordance with the provisions of Executive Order 12866, this proposed rule was reviewed by the Office of Management and Budget.List of Subjects 42 CFR Part 410Health facilities, Health professions, Kidney diseases,Laboratories, Medicare, Reporting and recordkeeping requirements, Rural areas, X-rays. 42 CFR Part 411Kidney diseases, Medicare, Physician Referral, Reporting and record keeping requirements. 42 CFR Part 414Administrative practice and procedure, Health facilities, Health professions, Kidney diseases, Medicare, Reporting and recordkeeping. 42 CFR Part 415Health facilities, Health professions, Medicare, Reporting and recordkeeping requirements. 42 CFR Part 485Grant programs--health, Health facilities, Medicaid, Medicare,Reporting and recordkeeping requirements.For the reasons set forth in the preamble, the Centers for Medicare& Medicaid Services would amend 42 CFR chapter IV as set forth below:PART 410--SUPPLEMENTARY MEDICAL INSURANCE (SMI) BENEFITS 1. The authority citation for part 410 continues to read:Authority: Secs. 1102, 1834, 1871, and 1893 of the SocialSecurity Act (42 U.S.C. 1302, 1395m, 1395hh, and 1395ddd).Subpart B--Medical and Other Health Services 2. Section 410.30 is amended by revising paragraph (b) to read as follows:Sec. 410.30 Prescription drugs used in immunosuppressive therapy.* * * * *(b) Eligibility. For drugs furnished on or after December 21, 2000, coverage is available only for prescription drugs used in immunosuppressive therapy, furnished to an individual who received an organ or tissue transplant for which Medicare payment is made, provided the individual is eligible to receive Medicare Part B benefits.* * * * * 3. Section 410.47 is added to read as follows:Sec. 410.47 Pulmonary rehabilitation program: Conditions for coverage.(a) Definitions.Individualized treatment plan means a written plan established, reviewed, and signed by a physician every 30 days, that describes all of the following:(i) The individual's diagnosis.(ii) The type, amount, frequency, and duration of the items and services under the plan.(iii) The goals set for the individual under the plan.Outcomes assessment means a written evaluation of the patient's progress as it relates to the individual's rehabilitation which includes the following:(i) Beginning and end evaluations, based on patient-centered outcomes, which are conducted by the physician at the start and end of the program.(ii) Objective clinical measures of effectiveness of the PR program for the individual patient, including exercise performance and self- reported measures of shortness of breath and behavior.Physician means a doctor of medicine or osteopathy as defined in section 1861(r)(1) of the Act.Physician-prescribed exercise means physical activity, including aerobic exercise, prescribed and supervised by a physician that improves or maintains an individual's pulmonary functional level.Psychosocial assessment means a written evaluation of an individual's mental and emotional functioning as it relates to the individual's rehabilitation or respiratory condition.Pulmonary rehabilitation means a physician-supervised program forCOPD and certain other chronic respiratory diseases designed to optimize physical and social performance and autonomy.(b) Beneficiaries who may be covered. (1) Medicare covers pulmonary rehabilitation for beneficiaries with moderate to severe COPD (defined as
Page 33674GOLD classification II and III), when referred by the physician treating the chronic respiratory disease.(2) Additional medical indications for coverage for pulmonary rehabilitation program services may be established through a national coverage determination (NCD).(c) Components. Pulmonary rehabilitation includes all of the following components:(1) Physician-prescribed exercise. This physical activity includes techniques such as exercise conditioning, breathing retraining, step and strengthening exercises. Some aerobic exercise must be included in each pulmonary rehabilitation session.(2) Education or training. (i) Education or training closely and clearly related to the individual's care and treatment which is tailored to the individual's needs.(ii) Education includes information on respiratory problem management and, if appropriate, brief smoking cessation counseling.(iii) Any education or training prescribed must assist in achievement of individual goals towards independence in activities of daily living, adaptation to limitations and improved quality of life.(3) Psychosocial assessment. The psychosocial assessment must meet the criteria as defined in paragraph (a) of this section and includes:(i) An assessment of those aspects of an individual's family and home situation that affects the individual's rehabilitation treatment.(ii) A psychosocial evaluation of the individual's response to and rate of progress under the treatment plan.(4) Outcomes assessment. The outcomes assessment must meet the criteria as defined in paragraph (a) of this section.(5) Individualized treatment plan. The individualized treatment plan must be established, reviewed, and signed by a physician every 30 days.(d) Settings. (1) Medicare Part B pays for a pulmonary rehabilitation in the following settings:(i) Physician's offices.(ii) Hospital outpatient settings.(2) All settings must have the following available for immediate use and accessible at all times:(i) The necessary cardio-pulmonary, emergency, diagnostic, and therapeutic life-saving equipment accepted by the medical community as medically necessary (for example, oxygen, cardiopulmonary resuscitation equipment, and defibrillator) to treat chronic respiratory disease.(ii) A physician must be immediately available and accessible for medical consultations and emergencies at all times when services are being provided under the program. This provision is satisfied if the physician meets the requirements for direct supervision for physician office services at Sec. 410.26(b)(5) of this subpart as described inSec. 410.26(a)(2) of this subpart (defined through cross references toSec. 410.32(b)(3)(ii) of this subpart); and for hospital outpatient services at Sec. 410.27(f) of this subpart.(e) Physician standards. Medicare Part B pays for pulmonary rehabilitation services provided by a physician only if the physician meets all of the following requirements:(1) Has expertise in the management of individuals with respiratory pathophysiology.(2) Is licensed to practice in the State in which the pulmonary rehabilitation program is offered.(3) Is responsible and accountable for the pulmonary rehabilitation program.(4) Is involved substantially in consultation with staff in directing the progress of the individual in the program.(f) Limitations on coverage: Sessions. Medicare Part B pays for services provided in connection with a pulmonary rehabilitation exercise program for up to 36 sessions, no more than one session per day.(g) Effective date. Coverage for pulmonary rehabilitation program services is effective January 1, 2010. 4. Section 410.48 is added to read as follows:Sec. 410.48 Kidney disease education services.(a) Definitions.Kidney disease patient education services means face-to-face educational services provided to patients with Stage IV chronic kidney disease.Physician means a physician as defined in section 1861(r)(1) of theAct.Qualified person means either of the following healthcare entities that meets the qualifications and requirements specified in this section to provide kidney disease patient education services--(i) One of the following healthcare professionals who furnishes services for which payment may be made under the physician fee schedule:(A) Physician (as defined in section 1861(r)(1) of the Act).(B) Physician assistant (as defined in section 1861(aa)(5) of theAct and Sec. 410.74 of this subpart).(C) Nurse practitioner (as defined in section 1861(aa)(5) of theAct and Sec. 410.75 of this subpart).(D) Clinical nurse specialist (as defined in section 1861(aa)(5) of the Act and Sec. 410.76 of this subpart),(ii)(A) Hospital, critical access hospital, skilled nursing facility, comprehensive outpatient rehabilitation facility, home health agency, or hospice that is located in a rural area as defined in Sec. 412.64(b)(ii)(C); or(B) A hospital or critical access hospital that is treated as being rural under Sec. 412.103 of this chapter.Renal dialysis facility means a unit which is approved to furnish dialysis service(s) directly to end-stage renal disease (ESRD) patients, as defined in Sec. 405.2102 of this chapter.Stage IV chronic kidney disease means kidney damage with a severe decrease in glomerular filtration rate (GFR) quantitatively defined by a GFR value of 15-29 ml/min/1.73m\2\, using the Modification of Diet inRenal Disease (MDRD) Study formula.(b) Covered beneficiaries. Medicare Part B covers outpatient kidney disease patient education services if the beneficiary meets all of the conditions and requirements of this subpart, including all of the following:(1) Is diagnosed with Stage IV chronic kidney disease.(2) Obtains a referral from the physician (as defined in section 1861(r)(1) of the Act) managing the beneficiary's kidney condition.(c) Qualified person. (1) Medicare Part B covers outpatient kidney disease patient education services provided by a qualified person as defined in paragraph (a) of this section and must be able to properly receive Medicare payment under part 424 of this chapter.(2) A qualified person does not include either of the following:(i) A hospital, critical access hospital, skilled nursing facility, comprehensive outpatient rehabilitation facility, home health agency or hospice if kidney disease patient education services are provided outside of a rural area as defined in Sec. 412.64(b)(ii)(C) of this chapter unless the services are furnished in a hospital or critical access hospital that is treated as being in a rural area under Sec. 412.103 of this chapter.(ii) A renal dialysis facility, as defined in Sec. 405.2102 of this chapter.(d) Standards for content of kidney disease patient education services. The content of the kidney disease patient education services includes the following:(1) The management of comorbidities including for the purpose of delaying the need for dialysis which includes, but not limited to, the following topics:
Page 33675(i) Prevention and treatment of cardiovascular disease.(ii) Prevention and treatment of diabetes.(iii) Hypertension management.(iv) Anemia management.(v) Bone disease and disorders of calcium and phosphorus metabolism management.(vi) Symptomatic neuropathy management.(vii) Impairments in functioning and well-being.(2) The prevention of uremic complications which includes, but not limited to, the following topics:(i) Information on how the kidneys work and what happens when the kidneys fail.(ii) Understanding if remaining kidney function can be protected, preventing disease progression, and realistic chances of survival.(iii) Diet and fluid restrictions.(iv) Medication review, including how each medication works, possible side effects and minimization of side effects, the importance of compliance, and informed decision-making if the patient decides not to take a specific drug.(3) Therapeutic options, treatment modalities and settings, including a discussion of the advantages and disadvantages of each treatment option and how the treatments replace the kidney:(i) Hemodialysis, both at home and in-facility.(ii) Peritoneal dialysis (PD), including intermittent PD, continuous ambulatory PD, and continuous cycling PD, both at home and in-facility.(iii) All vascular access options.(iv) Transplantation.(4) Opportunities for beneficiaries to actively participate in the choice of therapy and be tailored to meet the needs of the individual beneficiary involved which includes, but not limited to, the following topics:(i) Physical symptoms.(ii) Impact on family and social life.(iii) Exercise.(iv) The right to refuse treatment.(v) Impact on work and finances.(vi) The meaning of test results.(vii) Psychological impact.(5) Qualified persons must develop outcomes assessments designed to measure beneficiary knowledge about chronic kidney disease and its treatment.(i) The outcomes assessments serve to assess program effectiveness of preparing the beneficiary to make informed decisions about their healthcare options related to chronic kidney disease.(ii) The outcomes assessments serve to assess the program's effectiveness in meeting the communication needs of underserved populations, including persons with disabilities, persons with limitedEnglish proficiency, and persons with health literacy needs.(iii) The assessment must be administered to the beneficiary during a kidney disease education session.(iv) The outcomes assessments must be made available to CMS upon request.(e) Limitations for coverage of kidney disease education services.(1) Medicare Part B makes payment for up to 6 sessions of kidney disease patient education services.(2) A session is 60 minutes long and may be provided individually or in group settings of 2 to 20 individuals who need not all beMedicare beneficiaries.(f) Effective date. Medicare Part B covers kidney disease patient education services for dates of service on or after January 1, 2010. 5. Section 410.49 is added to read as follows:Sec. 410.49 Cardiac rehabilitation program and intensive cardiac rehabilitation program: Conditions of coverage.(a) Definitions.Cardiac rehabilitation (CR) means a physician-supervised program that furnishes physician prescribed exercise, cardiac risk factor modification, psychosocial assessment, and outcomes assessment.Individualized treatment plan means a written plan tailored to each individual patient that includes all of the following:(i) A description of the individual's diagnosis.(ii) The type, amount, frequency, and duration of the items and services furnished under the plan.(iii) The goals set for the individual under the plan.Intensive cardiac rehabilitation (ICR) means a physician-supervised program that furnishes cardiac rehabilitation and has shown, in peer- reviewed published research that it improves patients' cardiovascular disease through specific outcome measurements described in paragraph(c) of this section.Physician means a doctor of medicine or osteopathy as defined in section 1861(r)(1) of the Act.Outcomes assessment means an evaluation of progress as it relates to the individual's rehabilitation which includes all of the following:(i) Minimally, assessments from the commencement and conclusion of cardiac rehabilitation and intensive cardiac rehabilitation, based on patient-centered outcomes which must be measured by the physician immediately at the beginning of the program and at the end of the program.(ii) Objective clinical measures of exercise performance and self- reported measures of exertion and behavior.Physician-prescribed exercise means aerobic exercise combined with other types of exercise (that is, strengthening, stretching) as determined to be appropriate for individual patients by a physician.Psychosocial assessment means an evaluation of an individual's mental and emotional functioning as it relates to the individual's rehabilitation which includes an assessment of those aspects of an individual's family and home situation that affects the individual's rehabilitation treatment, and psychosocial evaluation of the individual's response to and rate of progress under the treatment plan.(b) General rule. (1) Covered beneficiary rehabilitation services.Medicare part B covers cardiac rehabilitation and intensive cardiac rehabilitation programs, as defined in this section, for beneficiaries who have experienced one or more of the following:(i) An acute myocardial infarction within the preceding 12 months.(ii) A coronary artery bypass surgery.(iii) Current stable angina pectoris.(iv) Heart valve repair or replacement.(v) Percutaneous transluminal coronary angioplasty (PTCA) or coronary stenting.(vi) A heart or heart-lung transplant.(vii) For cardiac rehabilitation only, other conditions as specified through a national coverage determination.(2) Components of a cardiac rehabilitation program. Cardiac rehabilitation programs must include all of the following:(i) Physician-prescribed exercise each day cardiac rehabilitation items and services are furnished.(ii) Cardiac risk factor modification, including education, counseling, and behavioral intervention, tailored to the patients' individual needs.(iii) Psychosocial assessment.(iv) Outcomes assessment.(v) An individualized treatment plan detailing how components are utilized for each patient.(3) Settings. (i) Medicare Part B pays for cardiac rehabilitation and intensive cardiac rehabilitation in one of the following settings:(A) A physician's office.(B) A hospital outpatient setting.(ii) All settings must have a physician, as defined in this section, immediately available and accessible for medical
Page 33676consultations and emergencies at all times when items and services are being furnished under the program. This provision is satisfied if the physician meets the requirements for direct supervision for physician office services at Sec. 410.26(b)(5) of this subpart as described inSec. 410.26(a)(2) of this subpart (defined through cross references toSec. 410.32(b)(3)(ii) of this subpart); and for hospital outpatient services at Sec. 410.27 of this subpart.(c) Standards for an intensive cardiac rehabilitation program. (1)To be designated an intensive cardiac rehabilitation program, a program in an approved setting must apply for designation. To be designated as an intensive cardiac rehabilitation program, the program must demonstrate through peer-reviewed, published research that it accomplishes one or more of the following for its patients:(i) Positively affected the progression of coronary heart disease.(ii) Reduces the need for coronary bypass surgery.(iii) Reduces the need for percutaneous coronary interventions.(iv) A statistically significant reduction in 5 or more of the following measures for patients from their levels before cardiac rehabilitation services to after cardiac rehabilitation services:(A) Low density lipoprotein.(B) Triglycerides.(C) Body mass index.(D) Systolic blood pressure.(E) Diastolic blood pressure.(F) The need for cholesterol, blood pressure, and diabetes medications.(2) A list of designated intensive cardiac rehabilitation programs will be posted to the CMS Web site and listed in the Federal Register.(3) To ensure that intensive cardiac rehabilitation programs maintain the designated quality of rehabilitation, sites must demonstrate that patients enrolled continue to achieve beneficial outcomes by submitting outcomes data annually from the date of approval as an intensive cardiac rehabilitation site.(i) Sites will be notified of continued compliance via a re- evaluation date posted to the CMS Web site.(ii) Sites that are no longer designated as approved intensive cardiac rehabilitation programs, due to poor outcomes data resulting in noncompliance, will be notified in writing and removed from the CMS Web site.(d) Standards for physicians responsible for cardiac rehabilitation programs. A physician who serves as the program Medical Director responsible for general or intensive cardiac rehabilitation programs, and who, in consultation with staff, is involved in directing the progress of individuals in the program must possess all of the following:(1) Expertise in the management of individuals with cardiac pathophysiology.(2) Be licensed to practice medicine in the State in which the cardiac rehabilitation program is offered.(e) Standards for supervising-physicians. Physicians acting as the supervising-physician must possess all of the following:(1) Expertise in the management of individuals with cardiac pathophysiology.(2) Be licensed to practice medicine in the State in which the cardiac rehabilitation program is offered.(f) Limitations for coverage of cardiac rehabilitation programs.(1) General cardiac rehabilitation. The number of general cardiac rehabilitation program sessions are limited to a minimum of 2 1-hour sessions per week and a maximum of 2 1-hour sessions per day for up to 36 sessions over up to 18 weeks. Medicare contractors have discretion to expand these limitations to not exceed 72 sessions for 36 weeks.(2) Intensive cardiac rehabilitation: Intensive cardiac rehabilitation program sessions are limited to 72 1-hour sessions (as defined in section 1848(b)(5) of the Act), up to 6 sessions per day, over a period of up to 18 weeks. 6. Section 410.78 is amended by--A. Revising the introductory text of paragraph (b).B. Revising paragraph (e).The revisions read as follows:Sec. 410.78 Telehealth services.* * * * *(b) General rule. Medicare Part B pays for office and other outpatient visits, professional consultation, psychiatric diagnostic interview examination, individual psychotherapy, pharmacologic management, end-stage renal disease-related services included in the monthly capitation payment (except for one visit per month to examine the access site), individual medical nutrition therapy, the neurobehavioral status exam, follow-up inpatient telehealth consultations furnished to beneficiaries in hospitals and SNFs, and individual health and behavior assessment and intervention services furnished by an interactive telecommunications system if the following conditions are met:* * * * *(e) Limitations. (1) A clinical psychologist and a clinical social worker may bill and receive payment for individual psychotherapy via a telecommunications system, but may not seek payment for medical evaluation and management services.(2) The physician visits required under Sec. 483.40(c) of this title may not be furnished as telehealth services.* * * * *Subpart I--Payment of SMI Benefits 7. Section 410.155 is amended by--A. Revising paragraphs (a), (b)(2)(i), (b)(2)(ii), (b)(2)(iv),(b)(2)(v), and (c).B. Adding paragraph (b)(3).The revisions and addition read as follows:Sec. 410.155 Outpatient mental health treatment limitation.(a) Limitation. For services subject to the limitation as specified in paragraph (b) of this section, the percentage of the expenses incurred for such services during a calendar year that is considered incurred expenses under Medicare Part B when determining the amount of payment and deductible under Sec. 410.152 and Sec. 410.160, respectively, is as follows:(1) For expenses incurred in years before 2010, 62\1/2\ percent.(2) For expenses incurred in 2010 and 2011, 68\3/4\ percent.(3) For expenses incurred in 2012, 75 percent.(4) For expenses incurred in 2013, 81\1/4\ percent.(5) For expenses incurred in CY 2014 and subsequent years, 100 percent.(b) * * *(2) Services not subject to the limitation. Services not subject to the limitation include the following:(i) Services furnished to a hospital inpatient.(ii) Brief office visits for the sole purpose of monitoring or changing drug prescriptions used in the treatment of mental, psychoneurotic, or personality disorders billed under HCPCS code M0064(or its successor).(iii) * * *(iv) Diagnostic services, such as diagnostic psychological and neuropsychological testing, that are performed to establish a diagnosis.(v) Medical management services billed under CPT code 90862 (or its successor), as opposed to psychotherapy, when furnished to a patient diagnosed with Alzheimer's disease or a related disorder.(3) Payment amounts. The Medicare payment amount and the patient liability amounts for outpatient mental health services subject to the limitation for each year during which the limitation is phased out are as follows:
Page 33677RecognizedCalendar yearincurred expenses Patient pays (%)Medicare pays(%)(%)CY 2009 and prior calendar years.......................62.505050CYs 2010 and 2011......................................68.754555CY 2012................................................75.004060CY 2013................................................81.253565CY 2014................................................100.002080(c) General formula. A general formula for calculating the amount of Medicare payment and the patient liability for outpatient mental health services subject to the limitation is as follows:(1) Multiply the Medicare approved amount by the percentage of incurred expenses that is recognized as incurred expenses for Medicare payment purposes for the year involved;(2) Subtract from this amount the amount of any remaining Part B deductible for the patient and year involved; and,(3) Multiply this amount by 0.80 (80 percent) to obtain theMedicare payment amount.(4) Subtract the Medicare payment amount from the Medicare-approved amount to obtain the patient liability amount.PART 411--EXCLUSIONS FROM MEDICARE AND LIMITATIONS ON MEDICAREPAYMENT 8. The authority citation for Part 411 continues to read as follows:Authority: Secs. 1102, 1860D-1 through 1860D-42, 1871, and 1877 of the Social Security Act (42 U.S.C. 1302, 1395w-101 through 1395w- 152, 1395hh, and 1395nn).Subpart J--Financial Relationships Between Physicians and EntitiesFurnishing Designated Health Services 9. Section 411.354 is amended by revising paragraph (c)(3)(i) to read as follows:Sec. 411.354 Financial relationship, compensation, and ownership or investment interest.* * * * *(c) * * *(3)(i) For purposes of paragraphs (c)(1)(ii) and (c)(2)(iv), a physician who ``stands in the shoes'' of his or her physician organization is deemed to have the same compensation arrangements (with the same parties and on the same terms) as the physician organization.When applying the exceptions in Sec. 411.355 and Sec. 411.357 of this part to arrangements in which a physician stands in the shoes of his or her physician organization, the relevant referrals and other business generated ``between the parties'' are referrals and other business generated between the entity furnishing DHS and the physician organization (including all members, employees, and independent contractor physicians).* * * * *PART 414--PAYMENT FOR PART B MEDICAL AND OTHER HEALTH SERVICES 10. The authority citation for part 414 continues to read as follows:Authority: Secs. 1102, 1871, and 1881(b)(l) of the SocialSecurity Act (42 U.S.C. 1302, 1395hh, and 1395rr(b)(l)).Subpart A--General ProvisionsSec. 414.1 [Amended] 11. Amend Sec. 414.1 by adding ``1834(e)--Implementation of accreditation standards for suppliers furnishing the technical component of advanced imaging services'' in numerical order.Subpart B--Physicians and Other Practitioners 12. Section 414.46 is amended by revising paragraphs (d)(2) and (e) to read as follows:Sec. 414.46 Additional rules for payment of anesthesia services.* * * * *(d) * * *(2) The rules for medical direction differ for certain time periods depending on the nature of the qualified individual who is directed by the physician. If more than two procedures are directed on or afterJanuary 1, 1994, the qualified individuals could be AAs, CRNAs, interns, or residents. The medical direction rules apply to student nurse anesthetists only if the physician directs two concurrent cases, each of which involves a student nurse anesthetist or the physician directs one case involving a student nurse anesthetist and the other involving a CRNA, AA, intern, or resident. For services furnished on or after January 1, 2010, the medical direction rules do not apply to a single anesthesia resident case that is concurrent to another case which is paid under the medical direction payment rules as specified in paragraph (e) of this section.* * * * *(e) Special payment rule for teaching anesthesiologist involved in a single resident case or two concurrent cases. For physicians' services furnished on or after January 1, 2010, if the teaching anesthesiologist is involved in the training of physician residents in a single anesthesia case or two concurrent anesthesia cases, the fee schedule amount must be 100 percent of the fee schedule amount otherwise applicable if the anesthesia services were personally performed by the teaching anesthesiologist and the teaching anesthesiologist fulfilled the criteria in Sec. 415.178 of this chapter. The single anesthesia resident case is the only case or concurrent to one other anesthesia case that is being medically directed by the physician.* * * * * 13. Section 414.61 is added to read as follows:Sec. 414.61 Payment for anesthesia services furnished by a teachingCRNA.(a) Basis for payment. Beginning January 1, 2010, anesthesia services furnished by a teaching CRNA may be paid under one of the following conditions:(1) The teaching CRNA, who is not under medical direction of a physician, is present with the student nurse anesthetist for the pre and post anesthesia services included in the anesthesia base units payment and is continuously present during anesthesia time in a single case with a student nurse anesthetist.(2) The teaching CRNA, who is not under the medical direction of a physician, is involved with two concurrent anesthesia cases with student nurse anesthetists. The teaching CRNA must be present with the student nurse anesthetist for the pre and post anesthesia services included in the anesthesia base unit. For the anesthesia time of the two concurrent cases, the teaching CRNA can only be involved with those two concurrent cases and may not perform services for other patients.
Page 33678(b) Level of payment. The allowance for the service of the teachingCRNA, furnished under paragraph (a) of this section, is determined in the same way as for a physician who personally performs the anesthesia service alone as specified in 414.46(c) of this subpart. 14. Section 414.65 is amended by revising paragraph (a)(1) to read as follows:Sec. 414.65 Payment for telehealth services.(a) * * *(1) The Medicare payment amount for office or other outpatient visits, consultation, individual psychotherapy, psychiatric diagnostic interview examination, pharmacologic management, end-stage renal disease related services included in the monthly capitation payment(except for one visit per month to examine the access site), individual medical nutrition therapy, and individual health and behavior assessment and intervention services furnished via an interactive telecommunications system is equal to the current fee schedule amount applicable for the service of the physician or practitioner. TheMedicare payment amount for follow-up inpatient telehealth consultations furnished via an interactive telecommunications system is equal to the current fee schedule amount applicable to subsequent hospital care provided by a physician or practitioner.* * * * * 15. Section 414.68 is added to read as follows:Sec. 414.68 Imaging accreditation.(a) Scope and purpose. Section 1834(e) of the Act, requires theSecretary to designate and approve independent accreditation organizations for purposes of accrediting suppliers furnishing the technical component (TC) of advanced diagnostic imaging services and establish procedures to ensure that the criteria used by an accreditation organization is specific to each imaging modality.Suppliers of the TC of advanced diagnostic imaging services for which payment is made under the fee schedule established in section 1848(b) of the Act must become accredited by an accreditation organization designated by the Secretary beginning January 1, 2012.(b) Definitions. As used in this section, the following definitions are applicable:Accredited supplier means a supplier that has been accredited by aCMS-designated accreditation organization as specified in this part.Advanced diagnostic imaging service means any of the following diagnostic services:(i) Magnetic resonance imaging.(ii) Computed tomography.(iii) Nuclear medicine.(iv) Positron emission tomography.CMS-approved accreditation organization means an accreditation organization designated by CMS to perform the accreditation functions specified in section 1834(e) of the Act(c) Application and reapplication procedures for accreditation organizations. An independent accreditation organization applying for approval or reapproval of authority to survey suppliers for purposes of accrediting suppliers furnishing the TC of advanced diagnostic imaging services is required to furnish CMS with all of the following:(1) A detailed description of how the organization's accreditation criteria satisfy the statutory standards at section 1834(e)(3) of theAct, specifically--(i) Qualifications of medical personnel who are not physicians and who furnish the TC of advanced diagnostic imaging services;(ii) Qualifications and responsibilities of medical directors and supervising physicians, such as their training in advanced diagnostic imaging services in a residency program, expertise obtained through experience, or continuing medical education courses;(iii) Procedures to ensure the reliability, clarity, and accuracy of the technical quality of diagnostic images produced by the supplier; and(iv) Procedures to ensure the safety of persons who furnish the TC of advanced diagnostic imaging services and individuals to whom such services are furnished.(2) An agreement to conform accreditation requirements to any changes in Medicare statutory requirements in section 1834(e) of theAct.(3) Information that demonstrates the accreditation organization's knowledge and experience in the advanced diagnostic imaging arena.(4) The organization's proposed fees for accreditation for each modality in which the organization intends to offer accreditation, including any plans for reducing the burden and cost of accreditation to small and rural suppliers.(5) Any specific documentation requirements and attestations requested by CMS as a condition of designation under this part.(6) A detailed description of the organization's survey process, including the following:(i) Type and frequency of the surveys performed.(ii) The ability of the organization to conduct timely reviews of accreditation applications, to include the organizations national capacity.(iii) Description of the organizations audit procedures including random site visits, site audits, or other strategies for ensuring suppliers maintain compliance during the duration of accreditation.(iv) Procedures for performing unannounced site surveys.(v) Copies of the organization's survey forms.(vi) A description of the accreditation survey review process and the accreditation status decision-making process, including the process for addressing deficiencies identified with the accreditation requirements, and the procedures used to monitor the correction of deficiencies found during an accreditation survey.(vii) Procedures for coordinating surveys with another accrediting organization if the organization does not accredit all products the supplier provides.(viii) Detailed information about the individuals who perform evaluations for the accreditation organization, including all of the following information:(A) The number of professional and technical staff that are available for survey.(B) The education, current employment and experience requirements surveyors must meet.(C) The content and length of the orientation program.(ix) The frequency and types of in-service training provided to survey personnel.(x) The evaluation systems used to monitor the performance of individual surveyors and survey teams.(xi) The policies and procedures regarding an individual's participation in the survey or accreditation decision process of any organization with which the individual is professionally or financially affiliated.(xii) The policies and procedures used when an organization has a dispute regarding survey findings or an adverse decision.(7) Detailed information about the size and composition of survey teams for each category of advanced medical imaging service supplier accredited.(8) A description of the organization's data management and analysis system for its surveys and accreditation decisions, including the kinds of reports, tables, and other displays generated by that system.(9) The organization's procedures for responding to and for the investigation
Page 33679of complaints against accredited facilities, including policies and procedures regarding coordination of these activities with appropriate licensing bodies and CMS.(10) The organization's policies and procedures for the withholding or removal of accreditation status for facilities that fail to meet the accreditation organization's standards or requirements, and other actions taken by the organization in response to noncompliance with its standards and requirements. These policies and procedures must include notifying CMS of facilities that fail to meet the requirements of the accrediting organization.(11) A list of all currently accredited suppliers, the type and category of accreditation currently held by each supplier, and the expiration date of each supplier's current accreditation.(12) The accreditation organization must also submit the following supporting documentation:(i) A written presentation that demonstrates the organization's ability to furnish CMS with electronic data in ASCII comparable code.(ii) A resource analysis that demonstrates that the organization's staffing, funding, and other resources are adequate to perform the required surveys and related activities.(iii) A statement acknowledging that, as a condition for approval of designation, the organization agrees to the following activities:(A) Prioritize surveys for those suppliers needing to be accredited by January 1, 2012.(B) In the case of a supplier that is accredited before January 1, 2010, the supplier must be considered accredited as of January 1, 2012.(C) Notify CMS, in writing, of any supplier that had its accreditation revoked, withdrawn, revised, or any other remedial or adverse action taken against it by the accreditation organization within 30 calendar days of any such action taken.(D) Notify all accredited suppliers within 10 calendar days of the organization's removal from the list of designated accreditation organizations.(E) Notify CMS, in writing, at least 30 calendar days in advance of the effective date of any proposed changes in accreditation requirements.(F) Permit its surveyors to serve as witnesses if CMS takes an adverse action based on accreditation findings.(G) Notify CMS, in writing, (electronically or hard copy) within 2 calendar days of a deficiency identified in any accreditation supplier where the deficiency poses an immediate jeopardy to the supplier's beneficiaries or a hazard to the general public.(H) Provide, on an annual basis, summary data specified by CMS that relates to the past years' accreditations and trends.(I) Attest that the organization will not perform any accreditation surveys of Medicare participating suppliers with which it has a financial relationship with or interest in.(J) Conform accreditation requirements to changes in Medicare requirements.(iv) If CMS determines that additional information is necessary to make a determination for approval or denial of the accreditation organization's application for designation, the organization is notified and afforded an opportunity to provide the additional information.(v) CMS may visit the organization's offices to verify representations made by the organization in its application, including, but not limited to, review of documents and interviews with the organization's staff.(vi) The accreditation organization will receive a formal notice from CMS stating whether the request for designation has been approved or denied. If approval was denied the notice includes the basis for denial and reconsideration and reapplication procedures.(d) Ongoing responsibilities of a CMS-approved accreditation organization. An accreditation organization approved by CMS must undertake the following activities on an ongoing basis:(1) Provide to CMS all of the following in written format (either electronic or hard copy):(i) Copies of all accreditation surveys, together with any survey- related information that CMS may require (including corrective action plans and summaries of findings with respect to unmet CMS requirements).(ii) Notice of all accreditation decisions.(iii) Notice of all complaints related to suppliers.(iv) Information about any supplier furnishing the TC of advanced diagnostic imaging service against which the CMS approved accreditation organization has taken remedial or adverse action, including revocation, withdrawal, or revision of the supplier's accreditation.(v) Notice of any proposed changes in its accreditation standards or requirements or survey process. If the organization implements the changes before or without CMS' approval, CMS may withdraw its approval of the accreditation organization.(2) Within 30 calendar days of a change in CMS requirements, an acknowledgment of CMS' notification of the change must be submitted toCMS.(3) Permit its surveyors to serve as witnesses if CMS takes an adverse action based on accreditation findings.(4) Within 2 calendar days of identifying a deficiency of an accredited supplier that poses immediate jeopardy to a beneficiary or to the general public, provide CMS with written notice of the deficiency and any adverse action implemented by the accreditation organization.(5) Within 10 calendar days after CMS' notice to a CMS approved accreditation organization that CMS intends to withdraw approval of the accreditation organization, provide written notice of the withdrawal to all the CMS approved accreditation organization's accredited suppliers.(6) Provide, on an annual basis, summary data specified by CMS that relate to the past year's accreditation activities and trends.(d) Continuing Federal oversight of approved accreditation organizations. This paragraph establishes specific criteria and procedures for continuing oversight and for withdrawing approval of aCMS approved accreditation organization.(1) Validation audits. CMS or its contractor may conduct an audit of an accredited supplier to validate the survey accreditation process of approved accreditation organizations in the TC of advanced diagnostic imaging services. The audits must be conducted on a representative sample of suppliers who have been accredited by a particular accrediting organization or in response to allegations of supplier noncompliance with the standards. When conducted on a representative sample basis, we are proposing that the audit would be comprehensive and address all of the standards or would focus on a specific standard in issue. When conducted in response to an allegation, we would specify that the CMS team or our contractor would audit for any standard that we determined was related to the allegations. At the conclusion of this audit, if CMS identifies any accreditation programs for which validation audit results indicate--(i) A 10 percent rate of disparity between findings by the accreditation organization and findings by CMS or its designated survey team on standards that do not constitute immediate jeopardy to patient health and safety if unmet.(ii) Any disparity between findings by the accreditation organization and
Page 33680findings by CMS on standards that constitute immediate jeopardy to patient health and safety if unmet.(iii) That, irrespective of the rate of disparity, there are widespread or systemic problems in an organization's accreditation process such that accreditation by that accreditation organization no longer provides CMS with adequate assurance that suppliers meet or exceed the Medicare requirements.(2) Notice of intent to withdraw approval. CMS provides the organization written notice of its intent to withdraw approval if an equivalency review, validation review, onsite observation, or CMS' daily experience with the accreditation organization suggests that the accreditation organization is not meeting the requirements of this section.(3) Withdrawal of approval. CMS may withdraw its approval of an accreditation organization at any time if CMS determines that--(i) Accreditation by the organization no longer adequately assures that the suppliers furnishing the technical component of advanced diagnostic imaging service are meeting the established industry standards for each modality and that failure to meet those requirements could jeopardize the health or safety of Medicare beneficiaries and could constitute a significant hazard to the public health; or(ii) The accreditation organization has failed to meet its obligations with respect to application or reapplication procedures.(f) Reconsideration. An accreditation organization dissatisfied with a determination that its accreditation requirements do not provide or do not continue to provide reasonable assurance that the suppliers accredited by the accreditation organization meet the applicable quality standards is entitled to a reconsideration. CMS reconsiders any determination to deny, remove, or not renew the approval of designation to accreditation organizations if the accreditation organization files a written request for reconsideration by its authorized officials or through its legal representative.(1) Filing requirements.(i) The request must be filed within 30 calendar days of the receipt of CMS notice of an adverse determination or non renewal.(ii) The request for reconsideration must specify the findings or issues with which the accreditation organization disagrees and the reasons for the disagreement.(iii) A requestor may withdraw its request for reconsideration at any time before the issuance of a reconsideration determination.(2) CMS response to a filing request. In response to a request for reconsideration, CMS provides the accreditation organization with--(i) The opportunity for an informal hearing to be conducted by a hearing officer appointed by the Administrator of CMS and provide the accreditation organization the opportunity to present, in writing and in person, evidence or documentation to refute the determination to deny approval, or to withdraw or not renew designation; and(ii) Written notice of the time and place of the informal hearing at least 10 business days before the scheduled date.(3) Hearing requirements and rules.(i) The informal reconsideration hearing is open to all of the following:(A) CMS.(B) The organization requesting the reconsideration including--(1) Authorized representatives;(2) Technical advisors (individuals with knowledge of the facts of the case or presenting interpretation of the facts); and(3) Legal counsel.(ii) The hearing is conducted by the hearing officer who receives testimony and documents related to the proposed action.(iii) Testimony and other evidence may be accepted by the hearing officer even though it is inadmissible under the rules of court procedures.(iv) The hearing officer does not have the authority to compel by subpoena the production of witnesses, papers, or other evidence.(v) Within 45 calendar days of the close of the hearing, the hearing officer presents the findings and recommendations to the accreditation organization that requested the reconsideration.(vi) The written report of the hearing officer includes separate numbered findings of fact and the legal conclusions of the hearing officer.(vii) The hearing officer's decision is final.Subpart F--Competitive Bidding for Certain Durable MedicalEquipment, Prosthetics, Orthotics, and Supplies (DMEPOS) 16. Section 414.402 is amended by revising the definition``Grandfathered item'' to read as follows:Sec. 414.402 Definitions.* * * * *Grandfathered Item means all rented items within a product category for which payment was made prior to the implementation of a competitive bidding program to a grandfathered supplier that chooses to continue to furnish the items in accordance with Sec. 414.408(j) of this subpart and that fall within the following payment categories for competitive bidding:(1) An inexpensive or routinely purchased item described in Sec. 414.220 of this part.(2) An item requiring frequent and substantial servicing, as described in Sec. 414.222 of this part.(3) Oxygen and oxygen equipment described in Sec. 414.226 of this part.(4) Other DME described in Sec. 414.229 of this part.* * * * * 17. Section 414.408 is amended by--(A) Redesignating paragraph (j)(5) as (j)(7).(B) Adding a new paragraphs (j)(5) and (j)(6).Sec. 414.408 Payment rules.* * * * *(j) * * *(5) Notification of beneficiaries and CMS by suppliers that choose to become grandfathered suppliers.(i) Notification of beneficiaries by suppliers.(A) Requirements of notification. A noncontract supplier that elects to become a grandfathered supplier must provide a 30-day written notification to each Medicare beneficiary that resides in a competitive bidding area and is currently renting a competitively bid item from that supplier. The 30-day notification to the beneficiary must meet the following requirements:(1) Be sent by the supplier to the beneficiary at least 30 business days before the start date of the implementation of the competitive bidding program for the CBA in which the beneficiary resides.(2) Identify the grandfathered items that the supplier is willing to continue to rent to the beneficiary.(3) Be in writing (for example, by letter or postcard) and the supplier must maintain proof of delivery.(4) State that the supplier is willing to continue to furnish certain rented Durable Medical Equipment (DME), oxygen and oxygen equipment, and supplies that the supplier is currently furnishing to the beneficiary (that is, before the start of the competitive bidding program) and is willing to continue to provide these items to the beneficiary for the remaining rental months.(5) State that the beneficiary has the choice to continue to receive a grandfathered item(s) from the
Page 33681grandfathered supplier or may elect to receive the item(s) from a contract supplier after the end of the last month for which a rental payment is made to the noncontract supplier.(6) Provide the supplier's telephone number and instruct the beneficiary to call the supplier with any questions and to notify the supplier of his or her decision to use or not use the supplier as a grandfathered supplier.(7) State that the beneficiary can obtain information about the competitive bidding program by calling 1-800-MEDICARE or accessing http://www.medicare.gov on the Internet.(B) Record of beneficiary's choice. The supplier should obtain an election from the beneficiary regarding whether to use or not use the supplier as a grandfathered supplier. The supplier must maintain a record of its attempts to communicate with the beneficiary to obtain the beneficiary's election regarding grandfathering. When the suppier obtains such an election, the supplier must maintain a record of the beneficiary decision including the date the choice was made, and how the beneficiary communicated his or her choice to the supplier.(C) Notification. If the beneficiary chooses not to continue to receive a grandfathered item(s) from their current supplier, the supplier must provide the beneficiary with 2 more notices in addition to the 30-day notice prior to the supplier picking up its equipment.(1) 10-day notification: Ten business days prior to picking up the item, the supplier should have direct contact (for example, a phone call) with the beneficiary or the beneficiary's caregiver and receive acknowledgement that the beneficiary understands their equipment will be picked up. This should occur on the first anniversary date after the start of the CBP or on another date agreed to by the beneficiary or the beneficiary's caregiver. The beneficiary's anniversary date occurs every month and is the date of the month on which the item was first delivered to the beneficiary by the current supplier. When a date other than the anniversary date is chosen by the beneficiary or the beneficiary's caregiver, the noncontract supplier will still receive payment up to the anniversary date after the start of the CBP, and the new contract supplier may not bill for any period of time before the anniversary date.(2) 2-day notification: Two business days prior to picking up the item the supplier should contact the beneficiary of the beneficiary's caregiver by phone to notify the beneficiary of the date the supplier will pick up the item. This date should not be before the beneficiary's first anniversary date that occurs after the start of the competitive bidding program unless an alternative arrangement has been made with the beneficiary and the new contract supplier.(D) Pickup procedures.(1) The pickup of the noncontract supplier's equipment and the delivery of the new contract supplier's equipment should occur on the same date, that is, the first rental anniversary date of the equipment that occurs after the start of the competitive bidding program unless an alternative arrangement has been made with the beneficiary and the new contract supplier.(2) Under no circumstance should a supplier pick up a rented item prior to the supplier's receiving acknowledgement from the beneficiary that the beneficiary is aware of the date on which the supplier is picking up the item and the beneficiary has made arrangements to have the item replaced on that date by a contract supplier.(3) When a beneficiary chooses to switch to a new contract supplier, the current noncontract supplier and the new contract supplier must make arrangements that are suitable to the beneficiary.(4) The contract supplier may not submit a claim with a date of delivery for the new equipment that is prior to the first anniversary date that occurs after the beginning of the CBP, and the contract supplier may not begin billing until the first anniversary date that occurs after the beginning of the CBP.(5) The noncontract supplier must submit a claim to be paid up to the first anniversary date that occurs after the beginning of the CBP.Therefore, they should not pick up the equipment before that date unless an alternative arrangement has been made with the beneficiary and the new contract supplier.(ii) Notification to CMS by suppliers. A noncontract supplier that elects to become a grandfathered supplier must provide a written notification to CMS of this decision. This notification must meet the following requirements:(A) State that the supplier agrees to continue to furnish certain rented DME, oxygen and oxygen equipment that it is currently furnishing to beneficiaries (that is, before the start of the competitive bidding program) in a CBA and will continue to provide these items to these beneficiaries for the remaining months of the rental period.(B) Include the following information:(1) Name and address of the supplier.(2) The 6-digit NSC number of the supplier.(3) Product category(s) by CBA for which the supplier is willing to be a grandfathered supplier.(C) State that the supplier agrees to meet all the terms and conditions pertaining to grandfathered suppliers.(D) Be provided by the supplier to CMS in writing at least 30 business days before the start date of the implementation of theMedicare DMEPOS Competitive Bidding Program.(6) Suppliers that choose not to become grandfathered suppliers.(i) Requirement for non-grandfathered supplier. A noncontract supplier that elects not to become a grandfathered supplier is required to pick up the item it is currently renting to the beneficiary from the beneficiary's home after proper notification.(ii) Notification. Proper notification includes a 30-day, a 10-day, and a 2-day notice of the supplier's decision not to become a grandfathered supplier to its Medicare beneficiaries who are currently renting certain DME competitively bid item(s) and who reside in a CBA.(iii) Requirements of notification. These notifications must meet all of the requirements listed in paragraph (j)(5)(i) of this section for the 30-day, 10-day and 2-day notices that must be sent by suppliers who decide to be grandfathered suppliers, with the following exceptions for the 30-day notice.(A) State that, for those items for which the supplier has decided not to be a grandfathered supplier, the supplier will only continue to rent these competitively bid item(s) to its beneficiaries up to the first anniversary date that occurs after the start of the MedicareDMEPOS Competitive Bidding Program.(B) State that the beneficiary must select a contract supplier forMedicare to continue to pay for these items.(C) Refer the beneficiary to the contract supplier locator tool on http://www.medicare.gov and to 1-800-MEDICARE to obtain information about the availability of contract suppliers for the beneficiary's area.(iv) Pickup procedures.(A) The pick-up of the noncontract supplier's equipment and the delivery of the new contract supplier's equipment should occur on the same date, that is, the first rental anniversary date of the equipment that occurs after the start of the competitive bidding program unless an alternative arrangement has been made with the beneficiary and the new contract supplier.
Page 33682(B) Under no circumstance should a supplier pick up a rented item prior to the supplier's receiving acknowledgement from the beneficiary that the beneficiary is aware of the date on which the supplier is picking up the item and the beneficiary has made arrangements to have the item replaced on that date by a contract supplier.(C) When a beneficiary chooses to switch to a new contract supplier, the current noncontract supplier and the new contract supplier must make arrangements that are agreeable to the beneficiary.(D) The contract supplier cannot submit a claim with a date of delivery for the new equipment that is prior to the first anniversary date that occurs after the beginning of the CBP.* * * * * 18. Section 414.425 is added to read as follows:Sec. 414.425 Claims for damages.(a) Eligibility for filing a claim for damages as a result of the termination of supplier contracts by the Medicare Improvements forPatients and Providers Act of 2008 (MIPPA). (1) Any aggrieved supplier, including a member of a network that was awarded a contract for theRound 1 Durable Medical Prosthetics, Orthotics, and SuppliesCompetitive Bidding Program (DMEPOS CBP) that believes it has been damaged by the termination of its competitive bid contract, may file a claim under this section.(2) A subcontractor of a contract supplier is not eligible to submit a claim under this section.(b) Timeframe for filing a claim. (1) A completed claim, including all documentation, must be filed within 90 days of the effective date of this paragraph, unless that day is a Federal holiday or Sunday in which case it will fall to the next business day.(2) The date of filing is the actual date of receipt by the CBIC of a completed claim that includes all the information required by this rule.(c) Information that must be included in a claim. (1) Supplier's name, name of authorized official, U.S. Post Office mailing address, phone number, e-mail address and bidding number, and National SupplierClearinghouse Number;(2) A copy of the signed contract entered into with CMS for theRound 1 DMEPOS Competitive Bidding Program;(3) A detailed explanation of the damages incurred by this supplier as a direct result of the termination of the Round 1 competitive bid contract by MIPPA. The explanation must include all of the following:(i) Documentation of the supplier's damages through receipts.(ii) Records that substantiate the supplier's damages and demonstrate that the damages are directly related to performance of theRound 1 contract and are consistent with information the supplier provided as part of their bid.(4) The supplier must explain how it would be damaged if not reimbursed.(5) The claim must document steps the supplier took to mitigate any damages they may have incurred due to the contract termination, including a detailed explanation of the steps of all attempts to use for other purposes, return or dispose of equipment or other assets purchased or rented for the use in the Round 1 DMEPOS CBP contract performance.(d) Items that will not be considered in a claim. The following items will not be considered in a claim:(1) The cost of submitting a bid.(2) Any fees or costs incurred for consulting or marketing.(3) Costs associated with accreditation or licensure.(4) Costs incurred before March 20, 2008.(5) Costs incurred for contract performance after July 14, 2008 except for costs incurred to mitigate damages.(6) Any profits a supplier may have expected from the contract.(7) Costs that would have occurred without a contract having been awarded.(8) Costs for items such as inventory, delivery vehicles, office space and equipment, personnel, which the supplier did not purchase specifically to perform the contract.(9) Costs that the supplier has recouped by any means, and may include use of personnel, material, suppliers, or equipment in the supplier's business operations.(e) Filing a claim. (1) A claim, with all supporting documentation, must be filed with the CMS Competitive Bidding ImplementationContractor (CBIC).(2) Claims must include a statement from a supplier's authorized official certifying the accuracy of the information provided on the claim and all supporting documentation.(3) The CBIC does not accept electronic submissions of claims for damages.(f) Review of claim. (1) Role of the CBIC.(i) The CBIC will review the claim to ensure it is submitted timely, complete, and by an eligible claimant. When the CBIC identifies that a claim is incomplete or not filed timely, it will make a recommendation to the Determining Authority not to process the claim further. Incomplete or untimely claims may be dismissed by theDetermining Authority without further processing.(ii) For complete, timely claims, the CBIC will review the claim on its merits to determine if damages are warranted and may seek further information from the claimant when making its recommendation to theDetermining Authority. The CBIC may set a deadline for receipt of additional information. A claimant's failure to respond timely may result in a denial of the claim.(iii) The CBIC will make a recommendation to the DeterminingAuthority for each claim filed and include an explanation that supports its recommendation.(iv) The recommendation must be either to award damages for a particular amount (which may not be the same amount requested by the claimant) or that no damages should be awarded.(A) If the CBIC recommends that damages are warranted, the CBIC will calculate a recommended reasonable amount of damages based on the claim submitted.(B) The reasonable amount will consider both costs incurred and the contractor's attempts and action to limit the damages;(v) The recommendation will be sent to the Determining Authority for a final determination.(2) CMS' role as the Determining Authority.(i) The Determining Authority shall review the recommendation of the CBIC.(ii) The Determining Authority may seek further information from the claimant or the CBIC in making a concurrence or non-concurrence determination.(iii) The Determining Authority may set a deadline for receipt of additional information. A claimant's failure to respond timely may result in a denial of the claim.(iv) If the Determining Authority concurs with the CBIC recommendation, the Determining Authority shall submit a final signed decision to the CBIC and direct the CBIC to notify the claimant of the decision and the reasons for the final decision.(v) If the Determining Authority non-concurs with the CBIC recommendation, the Determining Authority may return the claim for further processing or the Determining Authority may:(A) Write a determination granting (in whole or in part) a claim for damages or denying a claim in its entirety;(B) Direct the CBIC to write said determination for the DeterminingAuthority's signature; or
Page 33683(C) Return the claim to the CBIC with further instructions.(vi) The Determining Authority's determination is final and not subject to administrative or judicial review.(g) Timeframe for determinations. (1) Every effort will be made to make a determination within 120 days of initial receipt of the claim for damages by the CBIC or the receipt of additional information that was requested by the CBIC, whichever is later.(2) In the case of more complex cases, or in the event of a large workload, a decision will be issued as soon as practicable.(h) Notification to claimant of damage determination. The CBIC must mail the Determining Authority's determination to the claimant by certified mail return receipt requested, at the address provided in the claim.Subpart H--Fee Schedule for Ambulance Services 19. Section 414.610 is amended by revising paragraph (c)(5)(i) to read as follows:Sec. 414.610 Basis of payment.* * * * *(c) * * *(5) * * *(i) For ground ambulance services where the point of pickup is in a rural area, the mileage rate is increased by 50 percent for each of the first 17 miles and, for services furnished before January 1, 2004, by 25 percent for miles 18 through 50. The standard mileage rate applies to every mile over 50 miles and, for services furnished after December 31, 2003, to every mile over 17 miles. For air ambulance services where the point of pickup is in a rural area, the total payment is increased by 50 percent; that is, the rural adjustment factor applies to the sum of the base rate and the mileage rate.* * * * *Subpart J--Submission of Manufacturer's Average Sales Price Data 20. Section 414.802 is amended by revising the definition of``unit'' to read as follows:Sec. 414.802 Definitions.* * * * *Unit means the product represented by the 11-digit National DrugCode. The method of counting units excludes units of CAP drugs (as defined in Sec. 414.902) sold to an approved CAP vendor (as defined inSec. 414.902) for use under the CAP (as defined in Sec. 414.902).Subpart K--Payment for Drugs and Biologicals Under Part BSec. 414.904 [Amended] 21. Amend Sec. 414.904(d)(3) by removing the phrase ``and 2009'' and adding in its place the phrase ``2009, and 2010.'' 22. Section 414.906 is amended by--B. Revising the introductory text of paragraph (c) and paragraph(c)(1).C. Redesignating paragraph (c)(2) as (c)(3).D. Adding new paragraph (c)(2).E. Adding paragraphs (f)(2)(v), (f)(3)(iv), and (g).The revision and additions read as follows:Sec. 414.906 Competitive acquisition program as the basis for payment.* * * * *(c) Computation of payment amount. Except as specified in paragraph(c)(2) of this section, payment for CAP drugs is based on bids submitted as a result of the bidding process as described in Sec. 414.910.(1) Single payment amount.(i) A single payment amount for each CAP drug in the competitive acquisition area is determined on the basis of the bids submitted and accepted and updated from the bidding period to the beginning of the payment year.(ii) The single payment amount is then updated quarterly based on the approved CAP vendor's reasonable net acquisition costs for that category as determined by CMS, and limited by the weighted payment amount established under section 1847A of the Act across all drugs for which a composite bid is required in the category.(iii) The payment amount for each other drug for which the approvedCAP vendor submits a bid in accordance with Sec. 414.910 of this subpart and each other drug that is approved by CMS for the approvedCPA vendor to furnish under the CAP is also updated quarterly based on the approved CAP vendor's reasonable net acquisition costs for eachHCPCS code and limited by the payment amount established under section 1847A of the Act.(2) Updates to payment amount.(i) The first update is effective on the first day of claims processing for the first quarter of an approved CAP vendor's contract.The first quarterly contract update is based on the reasonable net acquisition cost (RNAC) data reported to CMS or its designee for any purchases of drug before the beginning of CAP claims processing for the contract period and reported to CMS no later than 30 days before the beginning of CAP claims processing.(ii) For subsequent quarters, each approved CAP vendor must report to CMS or its designee RNAC data for a quarter of CAP drug purchases within 30 days of the close of that quarter.(iii) For all quarters, only RNAC data from approved CAP vendors that are supplying CAP drugs under their CAP contract at the time updates are being calculated must be used to calculate updated CAP payment amounts.(iv) CMS excludes such RNAC data submitted by an approved CAP vendor if, during the time calculations are being done, CMS knows that the approved CAP vendor will not be under contract for the applicable quarterly update.(v) The payment amount weights must be calculated based on the more recent of the following:(A) Contract bidding weights.(B) CAP claims data.(vi) The payment limit must be determined using the most recent payment limits available to CMS under section 1847A of the Act.(vii) The following payment amount update calculation must be applied for the group of all drugs for which a composite bid is required.(A) The most recent previous composite payment amount for the group is updated by--(1) Calculating the percent change in reasonable net acquisition costs for each approved CAP vendor;(2) Calculating the median of all participating approved CAP vendors' adjusted CAP payment amounts; and(3) Limiting the payment as described in paragraph (c)(1) of this section.(B) The median percent change, subject to the limit described in paragraph (c)(1) of this section, must be the update percentage for that quarter.(C) The single update percentage must be applied to the payment amount for each drug in the group of drugs for which a composite bid is required in the category.(viii) The following payment amount update calculation must be applied for each of the following items: each HCPCS code not included in the composite bid list; each HCPCS code added to the drug list during the contract period; and each drug that has not yet been assigned a HCPCS code, but for which a HCPCS code will be established.(A) The most recent previous payment amount for each drug must be updated by calculating the percent change in reasonable net acquisition costs for each approved CAP vendor, then calculating the median of all participating approved CAP vendors' adjusted CAP payment amounts.(B) The median percent change calculated for each drug, subject to the
Page 33684limit described in paragraph (c)(1) of this section, must be applied to the payment amount for each drug.* * * * *(f) * * *(2) * * *(v) On or after January 1, 2010, the proposed addition of drugs with similar therapeutic uses to drugs already supplied under the CAP by the approved CAP vendor(s).(3) * * *(iv) In the case of additions requested under paragraph (f)(2)(v) of this section, address and document the need for such an expansion based on demand for the product(s).* * * * *(g) Deletion of drugs on an approved CAP vendor's CAP drug list due to unavailability requires a written request and approval as described in paragraphs (f)(3)(i) through (iii) and (f)(4). 23. Section 414.908 is amended by revising paragraph (a)(3)(xii) to read as follows:Sec. 414.908 Competitive acquisition program.(a) * * *(3) * * *(xii) Agrees not to transport CAP drugs from one practice location or place of service to another location except in accordance with a written agreement between the participating CAP physician and the approved CAP vendor that requires that drugs are not subjected to conditions that will jeopardize their integrity, stability, and/or sterility while being transported.* * * * * 24. Section 414.914 is amended by revising paragraph (f)(12) to read as follows:Sec. 414.914 Terms of contract.* * * * *(f) * * *(12) Supply CAP drugs upon receipt of a prescription order to all participating CAP physicians who have selected the approved CAP vendor, except when the conditions of paragraph (h) of this section or Sec. 414.916(b) are met;* * * * * 25. Section 414.916 is amended by --A. Redesignating paragraph (b)(4) as (b)(5).B. Adding new paragraph (b)(4).The addition reads as follows:Sec. 414.916 Dispute resolution for vendors and beneficiaries.* * * * *(b) * * *(4) Upon notification from CMS of a participating CAP physician's suspension from the program, the approved CAP vendor must cease delivery of CAP drugs to the suspended participating CAP physician until the suspension has been lifted.* * * * * 26. Section 414.917 is amended by revising paragraph (b)(4) to read as follows:Sec. 414.917 Dispute resolution and process for suspension or termination of approved CAP contract and termination of physician participation under exigent circumstances.* * * * *(b) * * *(4) The approved CAP vendor may appeal that termination by requesting a reconsideration. A determination must be made as to whether the approved CAP vendor has been meeting the service and quality obligations of its CAP contract. The approved CAP vendor's contract will remain suspended during the reconsideration process.* * * * * 27. Section 414.930 is amended by--A. Revising paragraph (a).B. Redesignating paragraphs (b)(1)(v) as (vi).C. Adding new paragraphs (b)(1)(v).The revision and addition read as follows:Sec. 414.930 Compendia for determination of medically-accepted indications for off-label uses of drugs and biologicals in an anti- cancer chemotherapeutic regimen.(a) Definitions. For the purposes of this section:Compendium means a comprehensive listing of FDA-approved drugs and biologicals or a comprehensive listing of a specific subset of drugs and biologicals in a specialty compendium, for example a compendium of anti-cancer treatment. A compendium--(i) Includes a summary of the pharmacologic characteristics of each drug or biological and may include information on dosage, as well as recommended or endorsed uses in specific diseases.(ii) Is indexed by drug or biological.(iii) Has a publicly transparent process for evaluating therapies and for identifying potential conflicts of interests.Publicly transparent process for evaluating therapies means that the following materials are available to the public on the compendium'sWeb site coincident with the compendium's publication of the related recommendation:(i) The application for inclusion of a therapy including criteria used to evaluate the request.(ii) A listing of all the evidentiary materials reviewed or considered by the compendium pursuant to the application.(iii) A listing of all individuals who have substantively participated in the development of compendia recommendations.(iv) Transcripts of meetings and records of the votes, including abstentions, related to the therapeutic recommendation on the application.Publicly transparent process for identifying potential conflicts of interests means that the following materials are identified and available to the public coincident with the compendium's publication of the related recommendation:(i) Direct or indirect financial relationships that exist between individuals who have substantively participated in the development of compendia recommendations and the applicant (for example, the manufacturer or seller of the drug or biological being reviewed by the compendium). This includes compensation arrangements such as salary, grant, contract, or collaboration agreements between individuals who have substantively participated in the development of compendia recommendations and the applicant.(ii) Ownership or investment interests of individuals who have substantively participated in the development of compendia recommendations and the applicant (for example, the manufacturer or seller of the drug or biological being reviewed by the compendium).(b) * * *(1) * * *(v) Considers whether the publication that is the subject of the request meets the definition of a compendium in this section.* * * * *PART 415--SERVICES FURNISHED BY PHYSICIANS IN PROVIDERS,SUPERVISING PHYSICIANS IN TEACHING SETTINGS, AND RESIDENTS INCERTAIN SETTINGS 28. The authority citation for part 415 continues to read as follows:Authority: Secs. 1102 and 1871 of the Social Security Act (42U.S.C. 1302 and 1395(hh)).Subpart D--Physician Services in Teaching Settings 29. Section 415.178 is revised to read as follows:
Page 33685Sec. 415.178 Anesthesia services.(a) General rule. (1) For services furnished prior to January 1, 2010, an unreduced physician fee schedule payment may be made if a physician is involved in a single anesthesia procedure involving an anesthesia resident. In the case of anesthesia services, the teaching physician must be present during all critical portions of the procedure and immediately available to furnish services during the entire service or procedure. The teaching physician cannot receive an unreduced fee if he or she performs services involving other patients during the period the anesthesia resident is furnishing services in a single case.Additional rules for payment of anesthesia services involving residents are specified in Sec. 414.46(c)(1)(iii) of this chapter.(2) For services furnished on or after January 1, 2010, payment may be made under Sec. 414.46(e) of this chapter if the teaching anesthesiologist is present during all critical or key portions of the anesthesia service or procedure involved; and the teaching anesthesiologist (or another anesthesiologist with whom the teaching anesthesiologist has entered into an arrangement) is immediately available to furnish anesthesia services during the entire procedure.(b) Documentation. Documentation must indicate the physician's presence during all critical or key portions of the anesthesia procedure and the immediate availability of another teaching anesthesiologist.PART 485--CONDITIONS OF PARTICIPATION: SPECIALIZED PROVIDERS 30. The authority citation for part 485 continues to read as follows:Authority: Secs. 1102 and 1871 of the Social Security Act (42U.S.C. 1302 and 1395(hh)).Subpart B--Conditions of Participation: Comprehensive OutpatientRehabilitation Facilities 31. Section 485.70 is amended by revising paragraph (j) to read as follows:Sec. 485.70 Personnel qualifications.* * * * *(j) A respiratory therapist must complete one the following criteria:(1) Criterion 1. All of the following must be completed:(i) Be licensed by the State in which practicing, if applicable.(ii) Have successfully completed a nationally-accredited educational program for respiratory therapists.(iii)(A) Be eligible to take the registry examination administered by the National Board for Respiratory Care for respiratory therapists; or(B) Have passed the registry examination administered by theNational Board for Respiratory Care for respiratory therapists.(2) Criterion 2: All of the following must be completed:(i) Be licensed by the State in which practicing, if applicable.(ii) Have equivalent training and experience as determined by theNational Board for Respiratory Care.* * * * *Authority: Catalog of Federal Domestic Assistance Program No. 93.773, Medicare--Hospital Insurance; and Program No. 93.774,Medicare--Supplementary Medical Insurance Program.Dated: June 15, 2009.Charlene Frizzera,Acting Administrator, Centers for Medicare & Medicaid Services.Approved: June 30, 2009.Kathleen Sebelius,Secretary.Note: These addenda will not appear in the Code of FederalRegulations.Addendum A: Explanation and Use of Addenda BThe addenda on the following pages provide various data pertaining to the Medicare fee schedule for physicians' services furnished in CY 2010. Addendum B contains the RVUs for work, nonfacility PE, facility PE, and malpractice expense, and other information for all services included in the PFS.In previous years, we have listed many services in Addendum B that are not paid under the PFS. To avoid publishing as many pages of codes for these services, we are not including clinical laboratory codes or the alphanumeric codes (Healthcare CommonProcedure Coding System (HCPCS) codes not included in CPT) not paid under the PFS in Addendum B.Addendum B contains the following information for each CPT code and alphanumeric HCPCS code, except for: Alphanumeric codes beginning with B (enteral and parenteral therapy), E (durable medical equipment), K (temporary codes for nonphysicians' services or items), or L (orthotics); and codes for anesthesiology. Please also note the following:An ``NA'' in the ``Non-facility PE RVUs'' column ofAddendum B means that CMS has not developed a PE RVU in the nonfacility setting for the service because it is typically performed in the hospital (for example, an open heart surgery is generally performed in the hospital setting and not a physician's office). If there is an ``NA'' in the nonfacility PE RVU column, and the contractor determines that this service can be performed in the nonfacility setting, the service will be paid at the facility PE RVU rate.Services that have an ``NA'' in the ``Facility PERVUs'' column of Addendum B are typically not paid using the PFS when provided in a facility setting. These services (which include``incident to'' services and the technical portion of diagnostic tests) are generally paid under either the outpatient hospital prospective payment system or bundled into the hospital inpatient prospective payment system payment. 1. CPT/HCPCS code. This is the CPT or alphanumeric HCPCS number for the service. Alphanumeric HCPCS codes are included at the end of this addendum. 2. Modifier. A modifier is shown if there is a technical component (modifier TC) and a professional component (PC) (modifier- 26) for the service. If there is a PC and a TC for the service,Addendum B contains three entries for the code. A code for: The global values (both professional and technical); modifier-26 (PC); and, modifier TC. The global service is not designated by a modifier, and physicians must bill using the code without a modifier if the physician furnishes both the PC and the TC of the service.Modifier-53 is shown for a discontinued procedure, for example a colonoscopy that is not completed. There will be RVUs for a code with this modifier. 3. Status indicator. This indicator shows whether the CPT/HCPCS code is in the PFS and whether it is separately payable if the service is covered.A = Active code. These codes are separately payable under thePFS if covered. There will be RVUs for codes with this status. The presence of an ``A'' indicator does not mean that Medicare has made a national coverage determination regarding the service. Carriers remain responsible for coverage decisions in the absence of a national Medicare policy.B = Bundled code. Payments for covered services are always bundled into payment for other services not specified. If RVUs are shown, they are not used for Medicare payment. If these services are covered, payment for them is subsumed by the payment for the services to which they are incident (an example is a telephone call from a hospital nurse regarding care of a patient).C = Carriers price the code. Carriers will establish RVUs and payment amounts for these services, generally on an individual case basis following review of documentation, such as an operative report.D* = Deleted/discontinued code.E = Excluded from the PFS by regulation. These codes are for items and services that CMS chose to exclude from the fee schedule payment by regulation. No RVUs are shown, and no payment may be made under the PFS for these codes. Payment for them, when covered, continues under reasonable charge procedures.F = Deleted/discontinued codes. (Code not subject to a 90-day grace period.) These codes are deleted effective with the beginning of the year and are never subject to a grace period. This indicator is no longer effective beginning with the 2005 fee schedule as ofJanuary 1, 2005.G = Code not valid for Medicare purposes. Medicare uses another code for reporting of, and payment for, these services. (Codes
Page 33686subject to a 90-day grace period.) This indicator is no longer effective with the 2005 PFS as of January 1, 2005.H* = Deleted modifier. For 2000 and later years, either the TC or PC component shown for the code has been deleted and the deleted component is shown in the database with the H status indicator.I = Not valid for Medicare purposes. Medicare uses another code for the reporting of, and the payment for these services. (Codes not subject to a 90-day grace period.)L = Local codes. Carriers will apply this status to all local codes in effect on January 1, 1998 or subsequently approved by central office for use. Carriers will complete the RVUs and payment amounts for these codes.M = Measurement codes, used for reporting purposes only. There are no RVUs and no payment amounts for these codes. Medicare uses them to aid with performance measurement. No separate payment is made. These codes should be billed with a zero (($0.00) charge and are denied) on the MPFSDB.N = Non-covered service. These codes are non-covered services.Medicare payment may not be made for these codes. If RVUs are shown, they are not used for Medicare payment.R = Restricted coverage. Special coverage instructions apply. If the service is covered and no RVUs are shown, it is carrier-priced.T = There are RVUs for these services, but they are only paid if there are no other services payable under the PFS billed on the same date by the same provider. If any other services payable under thePFS are billed on the same date by the same provider, these services are bundled into the service(s) for which payment is made.X = Statutory exclusion. These codes represent an item or service that is not within the statutory definition of ``physicians' services'' for PFS payment purposes. No RVUs are shown for these codes, and no payment may be made under the PFS. (Examples are ambulance services and clinical diagnostic laboratory services.) 4. Description of code. This is an abbreviated version of the narrative description of the code. 5. Physician work RVUs. These are the RVUs for the physician work for this service in CY 2010. 6. Nonfacility practice expense RVUs. These are the 2010 resource-based PE RVUs for nonfacility settings. 7. Facility practice expense RVUs. These are the 2010 resource- based PE RVUs for facility settings. 8. Malpractice expense RVUs. These are the RVUs for the malpractice expense for the service for 2010.Note: The budget neutrality reduction resulting from the chiropractic demonstration is not reflected in the RVUs for CPT codes 98940, 98941 and 98942. The required reduction will only be reflected in the files used for Medicare payment. 9. Global period. This indicator shows the number of days in the global period for the code (0, 10, or 90 days). An explanation of the alpha codes follows:MMM = Code describes a service furnished in uncomplicated maternity cases including antepartum care, delivery, and postpartum care. The usual global surgical concept does not apply. See the 1999Physicians' Current Procedural Terminology for specific definitions.XXX = The global concept does not apply.YYY = The global period is to be set by the carrier (for example, unlisted surgery codes).ZZZ = Code related to another service that is always included in the global period of the other service. (Note: Physician work and PE are associated with intra service time and in some instances in the post service time.*Codes with these indicators had a 90-day grace period beforeJanuary 1, 2005.BILLING CODE 4210-01-P
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Continued on page 33719From the Federal Register Online via GPO Access [wais.access.gpo.gov]]
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FR Doc. E9-15835 Filed 7-1-09; 11:15 amBILLING CODE 4120-01-C
