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  • Payment Rates, Misvalued Codes, Quality Provisions, Self-Referral: Quick Take on Proposed 2016 Physician Fee Schedule

    In the first physician fee schedule rule to come out since the repeal of the sustainable growth rate formula, the Centers for Medicare and Medicaid Services (CMS) proposes revisions to payment policies, establishes 2016 payment rates for Medicare-billed services, and updates quality provisions. The rule also begins implementation of the new merit-based incentive payment system, applicable for now to physicians and other designated providers (not physical therapists) only.

    How will the rule impact physical therapists (PTs) and physical therapist assistants (PTAs)? Below are some key highlights from APTA's initial look at the proposed rule. The association will prepare a more detailed summary in the coming days and post to APTA's website.

    2016 Payment Rates. The payment rate for physical therapy services is estimated to increase approximately 0.5%. This is based on:

    1. The proposed 2016 conversion factor of $36,1096, which reflects the 0.5% increase and budget neutrality adjustment of 0.9999 called for under the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA); and
    2. A zero impact on the relative value units—the work values, practice expense values, and malpractice expense values related to physical therapy services. The actual impact of payment rates for individual physical therapy practices will depend on the mix of services provided.

    Misvalued Codes. Ten CPT codes that PTs typically report were identified by CMS for review to determine if they are "misvalued" and need to be updated based on possible changes in physician work and direct practice expense inputs, as these codes haven't been reviewed since 2009 or earlier. The codes are 97032 (electrical stimulation), 97035 (ultrasound therapy), 97110 (therapeutic exercises), 97112 (neuromuscular reeducation), 97113 (aquatic therapy), 97116 (gait training), 97140 (manual therapy), 97530 (therapeutic activities), 97535 (self-care management training), G0283 (electrical stimulation other than wound). They are among 118 total "high expenditure" codes (with Medicare allowed charges of $10 million or more) that CMS identified for review, with a target of a 1% reduction in expenditures for misvalued codes in 2016.

    Quality Provisions. Reporting requirements and the measures that PTs report in 2016 under the PQRS program will be largely unchanged from 2015. PTs who don't successfully participate in PQRS in 2016 will face a 2.0% reduction in payment in 2018. In other quality reporting provisions:

    • CMS had planned to make all 2015 PQRS measures for individual eligible professionals available for public reporting, and this rule would to continue to make all PQRS measures available for public reporting annually.
    • PTs are again not part of the value-based modifier program in 2016, although the program will expand to a limited group of other eligible nonphysician professionals.

    Physician Self-Referral. CMS proposes some major provisions related to the physician self-referral law (ie, Stark Law) and its exceptions. CMS states the purpose of these proposals is "to accommodate delivery and payment system reform, to reduce burden, and to facilitate compliance," and "to expand access to needed health care services."

    APTA will submit comments on the proposal, which are due September 8.


    • Any movement on the proposed payment methodology from the APTA? For example, complicated versus simple treatments? Secondly, the commnets about the Stark law suggestes that POPs wil be exploding in the coming 12-18 months. Hopefully I'm m isinterpreting these comments from CMS.

      Posted by Brett Michener on 7/13/2015 6:31 AM

    • Paragraph about "misvalued codes" is quite troubling. Since these are essentially all the codes available to outpatient PT, it appears CMS feels PT is misvalued. Sounds like another potential pay cut - already reduced by MPPR, sequestration, and years of flawed SGR formula. The cost of a DPT education has become increasingly exorbitant as compared to a decade or so ago and I hope students are being counseled on their declining projected return on investment.

      Posted by Maryann D on 7/15/2015 5:37 PM

    • Concerned about misvalued codes and a target reduction of 1%, when PT's are only receiving a 0.5% increase. That sounds like PT should prepare once again to go backwards in reimbursement. BC&BS of Hawaii then drops their payments to 10-15% below M/C rate. We simply have to see an increase with reimbursement or start baking cupcakes for income. Our rates have been more static than any other healthcare providers for over a decade. Our sequestration and MPPR losses have made the last few years of rising cost of doing business: leasing, insurance, utility and employee cost (healthcare, Workers' Comp, unemployment etc.) difficult to offset. If there are any misvalued codes they are undervalued and should be upwardly adjusted based on our expertise and higher education. We definitely should be seeing some merit-based incentives and reimbursement for the cost of our mandatory EMR systems.

      Posted by Betty Fackler on 7/15/2015 10:55 PM

    • I do not find that the APTA has been strong enough in the reimbursement arena, by even a little. Instead of working so hard to make the DPT program unaffordable, they should have been working to fight the insurance companies to improve reimbursement. The insurance companies are the only ones who have gained anything for years. I agree totally with comments by Betty Fackler

      Posted by Tricia Ashton on 7/16/2015 3:34 PM

    • I already own commercial real estate to offset the reimbursement declines. Now I am looking at other revenue streams not related to PT. I refuse to grow our clinic. It is a sinking ship. We will put our money in a business with growth potential. Not PT...

      Posted by Charles Hollier on 7/18/2015 6:04 AM

    • While APTA has worked hard to prepare us on how to deal with all these changes and has attempted to deal with agencies and companies that have impacted practice in the long run it won't make a difference other than slow the sinking ship. Pretty sad.

      Posted by Scott Schultz on 7/24/2015 2:59 PM

    • This update is so vague if not having more knowledge if these matters it leaves the reader capable of interpreting the profession's future in any direction. I smell opportunity if optimistic and embracing of risk. I sense the proverbial sinking ship already referenced above if pessimistic. I think about retiring or changing industries if I struggle with change.

      Posted by Ken stack on 7/25/2015 7:29 PM

    • As sole owner of a small out-pt practice I'm wondering why APTA is not more aggressive about the MPPR that is slowly killing off small private practices that operate with high ethical standards. PTs who don't run their own offices don't feel the effect of MPPR. My (tiny)profit came from our wellness program and by leasing space to a doctor. Pitiful that we aren't being fully paid by Medicare for what we do. I would love to hear that APTA is fighting for our reimbursement.

      Posted by Nancy Reynolds on 7/27/2015 2:15 PM

    • Its interesting to observe that the "Mis-valued" codes were determined by the amount of Medicare Charges ($10+MM). Would one not expect the "Mis-valued" to be determined by the codes calculation formula rather than the expenditure. Hmmm.

      Posted by Robert Wiersma -> COS]< on 7/28/2015 2:18 PM

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