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  • Washington Highlights

    CMS Releases Proposed Rule for the CY 2016 Physician Fee Schedule

    Len Marquez, Senior Director, Government Relations

    The Centers for Medicare and Medicaid Services (CMS) July 8 released the calendar year (CY) 2016 Physician Fee Schedule proposed rule, which contains a number of provisions focused on patient-centered care, and proposals to implement statutory adjustments to physician payments based on misvalued codes.  Comments on the proposed rule are due Sept. 8 and a final rule is expected in early November.

    The rule additionally proposes updates to the Physician Quality Reporting System (PQRS), Physician Value-Based Modifier (VBM) program, Medicare Electronic Health Record (HER) Incentive program, Medicare Shared Savings Program (MSSP), and to the Physician Compare site. The proposed rule is the first release since the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) repealed the sustainable growth rate (SGR) formula and replaced the statutory formula which had predicted negative updates with a predetermined update.

    As a part of the agency’s broader effort to move the Medicare program to a system focused on the delivery of quality care and value, CMS seeks comments in various areas including the implementation of certain MACRA provisions, such as the new Merit-Based Incentive Payment System (MIPS). The proposed rule also seeks comments on the potential expansion of the Comprehensive Primary Care initiative, a Center for Medicare and Medicaid Innovation (CMMI) initiative designed to improve Medicare beneficiaries’ care coordination.

    CMS also proposes to establish a new payment for two advance care planning services provided to Medicare beneficiaries.

    CMS proposes to continue many existing policies regarding PQRS from CY 2015 to 2016. In addition, 2016 will be the payment year for the 2018 PQRS payment adjustment. After 2018, the PQRS payment adjustment will transition to MIPS, as required by MACRA. CMS is also in the process of making changes to a PQRS measure set to eliminate gaps and replace existing measures with more robust measures. If all proposals are finalized, there will be 300 measures in the 2016 PQRS measure set.

    With the VBM program replaced by MIPS beginning in CY 2019, the proposed rule includes several key provisions to provide a smooth transition, including:

    • Using CY 2016 as a performance period for the CY 2018 VBM;
    • Applying the VBM to non-physician EP-only groups (e.g. CRNAs); and
    • Setting the amount of payment at risk for the CY 2018 VBM to minus 4.0 percent for groups with 10 or more eligible professionals (EPs), and to minus 2.0 percent for groups with 2-9 EPs, solo practitioners, and for groups that consist only of non-physician EPs who are physician assistants, nurse practitioners, certified registered nurse anesthetists, and certified nurse specialists.

    Other provisions regarding application waiver and risk-adjustments are also proposed.