CY2015 Final Rule Summary Medical Oncology

CY2015 Final Rule Summary Medical Oncology Medicare Physician Fee Schedule (MPFS) Prepared By: Revenue Cycle Inc. Prepared On: October 31, 2014 http://www.revenuecycleinc.com/disclaimer. 1817 West By using Braker this information Lane, Building or guidance, F, Suite you agree 200, Austin, to such terms TX 78758 and limitations. Phone 512.583.2000 Fax 512.583.2011 www.revenuecycleinc.com 1817 West Braker Lane, Building F, Suite 200, Austin, TX 78758 Phone 512.583.2000 Fax 512.583.2002 www.revenuecycleinc.com

Introductory Summary On October 31, 2014, the Centers for Medicare and Medicaid Services (CMS) issued the final rule for the Medicare Physician Fee Schedule (MPFS) for CY 2015. MPFS Final Rule Highlights The CY 2015 may be located in its entirety by following the link below: http://www.ofr.gov/ofrupload/ofrdata/2014-26183_pi.pdf This document in PDF form is 1185 pages in length. The format of the information on the following pages is intended to serve as highlights, and readers are encouraged to view the document in its entirety for further details. Within the summation, which follows, Revenue Cycle Inc. has provided examples of reimbursement based on the interpretation of the published ruling. CY2015 MPFS Final Rule Highlights The highlights of the Final Rule are provided below in a succinct manner. Conversion Factor for CY 2015 is set at $35.8013 through March 31,2015 o 0% update from Jan 1, 2015 to March 31, 2015 related to the PAMA (Protecting Access to Medicare Act of 2014); however, due to adjustments with Budget Neutrality the CF was adjusted o If no congressional action, the update for the remainder of the year will be set at $28.2239, which is considered a 21.2% reduction Estimated impact on total allowable change by specialty o Hematology / Oncology: 1% Malpractice updates Medicare will utilize 2013 claims data to determine service level malpractice risk factor, but additional review necessary for low volume services Potentially misvalued codes- oncology related services identified through high value expenditure specialty screen; however, finalization delayed due to other review areas PQRS Seven (7) oncology measures finalized for CY 2015 and beyond Off Campus Provider Based new reporting processes were finalized to provide opportunity for data collection to be used in future ratesetting Incident To requirements for Rural Health Clinic (RHC) or Federally Qualified Health Center (FQHC) o Finalized removal of requirement for employment of nurses, medical assistants and other auxiliary personnel Locum Tenens Physicians Payment Policy comments requested and received since the proposed rule; however, no new or revised requirements at this time Addition of services to the Telehealth list 1817 West Braker Lane, Building F, Suite 200, Austin, TX 78758 Phone 512.583.2000 Fax 512.583.2002 www.revenuecycleinc.com Page 2 of 10

Conversion Factor The CY 2015 Conversion Factor (CF) was proposed to be $35.7977; however, was finalized at $35.8013 for January 1, 2015 March 31, 2015. The Protecting Access to Medicare Act of 2014 (PAMA) has replaced the reduction in the PFS which would be expected for January 1, 2015, with a zero percent update for the first three months. It is noted; beginning April 1, 2015, the published CF is set at $28.2239, unless there is Congressional action taken for the remaining nine months. This would be considered a 21.2% reduction, intended to account for budget neutrality. The payment for services under PFS is calculated with the following formula: Payment = [(Work RVU x Work GPCI) + (PE RVU x PE GPCI) + (Malpractice RVU x Malpractice GPCI)] x CF Based on the finalized CF and associated Relative Value Units (RVUs), it is estimated this will have a 1.0% impact on Hematology Oncology. An excerpt of Table 93 is provided illustrating this estimate. Malpractice Updates Medicare utilizes the Malpractice Relative Value Unit (MP RVU) to account for malpractice expenses involved in furnishing a particular service and requires review of RVUs no less than every 5 years. For CY 2015, this represents the third comprehensive review and update of the MP RVUs since implementation in CY 2000. The calculation required using information on specialty specific MP premiums linked to a specific service based upon the relative risk factors of the various specialties that furnish a particular service. As a result, the MP RVUs are based on specialty-specific data to determine the actual expense incurred by practitioners to obtain MP insurance, as well as CY 2013 Medicare claims data. The service level risk factors are based on the mix of all practitioners billing for a given service and the specialty weighted approach for surgical and non-surgical services; however, comments following the proposed rule raised questions for services utilized by multiple specialties and the possibility for MP RVUs to be set incorrectly. Medicare commented they utilize the dominant specialty designation for codes with less than 100 allowed services, and clarified that use of actual claims data to determine the dominant 1817 West Braker Lane, Building F, Suite 200, Austin, TX 78758 Phone 512.583.2000 Fax 512.583.2002 www.revenuecycleinc.com Page 3 of 10

specialty is preferable. Medicare did state an understanding of anomalies for low volume services; therefore, these codes result in the need for a subjective review in place of mere claims data. These services were defined in Table 12 of the Final Rule, which included CPT code 96420, Chemotherapy administration, intra-arterial; push technique, which is assigned to hematology oncology; however, the dominant specialty is urology based on claims data. Reimbursement Using the finalized payment information, the following reimbursement information provided. The payment amounts are based upon the published Medicare allowable for the CPT codes and the conversion factor finalized through March 31, 2015. Non-facility rates represent those services provided in a physician office setting and facility rates represent those professional services provided by the physician in a facility setting (hospital outpatient or inpatient). The variance shown in the final two columns illustrate the change in estimated reimbursement as compared to CY 2014. 2014-2015 Medicare Physician Fee Schedule HCPCS Example Impacts HCPCS Code Short Descriptor Non-Facility Payment Rate Facility Payment Rate 2014 Final 2015 Final 2014 Final 2015 Final Non- Facility Variance Facility Variance 36415 Routine venipuncture $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 36430 Blood transfusion service $34.03 $35.09 NA NA $1.05 $0.00 36591 Draw blood off venous device $23.28 $23.63 NA NA $0.34 $0.00 36593 Declot vascular device $30.81 $31.15 NA NA $0.34 $0.00 38220 Bone marrow aspiration $161.92 $166.83 $62.33 $63.01 $4.92 $0.68 38221 Bone marrow biopsy $167.65 $170.06 $77.02 $76.97 $2.41 -$0.05 96360 Hydration iv infusion init $56.96 $58.00 NA NA $1.04 $0.00 96361 Hydrate iv infusion add-on $15.05 $15.39 NA NA $0.35 $0.00 96365 Ther/proph/diag iv inf init $68.78 $69.81 NA NA $1.03 $0.00 96366 Ther/proph/diag iv inf addon $18.63 $18.97 NA NA $0.35 $0.00 96367 Tx/proph/dg addl seq iv inf $30.09 $30.43 NA NA $0.34 $0.00 96368 Ther/diag concurrent inf $20.42 $20.76 NA NA $0.35 $0.00 96372 Ther/proph/diag inj sc/im $25.08 $25.42 NA NA $0.34 $0.00 96374 Ther/proph/diag inj iv push $56.24 $56.92 NA NA $0.68 $0.00 1817 West Braker Lane, Building F, Suite 200, Austin, TX 78758 Phone 512.583.2000 Fax 512.583.2002 www.revenuecycleinc.com Page 4 of 10

96375 Tx/pro/dx inj new drug addon $22.21 $22.55 NA NA $0.34 $0.00 96376 Tx/pro/dx inj same drug adon $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 96401 Chemo anti-neopl sq/im $73.79 $74.82 NA NA $1.03 $0.00 96402 Chemo hormon antineopl sq/im $31.88 $32.22 NA NA $0.34 $0.00 96409 Chemo iv push sngl drug $108.90 $110.98 NA NA $2.08 $0.00 96411 Chemo iv push addl drug $61.26 $62.29 NA NA $1.04 $0.00 96413 Chemo iv infusion 1 hr $133.26 $136.04 NA NA $2.78 $0.00 96415 Chemo iv infusion addl hr $27.94 $27.93 NA NA -$0.02 $0.00 96416 Chemo prolong infuse w/pump $138.99 $141.42 NA NA $2.42 $0.00 96417 Chemo iv infus each addl seq $61.97 $62.65 NA NA $0.68 $0.00 96450 Chemotherapy into cns $181.98 $183.30 $82.03 $81.63 $1.32 -$0.41 96521 Refill/maint portable pump $135.05 $139.27 NA NA $4.22 $0.00 96523 Irrig drug delivery device $24.72 $25.06 NA NA $0.34 $0.00 99195 Phlebotomy $98.87 $101.32 NA NA $2.45 $0.00 G0364 Bone marrow aspirate &biopsy $12.54 $12.53 $8.96 $8.95 -$0.01 -$0.01 99201 Office/outpatient visit new $43.35 $43.68 $26.51 $26.85 $0.33 $0.34 99202 Office/outpatient visit new $74.51 $74.82 $50.51 $50.48 $0.31 -$0.03 99203 Office/outpatient visit new $108.18 $108.48 $77.02 $76.97 $0.29 -$0.05 99204 Office/outpatient visit new $166.22 $165.40 $131.83 $130.67 -$0.82 -$1.15 99205 Office/outpatient visit new $207.06 $207.29 $170.16 $169.70 $0.23 -$0.46 99211 Office/outpatient visit est $20.06 $20.05 $9.31 $9.31 -$0.01 -$0.01 99212 Office/outpatient visit est $43.70 $43.68 $25.43 $25.78 -$0.03 $0.34 99213 Office/outpatient visit est $73.08 $73.39 $51.58 $51.55 $0.31 -$0.03 99214 Office/outpatient visit est $107.83 $107.76 $79.17 $78.76 -$0.06 -$0.41 99215 Office/outpatient visit est $144.37 $145.35 $111.41 $111.70 $0.99 $0.29 Potentially Misvalued Codes A new statutory category was established, codes that account for the majority of spending under the physician fee schedule, the list of 65 codes, four of which are utilized within Medical Oncology, may be potentially misvalued. 1817 West Braker Lane, Building F, Suite 200, Austin, TX 78758 Phone 512.583.2000 Fax 512.583.2002 www.revenuecycleinc.com Page 5 of 10

The list of codes is prioritized as important to the Medicare program and beneficiaries, and account for a high level of Medicare expenditures. In order to identify potentially misvalued service or codes, Medicare periodically reviews the high expenditure services by specialty. The list for CY 2015 was developed using the top 20 codes by specialty and allowed charges. The codes have not been reviewed since 2009 or earlier and have a significant impact on PFS payments at a specialty level. This review is meant to assess any changes in the physician work and update the direct PE inputs. The selected codes were included within Table 11 of the Final Rule and excerpt pertaining to oncology is provided. TABLE 11: Potentially Misvalued Codes Identified Through the High Expenditure by Specialty Screen 96372 Therapeutic, prophylactic, or diagnostic injection (specify substance or drug); subcutaneous or intamuscular 96375 - each additional sequential intravenous push of a new substance/drug 96401 - Chemotherapy administration, subcutaneous or intramuscular; non-hormonal anti-neoplastic 96409 - intravenous, push technique, single or initial substance/drug Based on resources required over the next several years to revalue services with global periods, Medicare is not finalizing the codes identified through the high expenditure screening as potentially misvalued at this time. Medicare instructed they will re-run the high expenditure screen at a future date and further proposals for review will be provided at that time. PQRS Seven specific Oncology Measure Groups were proposed for 2015 and beyond and finalized as a component of the CY 2015 Final Rule. A measure group is a subset of four or more Physician Quality Reporting System measures, which have a particular clinical condition or focus in common. By coding a measure in a measure group providers are identifying a condition or focus which is shared across the measures in a particular measure group. The following table outlines the seven finalized Oncology measures. 1817 West Braker Lane, Building F, Suite 200, Austin, TX 78758 Phone 512.583.2000 Fax 512.583.2002 www.revenuecycleinc.com Page 6 of 10

Provider Based Status As outlined within the Proposed Rule, the increased trend of hospital acquiring physicians and physician practices has posed concern with regard to effectively and accurately establishing payment rates for the facility based pricing. The total payment for services received by a patient in a hospital based system is typically higher than those received in an office-based or free-standing center. The ability to accurately establish and set pricing information for both individual items and indirect PEs is critical in establishing accurate Practice Expense (PE) RVUs for PFS services. Medicare indicated there are serious concerns in some of the information used to establish the PE RVUs. This includes concerns with the direct PE time allocations or assumptions and prices of services and equipment. In addition, for indirect PE the information used was collected several years ago and likely needs to be updated. In was indicated a comparison of payment amounts for OPPS vs. PFS is not an accurate or appropriate means of ensuring the PFS payment rates are based on accurate cost assumptions. As published within the Proposed Rule Medicare was reviewing ways of collecting better data from physician practices including provider based and other non-facility entities that are paid through PFS. Medicare clarified the finalized adjustments were specific to the process of data collection and not adjustments to payments furnished in off-campus provider-based locations. 1817 West Braker Lane, Building F, Suite 200, Austin, TX 78758 Phone 512.583.2000 Fax 512.583.2002 www.revenuecycleinc.com Page 7 of 10

As published within the CY 2015 Final Rule, Medicare has created a two-digit HCPCS modifier to be reported with each code for hospital services furnished in an off-campus provider-based department of a hospital. The modifier will not be required for remote locations of a hospital, satellite facility of a hospital or emergency department. The two-digit modifier will be added to the HCPCS annual file as of January 1, 2015 with the label PO, the short descriptor Serv/proc off-campus pbd and the long descriptor Services, procedures and/or surgeries furnished at off-campus provider-based outpatient departments. The reporting of this modifier will be voluntary for 1 year with required reporting required beginning January 1, 2016. For professional services, Place of Service (POS) code 22, Hospital Outpatient, will be deleted and two new POS codes will be established. One will represent outpatient services furnished in an on-campus, remote or satellite location of a hospital and the other will identify services furnished in an off-campus provider-based department. At the writing of the CY 2015 MPFS Final Rule, the new POS codes were not defined, and it is expected they will not be available prior to July 1, 2015. At the time the new codes are established, Medicare has indicated practitioners will be required to use them. Collection of the data provided will begin the process of accurately assessing the PE data, including both the service-level direct PE inputs and specialty-level indirect PE information currently used to value PFS services. In addition, this data will provide better understanding of the growing trend towards hospital acquisition of physician offices and the impact of payments for these scenarios under PFS and beneficiary cost-sharing. Understanding which PE costs are actually incurred by the physician and which are incurred by the hospital is expected to provide a more accurate representation of the PE values. Incident To Current requirements for incident to billing state services must be furnished by an employee of the facility. In order to allow for flexibility and the ability to meet staffing needs in RHCs and FQHCs, Medicare proposed to remove this requirement for services furnished incident to an RHC or FQHC visit for CY 2015. This change would allow for nurses, medical assistants and other auxiliary personnel to furnish incident to services if under contract with the entity. As stated by Medicare, 23 comments were received covering concerns with professional standards of care and scope of practice for nurses, medical assistants and other auxiliary personnel, as well as benefit packages for contracted staff. Medicare did not feel this change would affect the standards of care, and the benefit packages were not felt to be a component of their regulation. As a result, Medicare finalized the provision as proposed. 1817 West Braker Lane, Building F, Suite 200, Austin, TX 78758 Phone 512.583.2000 Fax 512.583.2002 www.revenuecycleinc.com Page 8 of 10

Locum Tenens Physicians Payment Policy As a component of the CY 2015 Proposed Rule, Medicare solicited public comments regarding substitute (Locum Tenens) physician billing arrangements due to concerns with operational and program integrity issues that may occur when utilizing a substitute physician to fill staffing needs or replace a physician. In this scenario, Medicare understands services may be billed under the departed physicians NPI when performed by a substitute physician, while the same departed physician may be billing services from a new location. This could potentially result in denied claims, as well as raise questions regarding the program integrity, as the departed physician is unaware of the former medical group or employer s actions. Per The Affordable Care Act, Medicare requires that physicians and other eligible providers enroll in the Medicare program to order or refer certain items or services for Medicare beneficiaries, even if that provider will not submit claims to Medicare. In the event of a substitute physician, CMS does not know whether the physician has the proper credentials in order to perform the services billed. Medicare is requesting comments in order to achieve transparency for substitute physician billing arrangements and identify the individual furnishing the services. Medicare indicated comments were received on this issue and Medicare thanked the commenters for their input. No changes or adjustments were made at this time; however, the comments received will be considered in future rulemaking regarding this issue. Telehealth CMS finalized the proposal to add the following requested services to the telehealth list for CY 2015. Upon review of these services, Medicare found the services were similar to procedures and visits currently on the telehealth list; therefore, would qualify to be added to the list for CY 2015. The additions include: CPT codes 90845 (Psychoanalysis); 90846 (family psychotherapy (without the patient present); and 90847 (family psychotherapy (conjoint psychotherapy) (with patient present); CPT codes 99354 (prolonged service in the office or other outpatient setting requiring direct patient contact beyond the usual service; first hour (list separately in addition to code for office or other outpatient evaluation and management service); and, 99355 (prolonged service in the office or other outpatient setting requiring direct patient contact beyond the usual service; each additional 30 minutes (list separately in addition to code for prolonged service); and, HCPCS codes G0438 (annual wellness visit; includes a personalized prevention plan of service (pps), initial visit; and, G0439 (annual wellness visit, includes a personalized prevention plan of service (pps), subsequent visit). 1817 West Braker Lane, Building F, Suite 200, Austin, TX 78758 Phone 512.583.2000 Fax 512.583.2002 www.revenuecycleinc.com Page 9 of 10

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