Congressional Letter to CMS Calls for Quicker Implementation of Reforms to the Agency's Rulemaking Process, Including Transparency and Stakeholder Participation

A bipartisan letter signed by 33 Members of Congress to CMS Administrator Marilyn Tavenner calls for changes to the CMS' 2015 Physician Fee Schedule (PFS), urging the Agency to more quickly implement a proposed policy that would allow providers an opportunity to comment on new values and price inputs for services before new rates are established in the final rule.

Currently, public comment by stakeholders on certain coding and valuation changes may only take place following the release of the PFS Final Rule. However, CMS recently proposed reforms that would ensure that such changes be included in a proposed rule, rather than a final rule. This change would allow for proper public comment and additional time to adjust to coding and valuation changes. Most importantly, it would allow stakeholders to address any errors in coding or valuation before such changes are implemented, rather than potentially being subjected to erroneous payments until such issues can be resolved in the next rulemaking cycle. Yet, this proposed reform is not set to take place until 2016, a delay that prompted the letter to CMS.

The letter, spearheaded by Rep. Bill Cassidy (R-LA), cites the CMS concession that in previous rulemaking, comments provided after the final rule had been established would have been useful if the process had allowed for such comment to the proposed rule instead. In questioning why the reform would be delayed until 2016, the lawmakers stated, "There is no reason to delay these important reforms and subject certain providers to the same opaqueness and lack of transparency in the 2015 PFS Final Rule under a process CMS acknowledges to be flawed."

"Among other benefits, this proposal will ensure that providers have a sufficient opportunity to review and provide public comment on new values and price inputs for services before new rates are established as final," wrote the lawmakers.

Study Touts Benefits of Bundled Payment Models

An analysis published in the August issue of the International Journal of Radiation Oncology lends increasing support for modifying the current Medicare fee-for-service system of cancer care reimbursement toward a more efficient and sustainable bundled model.

The analysis entitled, "Design and Implementation of Bundled Payment Systems for Cancer Care and Radiation Therapy," highlights the inefficiencies of a system that can encourage overutilization. To properly address the fundamental flaws of the current payment structure, the authors recommend a rational payment system that promotes value and ties payment to patient outcomes, rather than each unit of care provided.

Authors of the study cite an episodic payment agreement between 21st Century Oncology and Humana that, among other benefits, "streamlines claims processing for both parties and significantly reduces administrative waste." The program

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bundles 13 common cancer diagnoses, comprising approximately 90 percent of patients treated with external beam radiation therapy. After 12 months, data revealed that utilization and physician prescribing habits for the Humana population remained greater than 98 percent compliant to the recommended types and number of services modeled in each diagnosis group. Patient satisfaction scores also were consistently high.

Dr. Mantz and his fellow authors conclude, "Medicare recognizes the need for alternative payment models but thus far has focused its efforts outside of oncology. Innovative payers and providers have an opportunity to serve society and their shareholders by working together to design and implement new payment systems that align incentives while reducing administrative costs."

CMS Reports More Than 6,000 Providers Eligible For Bundled Payments Pilot

The Centers for Medicare and Medicaid Services (CMS) has added 4,122 providers to a list of 2,412 health systems already eligible to test the first phase of a bundled payments pilot program created under the Affordable Care Act.

A new CMS Fact Sheet on the Bundled Payments for Care Improvement (BPCI) initiative allows health providers to establish payment arrangements that include financial and performance accountability for episodes of care. The goal of the initiative is to increase the quality of care and patient care coordination to ultimately lowering Medicare costs.

The BPCI is comprised of four broadly defined models of care, which link payments for multiple services beneficiaries receive during a single episode of care:

Model 1: Acute care inpatient hospitalization model, in which awardees agree to provide a standard discount to Medicare from the usual Part A hospital inpatient payments.

Models 2 and 3: Retrospective bundled payment arrangement where actual expenditures are reconciled against a target price for an episode of care.

Model 4: Prospective bundled payment arrangement for which a lump sum payment is made to a provider for the entire episode of care.

According to CMS, "The initiative currently has 105 Awardees in Phase 2, including 38 conveners of health care organizations, representing 243 Medicare organizational providers. Additionally within Phase 1 of the initiative are 870 participants, including 138 conveners of health care organizations, representing 6,424 Medicare organizational providers."

CMMI Developing Episode-Based Payment Model for Oncology

The Centers for Medicare and Medicaid Innovation (CMMI) is developing specialty practitioner-focused payment and delivery models to improve the effectiveness and efficiency of specialty care, specifically chemotherapy treatment, episode-based model. The oncology payment model under development, called the Oncology Care Model (OCM), will test the effects of care coordination, improved access to practitioners, and appropriate clinical care at lower costs.

The care model would offer providers financial incentives through performance-based payments improve coordination and access for Medicare beneficiaries receiving chemotherapy treatments, which CMMI hopes will result in better health outcomes, increased quality of care and lower Medicare expenditures. The OCM would focus on chemotherapy treatment and the course of care provided during the six-month episode following the initial chemotherapy treatment.

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OCM would include all types of cancer as well as all Medicare A, B and D services that fee-for-service (FFS) beneficiaries receive during the episode period.

CMMI is undertaking the development of this model to improve health outcomes for patients with cancer, improve the quality of cancer care and reduce spending for cancer treatment through more efficient, patient-centered care.

CMMI is seeking input from the oncology community the guide the development of the model's framework. CMMI has released a design paper of the provisional elements of the model, which offers an explanation of target oncology patients and providers as well as the anticipated structure of payments.

The final oncology model will be published with requirements for participation by CMMI with a Request for Applications on the CMMI website.

CMS Establishes New Compliance Date for ICD-10

On July 31, the Department of Health and Human Services (HHS) issued a rule establishing October 1, 2015 as the new compliance date for healthcare providers, health plans, and health care clearinghouses to transition to ICD-10.

According to HHS, "The ICD-10 codes on a claim are used to classify diagnoses and procedures on claims submitted to Medicare and private insurance payers. By enabling more detailed patient history coding, ICD-10 can help to better coordinate a patient's care across providers and over time. ICD-10 improves quality measurement and reporting, facilitates the detection and prevention of fraud, waste, and abuse, and leads to greater accuracy of reimbursement for medical services."

ICD-10 will affect diagnosis and inpatient procedure coding for everyone covered by Health Insurance Portability Accountability Act (HIPAA), not just those who submit Medicare or Medicaid claims. The change to ICD-10 does not affect CPT coding for outpatient procedures.

For providers, the Centers for Medicare & Medicaid Services recommends the following for ICD-10 transition:

Develop an implementation strategy that includes an assessment of the impact on your organization, a detailed timeline, and budget. Check with your billing service, clearinghouse, or practice management software vendor about their compliance plans. Providers who handle billing and software development internally should plan for medical records/coding, clinical, IT, and finance staff to coordinate on ICD-10 transition efforts.

To learn more about the ICD-10 transition, click here.

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