Health Policy News

    CMS Finalizes the New Medicare Quality Payment Program

    On October 14, 2016, the Department of Health and Human Services (HHS) finalized its policy implementing the Merit-Based Incentive Payment System (MIPS) and the Advanced Alternative Payment Model (APM) incentive payment provisions in the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), collectively referred to as the Quality Payment Program. The new Quality Payment Program will gradually transform Medicare payments for more than 600,000 clinicians across the country, and is a major step in improving care across the entire health care system.

    The final rule with comment period offers a fresh start for Medicare by centering payments around the care that is best for the patients, providing more options to clinicians for innovative care and payment approaches, and reducing administrative burden to give clinicians more time to spend with their patients, instead of on paperwork.  

    Accompanying today’s announcement is a new Quality Payment Program website, which will explain the new program and help clinicians easily identify the measures most meaningful to their practice or specialty.

    To see the press release and obtain more information about today’s announcement, including a fact sheet, please visit:

    To learn more about the rule, visit:


    CMS Begins Implementation of Key Payment Legislation

    On August 8, 2015, CMS released the first proposed update to the physician payment schedule since the repeal of the Sustainable Growth Rate through the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA).  The proposal includes a number of provisions focused on person-centered care, and continues the Administrations commitment to transform the Medicare program to a system based on quality and healthy outcomes.

    In the proposed CY 2016 Physician Fee Schedule rule, CMS saught comment from the public on implementation of certain provisions of the MACRA, including the new Merit-based Incentive payment system (MIPS).  This is part of the broader effort at the Department to move the MEdicare program to a health care system focused on the delivery of quality care and value.

    The proposed rule includes updates to payment policies, proposals to implement statutory adjustments to physician payments based on misvalued codes, updates to the Physician Quality Reporting System, which emasures the quality performance of physicians participating in MEdicare, and updates to the Physician Value-Based Payment Modifier, which ties a portion of physician payments to performance on measures of quality and cost.  CMS also saught comment on the potential expansion of the Comprehensive Primary Care Initiative, a CMS Innovation Center initiative designed to improve the coordination of care for Medicare beneficiaries.

    The proposed rule also saught comment on a proposal that supports patient and family centered care for seniors and other Medicare beneficiaries by enabling them to discuss advance care planning with their providers.  The proposal follows the American Medical Association's recommendation to make advance care planning services a separately payable service under Medicare.

    AUGS responded to the Center for Medicare and Medicaid Services (CMS)’s proposals on a variety of issues.  AUGS commented on the progress in identifying and reviewing potentially misvalued services, improving the valuation and coding of the Global Surgical Package, establishing separate payment for Collaborative care, target for Relative Value Unit (RVU) adjustments for misvalued services, phase-in of significant RVU reductions, Laparoscopic, surgical, and supracervical hysterectomy CPT codes, PQRS, and provisions in CHIP and MACRA.  Please read our full comment letter here.


    Physician Fee Schedule Updates

    CMS released the CY 2017 Proposed Medicare Physician Fee Schedule Rule

    CMS released the CY 2017 Proposed Medicare Physician Fee Schedule Rule last week. Comments are due on September 6, 2016. CMS is proposing a conversion factor of $35.7751, down a bit from this year. This is even with the misvalued services target being met and the half percent update from MACRA. CMS is proposing a claims-based data collection process of 5,000 surgeons

    regarding the global surgical package starting January 1, 2017. CMS is not accepting the RUC recommended values for all of the hysteroscopy codes. Also proposed is a new list of 83 misvalued services for review by the RUC using a screen of zero day global period bill with a -25 modifier E/M. Over the next several weeks AUGS will be further analyzing the rule and the proposed RVUs for individual CPT codes and working to identify the areas that are important to comment on. Please click here for the complete Proposed Policy, Payment, and Quality Provisions Changes to the Medicare Physician Fee Schedule for Calendar Year (CY) 2017.


    Proposed policy, payment, and quality provision changes to the Mediare Physician Fee Schedule for Calendar Year 2016

    On October 30, 2015, the Centers for Medicare & Medicaid Services (CMS) issued a final rule updating payment policies, payment rates, and quality provisions for services furnished under the Medicare Physician Fee Schedule (PFS) on or after January 1, 2016. CMS finalized a number of new policies, including several that are a result of recently enacted legislation. The rule also finalizes changes to several of the quality reporting initiatives that are associated with PFS payments, including the Physician Quality Reporting System (PQRS), the Physician Value-Based Payment Modifier (Value Modifier), and the Medicare Electronic Health Record (EHR) Incentive Program, as well as changes to the Physician Compare website on  This is the first PFS final rule since the repeal of the Sustainable Growth Rate (SGR) formula by the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA).  

    The AUGS Coding and Reimbursement committee has put together this informational sheet outlining some of the specific changes that affect AUGS members.  You can also find the Urogynecologic specific Relative Value Units used in determining final Medicare payments along with the complete CMS Physician Fee Schedule in these links.


    2015 Review of Value-Based Modifier Proposed Changes
    THE AFFORDABLE CARE ACT (ACA) established a value-based payment modifier that provides for differential payment to physicians based on the quality of care provided in relation to the cost of providing that care. The modifier must be budget neutral implying that a reward for high-quality care is offset by a penalty for poor-performance care as measured through alignment with the Physician Quality Reporting System (PQRS).

    The INITIAL component in the modifier determination is PQRS participation through satisfactory reporting of data on PQRS quality measures via the PQRS Group Practice Reporting Option (GRPO) (through the use of the web-interface electronic health record) or through satisfactory participation in a PQRS-qualified clinical data registry. All EP’s (eligible providers) that meet the initial reporting requirements are placed in Category 1 and Category 1 providers are then further quality-tiered for further adjustments. Those providers who do not meet Category 1 requirements fall into Category 2. Category 2 providers are only eligible for a downward payment adjustment. Quality-tiering methodology is being utilized for value determination within the initial category. Eligible providers are classified as either low quality/average cost, average quality/high cost, high quality/low cost or average quality/low cost. The value based modifier would be applied based on the tier the EP is placed in from PQRS reporting.

    In the CY 2015 Proposed Medicare Physician Fee Schedule Rule, CMS is proposing to increase the downward adjustment from -2.0 percent to -4 percent for 2017, using a data collection year of 2015. In other words, a -4.0% Value Modifier would be applied to EP’s that don’t meet quality reporting requirements for the PQRS (Category 2) or to the quality tiers classified as low quality/average cost or average quality/high cost within Category 1. However, solo providers and groups of 2 to 9 EP’s would receive only upward or neutral adjustments in 2017, given that this will be their first year under the VBM program. Groups with 10 or more EP’s would receive upward, neutral, or downward adjustments. This approach is designed to reward groups and solo practitioners that provide high quality/low-cost care, reduce program complexity, and engage groups and solo practitioners into the Value Modifier as the phase-in is completed.

    It is proposed that the Value Modifier begin in 2017 for ALL eligible providers and all physician groups including solo practitioners. A physicians’ value modifier adjustment would be based on the 2015 data collection year. This proposal would complete the phase-in of the Value Modifier that began in 2013 with the adjustment in 2015 for groups over 100 Eps and has continued to expand in subsequent years. This program is expected to involve 815,000 physicians and 315,000 non-physician providers.

    CMS is also applying the Value Modifier to physicians and non-physician providers that participate in an ACO (Accountable Care Organization) under the Medicare Shared Savings Program during the payment adjustment period. Beginning in 2017, practitioners that participate in the Pioneer ACO Model, the Comprehensive Primary Care (CPC) Initiative, or other similar Innovation Center models or CMS initiatives will also participate in the Value Modifier.

    There is a proposal also to expand the informal inquiry process for the Value Modifier starting in CY 2015. CMS will establish a “brief” period for a group or solo practitioner to request correction of a perceived error made by CMS in the determination of its Value Modifier adjustment. CMS is currently developing the necessary infrastructure to support this process. They currently propose to classify an EP as “average quality” to the extent CMS determines it has made an error in the calculation of the quality composite.

    CMS has been distributing Quality and Resource Use Reports (QRURs) for three years to physicians providing feedback regarding quality and cost-of-care furnished to Medicare beneficiaries. CMS plans to continue with this service explaining how the Value Modifier would affect a provider’s reimbursement under PFS (Physician Fee Schedule). In the summer of 2014, CMS will provide the information to all providers based on data reported in 2013. This process will continue every summer evaluating the prior years reported data so that a provider may see how he/she fares under the new policy. It is suggested that providers access their 2013 QRURs when available to improve their performance on quality and cost measures. These reports are available via the following link:

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