Permanent “Doc Fix” Passed, Congress Ushers in New Era of Value-Based Payment

Late last night, the United States Senate overwhelmingly passed legislation to permanently repeal the flawed Sustainable Growth Rate (SGR) formula, the method used by CMS to determine physician reimbursement in the Medicare program. In a bipartisan 92-8 vote, which followed a 392-37 vote in the U.S. House of Representatives at the end of March, the Senate sent House Resolution 2 – known as the “Medicare and CHIP Reauthorization Act of 2015” – to President Obama, who has indicated that he will sign the bill [Update: President Obama signed into law on April 16].

The Senate’s action last night prevented the implementation of a severe 21 percent cut that took place on April 1, 2015, and came after years of negotiations and 17 short-term “doc fixes” that staved off the major cuts scheduled under the SGR.

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Generally, the proposal would:

• Repeal the current SGR and institute a 0.5 percent payment increase for July-December 2015 and each year until 2019;
• Shift Medicare reimbursement away from “fee-for-service” to a “pay-for-performance” system that incentivizes the use of alternative payment models and encourages providers to focus more on coordination and prevention, improving quality and reducing costs; and
• Streamline Medicare’s existing quality programs (PQRS, EHR Incentive Program, etc.) into one “value-based” performance program.

Unfortunately, the bill also contained provisions specific to doctors of chiropractic. Specifically, Section 514, Oversight of Medicare Coverage of Manual Manipulation of the Spine to Correct Subluxation, contains, among others, the following provisions:

Medical Review of Covered Services By A Chiropractic Physician

The Department of Health and Human Services will implement a process for the medical review of CMT by a chiropractor to a Medicare beneficiary, applicable to services furnished on or after January 1, 2017, focusing on:

Specifically, Section 514, Oversight of Medicare Coverage of Manual Manipulation of the Spine to Correct Subluxation, contains, among others, the following provisions:

Medical Review of Covered Services By A Chiropractic Physician

The Department of Health and Human Services will implement a process for the medical review of CMT by a chiropractor to a Medicare beneficiary, applicable to services furnished on or after January 1, 2017, focusing on:

• Chiropractic physicians whose pattern of billing is aberrant (“outlier”) compared to peers, and
• Chiropractic physicians who have a services denial percentage in the 85th percentile or greater.

For chiropractic physicians who fall into the above two categories, prior authorization will be required after 12 services for an “episode of treatment,” determined by the underlying cause that justifies the need for services, such as a diagnosis code.

Improving Documentation of Services

The law requires CMS “in consultation with stakeholders (including the American Chiropractic Association) and representatives of Medicare administrative contractors” to develop educational and training programs by January 1, 2016, to improve the ability of chiropractic physicians to provide documentation demonstrating medical necessity. The law is not clear regarding whether such education will be mandatory.

Rules for this law have not been adopted yet and may provide further definitions and interpretations of the provisions of the new law. The ICS will keep members posted when developments occur.

Additionally, there is no provision within H.R. 2 that delays the implementation date of ICD-10. Therefore, the ICS anticipates that ICD-10 will remain mandatory beginning October 1, 2015.

H.R. 2 Text: https://www.congress.gov/bill/114th-congress/house-bill/2/text?