Print | Email Proposed Physician Fee Schedule Holds Mixed Results for Departments of Internal Medicine (July 9, 2009) 

The Centers for Medicare & Medicaid Services (CMS) released the proposed Medicare physician fee schedule for calendar year 2010 on July 1, 2009.  In the proposal, CMS announced plans for a 21.5% reduction in the conversion factor for the year, a cut observers expect Congress will rescind, as has been the case for the last five years.  The proposal also includes significant changes to the practice expense relative value unit (RVU) component of Medicare physician payments that will reduce the program’s payments for some specialties while increasing expenditures for primary care.

The practice expense RVU changes were driven largely by the results of a new survey on expenses conducted by the American Medical Association.  The following list shows the practice expenses and cumulative RVU changes (including only marginal changes in work and malpractice RVUs) for Medicare allowed charges by recognized specialty (see page 716):

Detailed RVU amounts for evaluation and management services are listed here; the proposed rule lists all such changes starting on page 852.

Despite the proposed RVU changes, the conversion factor cut would significantly reduce payments for all Medicare physician services.  For example, CMS estimates (for non-facility venues) that payment for a mid-level new patient office visit (CPT code 99203) would be cut from $91.97 to $81.00; a mid-level established patient office visit (CPT code 99213) would be cut from $61.31 to $54.09.  Left heart catheterization (CPT code 93510) would be cut from $248.86 to $169.36.  CMS does not provide any estimations of the reimbursement levels were Congress to rescind the conversion factor reduction.

The proposal also calls for the elimination of all consultation codes, with the exception of new codes for telehealth consultations.  In lieu of consultations, physicians would bill for the relevant level of evaluation and management (E/M) service.  This change would be accompanied by small increases in work RVUs for E/M services.

In other sections of the proposal (see page 254), CMS promulgates standards for group practice reporting of quality measures in lieu of standard participation in the Physician Quality Reporting Initiative (PQRI).  For 2010, participation in PQRI qualifies physicians for an incentive payment equal to 2% of allowed charges.  Table 34 in the rule (see page 314) lists the 26 measures proposed for group practice reporting in 2010.  These measures include several related to diabetes, cardiovascular diseases, hypertension, and prevention.

Comments on the proposed fee schedule are due to CMS by August 31, 2009.  The Alliance for Academic Internal Medicine (AAIM) will draft its own comment letter to CMS.  Please contact policy@im.org with concerns about or analyses of the fee schedule that AAIM should consider when composing its comment letter.