CMS Fee Schedule Briefing

On December 12, 2005 the American Medical Association (AMA) hosted a meeting with the Centers of Medicare and Medicaid Services (CMS) staff who provided an update on the physician fee schedule final rule. Most of what was said came out of the final rule, however; there were some additional comments.

Highlights include:

Sustainable Growth Rate (SGR): If Congress acts to avert the negative 4.5% update, CMS will need 2-3 weeks before everything is ready on the Carrier and Fiscal Intermediary (FI) side. If it occurs after January 1, CMS will decide whether to tell physicians to hold their claims or what else they should do with their claims in the meantime. Carriers and FIs can implement the 4.5% reduction or carry over the 2005 rates into 2006 depending on Congress' instructions. CMS will need to figure out how to deal with new and deleted HCPCS codes.

Physicians will be allowed 45 days after the implementation of the update to make changes in their election for participation status.

CMS will issue a correction notice regarding the error in Table 35 (Annual and Cumulative Allowed and Actual Expenditures for Physicians' Services...). The 15% growth rate should have actually been 11%.

Drug Provisions: A second final rule will be released in July 2006 to address the additional comments received in response to the drug provisions of the final rule.

Practice Expense (PE): CMS is planning to hold a meeting in February to clarify the agency's intentions for the PE methodology and to gather input for ideas for the 2007 proposed rule.

Process for the 5-Year Review: The 5-Year Review proposed rule will be published in the spring. The final rule will be published in November with the physician fee schedule. There was a question as to whether CMS plans to implement budget neutrality changes in the conversion factor from the 5-Year Review on top of the -7% reduction for 2007. CMS staff said that the agency is currently only working on the process.

Oncology Demonstration: CMS will publish Carrier instructions on the oncology demonstration. Although the demonstration currently applies only to hematologists and oncologists, CMS is looking into whether physicians who have oncology listed as their secondary designation are eligible to participate.

Voluntary Reporting Program: CMS is going to have a discussion with the AMA CPT representatives this week about the use of Category II codes in the program. The program will launch on January 1.