CMS proposes 21.5% physician pay cut; ACC fights back

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The Centers for Medicare & Medicaid Services (CMS) has proposed a 21.5 percent rate reduction for the 2010 calendar year to more than one million physicians and non-physician practitioners who are paid under the Medicare Physician Fee Schedule (MPFS). The MPFS sets payment rates for more than 7,000 types of services in physician offices, hospitals and other settings.

The American College of Cardiology (ACC) is opposing the proposed cuts to physician payments, and is launching a campaign to "fight these cuts."

"The ACC is shocked that CMS has proposed to cut payments to cardiology services by 11 percent in a single year," stated ACC President Alfred Bove, MD. "These proposed cuts are based on the incorporation of a few esoteric pieces of data into a complex formula. The focus on this formula completely ignores the very important issues of access that are certain to be created by these huge slashes in payment. Services that have improved countless lives by diagnosing and treating cardiovascular disease are scheduled to have payment cuts in the range of 25 to 42 percent."

Bove continued to say that the ACC is "very concerned that CMS chose to disregard the standards it previously put in place to ensure the quality of practice expense data. We believe this is a significant departure from previous policy and may be a violation of statute. It is ironic that the agency that purports to support an evidence-based approach to medicine is making major decisions based on such shoddy and incomplete data."

CMS also is proposing to remove physician-administered drugs from the definition of "physician services" for purposes of computing the physician update formula. This is being done in anticipation of enactment of legislation to provide fundamental reforms to Medicare physician payments. Although the proposal will not change the projected update for services during CY 2010, CMS projects that it would reduce the number of years in which physicians are projected to experience a negative update.

The American Medical Association (AMA) applauded the CMS decision to remove physician-administered drugs from fee computations.

"The removal of physician-administered drugs from the broken Medicare physician payment formula is a major victory for America's seniors and their physicians," said AMA President J. James Rohack, MD. "We are very pleased that the Obama administration agrees with the AMA that drugs do not belong in the physician payment formula."

CMS also is proposing to stop making payment for consultation codes, which are typically billed by specialists and are paid at a higher rate than equivalent evaluation and management (E/M) services. Instead, practitioners will use existing E/M service codes when providing these services.  Resulting savings would be redistributed to increase payments for existing E/M services. 

The agency will accept comments on the proposed rule until Aug. 31, and a final rule is scheduled to be issued by Nov. 1.