POTENTIAL REDUCTION OF OFFICE ULTRASOUND PAYMENTS BEGINNING AS SOON AS CY 2019

The Centers for Medicare & Medicaid Services (CMS) is proposing to drastically cut reimbursement to the technical component for all ultrasounds over a four-year period…

The Impact:

In the first year (2019), the impact of this proposal would be an overall reduction 9% reimbursement for physicians performing ultrasounds in their offices.  And once fully implemented, this proposal is expected to reduce overall reimbursement by 40%, with some specific ultrasounds approaching a 50% reduction.

How does CMS calculate payment?  

Your Medicare payment under the Medicare Physician Fee Schedule (MPFS) is based on relative value units (RVUs) which represents physician work, practice expense, and malpractice insurance.  It is this combination of RVUs that are multiplied by a Conversion Factor and Geographic Adjustment (GPSI) to determine the payment rate.  So, the higher the RVUs, the higher the payment.

• Physician Work RVUs are based on a relative measure of time, skill, training and intensity required to do the procedure
• Practice Expense RVUs include the expenses required to do the procedure.  Includes direct costs such as staff, supplies, and equipment along with indirect costs of providing the procedure
• Malpractice RVUs are set to reflect the costs associated with professional liability expenses

How are office-based Ultrasound payments being cut? 

The Practice Expense RVUs that are at risk of significant reduction – specifically the Direct Practice Expense Inputs (DPEI) for supply and equipment pricing.  Both the Ultrasound Access Coalition (UAC) and Radiology Business Management Association (RBMA) have worked diligently to avoid the impending reduction.  Just recently the entire Congressional delegation in the state of Washington signed onto and sent a letter to CMS administrator Seema Verma asking for further review of the practice expense data and to delay implementation. Included were concerns that CMS used an analysis that was full of inaccuracies and relied on hospital data to determine office reimbursement.  In addition, they pointed out that CMS was not transparent enough regarding the data used and questioned why they didn’t use data from reliable sources.  Since the Direct Costs include cost of the equipment and supplies, CMS was questioned as to why they didn’t get current prices directly from the manufacturers. They were also challenged as to why they didn’t check with medical societies for validation.

Biggest Concern:

We are concerned that if this proposal goes through, it will eventually reduce access for patients needing to have an ultrasound performed in an office-based setting.

What can you do? 

This proposal is slated to be finalized next month (Nov 2018).  You can help by contacting your local member of Congress to ask them to protect access to critical ultrasound services by not finalizing this proposal.  See below for Draft Template of letter you can send to your representative.

Wendy Block, CPC, RCC, CIRCC

Senior Coding Advisor, StreamlineMD

wblock@streamlinemd.com

Draft Letter for Your Representative

Just copy and paste on your own letterhead, sign and mail.

[Date]

The Honorable Seema Verma

Administrator

Centers for Medicare & Medicaid Services

U.S. Department of Health and Human Services

Hubert H. Humphrey Building, Room 445–G

200 Independence Avenue, SW

Washington, DC 20201

Dear Administrator Verma:

We write to express our concerns to the Centers for Medicare & Medicaid Services (CMS) regarding your efforts in the Calendar Year 2019 Medicare Physician Fee Schedule (PFS) Proposed Rule related to pricing of ultrasound equipment. We understand that once fully implemented, this proposal would reduce the general ultrasound room price by 65 percent and the vascular ultrasound room price by 57 percent. We have heard from a variety of stakeholders and experts that this proposal will result in a 9 percent reduction in reimbursement for ultrasound services in Year 1 and that this reduction is expected to exceed 40 percent in Year 4.

We support CMS’ efforts to review the various physician service codes under the PFS, but we are concerned that there are inaccuracies, omissions, and that CMS’ contractor used inappropriate data sources. We have also heard from stakeholders that CMS did not disclose critical information regarding the relevant data sources as statutorily required by the Protecting Access to Medicare Act of 2014. Most importantly, our constituents have expressed significant concern with the impact of this proposal, which we echo here. We are concerned that the extreme reimbursement reductions will result in significantly reduced access to critical ultrasound services.

Given the broad reaching impacts of this proposed reduction, we ask that CMS delay finalizing the reduction to the general ultrasound and vascular ultrasound room prices. Instead, we urge CMS to consider how these cuts will impact the availability of ultrasound services, especially in community-based settings and rural areas. Additionally, we request CMS disclose the information sources and relevant data used to support this proposal and work with the relevant medical societies, physicians, and manufacturers of ultrasound equipment to more accurately price this equipment.

We look forward to your response.