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Reimbursement Highlights

2014 brings yet more payment changes. Here are a few. By Nicole Channell

The Final Rule for the 2014 Physician Fee Schedule has been issued by the Centers for Medicare and Medicaid Services (CMS). While there are many proposed changes, here is just a sampling of what’s in store.

Telehealth Services: CMS has changed the criteria for eligible telehealth originating sites to include health professional shortage areas (HPSAs) located in rural census tracts of urban areas as determined by the office of Rural Health Policy. The hope is that this will improve access to telehealth in shortage areas. CMS has also established a policy whereby geographic eligibility for an originating site will be reviewed and determined on a yearly basis consistent with other telehealth services. This will eliminate the need for mid-year changes that were confusing to both provider and beneficiary.

Misvalued Codes: CMS has been actively involved over the past several years in efforts to identify and correct potentially misvalued codes of the physician fee schedule. Around 200 codes were finalized and another 200 additional codes had their work Relative Value Units (RVUs) changed on a provisional basis for 2014. The rates for these codes are open for Public Comment until Jan. 27, 2014.

Revisions to the Clinical Lab Fee Schedule (CLFS): Current law dictates that once a payment rate has been established on the CLFS, that rate is to remain unchanged. The current fee schedule is 30-years-old. CMS feels that these payments rates are outdated and potentially excessive. CMS has indicated that it intends to review an existing statutory provision that would allow for CLFS updates based on changes in technology. As a result, CMS will now regularly review and update lab payments.

Compliance with State Law for Incident-to Services: CMS is cracking down on “incident-to” billing. The agency is requiring that incident-to services be furnished in compliance with applicable state law. This policy is intended to strengthen the integrity of the Medicare program by allowing denials or recoupment of payments when the provider fails to follow state law in providing incident-to services. CMS has also consolidated all providers who are able to bill Medicare directly for their services, requiring them to follow all the same rules for incident-to billing.

Primary Care and Chronic Care Management: CMS has emphasized primary care services over the last couple of years and once again, puts primary care at the forefront. Starting in 2015, Medicare will begin making a separate payment for what it calls Chronic Care Management Services. This will cover services that do not fall in the face-to-face category and which CMS has deemed above and beyond those services already included in the current E&M categories of payment. CMS is establishing policies that would pay separately for non face-to-face services provided to chronically ill patients with two or more significant chronic conditions. Chronic Care Management Services include the following: development, revision and implementation of a plan of care, communication to the patient, caregivers and other treating professionals, and medication management.

Nicole Channell is a health care consultant with Professional Business Consultants, Inc., (PBC) in Oak Brook. PBC offers business and management consulting and accounting services to physician practices. For more information, visit their website at

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