Matthew Morrill, Technology Insights
You may have heard about the proposed Medicare HOPPS reductions to CT and MRI reimbursement as reported by my colleagues at the Imaging Performance Partnership.
This likely payment reduction solidifies the trend we’ve been talking about for the past few years: diagnostic imaging is increasingly shifting from a profit driver to cost center. How should planners react?
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Becka DeSmidt, Technology Insights
The Center for Medicare and Medicaid Services decided last week to abandon the requirement that bariatric surgery programs be accredited as Centers of Excellence (COE) in order to receive reimbursement for Medicare patients.
This reversal is likely to have a significant impact on the future of the Center of Excellence program and the market for bariatric surgery in the United States.
However, that’s not to say that the Center of Excellence program will suddenly disappear.
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Caitlin Visek, Technology Insights
The proposed reimbursement rates for the 2014 Hospital Outpatient Prospective Payment System (HOPPS), released by the Centers for Medicare and Medicaid Services (CMS) last month, could make realizing a positive return on premium technology investments more challenging.
In this case study, we calculated the break-even point for a hypothetical Premium CT investment under 2013 reimbursement rates and compared it to the return under the proposed 2014 payment schedule.
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In May of this year, CMS granted formal approval for TAVR reimbursement, focusing strong attention on the financial picture of transcatheter aortic valve replacement (TAVR). The ruling mapped TAVR ICD-9 procedure codes 35.05 (transfemoral access) and 35.06 (transapical access) to MS-DRGs 216-221. While the Medicare national average payment is between $25,000 and $55,000 for these cardiac valve MS-DRGs, the payment rates at centers likely to qualify for TAVR are considerably higher; in fact, in FY2011, the payment for hospitals performing 50 or more aortic valve replacements (AVRs) was between $35,000 and $74,000, according to MedPAR data.
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Last week, Medicare announced it would reopen its recent reimbursement decision denying coverage for patients receiving MRIs with pacemakers, unless they are part of a clinical trial. Medicare's decision came out February 24th, just two weeks after the FDA approval of the first MRI-compatible pacemaker, the Medtronic REVO. Originally, Medicare announced that there was not enough time to adjust their decision to limit reimbursement for pacemaker patients receiving an MRI; however, they are now reopening this question and have issued a call for public comment.
Presently, hospitals implanting the REVO can receive reimbursement for implanting the pacemaker in patients, though subsequent scans will not be covered. While this is likely to change, this caveat represents one of several limitations to the new device. In addition to a premium price tag, the REVO represents first generation technology, unlike newer models already in use in Europe. First, the device will be limited to "new" pacemaker candidates only, not replacement patients. This is due to the need to implant MRI-safe leads; currently, lead removal is very risky and not part of standard pacemaker replacement procedures, therefore these patients are unlikely to undergo such an invasive procedure to upgrade to these devices. Likewise, in order to perform an MRI on a patient with one of these devices, the hospital must use a 1.5T MRI system. While 1.5T systems are standard of care for most hospitals, institutions that have adopted 3T systems will not be able to image these patients, thereby limiting potential adoption.
Despite the passage of health care reform legislation last week, Congress failed to approve a $138 billion bill to prevent a planned 21% cut in Medicare Part B reimbursements to physicians before entering its spring recess. The cuts are set to go into effect on Thursday, April 1st. Although the Senate earlier this month approved a measure to prevent the cuts from taking effect until October 1st, the House failed to pass the measure before Congress began an approximately two-week long recess that will delay a fix from being passed until at least mid-April.
The bill is the most recent in a series of yearly postponements in cuts to physician payments prescribed by the sustainable growth rate (SGR) formula. Developed to ensure that Medicare spending doesn't outpace growth in the economy, the SGR is an accounting mechanism which ties Medicare Part B reimbursement rates to the gross domestic product. The formula has called for large cuts in physician payments every year since 1997. However, successful annual lobbying efforts by the American Medical Association and other physician groups have persuaded Congress to postpone these cuts each year, arguing that reducing reimbursements would cause doctors to stop seeing Medicare patients, jeopardizing access to healthcare for millions of seniors and military families. Such cuts, they argue, would reduce payments to well below the cost of providing care.
Physicians have advocated for the repeal of the SGR method, rather than perpetual reliance upon Congress to take action each year. Negotiations on a permanent fix have been active since December, but an initial vote was taken to postpone the planned decreases from January 1st until April 1st to allow Congress more time to develop a permanent solution. However, with Congress now in recess, a vote by the House to further forestall the cuts beyond April 1st will not be possible until their return in mid April, without which the -21% decrease in reimbursement rates will take effect.
Congress' failure to act before the April 1st deadline may be partially attributable to the looming fate of the overall health care reform package, which some had feared might complicate the delicate political process involved with that bill's passage. Now unhampered by activity on that legislation, the House of Representatives is widely expected to pass their version of the Senate's postponement bill (which also includes provisions on extending COBRA and unemployment benefits) upon returning to Capitol Hill two weeks from now. While this will result in at least a brief period of temporarily reduced Medicare physician payments, it is likely that -- when passed -- the House bill will apply the postponement of rate decreases retroactively to April 1st, ensuring all claims filed between the 1st of April and the date the bill takes effect will be reimbursed at the pre-cut rates.