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Medicare fees increased
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Medicare is in rough financial straits as 2008 begins. If we would be totally honest and more global about it, the entire government of the United States of America is not exactly flush with spare cash.
The administrative and legislative branches of government seem intent upon letting Medicare thrash around as it best can with no money to work with, in spite of having demonstrated its ability to cover a significant portion of the nation’s health care on a small administrative budget. Medicare, managed by the Centers for Medicare and Medicaid Services, is the world’s largest purchaser of health care, yet it cannot seem to get any respect from Congress or Pres. George W. Bush.
This year’s fees not finalized until end of 2007
As has become the norm, Medicare suggested a big cut in fees for 2008 (10%) and Congress responded to the pleas of the providers to wipe out the decrease and institute a small (.5%) increase. This came as no surprise to me and other observers, as Medicare, Congress and the providers’ lobbyists have perfomed the same dance for the past 4 or 5 years. By the time you read this, your state Medicare carrier will have the 2008 fee schedule available, as January 21 was the deadline for all carriers.
You may remember that Medicare fees are calculated using the formula, Fee=Relative Value x Conversion Factor. Of the two components in the equation, the Conversion Factor is set by Congress so that the only element that Medicare still controls is the relative value. No surprise here, as you will learn that many of the commonly reported services have lower relative values for 2008 than for 2007.
Combining the very slight increase in the Conversion Factor with the decrease in relative values for some services you will see that in 2008 some of the services you provide to Medicare patients will be reimbursed at a slightly higher fee than they were in 2007 and others will be reimbursed at a slightly lower fee.
I do not have to stick my neck out very far to predict that the overall impact of the changes in conversion factor and relative values across the entire range of services you provide to Medicare recipients will be essentially unchanged.
Medicare’s impact on providers’ fee schedules
The crazy thing I have found in my visits to doctors and staff in all 50 states and in my other consulting with eye doctors is that many offices wait for the Medicare Fee Schedule to be published each year before adjusting their own fees.
What? Who in their right mind would use the measly payments offered by a health care insurer on the brink of financial ruin (Medicare) as the basis for their own fee schedule? Payers, including Medicare, are out to get as many services for as many people as necessary while paying as little as possible. Providers, on the other hand, have their own concerns, such as paying their bills, creating net income, taking care of staff and family’s financial needs and concerns, and possibly even retiring someday. For that reason, fees should always be based upon what the provider believes the services are worth and not upon what one or any payer is willing to pay. ’Nuff said.
PQRI 2008 details to be announced
July 1, 2007, saw the beginning of a brand-new program in Medicare that attempted to influence the way health care is provided within the Medicare system. All health care payers, private or governmental, have always been somewhat frustrated by paying physicians and other providers for services without knowing for sure whether the care provided was consistent with national standards for the quality and efficacy of the care. The dilemma is further complicated by the fact that there are few or no nationally accepted standards in place by which care can be assessed or measured.
National legislation seeks to change that, by establishing the Physician Quality Review Initiative (PQRI). In a nutshell, PQRI establishes a list of covered diagnoses and a list of “measures” that Medicare has identified as being appropriate care for people with each of the diagnoses. Medicare feels so strongly that these measures should be provided that Medicare will pay providers a bonus if the measures are provided as recommended.
For doctors of optometry in 2007, there were four covered diagnoses and six covered measures. Offices participated in the program by reporting the measures each time a Medicare patient was seen in the office for care of any of the four covered diagnoses. The participation was communicated to Medicare on the Medicare claim, with the measure showing up right below the procedure codes for the day’s visit.
If, during the course of the 6 months of the program, July 1 to Dec. 31, 2007, the office dealt with at least three of the four diagnoses and included the appropriate measures on the claims at least 80% of the time for those patients, the office earned a year-end “bonus” of 1.5% of all its Medicare payments during the 6 months.
As of this writing, all we know is that there will be a PQRI program for 2008, that it will again be voluntary, that parameters will be similar to 2007, that it will include diagnoses and procedures common to eye care and that bonuses will be paid again. It is important to research the 2008 PQRI as soon as you can, to learn which measures are covered for eye care, so that you can make the appropriate decision to particpate or not.
For those of you who are members of state and national associations, all of the key information will be available to you via the associations’ respective Web sites. If you don’t have that resource, the CMS Web site will be your logical source of information. Visit http://www.cms.hhs.gov/PQRI/31_PQRIToolKit.asp. You may also refer to the charts included with this article for more information.
Once you’ve done a little preparation and education, all that remains is for your office to commit to the program and begin reporting the measures on all Medicare patients, any and every time you see them for care of any of the covered diagnoses.
PQRI easy to comply with
PQRI is an unusual government program in that it is simple to comply with. It is easy for ODs to gain the bonus payment because the diagnoses are common in each office and the measures are also commonly by most ODs frequently. It is also made easy because Medicare provides modifiers to be used if the doctor considered providing a measure with a particular patient and opted not to.
My recommendation is that every office that sees Medicare patients should learn more about PQRI and should strongly consider participating in the program. You have nothing to lose, while possibly gaining the bonus payment at year’s end. The other benefit is that Medicare will be able to assess whether bonuses can be effective in encouraging providers to include certain measures in their care. Without doctors’ participation, the program is doomed to failure. It is worth a try.
For more information:
- Charles B. Brownlow, OD, FAAO, is a member of the Primary Care Optometry News Editorial Board, executive vice president of the Wisconsin Optometric Association and a health care consultant. He can be reached at PMI, LLC, 321 W. Fulton St., PO Box 608, Waupaca, WI 54981; (715) 942-0410; fax: (715) 942-0412; e-mail: Brownlowod@aol.com.