CMS proposes an additional 6.1% cut in Medicare payments

The Centers for Medicare & Medicaid Services (CMS) has issued a proposed rule that would implement provisions in the Patient Protection and Affordable Care Act (PPACA) of 2010 that reduce preventive services for Medicare beneficiaries by 6.1 percent on or after Jan. 1, 2011. This reduction would be added to a projected 23.5 percent cut that is scheduled to take effect Dec. 1, unless Congress acts to change the current sustainable growth rate (SGR) formula.

The proposed policies would apply to payments under the Medicare Physician Fee Schedule (MPFS) for services furnished.

The proposed rule would implement provisions in the PPACA that would seek to “eliminate out-of-pocket costs for beneficiaries for most preventive services, including the new annual wellness visit,” CMS said. This visit augments the benefits of the Initial Preventive Physical Examination (IPPE) with an annual wellness visit that allows the physician and patient to develop a personalized prevention plan that includes not only the preventive services to the Medicare population, but additional services that may be appropriate because of the patient’s individual risk factors.

The agency said its proposed rule would also update other policies and payment rates for services by physicians, non-physician practitioners and certain other suppliers that are paid under the MPFS during 2011. The formula has called for an across-the-board reduction in physician payment rates every year beginning with 2002. Beginning in 2003 through Nov. 1, the cuts have been averted by legislative action.

On June 25, President Barack Obama signed the Preservation of Access to Care for Medicare Beneficiaries and Pension Relief Act of 2010, which replaces the 21.3 percent reduction in physician payment rates that was required by the SGR formula for 2010 with a 2.2 percent payment increase for services furnished on or after June 1 through Nov. 30.

“We are very concerned about the impact the continuing uncertainty about payment rates and cash flow disruptions may have on physician practices and on beneficiary access to physicians’ services,” said Jonathan Blum, deputy administrator and director of CMS’s Center for Medicare.

CMS will accept comments on the proposed rule until Aug. 24 and will respond to them in a final rule to be issued on or about Nov. 1. Except as otherwise specified, the payment policies and rates adopted in the final rule will be effective for services on or after Jan. 1, 2011.