MPFS 2011 Final Rule

November 6th, 2010 | Healthcare Reform | Income Approach & Methods | Medicare | Regulatory Matters

First of all, the 24.5% cut in the conversion factor is not going to happen, Congress will eventually get around to suspending it. More interesting, CMS defined the manner in which the 10% Primary Care Bonus provided under the Reform legislation will work. There has been considerable confusion over the language in the PPACA legislation which used the term “payment.” Medicare actually only pays 80% of the Allowed Charge and the Medicare beneficiary pays the other 20%. As such, looked like the bonus was 10% of 80% or 8%.  The Final Rule makes it clear that “payment” is read “payment amount” – the latter term appearing hundreds of times in the proposed rule – and the payment amount is equal to the allowed charge. Thus, the bonus is 10 of 100% or 10%. This is a lot of money in many primary care practices particularly those concentrated in the elderly where Medicare can easily make up more than 50% of the revenue.

CMS also made it clear that despite many comments to the Proposed Rule, it has no authority to modify the PPACA language defining primary care physicians based on specific CPT codes and the 60% threshold for allowed charges under those CPT codes. Readers should be aware that when physicians obtain their Medicare provider number they specify their specialty; the rule also precludes physicians from reclassifying themselves to take advantage of the bonus.

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