Is a ‘perfect storm’ heading for urology?

Dr. Dowling“The perfect storm” is a commonly and perhaps overused metaphor that describes an effect of combined circumstances to produce an unusually strong effect. Independent urologists have absorbed remarkable change at a remarkable pace in the last 10 years-change in the understanding of urologic disease and treatment, change in adoption of technology, change in insurance reform, change in health care reimbursement, and change in the cost of operating a medical practice.

Also by Dr. Dowling: What overpayments rule means for your practice

The next few years may bring more change in a more compressed time frame than ever before. Could a perfect storm be brewing, and what should you be doing about it?

ICD-10 flexibility set to expire

On Oct. 1, 2015, the Centers for Medicare & Medicaid Services and other payers stopped accepting ICD-9 codes and began rejecting claims without valid ICD-10 codes. The transition brought dire predictions of interruptions in cash flow, drawing on lines of credit, practices shutting down, and information systems crashing. In retrospect, the transition was relatively smooth and has been compared to the Y2K “nonevent.”

Perhaps lost in the memory of this successful management of change is the “flexibility” that CMS issued in July 2015 regarding the specificity of codes (bit.ly/ICD10guidancestatement): “For 12 months after ICD-10 implementation, Medicare review contractors will not deny physician or other practitioner claims billed under the Part B physician fee schedule through either automated medical review or complex medical records review based solely on the specificity of the ICD-10 diagnosis code as long as the physician/practitioner used a valid code from the right family.”

Read - Buy and bill: Know the nuances, save your margins

In other words, starting Oct. 1, 2016, urologists face claims rejections if they choose a nonspecific code or an incorrect code from the same family when a specific code exists. A good indication of your practice’s compliance in this regard would be the utilization of C67.9-Malignant Neoplasm of Bladder, unspecified: If you are still using this nonspecific code, it could signal a gap in your adoption of ICD-10 that should be addressed before Oct. 1, 2016.

Next: Negative PQRS pay adjustments

Negative PQRS pay adjustments

The Physician Quality Reporting System has been around for several years as an incentive program, and has transitioned to a “payment adjustment system.” Many specialists, including urologists, have struggled to find relevance in the available quality measures, and the options for reporting have grown extremely complex (claims submission, EHR reporting, group practice reporting, registry reporting).

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There are indirect signs that providers are struggling to successfully attest under this program: In the last few months, CMS extended the period during which physicians could request an informal review of determinations that they would receive a 2016 negative adjustment (based on 2014 performance) (bit.ly/PQRSdeadline); then, in February 2016, CMS extended the deadline for certain 2015 PQRS submissions (bit.ly/PQRSdeadlineextension) (to avoid a 2017 payment adjustment).

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Perhaps lost in the complexity of the program is the simple arithmetic that adjustments to payment are implemented 2 years after the submission of measures. In other words, starting Jan. 1, 2017, urologists could face negative payment adjustments based upon their performance in 2015, the results of which are unknown. A good indication of a practice’s likelihood of facing negative adjustments in 2017 could be obtained from reviewing your 2014 Quality and Resource Use Reports (bit.ly/QRURinfo). If your quality score is more than one standard deviation below the benchmark, you may want to closely monitor your 2016 PQRS measures while there is still time to “improve,” as well as prepare for the possibility of a negative adjustment on Jan. 1, 2017.

Next: Meaningful use still a factor

Meaningful use still a factor

Meaningful use is still around but changing (www.urologytimes.com/mu-shift). In January 2017, early adopters of meaningful use will have the option of progressing to Stage 3 attestation (mandatory in 2018). Stage 3 will bring higher thresholds for successful attestation of some existing measures, higher standards for exchange of information with public health entities, and a requirement that the EHR be certified to 2015 edition standards, which could mean a technology or software upgrade in some cases.

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Furthermore, practices that did not successfully attest to meaningful use in 2015 will face a negative payment adjustment starting Jan. 1, 2017. Meaningful use as a stand-alone program is scheduled to end in 2019, but until then, practices need to consider the financial implications of successful participation in the program.

Changes from MACRA coming

Remember SGR and the “physician fix”? Both were replaced by the Medicare Access & CHIP Reauthorization Act of 2015 (MACRA, bit.ly/MACRAresources), a massive reform to the way physicians are paid under the Medicare program. The legislation is too complex to review in detail here, but providers will be reimbursed under one of two “value” models-the merit-based incentive program (MIPS) or alternative payment model (APM). While many details of this complicated bill have yet to be defined by rule, the schedule for change is set in law (bit.ly/MACRAtimeline), and payment changes begin in January 2019.

Read: How to safeguard your patients’ information

If CMS follows precedent, that means performance beginning Jan. 1, 2017 will impact adjustments under the MIPS program in January 2019. It is unlikely that urologists will know with certainty if they will be part of an APM in 2019 before the 2017 performance year begins; they should track details of the MIPS program as they are published to prepare for this sweeping change and the possibility that they will be reimbursed under MIPS in 2019.

Next: New drug reimbursement methodology

New drug reimbursement methodology

I recently reviewed buy and bill (www.urologytimes.com/buy-bill) for urology, and it looks like it is about to change. On March 11, 2016, CMS issued a proposed rule that would significantly change the way physicians are reimbursed for most drugs administered in the office and paid under the Part B program (bit.ly/PartBmodel). Under the first phase of this proposed “demonstration” project-ostensibly designed to test whether the current system incentivizes the administration of higher cost drugs-the ASP + 6% methodology would be replaced by ASP + 2.5% + a flat add-on fee ($16.80) for a significant number of providers in the country. Furthermore, CMS intends to implement this change in “late 2016.”

Also see: Your patients’ personal information is at risk

In other words, by Jan. 1, 2017, urologists could face a new reimbursement methodology that significantly decreases any profit margin (or increases any loss) on expensive drugs they acquire and administer to Medicare patients. Now more than ever, it is critical to understand on a drug-by-drug basis the revenue, acquisition cost, and margin as you decide whether the benefit to patients outweighs the operational risks for this line of service.

Bottom line: The forecast for late 2016/early 2017 includes the possibility of a perfect storm years in the making: ICD-10 “flexibility” expires as specificity requirement goes live, 2015 PQRS and meaningful use payment adjustments begin, the decision looms about whether to go to meaningful use stage 3, MIPS measurement is implemented, and phase 1 of the Part B drug demo begins. Local conditions may affect the weather in your area, but atmospheric disturbances appear likely to affect the entire country.

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