Final 2012 Physician Fee Schedule Released with Changes Requested by AAN

November 3, 2011

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While the physician community as a whole received good news when the Sustainable Growth Rate (SGR) formula cut was lower than expected, neurologists will fare better than many specialties in 2012 Medicare payments, including continued increases in practice expense payments. The final 2012 Medicare Physician Fee Schedule rule was released by the Centers for Medicare and Medicaid Services (CMS) on November 1, 2011. The final rule contains an SGR cut of 27.4 percent, 2.1 percent lower than expected, which results in an estimated conversion factor of $24.6712. Each year, Congress has acted to forestall an SGR cut from occurring and the AAN has received repeated assurances from members of Congress that they will not allow an almost 30-percent cut to physician payments. CMS finalized several provisions the AAN requested in the final rule, including adding neurologic quality measures, decreasing the proposed cut to imaging services, and easing the criteria to approve new telehealth services.

Neurologists will have greater opportunities to participate in the Physician Quality Reporting System (PQRS) and receive its payment bonus. CMS has accepted four quality measures sets to the PQRS, covering dementia, epilepsy, Parkinson's disease, and sleep apnea, which were supported by the AAN. The epilepsy and Parkinson's disease measures were developed solely by the AAN, and the dementia measures were developed by the AAN in conjunction with the AMA.

The fee schedule finalizes payment values for several new codes for neurologic services.

Furthermore, the Multiple Procedure Payment Reduction (MPPR) will be extended to the professional component of second and subsequent advanced imaging services provided to the same patient on the same day. CMS originally proposed a 50-percent cut to the professional component. However, CMS agreed with commenters, including the AAN, that a 50-percent cut was unwarranted and finalized a 25-percent cut to the professional component of the second and subsequent advanced imaging services provided to the same patient on the same day. The 25-percent MPPR cut to the professional component of imaging services will only apply to 119 imaging codes, which currently have a MPPR cut of 50 percent to their technical components.

Starting in 2012, the final rule's incentive payments for the Medicare Electronic Prescribing (eRx) Incentive Program will be 1 percent, and decrease to 0.5 percent in 2013. The reporting period for both the 2012 and 2013 incentive payments is 12 months, the entire respective calendar year. Payment adjustments will increase from 1 percent in 2012 (already determined based on reporting in 2011) to 1.5 percent in 2013 and 2 percent in 2014. Neurologists who do not meet the December 31, 2011, deadline for successful reporting to avoid the 2013 payment adjustment will be able to use a new six-month reporting option from January 1, 2012, through June 30, 2012, that has been finalized to avoid the 2013 payment adjustment. CMS has changed the group practice reporting option to practices with 25 or more eligible professionals. Groups of 2-24 eligible physicians are no longer able to report as a group. Physicians who earn incentives through the Medicare EHR Incentive Program are not eligible for an eRx bonus.

CMS will change its criteria for adding to the list of approved telehealth services to focus on the clinical benefit of making the service available through telehealth, instead of the current standard which requires the service to be comparable.

The final rule with comment period will be reviewed in its entirety by the AAN staff and any comments needed to protect the interests of neurologists will be filed by the January 3, 2012, deadline.