Congress Averts Medicare Fee Cuts, Extends Therapy Cap Exceptions, Delays ICD-10 For the 17th time in 11 years, Congress overruled drastic Medicare payment cuts mandated by law. The last-minute legislation also allows exceptions to therapy caps and postpones the ICD-10 for another year. Policy Analysis
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Policy Analysis  |   May 01, 2014
Congress Averts Medicare Fee Cuts, Extends Therapy Cap Exceptions, Delays ICD-10
Author Notes
  • Ingrida Lusis
    is ASHA director of federal and political advocacy. ■ilusis@asha.org
Article Information
Regulatory, Legislative & Advocacy / Policy Analysis
Policy Analysis   |   May 01, 2014
Congress Averts Medicare Fee Cuts, Extends Therapy Cap Exceptions, Delays ICD-10
The ASHA Leader, May 2014, Vol. 19, 22-23. doi:10.1044/leader.PA.19052014.22
The ASHA Leader, May 2014, Vol. 19, 22-23. doi:10.1044/leader.PA.19052014.22
Congress voted to give Medicare Part B providers a 0.5 percent increase in fees effective April 1, but the short-term patch does not address the broader issue of a permanent fix to the fee-setting formula.
On March 31—the day before 24 percent cuts would have taken effect—the U.S. Senate passed H.R. 4302, The Protecting Access to Medicare Act of 2014, in a 64-35 vote. The House passed the bill the week before in a voice vote.
The legislation mandates four components of concern to speech-language pathologists and audiologists:
  • Avert the 24 percent cuts to the Part B fee schedule and increase payments by 0.5 percent through March 2015.

  • Extend the Part B therapy caps exceptions process through March 2015.

  • Delay implementation of the International Classification of Diseases, 10th edition, until Oct. 1, 2015.

  • Tie skilled nursing facility reimbursement to hospital readmission rates.

Many provider groups opposed the bill, hoping that Congress could agree on a permanent solution to the sustainable growth rate, the method used to compute Medicare reimbursement rates mandated in 1997. Congress has passed legislation to override use of the SGR, which is designed to control Medicare spending, 17 times in the past 11 years. The most recent three-month patch expired April 1.
Long-term SGR reform
The Balanced Budget Act of 1997 created the SGR payment formula and the therapy caps, which limit the amount of speech-language treatment and occupational and physical therapy a Medicare beneficiary may receive in a year. Since then, Congress has voted 17 times to avert the cuts associated with the SGR.
Congress also has either placed a moratorium on the implementation of the therapy caps or, in later years, instituted an exceptions process. This process allows additional “medically necessary” therapies, with a manual medical review at a particular threshhold.
ASHA and many other provider groups were disappointed that Congress failed to pass permanent reforms. A permanent solution to SGR and therapy caps would provide stability and predictability to the system and eliminate the uncertainty for providers and beneficiaries that results from short-term patches.
This year held promise for permanent reform. In 2013, the Congressional Budget Office scored the cost of SGR reform at $138 billion—down from its previous estimate of $297 billion—leading the House Energy and Commerce Committee and Ways and Means Committee and the Senate Finance Committee to move on permanent solutions.
The House voted to pass its version of SGR reform, but the legislation would have paid for the fix by delaying the individual mandate in the Affordable Care Act, a move that House and Senate Democrats did not support.
The Senate bill—which would not only repeal and replace the SGR formula, but also permanently repeal and replace the therapy caps—never made it to full Senate consideration, because legislators could not agree on how to pay for the cost of reform.
Although both chambers have signaled an interest in continuing talks on a longer-term solution, it is unclear whether there is true interest in or willingness to compromise on “pay-fors” to get the bill to the president’s desk.
The reform legislation would have moved reimbursement for Part B services from a volume-based approach to a system based on outcomes and clinical improvement. Providers would be required to submit data on various quality indicators to the Centers for Medicare and Medicaid Services, which would rank providers’ performance as compared with their peers. CMS would give bonuses to those with higher quality scores and penalize those with lower scores.
Neither audiologists nor speech-language pathologists were included in the first group of providers transitioning to outcome-based reimbursement.
Therapy caps
The current therapy cap exceptions process with manual medical review will remain in place until next April, with all states using a post-pay review system. G-code reporting is still required.
The Senate long-term fix would have removed the caps and required prior authorization for providers and facilities whose billing patterns deviate from generally accepted patterns, and required providers to report on standardized data that would be used to transition to a different therapy payment system. It also would have separated the disciplines of speech-language treatment and physical therapy, which are included as one therapy category under the current exceptions process.
ICD-10
It is unclear how the delay of ICD-10—scheduled to replace ICD-9 on Oct. 1—was included in the legislation. Many groups were disappointed at the measure, because of the significant resources and time expended preparing for the deadline.
New quality measures in skilled nursing facilities
H.R. 4302 also requires CMS to develop and implement two quality measures for skilled nursing facilities related to hospital readmission. Under this program, SNFs would receive incentive payments for low rates of patient hospital readmissions, beginning Oct. 1, 2018.
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May 2014
Volume 19, Issue 5