CMS Proposes 2007 Decrease in Medicare Reimbursement The Centers for Medicare and Medicaid Services (CMS) has proposed a decrease of more than 5% for all Medicare Fee Schedule payments in 2007 due to changes in Medicare’s conversion factor resulting from the Sustainable Growth Rate (SGR). The decrease is scheduled to take effect in November unless Congress intervenes. ... Bottom Line
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Bottom Line  |   October 01, 2006
CMS Proposes 2007 Decrease in Medicare Reimbursement
Author Notes
  • Mark Kander, director of health care regulatory analysis, can be contacted at mkander@asha.org.
    Mark Kander, director of health care regulatory analysis, can be contacted at mkander@asha.org.×
  • Steven White, director of health care economics and advocacy, can be contacted at swhite@asha.org.
    Steven White, director of health care economics and advocacy, can be contacted at swhite@asha.org.×
Article Information
Hearing Disorders / Practice Management / Regulatory, Legislative & Advocacy / Bottom Line
Bottom Line   |   October 01, 2006
CMS Proposes 2007 Decrease in Medicare Reimbursement
The ASHA Leader, October 2006, Vol. 11, 3-20. doi:10.1044/leader.BML.11142006.3
The ASHA Leader, October 2006, Vol. 11, 3-20. doi:10.1044/leader.BML.11142006.3
The Centers for Medicare and Medicaid Services (CMS) has proposed a decrease of more than 5% for all Medicare Fee Schedule payments in 2007 due to changes in Medicare’s conversion factor resulting from the Sustainable Growth Rate (SGR). The decrease is scheduled to take effect in November unless Congress intervenes.
The Medicare Fee Schedule sets the reimbursement rates for all outpatient speech-language pathology services and for audiology services provided in physicians’ offices and audiologists’ offices. The fee schedule includes values for each procedure using three components:
1) Professional or “work”
2) Technical or practice expense
3) Malpractice
CMS published two proposed regulations for revising the fee schedule. The first responded to a review of specific procedures which reportedly have changes in elements of the values and to address a change in the calculation of the practice expense component. The second proposal addressed other annual changes to the 2007 fee schedule.
Opposition Grows
ASHA is working with provider groups to help build congressional opposition to the proposed cut and to replace the flawed annual update formula for the Medicare fee schedule. More than 80 senators have signed such a letter initiated by Sens. Jon Kyl (R-AZ) and Debbie Stabenow (D-MI). A similar letter is being circulated in the House by Reps. Nancy Johnson (R-CT) and Ben Cardin (D-MD).
A major concern for audiology and speech-language pathology procedure values has been the proposed elimination of the non-physician work pool (NPWP)-a method established by CMS for determining the practice expenses of services without a “physician work” value. This included the technical components of most audiology services and certain speech-language pathology codes as well as radiology and cardiology services.
CMS first announced its goal to eliminate the NPWP in 2005. Under their initial proposal, payments for audiology would have been reduced by 17%. ASHA argued strongly against the proposed changes and presented several options to CMS for moderating the proposed reductions in payment. Because of objections raised and technical errors discovered in the proposal, CMS decided not to implement any of the practice expense changes for 2006.
For 2007, CMS announced a modified revision of the practice expense methodology that represents a significant improvement from its initial proposal. If implemented in its current form, audiology services would see about a 3% reduction in payment over a four-year transition period. In fact under the latest proposal, some audiology procedures that are frequently provided would receive an increase over time. For example, the values for pure tone, air and bone testing; cochlear implant programming; the new tinnitus assessment procedure; and comprehensive audiometry would all be increased. However, some high-volume audiology procedures, such as acoustic reflex threshold testing, are proposed for substantial reductions.
The situation is also mixed for speech-language pathology procedures. While increases are proposed for these evaluation and treatment codes, the clinical swallow evaluation and the modified barium swallow evaluation would be substantially reduced under the proposed rule. CMS officials have told ASHA that the four-year transition will allow for corrections to those procedures that have their values unfairly reduced.
ASHA recently submitted comments on the first proposed rule stressing the negative impact of the proposed changes and the professional role of the speech-language pathologists and audiologists. ASHA recommended that CMS calculate the values of the procedures performed by the two professions in the same manner as they do physical therapists, occupational therapists, and psychologists, utilizing the professional component of the fee schedule formula.
ASHA recommended several interim approaches to CMS for moderating the proposed reductions in payment for audiology and speech-language pathology procedures since this issue is unlikely to be resolved by the time a final rule is issued in early November. Members may view ASHA’s comment letter to CMS on the Billing and Reimbursement section of ASHA’s Web site. ASHA currently is completing comments to CMS regarding its proposal.
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October 2006
Volume 11, Issue 14