Medicare to Change Outpatient Reimbursement System The Medicare “doc fix” is gone, replaced by a yet-to-be-designed reimbursement system that ties health care providers’ pay to the quality of their care. Federal legislation passed in April permanently repealed the formula used to set reimbursement rates for outpatient services provided by doctors and other health care providers, including ... News in Brief
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News in Brief  |   June 01, 2015
Medicare to Change Outpatient Reimbursement System
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Practice Management / News in Brief
News in Brief   |   June 01, 2015
Medicare to Change Outpatient Reimbursement System
The ASHA Leader, June 2015, Vol. 20, 8. doi:10.1044/leader.NIB1.20062015.8
The ASHA Leader, June 2015, Vol. 20, 8. doi:10.1044/leader.NIB1.20062015.8
The Medicare “doc fix” is gone, replaced by a yet-to-be-designed reimbursement system that ties health care providers’ pay to the quality of their care.
Federal legislation passed in April permanently repealed the formula used to set reimbursement rates for outpatient services provided by doctors and other health care providers, including audiologists and speech-language pathologists. Congress has overturned this statutory formula in short-fix legislation (the “doc fix”) 17 times since 1977 because of the drastic fee cuts it would have forced.
The Senate passed the Medicare Access and CHIP Reauthorization Act—which the House passed in March—before a 21-percent fee cut was set to take effect. The legislation repeals the sustainable growth rate formula used to set Medicare reimbursement rates; calls for the new system to be in place Jan. 1, 2020; and provides annual 0.5-percent increases until that date, starting July 1.
The law transitions the current Physician Quality Reporting System with higher penalties—and more focus on registry reporting—over the next two to five years, with physicians subject to the new payment system first.

Federal legislation passed in April permanently repealed the formula used to set reimbursement rates for outpatient services.

Therapy caps remain
The bill did not, however, permanently change the therapy caps—the amount of outpatient rehabilitation services a single beneficiary may receive in a year—another provision Congress has overturned almost every year. Instead, the legislation extends a modified version of the current exceptions process through 2017. An ASHA-backed amendment to the bill that would have repealed the caps failed; strong bipartisan support for the amendment, however, clearly indicates the Senate’s opposition to hard caps on outpatient therapy services and bodes well for future efforts to repeal them.
The cost of the bill—$210 billion—will be partially paid by raising Medicare costs for high-income seniors and with co-payments in Medigap plans. Those “pay-fors” still leave more than $140 billion of the bill unpaid in the first decade.
What now?
The Centers for Medicare and Medicaid Services and other agencies will begin proposing regulations to implement the new law. ASHA will comment on and meet with CMS about the development and implementation of the new system, especially regarding how the incentive payment program will work, quality and outcome measures and criteria, participation in alternative payment models and accountable care organizations, and other nuances.
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June 2015
Volume 20, Issue 6