Medicare Outpatient Rule Proposes Few Changes Audiologists and speech-language pathologists would see no change in reimbursement and would gain a temporary reprieve from quality reporting. Policy Analysis
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Policy Analysis  |   September 01, 2016
Medicare Outpatient Rule Proposes Few Changes
Author Notes
  • Sarah Warren, MA, is director of ASHA health care regulatory advocacy. swarren@asha.org
    Sarah Warren, MA, is director of ASHA health care regulatory advocacy. swarren@asha.org×
  • Neela Swanson is director of ASHA health care coding policy. nswanson@asha.org
    Neela Swanson is director of ASHA health care coding policy. nswanson@asha.org×
Article Information
Regulatory, Legislative & Advocacy / Policy Analysis
Policy Analysis   |   September 01, 2016
Medicare Outpatient Rule Proposes Few Changes
The ASHA Leader, September 2016, Vol. 21, 26-27. doi:10.1044/leader.PA.21092016.26
The ASHA Leader, September 2016, Vol. 21, 26-27. doi:10.1044/leader.PA.21092016.26
Proposed 2017 regulations for Medicare Part B (outpatient) reimbursement would have little or no effect on fees for audiologists and speech-language pathologists, end some quality measure programs, propose mandatory enrollment for managed care providers, and revise some laryngoscopy codes.
Overall, however, the rule, which applies to calendar year 2017, has no significant impact on audiology and speech-language services. No changes—including reimbursement levels—are final until the final rule is published later this year.
Payment changes
The 2017 conversion factor will be $35.7551, according to estimates from the Centers for Medicare and Medicaid Services (CMS; see the sidebar below for an explanation of how Medicare’s provider fee schedule works). This figure is slightly lower than the current $35.8279, despite 2015 legislation that calls for a 0.5 percent rate increase. The slight reduction is due to mandated adjustments necessary to offset other increased expenses in the Medicare program.
Reimbursement for some audiology and speech-language codes may change by a different amount if the code’s value changes, but CMS predicts an overall 1-percent positive impact on audiology reimbursement and no impact for speech-language services.
An ASHA analysis agrees with this assessment: Most individual codes will see only a small positive or negative rate adjustment, indicating increased stability in audiology and speech-language pathology payment rates.
Quality reporting
Existing Part B quality reporting mandates, including the Physician Quality Reporting System (PQRS), end Dec. 31, 2016, giving audiologists and SLPs a possible temporary reprieve from quality reporting. (Quality reporting from 2016 will, however, affect payment adjustments in 2018.)
The same legislation that established the 0.5 percent rate increase—the Medicare Access and CHIP Reauthorization Act (MACRA)—requires CMS to create a merit-based payment system (MIPS) to replace PQRS. This system bases payment on four quality-improvement categories: clinical practice improvement activities, quality, resource use and meaningful use of electronic health records.
In a separate proposed rule issued in April, CMS outlined its vision for this system, which includes many components from PQRS and other quality initiatives. Audiologists and SLPs will not be subject to MIPS for at least the first two years of the program, but ASHA is investigating ways interested members can voluntarily participate to gain experience with the program, the implications of voluntary participation, and the level of support voluntary reporters can expect.
ASHA is also developing qualified clinical data registries that audiologists and SLPs can use for reporting Medicare MIPS. The registries also will provide a data collection tool to help drive evidence-based practice.

Existing Part B quality reporting mandates end Dec. 31, 2016, giving audiologists and SLPs a possible temporary reprieve from quality reporting.

Medicare Advantage provider enrollment
The proposed rule also addresses Medicare Advantage (also known as Part C or Medicare managed care), which is administered by private health plans. Unlike traditional Medicare—in which providers must enroll in the Medicare program to treat beneficiaries in most settings—each private health plan participating in Medicare managed care determines the rules for becoming a provider within that plan. Under the proposed rule, Medicare Advantage providers must enroll in Medicare to treat Medicare beneficiaries. This proposed change would increase CMS oversight and promote consistency across the Medicare programs.
Therapy cap
The 2015 MACRA legislation extended the therapy cap exceptions process through Dec. 31, 2017 (see sidebar below). Typically, the cap increases by about $20 each year, so it is likely to be $1,980 for 2017. The definitive figure will be announced in the final rule.

Most individual codes will see only a small positive or negative rate adjustment, indicating increased stability in audiology and speech-language pathology payment rates.

Flexible laryngoscopy codes
CMS regularly identifies codes that may have been misvalued. In 2014, it began the process of revaluing two laryngoscopy CPT (Current Procedural Terminology) codes: CPT 31575 (diagnostic flexible fiberoptic laryngoscopy) and 31579 (flexible or rigid fiberoptic laryngoscopy with stroboscopy). The re-evaluation process has lowered the value of these two codes and, as a result, their associated fees:
  • 31575, Laryngoscopy, flexible; diagnostic—3 percent decrease.

  • 31579, Laryngoscopy, flexible or rigid telescopic, with stroboscopy—18 percent decrease.

ASHA is working with stakeholders, including the American Academy of Otolaryngology-Head and Neck Surgeons, to provide comment to CMS on the reduced values.
ASHA resources
ASHA’s website lists the current fee schedule and related information for audiologists and SLPs. That page will be updated when the final rule is released, typically in November.
Fee Schedule and Therapy Caps Primer

Need a refresher on how Medicare provider reimbursement and therapy caps work? Read on.

Fee schedule

The Medicare Physician Fee Schedule (MPFS) determines how much money physicians and other health care providers—including audiologists and speech-language pathologists—receive from Medicare for providing outpatient services to Medicare beneficiaries.

The MPFS specifies a fee for each covered procedure. The fee is based on the “value” of the procedure, a number that reflects the complexity and cost of providing the service. To calculate the fee, Medicare multiplies the value of the procedure by a dollar amount, known as the conversion factor. The conversion factor and the value assigned to a procedure can fluctuate.

Every summer, the Centers for Medicare and Medicaid Services (CMS) issues a proposed rule that includes the fee schedule and other regulations for the next calendar year. CMS invites comments on the proposed rule for 60 days and considers those comments before issuing a final rule in November.

The MPFS also applies to most speech-language treatment provided in hospital outpatient settings. Audiology outpatient hospital services are paid under a different schedule that is covered under a separate rule.

Therapy caps

Medicare places a limit on how much outpatient therapy it will cover for each beneficiary per year. This “therapy cap” is applied to two different therapy categories: speech-language pathology and physical therapy services combined, and occupational therapy. Outpatient therapy use is calculated using the Medicare rate for the services, including any deductible or coinsurance paid by the beneficiary.

The annual proposed fee schedule rule sets the cap for the following calendar year.

An exceptions process—under which providers use the “KX” modifier on claims to indicate medical necessity for services that exceed the cap—allows beneficiaries to receive medically necessary services. Claims that extend well beyond the cap may trigger an automatic medical review to determine necessity.

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September 2016
Volume 21, Issue 9