Policy Analysis: Proposed Medicare Rules Cut Fees, Alter Reporting Requirements SLPs and audiologists could see lower reimbursements, even with congressional intervention. Policy Analysis
Policy Analysis  |   September 01, 2013
Policy Analysis: Proposed Medicare Rules Cut Fees, Alter Reporting Requirements
Author Notes
  • Lisa Satterfield, MS, CCC-A is ASHA director of health care regulatory advocacy.
  • Neela Swanson is ASHA associate director of health care economics and coding.
Article Information
Regulatory, Legislative & Advocacy / Policy Analysis
Policy Analysis   |   September 01, 2013
Policy Analysis: Proposed Medicare Rules Cut Fees, Alter Reporting Requirements
The ASHA Leader, September 2013, Vol. 18, 20-22. doi:10.1044/leader.PA2.18092013.20
The ASHA Leader, September 2013, Vol. 18, 20-22. doi:10.1044/leader.PA2.18092013.20
The proposed 2014 Medicare fee schedule cuts reimbursement by about 20 percent, but Congress has reversed similar proposals in recent years and is expected to do the same this year. The proposal also drastically changes the Physician Quality Reporting System, and expands therapy cap provisions to critical access hospitals.
ASHA supplied comments on the rule to the Centers for Medicare and Medicaid Services, which released the proposal July 8. CMS will consider all public input before releasing a final rule before the end of 2013.
CMS computes reimbursement rates for each CPT code (Common Procedural Terminology © American Medical Association) based on a mandated formula. The formula begins with the code's relative value units, a number established by CMS—with input from the AMA and specialty societies—that considers a variety of costs associated with providing the service. The RVUs are multiplied by the conversion factor, a number that changes annually based on a congressionally mandated formula, to determine the corresponding fee.
CMS projects a 2014 conversion factor that is 24.4 percent lower than the 2013 factor. Although this reduction is mandatory because of a statutory formula, Congress has enacted legislation to prevent this reduction in previous years, and is expected to do so for 2014.
In addition, the 2014 proposed rule would revise the Medicare Economic Index, a measure of practice cost inflation that affects the conversion factor.
Although there will be reductions, ASHA's analysis of RVUs indicates an overall drop of 6.2 percent for audiology codes and a drop of 3.7 percent for speech-language pathology codes, although actual adjustments will not be determined until published in the final rule. RVUs separate the cost of providing the service into three components—professional work, practice expense, and professional liability insurance (malpractice)—adjusted for geographical differences. CMS adjusts practice expense RVUs across providers to maintain Medicare budget neutrality; if CMS adds new services to Medicare or increases RVUs for other specialties, it must offset the increased costs by reducing payment for other services. Diagnostic services have generally seen greater reductions than other services.
Unlike practice expense, professional work values (the amount of time, technical skill, physical effort, stress and judgment required to provide the service) do not change over time. To mitigate the fluctuation of practice expense values, ASHA continues to work with the American Medical Association, other specialty societies, and CMS to ensure appropriate assignment of professional work values to audiology and speech-language pathology codes.
Although ASHA's analysis focuses on the changes in RVUs for audiology and speech-language pathology codes, CMS, in its assessment of the total payment impact of the proposed rule, predicts a cumulative 1 percent increase in total allowed charges for audiology and speech-language pathology services. The CMS calculations reflect predicted total Medicare expenditures for each specialty for the entire year, but the effect on individual providers will vary based on the mix of services they provide. These calculations do not include the effect of the projected 24.4% decrease due to the conversion factor.
Multiple procedure payment reduction
The multiple procedure payment reduction process lowers the reimbursement level for speech-language pathology (and other) services when a single facility bills for multiple therapy services on the same day for a single patient. The 2014 proposed rule maintains the MPPR with no changes. The process does not apply to add-on codes, such as CPT 92608 (each additional 30 minutes for speech-generating device evaluation). MPPR does not apply to audiology services, although CMS is considering expanding it. For more information, visit our Calculating Medicare Fee Schedule Rates page.
Physician Quality Reporting System
Medicare providers must participate in the Physician Quality Reporting System, a method of outcome data collection, to avoid penalties—reductions in reimbursement levels—in 2015 and beyond. The proposed changes to PQRS are significant for audiologists and speech-language pathologists.
To avoid penalties in 2015, private and group practice audiologists and speech-language pathologists must report one measure for one patient on one claim in 2013.
The proposed rule requires a much higher level of participation in 2014 to avoid a 2 percent penalty in 2016: Providers must report on nine measures covering at least three of the National Quality Strategy domains for at least 50 percent of the eligible Medicare beneficiaries. If fewer than nine measures apply, providers must report the maximum measures available "for which there is Medicare patient data" for at least 50 percent of the eligible Medicare beneficiaries.
The National Quality Strategy, mandated in the Affordable Care Act, has developed six domains to classify measures of health care quality: patient-centered care, patient safety, care coordination, community health, efficiency and cost reduction, and effective clinical care.
These proposed changes affect speech-language pathology measures and how they are reported. Since PQRS was initiated, SLPs have been able to participate by reporting eight of the National Outcomes Measurement System functional communication measures for stroke patients. However, CMS has determined that registries must be able to collect at least nine measures in a minimum of three National Quality Strategy domains.
Because the NOMS functional communication measures—designed for SLPs to measure outcomes and progress—do not reflect the proposed direction, CMS has recommended retiring these measures for PQRS reporting.
The proposed PQRS reporting changes do not affect the use of NOMS for Medicare's functional outcome reporting requirements using G-codes on speech-language treatment claims.
CMS has proposed deleting one audiology measure—referral for otologic evaluation for patients with congenital or traumatic deformity of the ear. As a result, there is only one audiology-specific measure for reporting in 2014—referral for otologic evaluation for patients with chronic or acute dizziness.
The cross-discipline measures available to audiologists and SLPs remain the same in 2014: documentation of medication in the medical record, screening for clinical depression (audiology), and pain assessment (speech-language pathology). However, it is unclear how these measures fit into the new requirements. For more information, go to our PQRS page.
Therapy cap expansion
Medicare restricts the speech-language, physical therapy and occupational therapy services a single beneficiary may receive in a year. These services, when provided in hospitals, were never included in the therapy cap until October 2012, when Congress temporarily extended the therapy cap to all outpatient hospital services for the remainder of that year and subsequently 2013.
CMS has interpreted previous legislation to exempt critical access hospitals (rural community hospitals that meet specific criteria) from the provision; in 2013, however, Congress specified that therapy provided in critical access hospitals should count toward the therapy cap. Further CMS analysis of the Social Security Act concludes that it has the regulatory authority to extend the therapy cap provisions to critical access hospitals—permanently—outside the legislation that temporarily extends them to hospitals, and is proposing to do so in the 2014 rule.
'Incident to' and overpayment liability
The proposed rule also clarifies that any ancillary provider who bills Medicare "incident to" must be working within state and federal scope-of-practice regulations. "Incident to" refers to procedures billed under a physician's national provider identification but performed by another provider in the physician's office. Following an Office of Inspector General investigation, CMS determined that current regulations do not address state scope-of-practice and licensing laws that may prohibit some ancillary providers from performing certain services allowable under Medicare. The proposed rule requires ancillary providers to work within their state scope-of-practice-regulations when billing "incident to."
CMS also is proposing changes to overpayment liability regulations to align with a recent legislative mandate. Under the proposal, CMS may investigate suspected overpayment of claims for five years after the date of the claim, rather than for three years as currently regulated.
It is important to note that the 2014 rules are proposed, not final. Although audiologists and SLPs may want to prepare to make some practice changes—such as participating in PQRS, ensuring appropriate documentation, and remaining informed by signing up to receive ASHA Headlines announcements—no one should revise billing systems or update fee schedules yet. ASHA will submit comments and meet with CMS about concerns and significant impacts on the professions.
More Proposed Medicare Changes

The Medicare Physician Fee Schedule, which governs speech-language pathology services and some audiology services, is one of several proposed rules that affect audiologists, speech-language pathologists and the clients they serve. Information about other proposed Medicare rates and regulations is available at The ASHA Leader Online:

  • Home health agencies (decreased 60-day episode rates; increased per-episode rates; diagnostic code category changes; additional claims-based quality measures).

  • Audiology outpatient hospital rates (increased rates for audiology diagnostic tests, vestibular tests, and intraoperative monitoring).

  • Speech-generating devices (available only as rent-to-own).

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September 2013
Volume 18, Issue 9