Changes, improvements for Medicare Physician Fee Schedule

Recent changes to the Medicare Physician Fee Schedule affecting internists are detailed, including tweaks to chronic care management codes, e-prescribing and telehealth.

A variety of recent changes to the Medicare Physician Fee Schedule will affect internists this year.

Conversion factor


Congressional action in late December 2013 granted a temporary or “bridge” conversion factor for January through March 2014. The update is a 0.5% increase over 2013. The 3-month conversion factor will be $35.8228.

Chronic care management

CMS continues to recognize the full breadth of primary care and of complex chronic care management in particular. The agency has revised its previous proposal for complex chronic care service codes, and the new proposal can be viewed as a positive development for improving care of patients with chronic conditions.

In the new proposal, CMS made a number of changes that ACP sought. For instance, it changed the timeframe for the chronic care management code from 90 to 30 days, which brought it into alignment with the existing CPT codes for complex chronic care management. CMS also changed the requirement that the chronic care management code be associated with an Annual Wellness Visit to a recommendation, given the record-keeping burden the former would have caused for physicians.

The agency kept several components of its proposed codes that ACP supports and that were in line with existing CPT codes, such as keeping the codes applicable to all specialties and requiring a comprehensive care plan.


Beginning in 2014, Part D e-prescribing became easier. ACP recommended that CMS make a change in the e-prescribing standard, and CMS accepted. The standard will evolve from the National Council for Prescription Drug Programs (NCPDP) Formulary and Benefit 1.0 to the NCPDP Formulary and Benefit 3.0. This standard provides a uniform means for pharmacy benefit payers (including health plans and pharmacy benefit managers) to communicate a range of formulary and benefit information to prescribers via point-of-care systems.

The final rule considers both standards to be in compliance from Jan. 1 through June 30, 2014. After that, the agency will require only the NCPDP Formulary and Benefit 3.0 standard.

Medicare Shared Savings

The Medicare Shared Savings Program incentive payment will be based on a broader set of performance data inputs and will be better aligned with the Physician Quality Reporting System (PQRS). ACP advocated several changes to the program to reduce the administrative burden of reporting. Accountable care organizations (ACOs), on behalf of their clinicians and suppliers who are eligible professionals, will be required to satisfy the reporting criteria of the 22 ACO group practice reporting option (GPRO) measures during 2014 and subsequent reporting periods to avoid the PQRS penalty for 2016 and subsequent payment years. This is aligned with the requirement for eligible professionals reporting under the traditional (non-ACO-related) PQRS program.

The final rule would amend the regulations to replace all references to “GPRO web interface” with “CMS web interface.”

CMS also finalized a standardized method for calculating benchmark rates when a measure's performance rates are tightly clustered. This should allow for the determination of more meaningful differences in performance rates. The application of this proposed methodology to reduce measure clustering would apply only to quality measures whose performance rates are calculated as percentiles.

In addition, the agency finalized its plan to change the weighting used for the 7 “patient experience of care” measures within the Patient Experience of Care Quality domain so all are equally weighted. There will be no change in the weight given to the overall domain.

Physician Compare website

CMS will revise its methods for updating the Physician Compare website. In the final rule, CMS stated its commitment to providing accurate and up-to-date information on the site and will continue to work to make improvements to the information presented.

ACP recommended that evaluation of physician performance be based on a number of important criteria, including information being reliable and valid; transparent in its development; open to prior review and appeal by the physicians and other health care professionals referenced; minimally burdensome to the reporting physician and other health care professionals; and comprehensible and useful to its intended audience, including a clear statement of its limitations.

The College also recommended an emphasis on the importance of giving physicians and other health care professionals timely access to performance information prior to public reporting and a fair chance to examine and appeal potential inaccuracies.

The College stated its support for using nationally recognized performance measures and data collection methodology in the Physician Compare website, the PQRS and among various CMS programs to reduce the reporting burden on physicians. The College also supports increased efforts to determine and employ the most effective means of presenting performance information to patients/consumers; to educate these information users on the meaning of performance differences among clinicians; and to use this information effectively in making informed health care choices.

In addition, the College supports public reporting of initiatives such as ACP's High Value Care initiative or the American Board of Internal Medicine Foundation's Choosing Wisely campaign that includes a clear explanation of the specific initiative.

Regarding the Physician Compare website's user interface, the College recommended that the search function include a way to identify various practice models such as ACOs or patient-centered medical homes. The College supports the newly designed Intelligent Search Functionality debuted in July 2013. However, in reviewing the search results, ACP often found that they were too broad and were not actionable for patients. The College suggested developing reasonable criteria for inclusion in the webpage search results to help consumers/patients more appropriately identify physicians.


Transitional care has been added to the telehealth benefit. CMS believes that the interactions between the furnishing practitioner and the beneficiary described by the required face-to-face visit component of the transitional care management (TCM) services, reported as CPT 99487 through 99489, are sufficiently similar to services currently on the list of Medicare telehealth services for these services to be added under category 1.

CMS finalized telehealth proposals to define rural Health Professional Shortage Areas (HPSAs) as those located in rural census tracts as determined by the Office of Rural Health Policy (ORHP) and to establish and maintain geographic eligibility for an originating site on an annual basis.

By defining “rural” to include geographic areas located in rural census tracts within Metropolitan Statistical Areas, the agency would allow for the appropriate inclusion of additional HPSAs as areas for telehealth originating sites. By adopting the more precise definition of “rural” for this purpose, CMS attempts to expand access to health care services for Medicare beneficiaries located in rural areas.

Also finalized was a policy change establishing that geographic eligibility for an originating site would be established and maintained on an annual basis, consistent with other telehealth payment policies. Without this change, the status of a geographic area's eligibility for telehealth originating site payment is concurrently effective with the effective date for changes in designations that are made outside CMS.

This policy is expected to reduce the likelihood that mid-year changes to geographic designations would result in sudden disruptions to beneficiaries' access to services and unexpected changes in eligibility for established telehealth originating sites. It is also expected to help avoid the operational difficulties associated with administering mid-year Medicare telehealth payment changes.