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Congress delays Medicare fee cut, ICD-10


Congress has approved legislation delaying for 1 year a massive 24% Medicare fee cut, which had been scheduled to take effect April 1, as well as implementation of the ICD-10-CM coding system.

Washington, DC-Congress has approved legislation delaying for 1 year a massive 24% Medicare fee cut, which had been scheduled to take effect April 1, as well as implementation of the ICD-10-CM coding system.

The Senate approved the Protecting Access to Medicare Act (H.R. 4302) on a 64-35 vote March 31, following approval on a voice vote in the House of Representatives March 27.

Instead of a pay cut, as required under Medicare's Sustainable Growth Rate (SGR) fee-setting formula, the legislation grants Medicare physicians a 0.5% pay increase through March 31, 2015. Medicare carriers will hold off on processing claims filed during the first 10 days of April to allow time for enactment of the legislation and necessary system changes.

ICD-10-CM coding will now be required for diagnoses on all public- and private-sector insurance plan claims beginning October 1, 2015, instead of the same date this year. 

The legislation is the latest in a series of 17 temporary “doc fix” bills enacted since 2002 to spare physicians Medicare pay cuts required under the SGR fee-setting formula. It comes as a disappointment to healthcare provider organizations, including the American Optometric Association (AOA), which hoped Congress would permanently remove the SGR from the Medicare fee formula this year.

Says AOA President Mitchell T. Munson: “Whether Congress continues to go with temporary Medicare payment ‘patches’ or moves ahead with a much-needed long-term solution, the AOA has made it clear to both House and Senate leaders that our full physician status in Medicare is non-negotiable. Over the last year, thanks to the hard work done by the AOA and optometry’s army of grassroots advocates, we were successful in securing optometry-specific changes to all of the advancing Medicare payment bills. Now, with a new year-long patch in place and more uncertainty ahead, we must continue to do what it takes to be heard loud and clear on Capitol Hill.”

As late as Monday afternoon, Senate Finance Committee Chairman Ron Wyden (D-Ore.) was hoping to win approval of a comprehensive Medicare payment reform bill, The SGR Repeal and Medicare Payment Modernization Act (S. 2000, HR 4015), which would have guaranteed a 0.5 percent increase in physician reimbursements through 2018.   

That comprehensive Medicare reform package was praised as a rare example of bipartisan cooperation, when it was jointly released by the House Ways and Means, House Energy and Commerce, and Senate Finance committees on Feb. 6.

However, House Republicans added a provision delaying the Affordable Care Act's (ACA) individual insurance mandate before passing the bill earlier this month. Democratic leaders in the Senate promptly announced they would not consider the amended legislation and the White House announced President Obama would not sign it. (See Optometry Times Special Report, March 21, 2014.)

House members then quickly formulated and passed the temporary doc fix bill, including, to the surprise of some observers, a delay in the ICD-10-CM deadline.

ICD-9-CM codes are designed to provide much more specific reporting of diagnoses than the now-used ICD-9-CM code set. There are approximately 70,000 ICD-10-CM codes, compared with approximately 14,000 ICD-9-CM codes. Implementation is considered a challenge by some practitioners. The U.S. Centers for Medicare & Medicaid Services (CMS) recommends health care practice phase-in use of the ICD-10 codes over at least a nine-month period. 

Under the SGR fee-setting formula, Medicare physicians were to see reimbursements cut 24 percent on January 1, 2014. However, Congress late last year passed a temporary “pay patch” bill, providing a 0.5% increase through March 31.

The SGR was added to the Medicare fee-setting formula under the federal Balanced Budget Act of 1997 in an effort to curb growing Medicare costs. The statistic is used to tie Medicare cost increases to the Gross Domestic Product. However, instead of limiting annual Medicare Part B reimbursements, the revised formula has prompted the U. S. Centers for Medicare and Medicaid Services (CMS) to annually propose increasingly steep reimbursements cuts. During all but 1 year, Congress has intervened at the last minute to either freeze or nominally increase Medicare pay rates.

The SGR repeal would cost $138 billion over the next 10 years, according to the Congressional Budget Office (CBO). House Republicans had hoped to partially offset that cost by delaying the ACA individual mandate, a step that would save about $9 billion over the same period, according to the CBO. Sen Wyden proposed covering the cost with savings in military spending as the U.S. draws down forces in Afghanistan.

The new doc fix bill now give lawmakers another year to find funding to cover permanent repeal of the SGR. 


Other Medicare changes for 2014

Even without SGR repeal or a merit-pay program, Medicare is implementing a number of notable rule changes this year.

Incentive Programs

The CMS is winding down Medicare's current incentive programs; practitioners who act quickly still have the opportunity to earn potentially significant bonuses-as well as avoid future payment penalties.


This is the final year the Medicare Physician Quality Reporting System (PQRS) will offer incentive bonuses for reporting designated quality of care measures again offers a 0.5% bonus in 2014. However, practitioners now must report on at least 9 measures (up from 3 in the past) for a full year (up from just 3 months in the past). Practitioners not participating in PQRS during 2014 will see their Medicare payments reduced by 2% in 2016.           

To qualify for bonuses, optometrists will effectively be required to report on all seven PQRS diabetes, age-related macular degeneration (AMD), and glaucoma eyecare measures plus 2 preventive health measures applicable to eyecare practice:

The PQRS Primary Eye Care Measures are:

• Measure 12: POAG Optic Nerve Evaluation

• Measure 141: POAG Reduction of IOP by 15% or Documentation of Plan of Care

• Measure 14: AMD Dilated Exam

• Measure 140: AMD Counseling on Antioxidant Supplement

• Measure 117: Diabetes Mellitus (DM) Dilated Exam

• Measure 18: DM Documentation of Presence of Macular Edema (ME) and Level of Severity of Retinopathy

• Measure 19: Diabetic Retinopathy Communication with Physician Managing Diabetes Care

While the CMS has not formally indicated which PQRS primary care measures are applicable to optometry, coding experts variously suggest:

• Measure #236 – Hypertension (HTN): controlling blood pressure (BP)

• Measure #128 – Preventive care and screening: body mass index (BMI)

• Measure #111 – Preventitive care and screening: Pneumococcal vaccination in >65yo

• Measure #173 – Preventitive care and screening: Unhealthy alcohol use

• Measure #110 – Preventative care and screening: Influenza immunization

• Measure #226 – Patient screened for tobacco use and received cessation counseling if identified as user

• Measure #130 – Current medications with name, dose, frequency, and route documented

Practitioners who successfully participate in the PQRS can again earn an additional 0.5% bonus for participating in a qualified maintenance of certification program, such as American Board of Optometry. To receive the bonus, practitioners must exceed minimum participation levels for the certification program.

EHR Incentive Program

This is the final year health care in which practitioners can enter the Medicare Electronic Health Reforms (EHR) Incentive Program. During 2014, practitioners in their first or second year of participation can earn up to $12,000 in bonuses for meeting the program's Meaningful Use standards. Practitioners in their third year can qualify for up to $8,000 and those in their fourth year, up to $4,000.

Practitioners entering the program this year will have to meet new, revised Stage 1 Meaningful Use criteria that requires them to provide patients with timely access to their health information online. Stage 1 practitioners are also now required to record patients' blood pressure and body mass index.           

Practitioners beyond their first year in the program must meet the program's recently introduced Stage 2 Meaningful Use (MU) standards, requiring them to make protected health information (PHI) available securely online, engage patients online, and increase exchange of PHI with other health care providers.

Stage 2 also requires:

• Computerized physician order entry (CPOE)

• Online clinical decision support

• Adverse drug interaction warnings for specified number of patients

• E-prescribing

• Patient access to protected health information (PHI) via secure Web sites and e-mail

• Must conduct follow up electronically and answer patient questions electronically

• EHRs must have secure interconnectivity meeting the federal government's Nationwide Health Information Network or Direct Access Technology standards Both Stage 1 and Stage 2 have 90-reporting periods this year.

E-Rx incentives

The Medicare e-Prescribing Incentive Program no longer offers bonuses for practitioners who prescribe pharmaceuticals electronically. Optometrists are specifically exempted from a 0.5% Medicare penalty now imposed for failure to e-RX.

Coding changes


Medicare like all other public and private health insurance plans will require health care practitioners to begin using International Classification of Disease, 10th edition, Clinical Modification (ICD-10 CM) codes for all diagnoses begin October 1, 2014.           

ICD-10 CM codes have 7 digits, as opposed to 5 for the ICD-9 CM. The ICD-10 CM is a far larger code set with 68,000 codes, as opposed to 13,000 ICD-9 codes.           

The ICD-10 CM is designed to provide for much greater specificity in reporting diagnoses. For many conditions, ICD-10 has distinct codes for laterality. Many conditions are listed as right eye, left eye, bilateral, or unspecified. Many conditions of the eyelids are further differentiated as affecting the right upper, left upper, right lower, or left lower eyelid. For glaucoma, the seventh character will denote the stage of the disease.       

The ICD-10 also updates terminology to reflect current medical practices and provides some combination codes that describe 2 related conditions with a single code. Practitioners and their billing staffs will need to become familiar with required documentation.



Practitioners will continue to use the American Medical Association's (AMA) Current Procedural Terminology (CPT) codes to report procedures. The CPT Category I code set of this year include four new codes for telemedicine:

• 99446 – interprofessional telephone/internet assessment and management service including a verbal and written report, 5-10 minutes of review

• 99447 – consultation as above, 11-20 minutes

• 99448 – consultation as above, 21-30 minutes

• 99449 – consultation as above, 31 minutes or more

In addition the CPT Category III temporary (T) codes-used for emerging technology, services and procedures-this year include the first CPT code for pupillometry:

• 0341T – quantitative pupillometry with interpretation and report, unilateral or bilateral  

Once considered esoteric, pupillometry is now widely used for assessing laser refractive correction patients. Recent studies have linked pupil response to Parkinson's Alzeimer's, autism, cardiovascular disease, and other conditions. While neither Medicare nor most other public or private insurers yet reimburse for pupillometry, reporting the procedure on claims using the new T code is will provide the AMA important data on the value of the procedure and facilitate development of permanent CPT code for the procedure.

Other new Class III codes relevant to optometry this year include:

• 0330T – digital interferometry of the lipid layer of tear film for dry eye diagnosis, unilateral or bilateral with interpretation and report.

• 0333T – VEP, screening of visual acuity

• 0329T – monitoring of IOP for 24 hours, unilateral or bilateral with interpretation and report

Because the AMA announced its CPT Class III codes well after under after its CPT I codes, the new temporary codes may not appear in many coding manuals.  Nevertheless, the new T codes have been authorized for use on claims since January 1, 2014. In many cases, the new T codes may be more appropriate than existing permanent CPT codes. 

The AMA this year also added at least 2 new ophthalmic service codes and important new parenthetical notes for several codes commonly used by optometrists.

New 1500 claim form for 2014

Medicare is now accepting claims on the new CMS 1500 (02/12) claim form. The 02/12 version of the form will be required for Medicare claim filing on April 1. The new version of the form is designed to more adequately support use of ICD-10 CM code set.  In addition to additional space to accommodate longer ICD-10 CM coding, the new form expands the diagnosis code list from 4 to 12. The new revised form replaces the old CMS 1500 (08/05) version. The new version can accommodate both ICD-9 and ICD-10 codes; although the CMS warns the two code sets should never be used together on the same claim.ODT

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