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September 7, 2009


September 7, 2009

ATS Comments on CMS 2010 Proposed Rules

This week the ATS submitted comments on both the Medicare Physician Fee Schedule proposed rule and the Medicare Hospital Inpatient prospective payment rule. Below is a summary of the key items that ATS covered:

2010 Conversion Factor

The conversion factor (CF) is the dollar unit used to convert the relative value units for different physician services into the actual reimbursement received by physicians. In 2009, each 1-unit of physician relative value was worth $36.0666.

CMS is projecting that 2010 CF will be cut by 21.5 percent (approximately $28.3122). The projected steep cut was expected. As you may recall, the formula used for calculating the CF, known as the sustainable growth rate factor or SGR, is deeply flawed and has resulted in steep projected cuts in the CF for several years. The physician community has been successful in getting Congress to enact temporary fixes to forestall the annual projected cuts in the CF, but Congress has failed to fix the underlying SGR formula and has essentially delayed the current year cuts into future years, magnifying the cuts in the out years.

The good news is Congress and the Administration are well aware of the problem and have taken incremental steps to address the problem, including removing the costs of physician administer drugs from the SGR calculation. Furthermore, all the healthcare reform bills moving through Congress include provisions to permanently fix the SGR factor and provide reasonable updates for Medicare physician reimbursement. Fixing the Medicare SGR is projected to cost $228 billion over 10 years. The bad news is that fixing the SGR formula is linked to healthcare reform, making Medicare physician payments hostage to the fate of the healthcare debate.

Pulmonary Rehabilitation - Covered Conditions

The ATS is extremely disappointed with the proposed coverage and reimbursement policy developed by CMS. CMS is proposing to cover pulmonary rehabilitation services for all Medicare beneficiaries who have moderate or severe COPD (level II and level III COPD as defined by GOLD). While the proposed rule recognizes that research suggests other respiratory conditions may benefit from PR, CMS claims the evidence is insufficient, at this time, to include other conditions in the coverage policy. In the proposed rule, CMS notes that coverage of additional conditions can be accommodated through the Notice of Coverage Determination process as further research is conducted.

The ATS recommended CMS cover very severe COPD and a number of other respiratory conditions. Our comments provided extension references on the effectiveness of PR for a number of respiratory conditions.

Pulmonary Rehabilitation - Duration of Benefit, Reimbursement and Bundled Services

CMS is proposing to pay for up to 36 1-hour sessions as part of the PR benefit and will limit payment to one session per day. CMS is proposing to pay for PR using a new G-code (GXX30), which has a reimbursement rate of approximately $15 in hospital outpatient departments and $16.71 in the physician office. Bundled in the reimbursement are a number of monitoring services that currently are separately billable (including the 6-minute walk test).

The ATS is extremely concerned about CMS's proposed duration and reimbursement policy. The treatment guidelines published by all the major societies recommend at least 70 hours as part of the pulmonary rehabilitation program. Further, many pulmonary rehabilitation programs successfully provide 2-3 hours of therapy a day, as is well documented in the literature. In fact, CMS coverage policy for lung volume reduction surgery requires patients receive pulmonary rehabilitation therapy in two-hour sessions - up to 60 hours. It is unclear why CMS is proposing more restrictive policy for pulmonary rehabilitation patients compared to LVRS patients.

The proposed reimbursement rate is also extremely problematic. CMS is effectively paying $15-$17 for a 1-hour PR session, replacing the current reimbursement of $70 - a cut of more than 70 percent. The reduction in payment is even greater when calculating services that are currently separately billable under the current policy (6-minute walk test) that CMS is proposing to bundle into the GXX30 code.

The ATS recommended CMS allow physician offices and hospital outpatient departments to continue to use the existing G0237-9 codes for billing PR services and to further allow separate billing for related PR services.

CMS Adopts New Practice Expense Data - Pulmonary Reimbursement Increases

In a bit of welcomed news, the rule proposed to use new data collected for a national survey to update specialty specific practice expense rates. With the revised data, the pulmonary specific practice expense rate per hour will increase from $44.63/hour to $55.26/hour. The ATS projects the change in the pulmonary practice expense value will result in $50 million annual increase in Medicare payments to pulmonary physicians.

The ATS supported the adoption of the new practice expense data.

Research: FDA Expands Patient Access to Investigational Drugs

The FDA has published new rules aimed at expanding patient access to investigational drugs. The final rule aims to improve access to investigational drugs for patients with serious or immediately life-threatening diseases or conditions who lack other therapeutic options. Under the new rule, expanded access to investigational drugs for treatment use is available to individual patients, including in emergencies; intermediate-size patient populations; and larger populations under a treatment protocol or treatment investigational new drug application. The FDA has also created a website for patients and health professionals can get information about options for investigational drugs. A second new rule clarifies when investigational drugs can be used as part of clinical trial and the costs that manufacturers can charge patients.

Click here for the FDA's new website with information about investigational drugs.

Health Care Reform: ATS Supports Prevention in Health Reform Legislation

The ATS recently joined public health organizations on a letter to all members of Congress urging support for clinical and community preventative services in health reform legislation. The letter, which is signed by 30 public health and professional societies, states, "Health reform legislation should ensure that private and public health insurance covers recommended preventative services for patients and should provide funding to implement recommended prevention initiatives at the community level." Tobacco control programs in California and Maine, where smoking rates among adults and teenagers have dropped significantly following implementation of tobacco control programs, are cited as successful examples of the cost-effectiveness of prevention services. The healthcare reform bills passed by House committees and by the Senate Health, Education, Labor and Pensions Committee do include measures that provide clinical and community preventative services.

Points of Contact

Gary Ewart Senior Director, Government Relations
Nuala Moore Senior Legislative Representative
Joe Kirby DC Office Administrator