Proposed 2016 Medicare Physician Fee Schedule and Potential Implications for Therapy

The first proposed Medicare physician fee schedule rule since the enactment of the Medicare Access and Reauthorization Act of 2015 (MACRA) was released by CMS earlier this month.  CMS will review public comments submitted by September 8^th and will then publish the final rule by November 1^st.  Some highlights of the proposed fee schedule which will have an impact on therapy services:

• The 2016 payment rate for therapy services is projected to increase approximately 0.5% based on the proposed 2016 conversion factor of $36.1096, which reflects the 0.5% increase from the current $35.9335 called for under MACRA, as well as the zero impact on the RVUs for work values, practice expense values, and malpractice expense values related to therapy services.

• Using a high expenditure screen, CMS identified 118 CPT codes in the proposed rule as potentially misvalued.  Ten CPT codes that therapists use on a regular basis were among those codes identified by CMS for review with a target of a 1% reduction in expenditures for misvalued codes in 2016.  CMS recommended these codes be reviewed for potential revision of the work RVUs and practice expense inputs which would alter the overall RVU of each code reviewed and, ultimately, the pricing for that code in the fee schedule when the RVU is multiplied against the conversion factor. The 10 CPT codes identified by CMS for review which are commonly used by therapists are:
  • 97032 – Electrical Stimulation (manual)
  • 97035 – Ultrasound
  • 97110 – Therapeutic Exercise
  • 97112 – Neuromuscular Re-education
  • 97113 – Aquatic Therapy
  • 97116 – Gait Training
  • 97140 – Manual Therapy
  • 97530 – Therapeutic Activities
  • 97535 – Self-care/Home Management Training
  • G0283 – Electrical Stimulation (unattended)

• Reporting requirements, including measures therapists can report under the PQRS program and the successful reporting thresholds, would be largely unchanged in 2016.  Per the proposed rule, claims-based reporting would be retained as a reporting option.  Therapists who do not successfully participate in PQRS in 2016 would be subject to a 2.0% negative payment adjustment in 2018.  CMS proposed to expand the value-based modifier program to a limited number of non-physician eligible professionals in 2015, but physical and occupational therapists would not be included in this group.

• CMS proposed to clarify in the rule that the billing physician or practitioner for “incident to” services must also be the physician or practitioner who furnishes or directly supervises the service.  Additionally, CMS is proposing to require that auxiliary personnel providing “incident to” services and supplies cannot have been excluded from Medicare, Medicaid, or other Federal health care programs by the Office of Inspector General or have had their enrollment revoked for any reason at the time that they provide such services or supplies.

• CMS also proposed two new exceptions to the Stark Law; however, neither directly involves therapy services.