Physician Participation in PQRS Becomes More $ Imperative

All eligible professionals (EPs) who bill professional services to Medicare, who have not already done so, should consider enrolling in the Physician Quality Reporting System (PQRS), immediately. The cost of not participating is rising, and reporting in 2015 is the last opportunity for EPs in solo practice, or those who practice in small groups, to avoid further payment penalties in 2017.

The financial cost of failing to participate in PQRS is compounded by CMS’ adoption of a Value-Based Payment Modifier (VPBM), as required by the Affordable Care Act (ACA), beginning in 2015. The “value modifier” is not a modifier in the sense most familiar to medical professionals (e.g., modifier 25, modifier 59, etc.). Rather, the VM creates a payment differential among eligible providers (EPs) receiving reimbursement under the Medicare physician fee schedule (MPFS), according to whether, and how effectively, those providers demonstrate quality of care relative to cost.

Payment at risk is -4.0 percent. The upward payment adjustment factor will be contingent on the total calculated downward adjustment, as this latter element will determine the pot of money available for incentive payments under VBPM.

Additionally, CMS’s approach to implementing the VM is based on participation in PQRS. As such, EPs who do not to participate in PQRS may face a double payment penalty: First, from PQRS (-2 percent payment adjustment), and again from the VM (up to a -4.0 percent payment adjustement). There’s also a potential -3 percent adjustment for not meeting Meaningful Use in 2015. In other words: Provider payments from Medicare could be down as much as -9 -percent in 2017, based on 2015 performance year calculations.

VBPM payment adjustments (whether upward, downward, or neutral) will be based on several factors, including “quality tiering” analyses to determine if a group’s or individual EP’s performance is statistically better, the same, or worse than the national mean. Initially, quality tiering will be voluntary for large physician groups (100 or more EPs), but within a few years it will be mandatory for all providers:

  • In 2015, physicians in groups of 100 or more EPs who submit claims to Medicare under a single Taxpayer Identification Number (TIN) will be subject to the VM, based on their performance in calendar year 2013. Group size is determined by Medicare Provider Enrollment, Chain, and Ownership System (PECOS) data.
  • In 2016, physicians in groups of 10 or more EPs who submit claims to Medicare under a single TIN will be subject to the VM, based on their performance in calendar year 2014. Per CMS, “If a group practice does not report quality measures via 2014 PQRS GPRO [group practice reporting option], CMS will calculate a group quality score if at least 50 percent of the EPs in the group report measures individually and meet the criteria to avoid the 2016 PQRS payment adjustment.”
  • In 2017, CMS will apply the VM to all remaining EPs, including “physicians and nonphysician eligible professionals in groups with two or more eligible professionals and to solo practitioners,” based on their performance in 2015.

The bottom line: If you bill Medicare, participation in PQRS is no longer an “option,” it’s a financial imperative.

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John Verhovshek

John Verhovshek

John Verhovshek, MA, CPC, is Managing Editor at AAPC. He has covered medical coding and billing, healthcare policy, and the business of medicine since 1999. He is an alumnus of York College of Pennsylvania and Clemson University, and a member of the Asheville-Hendersonville AAPC Local Chapter.
John Verhovshek

About Has 404 Posts

John Verhovshek, MA, CPC, is Managing Editor at AAPC. He has covered medical coding and billing, healthcare policy, and the business of medicine since 1999. He is an alumnus of York College of Pennsylvania and Clemson University, and a member of the Asheville-Hendersonville AAPC Local Chapter.

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