Changes to physician reimbursement under reform – the details

Several clients have asked for more detail on how the reform bill will change Medicare reimbursement for physicians and other non-facility providers. Here’s the synopsis.
First, note that this pertains only to reimbursement changes contained within the reform bill. There are a host of other initiatives, ideas, pending changes, and reimbursement ‘tweaks’ outside the bill that will also impact reimbursement.
Reimbursement for primary care services – provided by some internists, family practice docs, pediatricians, PAs, and nurse practitioners – will increase 10% between 2011 and 2015. After 2015, the increase – which is described as a ‘bonus’ – will theoretically expire.
The key word here is ‘some’.
To get the increased compensation, 60% of the provider’s charges for services over the last (to be determined) months/years must have been for primary care.
There’s also more funds for some general surgeons – a 10% bonus if they provide ‘major surgical procedures in health professional shortage areas“.
That’s it for the easily described changes. Now here’s the more complex.
1. Bundled payments – there’s a national pilot program authorized under reform that would allow for bundling of payments for an entire episode of care, as opposed to the current fee for service (FFS) methodology. Under this scenario, a group of physicians, ancillary care providers, and facilities would get paid a flat amount for a specific condition/diagnosis.
2. Post 2014 and the Independent Payment Advisory Board – Starting in 2014, the IPAB would be required to recommend specific Medicare spending reductions in any year in which Medicare’s per capita cost growth rate exceeded a specific target. IPAB’s recommendations are more than just idle talk; they would become law unless Congress passed an alternative proposal that resulted in identical savings. Some provider types are excluded for a limited time (this is too deep in the weeds to go into here).
There’s more in the bill, but it is for very specific services, types of providers, and geographic areas yet to be identified – in all, few providers will be affected.
For more detail on the bill’s impact on reimbursement, click here.[opens pdf]
What does this mean for you?

Remember this is just the reform bill – it is highly likely other changes driven by other bills, regulatory changes, and miscellaneous factors will have as much – if not more – impact.