MGMA Submits Comments to CMS on Physician Fee Schedule

The Medical Group Management Association (MGMA) has submitted comments to Mark McClellan, MD, PhD, administrator of the Centers for Medicare & Medicaid Services (CMS), in response to the final rule titled, "Revisions to Payment Policies Under the Physician Fee Schedule for Calendar Year 2006 and Certain Provisions Related to the Competitive Acquisition Program of Outpatient Drugs and Biologicals Under Part B," as published in the Nov. 21, 2005 Federal Register.

CMS published a list of payment rates for services covered by the Medicare program and changes in program policy that CMS plans to implement. This publication is referred to as the "Medicare physician fee schedule." CMS puts forth the proposed fee schedule to provide ample time for the public to comment on the draft changes. The final rule includes the official payment rates, policy changes and responses to comments received on the proposed fee schedule.

Highlights of MGMA's comments to CMS include:

-- Preparation for pending congressional action concerning the 2006 Medicare physician payments - MGMA strongly urges CMS to work with its provider partners and have a final rule ready for publication upon enactment of the Deficit Reduction Act of 2005.

-- Administrative modification of the Medicare payment formula - The downward spiral of payment updates for providers paid under the Medicare physician fee schedule is prolonged for the fourth consecutive year with the 4.4 percent payment cut for 2006. MGMA-collected data indicate that the cost of operating a group practice rose by an average 4.9 percent per year for the last 10 years. MGMA data also show that between 2000 and 2004, operating costs in medical group practices increased more than 17.9 percent. Medicare reimbursement rates for physician services have fallen far short of the increased cost of delivering quality services to Medicare patients. CMS-initiated administrative modifications can help mitigate the anticipated cuts for calendar year 2006 and beyond.

-- Reform the competitive acquisition program for outpatient prescription drugs - The competitive acquisition program (CAP) may offer an alternative for providers who are unable to obtain physician-administered drugs at or below Medicare reimbursement rates. However, the program as proposed is not a viable option for providers as it is overly burdensome. Therefore, MGMA recommends that CMS continue to monitor providers' need for options to obtain these drugs while reducing the administrative burdens of the CAP.

-- CMS' inappropriate focus on physician referrals - MGMA is troubled by CMS' apparent focus on physician self-referral as the cause of the growth in imaging services, such as computed tomography (CT) and magnetic resonance imaging (MRI). Rather than hastily conclude that the growth in office-based imaging is due to 'inappropriate' referrals, MGMA urges CMS to carefully consider other factors.

-- Arbitrary reduction level of multiple diagnostic testing procedures - Beginning this year, CMS will reduce payment for the technical component for multiple imaging services performed on contiguous body parts. MGMA is concerned about the arbitrariness of a 50 percent reduction. It does not appear that CMS is basing the 50 percent reduction on sufficient and sound data. Before CMS makes a policy change that would severely affect certain specialties, MGMA urges the agency to reconsider the 50 percent figure to ensure its equity. Furthermore, it is unclear at this time whether Medicare claims processing systems will permit diagnostic imaging services subject to the reduction to be billed globally. MGMA seeks clarification on whether these services may be billed globally, and prefers that practices be able to do so.

Source: MGMA