AHLA. UU. Diagnostic Imaging Services. Thomas W. Greeson Reed Smith LLP Falls Church, VA

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1 AHLA UU. Diagnostic Imaging Services Thomas W. Greeson Reed Smith LLP Falls Church, VA Institute on Medicare and Medicaid Payment Issues March 25-27, 2015

2 AHLA Institute on Medicare and Medicaid Payment Issues Diagnostic Imaging Services March 27, 2015 Presented by: Thomas W. Greeson, Partner v1 AGENDA Hit after Hit on Payments for Diagnostic Imaging Services Ongoing attack by CMS on Technical Component Payments Conversation Factor and Sustainable Growth Rate (SGR) Formula Appropriateness Criteria Payment for Secondary Interpretations Place of Service Billing Rules IDTF issues CT Lung Cancer Screening Benefit 1

3 Diagnostic Imaging Cuts Since Multiple Procedure Payment Reduction (MPPR) CMS implements 25% cut to technical component (TC) in the Physician Fee Schedule (PFS) for a second imaging procedure within a family of codes 2007 Reimbursement Caps in the Deficit Reduction Act (DRA) CMS caps the technical component (TC) of the Physician Fee Schedule (PFS) to the hospital prospective payment systems (OPPS) rate for the same procedure, when the former is higher 2010 Utilization Rate (UR) CMS raises the UR to 90% from 50% (phased in once to 62.5% before being raised to 75% and capped under the Affordable Care Act) 2010 Multiple Procedure Payment Reduction (MPPR) in the Affordable Care Act (ACA) CMS implements 50% cut to technical component (TC) of the Physician Fee Schedule (PFS) within family of codes (up from 25%) for a second imaging procedure Diagnostic Imaging Cuts Since Bundled Codes CMS bundled codes for procedures provided together more than 75% of the time (combined CT of abdomen and pelvis) 2011 Multiple Procedure Payment Reduction (MPPR) CMS implements a 50% cut to the technical component (TC) in the Physician Fee Schedule (PFS) for a second imaging procedure across a family of codes 2012 Multiple Procedure Payment Reduction (MPPR) CMS implements a 25% cut to the professional component (PC) in the Physician Fee Schedule (PFS) for a second imaging procedure 2013 Multiple Procedure Payment Reduction (MPPR) CMS implements a 25% cut to the technical component (TC) of certain cardiology procedures when with certain ophthalmology procedures in the PFS 2013 Multiple Procedure Payment Reduction (MPPR) CMS applies the 25% cut to the professional component (PC) and 50% cut to the technical component (TC) to multiple physicians within the same practice for a second imaging procedure in the PFS 2014 Utilization Rate (UR) in the American Taxpayer Relief Act (ATRA) CMS raises the UR to 90% (up from 75%) 2

4 2015 MPFS Final Rule Desktop Workstation as Proxy for PACS In proposed rule, CMS considered whether a desktop workstation is appropriate proxy for PE inputs associated with PACS technology CMS received opposition to proposed rule, but in its final rule, determined that a desktop workstation would be used as proxy for PE inputs associated with PACS technology in 2015 Proxy will be desktop computer priced at $2,501; new equipment item desktop computer (proxy for PACS workstation) CMS believes this will facilitate accurate replacement of this input when it has sufficient information on PACS pricing 2015 Medicare Physician Fee Schedule CPT Code Description Modifier Non- Facility Pay 2014 Non-Facility Pay 2015 Percent Change Ct angiography head $ $ % Ct angiography head TC $ $ % Ct angiography head 26 $89.20 $ % Myelography thoracic spine $ $ % Myelography thoracic spine TC $78.81 $ % Myelography thoracic spine 26 $46.57 $ % Provider-Based Billing is an attraction and is leading to restructuring. 3

5 Off Campus Provider Based Departments New PO HCPCS modifier Voluntary in 2015 Mandatory in 2016 Conversion Factor and SGR Formula Protecting Access to Medicare Act of 2014 (H.R. 4302) signed into law (April 2014) One year fix to impact of SGR on payments under MPFS Extended 0.5% update through 12/31/14; 0.0% update from 1/1/15 3/31/15 (Resulting conversion factor is $35.80) Beginning 4/1/2015, conversion factor will be subject to a 21.2% decrease unless Congress over-rides mandate 4

6 SGR Patch Payment Reduction for Older CT Scanners that Do Not Meet NEMA Standards Applicable to TC of MPFS and HOPPS 5% reduction in % reduction in 2017 SGR Patch Appropriateness Criteria for Outpatient Imaging Services Effective January 1, 2017, physicians ordering outpatient diagnostic imaging services (MR, CT, PET, nuclear medicine) must consult qualified decision support system CMS will consult with stakeholders like ACR in developing the criteria. ACR Select Imaging Clinical Decision Support Software What will happen to prior authorization? 5

7 SGR Patch MPPR Data Disclosure CMS must disclose data to justify 25% multiple procedure payment reduction for professional component imaging services provided to same patient, on same day, in the same session Payment for Secondary Interpretations CMS considered paying for secondary interpretations CMS questioned whether policy change would reduce incidence of duplicative advanced imaging studies Currently, physician can only bill for secondary interpretation under unusual circumstances Industry pushed for focus on issues promoting clinical coordination Some commentators thought secondary interpretation policy would lead to cost savings, but could not determine amount 6

8 Place of Service Billing Rules Payment Jurisdiction Rule Claims must be billed to the Medicare Administrative Contractor (MAC) responsible for the jurisdiction where the service was furnished (unless the interpretation was performed in an unusual and infrequent location) The payment-jurisdiction rule is particularly relevant when the professional component is routinely performed in a different state (or MAC jurisdiction) from where the technical component is performed (e.g., teleradiology and in urban areas that cross or border state lines) Place of Service Billing Rules CMS Transmittal 503 Inter-Jurisdictional Reassignments Entity taking reassignment must still enroll with MAC where interpretation services provided but CMS has relaxed enrollment restrictions MAC must allow entity to enroll in the state where the interpretation was performed and can use interpreting physician s home or office address 7

9 Breast Biopsy Procedures - Problem for IDTFs The following codes were DELETED in 2014 Code Definition Stereotactic localization guidance for breast biopsy or needle placement (eg, wire placement or for injection), each lesion RS&I Mammographic guidance for needle placement, breast (eg, for wire localization or for injection), each lesion RS&I New Breast Biopsy Codes for 2014 Code Definition Biopsy, breast, with placement of breast localization device(s) (eg, clip, metallic pellet), when performed, and imaging of the biopsy specimen, when performed, percutaneous; first lesion, including stereotactic guidance each additional lesion, including stereotactic guidance Biopsy, breast, with placement of breast localization device(s) (eg, clip, metallic pellet), when performed, and imaging of the biopsy specimen, when performed, percutaneous; first lesion, including ultrasound guidance each additional lesion, including ultrasound guidance Biopsy, breast, with placement of breast localization device(s) (eg, clip, metallic pellet), when performed, and imaging of the biopsy specimen, when performed, percutaneous; first lesion, including magnetic resonance guidance each additional lesion, including magnetic resonance guidance Palmetto GBA Frequently Asked Questions Jurisdiction 11 Part B Can an independent diagnostic testing facility (IDTF) that functions as a mammography center receive Medicare reimbursement for percutaneous breast biopsy procedures and metallic localization clip placement? Answer: No, an IDTF cannot be reimbursed for the surgical CPT codes through and Reimbursement for these CPT codes can be made to the physician or physician group providing the surgical services. The IDTF may receive Medicare reimbursement for the CPT series codes (imaging studies) associated with these surgical procedures. Claims for the diagnostic mammography services must be submitted with the Food and Drug Administration (FDA) Mammography Certification Number. (emphasis added) 8

10 Informal Guidance from CMS Breast Biopsies in IDTFs Radiology group can bill under the group s NPI for breast biopsy procedures performed in an IDTF using the IDTF POS codes. Appropriate POS code is 11- Office or 49- Independent Clinic Payment is at the non-facility payment rate Financial reconciliation between radiologists and IDTF Supervision of IDTFs Follow rules at 42 CFR for supervision: General Direct Personal Supervising physicians must have proficiency in Performance and Interpretation of each test they supervise. 42 CFR (b)(2) 9

11 42 CFR (b)(1) Supervising Physicians: Each supervising physician must be limited to providing general supervision to no more than three IDTF sites. This applies to both fixed sites and mobile units where three concurrent operations are capable of performing tests. (emphasis added) NOVITAS Solutions Local Coverage Determination (LCD): Independent Diagnostic Testing Facility (IDTF) (L34792) Each supervising physician must be limited to providing supervision to no more than three IDTF sites. The IDTF supervising physician is responsible for the overall operation and administration of the IDTFs, including the employment of personnel who are competent to perform test procedures, record and report test results promptly, accurately and proficiently, and for assuring compliance with the applicable regulations. 10

12 CT Lung Cancer Screening Benefit CMS approved payment for low-dose CT screening for highrisk patients. Patients ages of 55 and 77 who have 30 plus-year history of smoking 15 year smoking cessation period Trained readers Facility must collect and submit data to CMS-approved registry. Reed Smith Thomas W. Greeson Partner Health Regulatory & Transactions Radiology Focus Falls Church, VA Please see our Health Care blog at and follow us on 11