November 5, 2015

National Update

Bipartisan budget deal extends Medicare cuts

Last week, the House and Senate passed H.R. 1314, the “Bipartisan Budget Act of 2015,” and the president signed the measure into law Nov. 2. The bill sets discretionary appropriations caps for 2016 and 2017, providing some relief from the budget sequestration provisions of the Budget Control Act.

Specifically, the legislation will lift the caps on defense and non-defense discretionary spending by $25 billion in each category for 2016 and $15 billion in 2017, for a total of $80 billion in increased spending. The bill also will extend the federal debt limit until March 2017. In addition, H.R. 1314 provides Medicare Part B premium relief in 2016 for the approximately 30 percent of Medicare beneficiaries who were facing large increases.

The bill will offset increased spending, in part, by extending the 2 percent mandatory spending sequester—which includes Medicare providers—for an additional year.

This is the third time that Congress has extended the sequester cuts for Medicare providers and other mandatory spending. “We strongly urge members of Congress to stop using this tool to offset other spending increases,” AMA President Steven Stack, MD, said in a news release. The bill will generate additional savings by prohibiting provider-based, off-campus hospital outpatient departments that execute provider agreements after the date of enactment from being paid under the Outpatient Prospective Payment System.

As a result, the site-of-service payment differential that typically produces higher total Medicare payments for services provided by off-campus, hospital-owned physician practices will not be allowed in newly acquired practices.

Physicians urge Congress to address onerous meaningful use regulations

In the face of new regulations that will make program requirements under Stage 3 of the electronic health record (EHR) meaningful use program even less achievable and more disruptive, the AMA and 110 other medical associations sent letters to members of the Senate (log in) and the House (log in), urging them to intervene.

The letters point out that “the Centers for Medicare & Medicaid Services (CMS) has continued to layer requirement on top of requirement, usually without any real understanding of the way health care is delivered at the exam room level.” Read more at AMA Wire®.

Physicians are encouraged to email their members of Congress and tell them that the nation’s patients and physicians need significant changes to meaningful use Stage 3. They also can submit comments on the Stage 3 regulations during the 60-day comment period that ends Dec. 15. The AMA’s dedicated website makes it simple to submit comments directly to Congress and CMS. 

Final 2016 Medicare Physician Fee Schedule rule issued

The Centers for Medicare & Medicaid Services (CMS) last week released the final Physician Fee Schedule rule for 2016, along with a fact sheet describing its provisions. Of particular note, the rule announces the Medicare fee schedule update for 2016 and finalizes a proposal to establish payments for advanced care planning.

The Medicare Access and Chip Reauthorization Act (MACRA), which was signed into law in April 2015, increased the conversion factor by 0.5 percent on July 1 and called for additional annual updates of 0.5 percent from 2016 through 2019. However, the Protecting Access to Medicare Act of 2014 enacted April 1, 2014, established an annual target for reductions in Medicare payment schedule expenditures that result from adjustments to misvalued codes.

The Achieving a Better Life Experience Act of 2014, enacted Dec. 19, 2014, accelerated the application of the expenditure reduction target, setting targets of 1 percent for  2016 and 0.5 percent for 2017 and 2018. These actions—which were opposed by the AMA—combined with other decisions made by CMS had an adverse impact on the update the MACRA established for 2016.

The Medicare fee schedule conversion factor will be adjusted by -0.29 percent in 2016. It will be reduced from $35.93 to $35.83.

CMS finalized Medicare payment for two Current Procedural Terminology® (CPT®) codes for advanced care planning services, which include conversations between patients and their physicians before an illness progresses and during treatment. The rule specifically referenced the AMA recommendations. This represents not only an achievement for CPT®, the Relative Value Scale Update Committee (RUC) and the AMA, but also a turning point toward a new approach to pay for advance care planning.

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State Update

NAIC approves model bill on network adequacy

Insurance regulators at the National Association of Insurance Commissioners (NAIC) this week approved revisions to an outdated model bill on network adequacy that are intended for use by state legislatures in coming sessions.

The new model bill has a number of positive improvements, including regulation of provider directories, transparency requirements on network design and provider selection, a shift away from using accreditation to establish network adequacy and greater regulatory oversight in numerous areas. However, several new provisions in the model have raised serious concerns for the AMA and other medical associations.

In a new section of the model addressing out-of-network billing by physicians at participating hospitals, the NAIC language would likely result in the further narrowing of provider networks, as incentives for health plans to contract with physicians are threatened.

The AMA is concerned that language meant to recognize the growth of telemedicine may be interpreted by legislatures to allow telemedical providers to wholly replace in-person providers for the purposes of meeting the state’s network requirements.

A number of important priorities for the medical profession are missing from the model and will need to be addressed if it is considered by states, including:

To help states get ready for possible introduction of the NAIC model bill, the AMA is preparing a detailed red-lined version of the act. This will include proposed amendments and additional resources to ensure that the model fully protects patient access to care and does not adversely affect physicians. These resources will be made available soon.

For more information, please email Emily Carroll or Daniel Blaney-Koen of the AMA.

New Interstate Medical Licensure Compact Commission meets

At its inaugural meeting last month, the Interstate Medical Licensure Compact Commission approved initial bylaws and planned for committees to work toward compact funding and technology. The commission also elected officers to one-year terms: Ian Marquard of Montana, chair; Jon Thomas of Minnesota, vice chair; Diana Shephard of West Virginia, secretary; Brian Zachariah of Illinois, treasurer.

A byproduct of the Interstate Medical Licensure Compact, this commission is charged with overseeing and administering the compact. It includes two representatives from each of the 11 compact member states and meets next on Dec. 18 in Salt Lake City, Utah.

In testimony, the AMA encouraged the commissioners to expeditiously work to enact the compact and to keep costs for member states low. In addition, the AMA requested that the commission clarify the intent of language in two parts of the compact:

Please email Kristin Schleiter of the AMA for more information about the Interstate Medical Licensure Compact.

Pennsylvania Physician General signs naloxone standing order for state residents

Pennsylvania Physician General Rachel Levine, MD, last week signed a standing order that will expand access to naloxone for all patients in the commonwealth. The order, which was signed at the headquarters of the Pennsylvania Medical Society, specifically provides the authorization, indications and instructions for using naloxone.

The order is available online, and according to Dr. Levine, should only be used when an individual cannot obtain a prescription from his or her physician.

The Pennsylvania Medical Society provides more information about naloxone on its website, and you also can view more information about naloxone, including AMA support for standing orders, on the AMA opioids Web pages.

Email Daniel Blaney-Koen of the AMA to learn more about AMA model legislation to allow for standing orders in your state.

NCOIL to consider adoption of AMA model telemedicine bill

The AMA will testify next week in front of the National Conference of Insurance Legislators (NCOIL) during a health committee special session on telemedicine. The committee will consider adoption of two AMA model bills: the Telemedicine Reimbursement Act and the Telemedicine Licensure Act.

Six states enacted laws based on the AMA model legislation this year, bringing the total number of states with coverage parity laws to 29. The NCOIL effort will help spur additional state action. Email Kristin Schleiter of the AMA for more information.

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Judicial Update

Court case threatens physician-patient confidentiality

A case to be heard by the Washington Supreme Court threatens the integrity of the physician-patient relationship, potentially raising new obstacles to communication and trust.

In Volk v. DeMeerleer, a treating psychiatrist was charged with liability for his patient’s homicidal actions in 2010. A lower court decided that the psychiatrist could not have identified the actual victims as targets because the patient had communicated no threats against them during his treatment.

An appeals court then examined the duty of a mental health professional to protect a third party when an outpatient occasionally expresses homicidal ideas without identifying the ultimate target. The majority reversed the trial court and ruled that mental health professionals who treat voluntary outpatients may owe a duty to protect “all foreseeable victims, not only those reasonably identifiable victims who were actually threatened by the patient.”

However, a state law designed to protect doctor-patient confidentiality provides that mental health professionals owe a duty to third parties only when a patient has “communicated an actual threat of physical violence against a reasonably identifiable victim or victims.” The Litigation Center of the AMA and State Medical Societies joined six other health care associations in Washington in an amicus brief opposing the court of appeals decision.

Without reasonable boundaries on legal liability for physicians in connection with psychiatric care, patients may refuse to seek mental health treatment, and physicians may decline to treat patients with severe mental illnesses.

Read more at AMA Wire.

Supreme Court to weigh insurer payment transparency

Health insurers are fighting a state law that would create transparency for physicians and patients when it comes to health insurance payments. A case before the Supreme Court of the United States will determine whether a technicality will stand in the way of reform efforts and keep the insurance payment process cloaked in mystery.

The issue at hand in Gobeille v. Liberty Mutual Insurance Co. is whether or not the federal Employee Retirement Income Security Act of 1974 (ERISA) preempts a Vermont law requiring health insurers to submit claims payment data to an all-payer claims database maintained by the state.

A federal appeals court had held that ERISA preempts application of Vermont’s claims database statute to the self-funded health benefit plan of insurer Liberty Mutual. The court concluded that the statute intruded on “one of ERISA’s core functions.”

The state of Vermont went to great effort to create its all-payer claims database, a method that at least 12 other states also are using. The databases collect and analyze medical claims payment information from all health insurers within the state to fill information gaps that hinder efforts in health care reforms that would bring transparency to health care systems at the state level.

The Litigation Center of the AMA and State Medical Societies filed an amicus brief (log in) in support of the state legislation, claiming that “Vermont’s statue does not ‘relate to’ employee benefit plans” and so is not preempted by ERISA.

Read more at AMA Wire.

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Other News

CMS extends deadline to contest 2016 PQRS and value modifier results

Based on the AMA notifying the Centers for Medicare & Medicaid Services (CMS) of potential problems with 2014 Physician Quality Reporting System (PQRS) and value modifier calculations that determine 2016 PQRS results and adjustments, the agency has extended the informal review deadline to Nov. 23. The AMA strongly encourages physician practices to file a PQRS and value modifier informal review and download their PQRS feedback reports and Quality and Resource Use Reports (QRUR).

For groups with 10 or more PQRS-eligible professionals who are subject to the 2016 value modifier, the QRUR outlines how the value modifier will affect Medicare’s 2016 payments. All eligible professionals are subject to the PQRS payment adjustment in 2016. Value modifier cost and quality scores also will be provided in the QRURs for practices that are not yet subject to the value modifier. If physicians or group practices think an incentive payment or penalty was made in error, they must file an informal review via the quality reporting communication support page by Nov. 23.

The AMA continues to advocate for changes to the PQRS and value modifier programs and is actively encouraging CMS to automatically recalculate results.

Authorized representatives of group and solo practitioners can access the 2014 annual PQRS feedback reports and QRURs on the CMS Enterprise Portal using an enterprise identity management account (EIDM) account with the correct role.

For more information about how to access the 2014 annual QRURs, visit CMS’ Web page on how to obtain a QRUR. Additional information about the 2014 QRURs and how to request an informal review is available on the 2014 QRUR website and through the QRUR help desk at or (888) 734-6433 (select option 3).

For additional questions regarding the PQRS and value modifier informal review process, contact the QualityNet Help Desk at (866) 288-8912, TTY (877) 715-6222 or Monday-Friday from 8 a.m. to 8 p.m. Eastern time.

CMS extends Physician Compare preview period

As a result of AMA advocacy, the Centers for Medicare & Medicaid Services (CMS) has extended the Physician Compare preview period until Nov. 16 to allow more time for individuals and group practices to preview their measures and better coincide with the Physician Quality Reporting System (PQRS) and Quality and Resource Use Reports, which form the basis of the posted measures.

The AMA urges practices to preview their 2014 quality measures through the PQRS portal—Provider Quality Information Portal (PQIP). Individuals or groups that are proceeding with a PQRS or value modifier informal review request will not have their data publicly reported until the end of this year. CMS will hold the data until the informal review process is complete and it is determined whether the performance data are accurate and publicly reportable.

It is important to note that the data available for public reporting at the end of this year are currently in preview, and the measure set to be reported has been established through rulemaking. Any issues noted during the preview process can be brought to the Physician Compare support team’s attention for further review.

To learn more about which measures will be publicly reported and how to preview your measures, visit the Physician Compare Initiative page. Group practices and eligible professionals will need an enterprise identity management account (EIDM) to preview their Physician Compare report. If you have any questions about Physician Compare, public reporting or the 2014 quality measure preview period, please contact CMS’s contractor Westat at

New webinar series: Health care needs of service members

In honor of Veterans Day, the Joining Forces initiative is hosting 2015 Wellness Week Nov. 9–13. The AMA has joined several other organizations in sponsoring this event, which includes a series of educational webinars on important topics that affect the health of service members, veterans and their families. Each hourlong webinar is worth one continuing education credit.

Physicians also can view an archived webinar to learn how to sign up to deliver care to veterans through the Veterans Choice Program. This new program was established by Congress following the revelation of significant wait times and falsified documents at the Veterans Health Administration. Learn more about the Veterans Choice Program on the AMA website.

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Upcoming Events

Nov. 15: Panel on antimicrobial resistance
Join leading infectious diseases experts from the Centers for Disease Control and Prevention at an interactive session that will delve into the global public health threat of antibiotic resistance. “Antimicrobial resistance: The threat is real. The time to act is now!” takes place during the 2015 AMA Interim Meeting in Atlanta at 3:30 p.m. Eastern time.

Nov. 16: Educational session on America’s opioid epidemic
Attend an educational session held by the AMA Task Force to Reduce Opioid Abuse, “Combating America’s opioid epidemic—Strategies for physicians and medical societies,” at the 2015 AMA Interim Meeting in Atlanta at 9:30 a.m. Eastern time. Hear from the task force, CDC Director Thomas R. Frieden, MD, and other experts about how physicians can prevent opioid abuse.

Feb. 19-21: 2016 AMPAC Candidate Workshop
Sign up for the 2016 AMPAC Candidate Workshop, which prepares those considering a run for public office. For more information or to apply, please see the online registration form or email Jim Wilson of the AMA.

April 13-17: 2016 AMPAC Campaign School
Register for the 2016 AMPAC Campaign School, which is for AMA members who wish to become involved in the political process as advocates and volunteers for medicine-friendly candidates. For more information or to apply, please see the online registration form or email Jim Wilson of the AMA.

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