For Immediate Release:               Thursday, November 1, 2012

Contact:                                          CMS Office of Public Affairs 202-690-6145



On November 1, 2012, the Centers for Medicare & Medicaid Services (CMS) issued a final rule to implement a provision of the Affordable Care Act that provides increased payments to certain primary care physicians for specified Medicaid primary care services.  Under this provision, certain physicians who provide eligible primary care services will be paid the Medicare rates in effect in calendar years (CY) 2013 and 2014 instead of their usual state-established Medicaid rates, which may be lower than federally established Medicare rates.  The payment increase applies to primary care services delivered by a physician with a specialty designation of family medicine, general internal medicine, or pediatric medicine or related subspecialists.  States will receive 100 percent federal financial participation (FFP) for the difference between the Medicaid state plan payment amount as of July 1, 2009, and the applicable Medicare rate.

The rule provides information about how CMS and states will work together to make the increased payments operational.  The rule includes information about the identification of eligible providers and services and how to meet the statutory requirements when making these payments for services provided through managed care. The rule also provides important information on how this policy applies to the Vaccines for Children (VFC) program, which has its own statutory requirements for billing and payment, and updates the administration fees that may be billed under VFC based on medical inflation rates.

Qualifying Providers

Through the Affordable Care Act, primary care services eligible for the higher Medicaid payment must be delivered by a physician who specializes in family medicine, general internal medicine, or pediatric medicine. This rule specifies that certain physician subspecialists (for example, pediatric cardiologists) who are board certified in those specialties or provide primary care within the overall scope of those categories also qualify for the enhanced payment. The rule also clarifies that the higher payment will be made for primary care services rendered by practitioners—including, for example, nurse practitioners—working under the personal supervision of any qualifying physician.

Implementing the Increased Payments in Fee for Service and Managed Care

The rule provides multiple options for states to allow for flexible implementation in fee-for-service and managed care settings. The rule permits states to either “lock” rates at the level of the Medicare physician fee schedule in effect at the beginning of 2013 and 2014 or modify the rates in alignment with all updates by Medicare.  For operational ease, it does not require states to make site of service adjustments, permitting them instead to make payments at the Medicare rate applicable to the office setting.  It also permits states to either pay in accordance with all Medicare locality adjustments within the state or to develop a rate for each code based on the mean Medicare rate over all counties in the state to be paid on a statewide basis.  The regulation provides that all of the requirements related to the increased payments apply to services reimbursed by Medicaid managed care plans.  States must incorporate the increased payment into contracts with such entities.

Interaction with the Vaccines for Children Program

The rule provides for payment of vaccine administration fees under the VFC program at the lesser of the VFC regional maximum administration fee (the VFC “ceiling”) or the Medicare rates in 2013 and 2014.  This is consistent with VFC program rules which limit payments to the VFC ceiling, which is the state’s regional maximum amount, and to one payment per vaccine administered.  Because the VFC ceiling rates were issued on an interim basis in 1994 and have never been updated, the rule also updates these rates using the Medicare Economic Index, which is a measure of medical practice cost inflation.

The rule can be found at


For Immediate Release:               Thursday, November 1, 2012

Contact:                                          CMS Office of Public Affairs 202-690-6145



The Centers for Medicare & Medicaid Services (CMS) issued a final rule with comment period on November 1, 2012 for Medicare’s payments for physician fees for 2013.  It includes a new policy to pay a patient’s physician or practitioner to coordinate the patient’s care in the 30 days following a hospital or skilled nursing facility stay.  Recognizing the work of community physicians and practitioners in treating a patient following discharge from a hospital or nursing facility will ensure better continuity of care for these patients and help reduce patient readmissions.   The changes in care coordination payment and other changes in the rule are expected to increase payment to family practitioners by seven percent—and other primary care practitioners between three and five percent—if Congress averts the statutorily required reduction in Medicare’s physician fee schedule.

The final rule with comment period also includes a statutorily required 26.5 percent across-the-board reduction to Medicare payment rates for more than 1 million physicians and non-physician practitioners under the Balanced Budget Act of 1997’s Sustainable Growth Rate (SGR) methodology.  However, Congress has overridden the required reduction every year since 2003.  The Administration is committed to fixing the SGR update methodology and ensuring these payment cuts do not take effect.  Predictable, fiscally-responsible physician payments are essential for Medicare to sustain quality and lower health care costs over the long-term.

In addition, the final rule with comment period continues the careful implementation of the physician value-based payment modifier by phasing in application of the modifier and enabling physicians in larger groups to choose how to participate.  The value modifier provides differential Medicare payments to physicians based on comparison of the quality of care furnished to beneficiaries and the cost of care.  The statute allows CMS to phase in the value modifier over three years from 2015 to 2017.  For the 2015, the final rule applies the value modifier to groups of physicians with 100 or more eligible professionals, a change from the proposed rule, which would have set the group size at 25 or above. This change was adopted to gain experience with the methodology and approach before expanding to smaller groups.

The final rule also provides an option for these groups of physicians to choose how the value modifier is calculated based on whether they participate in the Physician Quality Reporting System (PQRS).

For physicians and groups of physicians who elect to participate in 2015, common sense incentives will improve the care that beneficiaries receive; physicians with higher quality and lower costs will be paid more, and those with lower quality and higher costs will be paid less. The performance period for the application of the value modifier in CY 2015 was previously established as CY 2013 in the CY 2012 MPFS final rule.

The final rule continues efforts by CMS to align quality reporting across programs to reduce burden and complexity. The rule makes changes to the PQRS and the Electronic Prescribing (eRx) Incentive Program, the two quality reporting programs applicable to the MPFS, and updates the Medicare Electronic Health Records (EHR) Incentive Pilot Program.  These changes will simplify reporting and align the various programs’ quality reporting approaches so they support the National Quality Strategy.

The final rule also lays out next steps to enhance the Physician Compare website, including posting names of practitioners who, as part of the Million Hearts campaign, successfully report measures to prevent heart disease.  These are recommended measures under PQRS as well.

Among other changes, the final rule also expands access to services that can be provided by non-physicians practitioners.  The rule allows Certified Registered Nurse Anesthetists (CRNAs) to be paid by Medicare for providing all services that they are permitted to furnish under state law.  This change will allow Medicare to pay CRNAs for services to the full extent of their state scope of practice.  The rule also allows Medicare to pay for portable x-rays ordered by nurse practitioners, physician assistants and other non-physician practitioners.

Finally, the rule explains how Medicare will pay for molecular pathology services—the next innovation of clinical laboratory tests that will foster the development of personalized medicine. These tests will be paid under the Clinical Laboratory Fee Schedule with 2013 payment set by the gap filling method.   The final rule also requires a face-to-face encounter as a condition of payment for certain durable medical equipment (DME) items for orders written on or after July 1, 2013.

The final rule with comment period can be viewed at:

The rule will be published on November 16, 2012.  It will take effect January 1, 2013 with a comment period that closes on December 31, 2012


By Becky Amann, Compliance Manager


New OIG investigations in 2013:

  • Onsite visits for  Medicare Provider and Supplier Enrollment and Re-enrollment:  The OIG will determine how often onsite visits occur as part of the     Medicare enrollment or re-enrollment process. CMS is authorized to expand      the role of unannounced onsite visits to confirm the legitimacy of physical locations.
  • Anesthesia Services: The OIG will review Medicare Part B claims for personally performed anesthesia services to determine whether they were supported in accordance with Medicare regulations.
  • Ophthalmological Services: The OIG will review Medicare claims data to identify questionable billing for ophthalmological services during 2011.

Continuing OIG investigations in 2013:

  • High Cumulative Part B Payments: The OIG will continue to review high cumulative Part B payments to determine if they are reasonable  and necessary, adequately documented, and provided consistent with federal regulations. Report is expected to be issued in 2013.
  • Part B Imaging Services: Part B imaging services will continue to be reviewed to determine whether the services reflect expenses incurred and whether the utilization rates  reflect industry practices. Report is expected to be issued in 2013.
  • Laboratory Tests: The OIG will continue to describe billing characteristics and identify questionable billing for Part B clinical laboratory tests in 2010. Medicare only pays for those laboratory tests that are ordered by a physician or qualified non-physician practitioner who is treating a beneficiary. Report is expected to be      issued in 2013.
  • Incident-to Services: The OIG will continue to review whether incident-to billing has a higher error rate than that for non-incident-to services. Report is not expected to be issued until 2014.
  • Place of Service Coding Errors: The OIG will continue to review physicians’ coding on Medicare Part B claims for services  performed in ambulatory surgical centers and hospital outpatient departments to determine proper coding of the place of service. Report is expected in 2013.
  • E/M services:
    • Potential Inappropriate Payments in 2010: The OIG will continue to review multiple E&M services for the same providers and beneficiaries to identify EHR documentation practices associated with improper payments. An increased frequency has been noted in medical records with identical documentation across services. Report is expected in 2013.
    • Use of Modifiers During Global Surgery Period: The OIG will review       the appropriateness of the use of certain modifiers during the global       surgery period to determine if Medicare payments were in accordance with  Medicare requirements. Report is expected in 2013.

All practices and facilities should read the OIG Work Plan in its entirety, and take steps to identify and rectify any potential issues they may have, before the OIG does.

The full 2013 Work Plan can be accessed at:


The following topics were included in Medicare’s Quarterly Compliance Newsletter:


The following factors should be considered when making the decision to admit the patient:

  • The severity of the signs and symptoms exhibited by the patient.
  • The medical predictability of something adverse happening to the patient.
  • The need for diagnostic studies that appropriately are outpatient services (i.e., their performance does not ordinarily require the patient to remain at the hospital for 24 hours or more) to assist in assessing whether the patient should be admitted.
  • The availability of diagnostic procedures at the time when and at the location where the patient presents.

Observation care is a well-defined set of specific, clinically-appropriate services. It may include ongoing short term treatment, assessment, and reassessment before a decision is made regarding whether patients will require further treatment as hospital inpatients or if they can be discharged from the hospital.

Observation services are commonly ordered for patients who present to the Emergency Department and then require a significant period of treatment or monitoring in order to make a decision concerning their admission or discharge.

Place of Service Coding for Physician Services in an Outpatient Setting

Physicians are incorrectly reporting office place of service, when services are provided in an outpatient hospital setting. This results in overpayments to the physicians as reimbursement under the office place of service setting (which includes the overhead expenses) is a higher reimbursement than that of an outpatient setting.

Recovery Auditors reviewed surgical CPT codes (10000- 60000) and found that the greatest number of improper payments pertained to the CPT codes in the Integumentary System (10000 series).

To review the Quarterly Compliance Newsletter in its entirety, please access the CMS Learning Network at:


By Karin Bajak, Billing Manager



Medicare’s Open Enrollment period is from October 15th through December 7th 2012. This is when ALL people with Medicare can change their Medicare health plan and prescription drug coverage for 2013.

Your patients can compare plans and make sure they have the right health and prescription drug coverage. They can stay with their current plan if they are happy with it or look for a new one with better coverage, higher quality and lower cost.

Please let your patients know that they can call 1-800-MEDICARE or visit for plan information.



Effective January 1, 2013, United Healthcare Cardiology Notification Program for Medicare Advantage benefit plans is changing from a notification program to a prior authorization program.

The following services will require Prior Authorization for Medicare Advantage members:

  • Echocardiogram
  • Stress Echo
  • Diagnostic Catheterizations
  • Electrophysiology Implants

Notification is already required for diagnostic catheterization and electrophysiology implant procedures. United Healthcare is transitioning to Prior Authorization and adding Echocardiogram and Stress Echo to the program.

To view this update, please click on the link below.



Univera Healthcare is required by the Centers for Medicare & Medicaid Services (CMS) to issue Medicare members identification cards within 10 days of processing an application for coverage.

As a result of this CMS requirement, Univera must issue ID cards to newly enrolled Medicare members beginning October 15, 2012, and continue until the open enrollment period concludes December 7, 2012. Please be aware that these ID cards are issued to validate plan enrollment only. They should not be used for health care services. Medicare members should continue to use their current ID cards as their new coverage is not effective until January 1, 2013. Please review the effective date on ID cards presented to you to ensure that you have the correct member information for the claim submission time frame.

Univera Healthcare will transition all Medicare membership to their updated claims system on January 1, 2013. Current and newly enrolled Medicare members will receive new ID cards by mid-December. The identification number on these cards will begin with 200. Members should present their new ID cards when obtaining healthcare services on or after January 1, 2013.


Is Your Practice Prepared for Disaster?

By Emilie J DiChristina, MBA for PracticeFirst

Hurricane Sandy, like Irene and Katrina before her has been a demonstration of the weakness we all face when fighting a natural or man-made disaster. That weakness arises from a mixture of hubris (it won’t happen to us!), and expectation that in the U.S., help is on the way (which can’t happen when roads, bridges and safe standing structures are all gone).

Whether dealing with a natural disaster, an accident, an epidemic, or the zombie apocalypse those who survive, and thrive, will be those who were prepared.

So is YOUR practice prepared for emergencies, disasters and accidents? Do you have a formal plan that everyone who works for the practice, in any role, can find and work within? What does the plan cover?

Honestly, most practices have a plan for back-up and recovery of their Practice Management Programs (PMP) and their EMR data, however is smaller practices this back-up may include taking the back-up copies home so they are stored off-site. This may work in the case of a fire at your practice, but what happens if your practice and your home (or the home of the back-up) is destroyed at the same time (as has happened in New Jersey).

Do you have a plan for preventing damage to your paper files (whether medical charts, vaccine and medication logs, or financial and inventory records)?

Do you have a plan for tracking freezers and refrigerators at your practice storing expensive medications, vaccines, allergy preparations to determine if the power went out and allowed the temperature to drop enough to thaw or warm the materials so they are now unsafe? A thermometer alone will not provide sufficient data as it will not warn you that something thawed/warmed and then was refrozen/re-cooled when the power came back on.

How would you continue to care for your patients if there was a Teamster’s strike (no trucks often mean no supplies)? How about an epidemic? A sinkhole in the road to your practice?

How would you evacuate patients if there were a fire? How would you know every last patient AND employee was out of the building after such an evacuation?

What if your staff needed to be with their families, or you needed to be with yours?

The nature of preparedness requires self-awareness as to the most likely risks your practice may face.  Despite the CDC having an excellent disaster plan for surviving the Zombie Apocalypse, most practices will face more common issues such as:

  • Prolonged power outages
  • Fire/Explosion
  • High wind damage/Tornado
  • Water damage (broken pipes, backed up sewer lines, roof leaks, floods)
  • Snow (roof collapse, frozen pipes, staff unable to get to work)
  • Outbreak of Illness affecting staff
  • Patient/family members threatening practice with weapons
  • Contaminated medications given to patients
  • A loss of water for washing hands and flushing toilets

It makes sense to focus your disaster planning efforts on the most likely events for your practice. Once you have set-up a plan for the worst eventualities, you can then work on the least likely.

In addition to planning for how to survive the disaster and to minimize the risk to life and limb, you will also have to have a plan for mitigation.

How will you get your practice up and running again? Obviously you have some outstanding A/R, and hopefully the majority is being electronically transmitted to a major bank. If you have any payers including patients sending payments to your office and you will not be there, it is best to have the mail forwarded to a safe location immediately. What type of cushion do you have if it takes you several days to resume practice? How about several weeks or months?

How will you work with other providers and your patients to insure that they get the care/medications/treatments they need? How will you report critical lab and testing findings to patients?  How will you communicate with staff (who may be without power, phones, etc.)?

Do you have an answering machine in your office (even a highly complex one) that may now be off due to damage or power loss? How do the patient’s know what to do? Even if you have an answering service, you may find they have been evacuated, or have lost power…again, what will your patient’s do?

How will you document the damage to your insurance company in order to obtain payment for your losses? Do you have photos, videos and copies of invoices for everything you have ever purchased? Do you have a current list of the supplies, medications, vaccines, equipment, etc. that is in each room, in each building, in each refrigerator?

How about payroll information or other electronic data that may not be included in your PMP or EMR? Has that been backed up and is it available to you?

Okay, enough doom and gloom for today. The good news is:

  • Having a disaster plan that is effective, tested and reviewed yearly may lower your practice’s general liability insurance costs.
  • Having a disaster plan that covers how to get patient’s information to them, how to get them treated if your practice is unable to, and prevents anyone from going without critical values any longer than they have to is good defense against malpractice cases, as is a plan for monitoring freezer temps and for tracking medications delivered and injected.
  • There are many resources out there to help your practice prepare an effective disaster plan. There is also the CDC Blog Preparedness 101: Zombie Apocalypse to help you prepare your home and family (I kid you not!)

The even better news is that PracticeFirst is also available as always to help you and your staff plan for a disaster – feel fre

Updates on Vaccine Management Deficiencies Identified by the OIG and CDC Recommendations

By Emilie J DiChristina, MBA for PracticeFirst


On June 5, 2012, the HHS Office of the OIG indicated that inappropriate storage of vaccines and poor documentation was widespread among participants in the CDC VFC (Vaccines for Children) program.

As a response to these negative findings, the CDC, issued updated guidelines for the storage of vaccines and is revamping its own process for ordering and inventory management as a further support to physicians.

The OIG’s findings were based on a two-week assessment of 45 different vaccine providers from the five largest city and state VFC grantees. During the assessment, the majority of storage temperature measurements taken were “within the required ranges,” however they also found that vaccines stored by 76 percent of the assessed providers “were exposed to inappropriate temperatures for at least five cumulative hours during a two-week period.”

The OIG report also found none of the providers reviewed met requirements in all 10 vaccine management categories on which they were assessed, and 40 of the 45 providers did not meet requirements in “at least half” of the categories.

These findings by the OIG resulted in updated recommendations by the CDC, and also resulted in potential administrative headaches and increased expense for the providers participating in the VFC program. The CDC recommendations are currently considered just that – recommendations – however there is an expectation that providers who wish to administer the free vaccines VFC provides for uninsured and underinsured children and adolescents should be prepared to make a firm commitment to complying with the program’s dictates.

In addition to concerns over appropriate temperature management, the OIG also found that providers were found to be storing expired vaccines in the same location as unexpired vaccines, and were not maintaining appropriate documentation. Mixing expired and non-expired vaccines leaves open the possibility of administering an outdated vaccine, while the documentation issues leave the provider open to risk management issues including findings of fraud (note that physician in Orleans County was found to be charging for VFC vaccines in 2011).


In response to the OIG report of June 2012, the CDC released new interim vaccine storage and handling guidelines to aid providers in meeting the requirements of safe storage, handling and documentation for vaccines from any source, not just that of the VFC..

In a letter to the OIG responding to its findings, dated October 5, 2012, CDC Director Thomas Frieden, M.D., M.P.H. wrote, “CDC is in the process of implementing substantial improvements in vaccine ordering and inventory management systems, which will support improvements in vaccine management at the provider office,”  and, “Because VFC providers generally manage their public and private stock vaccines in a similar manner, and 90 percent of U.S. children are vaccinated by a provider that participates in the VFC program, CDC believes that efforts to strengthen storage and handling practices will help improve vaccination services nationally and benefit children vaccinated with both publicly and privately purchased vaccines.”


According to Kris Sheedy, Ph.D., associate director of communication science at the CDC’s National Center for Immunization and Respiratory Diseases, there is no deadline attached to the update and nothing will be enforced.

“These recommendations are in effect now, and … this is interim guidance, not a regulation,” Sheedy said. “This guidance is intended for use by all public and private sector providers and, while recognizing that cost may be a barrier, we encourage practices to move toward implementing these recommendations as soon as possible,” the CDC said in the report. “CDC is currently evaluating the most efficient and cost-effective method to phase these recommendations in, and more guidance is forthcoming.” Sheedy said that the CDC’s updated Vaccine Storage and Handling Toolkit currently is in the final approval stages, but should be cleared soon.


The CDC issued the update recommends providers constantly monitor temperature via a digital, 24-hour temperature-recording device. The CDC is also now recommending that providers use:

  • Stand-alone refrigerator and freezer units suitable for vaccine storage rather than combination (refrigerator/freezer) models not designed for storing fragile biologics;
  • Biosafe, glycol-encased or similarly temperature-buffered probes;
  • Digital data loggers with detachable probes that record and store temperature      information at frequent programmable intervals for 24-hour temperature      monitoring; and
  • A weekly review of vaccine expiration dates and rotation of vaccine stock      accordingly.
  • In addition, the CDC also is asking providers to discontinue use of  dorm-style or bar-style refrigerator/freezers for even temporary vaccine storage.


Providers offering vaccines through the VFC program or as privately reimbursed should consider reviewing and potentially revising their practice policies regarding the 10 areas reviewed by the OIG. These areas include:

In order to participate in the VFC, providers have to meet requirements related to:

  • Equipment for vaccine storage,
  • vaccine storage practices,
  • temperature monitoring,
  • vaccine handling,
  • personnel administering vaccines,
  • vaccine preparation.
  • vaccine waste,
  • vaccine security and equipment maintenance,
  • vaccine ordering and inventory management, and
  • receiving vaccine shipments<