Update on Medicare “Physician Fee” Payments

Mar 31, 2010

March proved yet another tumultuous month for congressional consideration of legislation establishing Medicare payment rates. Physicians, clinical social workers and other health professionals that bill Medicare Part B independently face a scheduled rate cut of 21 percent on April 1. Fortunately, this week the Centers for Medicare and Medicaid Services (CMS) delayed the scheduled formula payment cuts until after Congress reconvenes on April 12. CMS is working with Congress, health care practitioners, and the beneficiary community to avoid disruption in the payment of claims submitted under the Medicare Physician Fee Schedule (MPFS), which is based on a flawed formula known as the Sustainable Growth Rate (SGR).  For a recent history on the SGR formula problems for clinical social workers, see NASW’s website here.

A temporary extension of current practitioner payment levels was enacted on March 2, 2010. This short term remedy held payments at 2009 levels until March 31, 2010, but Congress recessed for two weeks without extending the provision past the March deadline.  CMS announced this week that Congress is working to avoid the payment cuts that will take effect April 1, 2010 and instructed its contractors to hold claims for services paid under the MPFS for the first 10 business days of April. Holding the MPFS claims will only affect those with dates of service April 1, 2010 and later.

CMS expects the hold on claims will have a minimum impact on practitioners’ cash flow bmedicare, physician fee, payments,ecause clean electronic claims are paid no sooner than 14 calendar days (29 for paper claims) after the date of receipt. The Senate has scheduled a vote on the extension legislation for April 12 when they are scheduled to return from recess. Congress has resisted a permanent correction of the SGR formula because any remedy will create budgetary problems. Congress is particularly reluctant to address the formula this year because the economic downturn has depressed Medicare revenues below actuaries’ projections. NASW has joined with physicians and other practitioners in calling for a permanent correction in the SGR payment formula.

The new health reform law, “Patient Protection and Affordable Care Act” (P.L. 111-148) includes one key provision that directly benefits the social work profession, a delay in the five-percent cut and extension until the end of the year for psychotherapy rates under the MPFS. The provision will allow Medicare psychotherapy rates to be paid at last year’s level. Clinical social workers’ and psychologists’ rates will remain at 2009 levels until the end of 2010, when the provision again expires and needs to be reauthorized.

In addition to these Medicare formula problems that require legislative remedies, a number of Medicare administrative changes are also affecting payments to clinical social workers in 2010. NASW has released a “Clinical Social Work Practice Update” on these administrative developments affecting Medicare participating practitioners. See NASW’s website for a copy of our Practice Update here. NASW members that wish to receive regular updates on legislation affecting Medicare payments should sign up for our listserv messages here.