Growing Medicare penalties start this year


Along with the usual threat of cuts to physician payment using the Sustainable Growth Rate (SGR) formula, which sets payment rates through a formula based on economic growth, physicians are also facing other potential cuts.

Physician Quality Report System (PQRS) – for eligible professionals (EPs), which include vascular surgeons, who do not successfully report nine quality measures:

1. 2015 – 1 percent payment adjustment

2. 2016 and beyond – 2 percent payment adjustment

3. According to the American Medical Association, only 35 percent of EPs are participating in PQRS

Meaningful Use of Electronic Health Record Incentive Program – for EPs who fail to participate:

1. 2015 – 1 percent payment adjustment

2. 2016 – 2 percent payment adjustment

3. 2017 – 3 percent payment adjustment

4. Hardship exemptions – insufficient Internet access, new physician, natural disaster or other unforeseeable barrier, lack of face-to-face or telemedicine interaction or lack of follow-up needed with patients and lack of control over availability of certified EHR technology

5. According to a 2014 Medscape Report, 22 percent of physicians are opting out of Meaningful Use

Value-Based Payment Modifier – for physicians who do not meet the benchmark for both cost and quality data:

1. 2015 – 1 percent payment adjustment for physicians in group practices of 100 or more EPs under a single tax identification number based on 2013 data

2. 2016 – 2 percent payment adjustment for physicians in group practices of 10 or more EPs based on 2014 data

3. 2017 – 4 percent for physicians in group practices of 10 or more EPs/2 percent for physicians in group practices under 10 EPs based on 2015 data

Sequestration – 2 percent across-the-board cut on Medicare to reduce the deficit

The result – penalties go as high as 11 percent in 2017 for these programs

According to the Medical Group Management Association survey conducted in October 2014 with 1,000 physician group practices in which 48,000 physicians practice:

1. 84 percent do not believe that Medicare’s quality reporting programs enhance physicians’ ability to provide high quality patient care

2. 71 percent rated the regulatory complexity of the quality reporting programs as very or extremely complex

3. 74 percent are concerned with their practices’ ability to successfully participate in Medicare quality reporting programs in 2015

SVS supports replacing the three programs with a Merit-Based Incentive Payment System, which was included in last year’s SGR repeal and reform bill. Even though there is bipartisan, bicameral support for this legislation, Congress will likely enact another SGR “patch” for six months before the current patch expires on March 31; otherwise, there will be a 22 percent cut that would take effect on April 1.


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