June 21, 2018

MedPAC Report Explores Cuts to Specialty Services

In its June 2018 Report to Congress, the Medicare Payment Advisory Commission (MedPAC) explored (but did not formally recommend) “rebalancing” Medicare’s physician fee schedule toward ambulatory evaluation and management (E&M) services by suggesting a 10 percent increase in relative value units for E&M services. This increase would be offset by a 3.8 percent reduction for all other fee schedule services, including medical imaging.

If implemented, primary care physicians who focus primarily on E&M services would see reimbursement increases. Specialists who perform some E&M services would realize payment reductions of less than 3.8 percent, and other specialties, such as radiology, would realize the full 3.8 percent decrease. MedPAC estimates aggregate impacts for radiation oncology and nuclear medicine at 3.2 percent and interventional radiology at 3.5 percent.

Implementing this concept would require Congressional action. The College does not believe there is enough interest on the Hill to revisit Medicare payments at this time; however, ACR staff will continue to monitor discussions.

In addition, the MedPAC report dedicated a chapter to “Medicare coverage policy and use of low-value care.” The chapter reviews Medicare local and national coverage processes and suggests more frequent policy updates are needed to account for new evidence that may lead to reductions in coverage for “low-value” services. Proton beam therapy was used as one of several examples of potentially low-value care that have seen increased use due to expansive coverage policies. The MedPAC report discusses the following six tools to potentially address low-value care:

  • Expanding prior authorization
  • Implementing clinical decision support
  • Increasing cost-sharing for low-value services
  • Establishing new payment models, such as accountable care organizations, to hold providers accountable for the cost and quality of care
  • Revisiting coverage determinations on an ongoing basis
  • Linking information about the comparative clinical effectiveness and cost-effectiveness of health care services to fee-for-service coverage and payment policies

The commission also believes Medicare coverage decisions should consider cost-effectiveness, but it recognizes that CMS lacks the statutory authority to do so.

The ACR supports the use of clinical decision support for imaging services and has been working with CMS on implementation of the Protecting Access to Medicare Act (PAMA) provisions to require clinical decision support for advanced diagnostic imaging services. A voluntary reporting period is slated to begin on July 1, 2018, with full implementation beginning on January 1, 2020.

MedPAC is an independent congressional agency of appointed health care policy experts, insurers, providers and advocates who are mandated to advise Congress on Medicare policy issues.

ACR staff will continue to monitor MedPAC and the Congressional response to the report. For questions, please contact Katie Keysor at kkeysor@acr.org.