September 20, 2018

ACR and UAC Question CMS About Ultrasound Practice Expense Updates

The American College of Radiology (ACR) and the Ultrasound Access Coalition (UAC) met with representatives of the Centers for Medicare and Medicaid Services (CMS) on September 18 to voice concerns about their proposal to update the direct practice expense inputs for equipment and supply pricing for ultrasound and vascular ultrasound rooms for calendar year (CY) 2019.

If implemented, the proposal would cut overall payment rates for ultrasound services in the CY 2019 Medicare Physician Fee Schedule by about nine percent. CMS proposes to phase in use of the new direct PE input pricing over a four-year period.

The ACR and UAC recommended that CMS not finalize its pricing proposal related to the general ultrasound and vascular ultrasound rooms, due to the potentially devastating impacts it could have on the availability of and patient access to critical, lifesaving ultrasound services. We asked CMS to work with the UAC and other stakeholders to more appropriately price ultrasound equipment. Concerns about CMS’ lack of transparency, the validity of its data sources and its chosen methodology were also discussed.

The ACR is a member of the UAC, which consists of ultrasound stakeholders including physician groups, ultrasound equipment manufacturers, and a broad range of groups and associations representing patients and imaging centers and medical practices that perform imaging procedures. The coalition was formed in response to CMS’ proposal to reprice the direct practice expense inputs for ultrasound and vascular ultrasound rooms.

CMS’ direct practice expense proposal for ultrasound was based on authority granted to the agency under section 1848(c)(2)(M) of Patient Access to Medicare (PAMA) Act to initiate a market research contract with StrategyGen to update the Medicare Physician Fee Schedule’s (MPFS) direct PE inputs (DPEI) supply and equipment pricing for CY 2019.

StrategyGen submitted a report to CMS with updated pricing recommendations for approximately 1,300 supplies and 750 equipment items currently used as direct PE inputs, from which CMS is recommending updated pricing recommendations for 2017 supply and equipment items. StrategyGen used several primary and secondary resources to gather price data for these items. The resources included a vendor survey, a physician panel, the General Services Administration system (GSA), an aggregate health system buyers’ database, and Amazon Business and Cardinal Health.

Considering the likelihood of significant payment changes, the agency proposed to phase-in use of the new direct PE input pricing over a four-year period using a 25 percent /75 percent (CY 2019), 50 percent/50 percent (CY 2020), 75 percent/25 percent (CY 2021) and 100 percent/0 percent (CY 2022) split between new and old pricing.

CMS notes that this transition period will ease the shift to the updated supply and equipment pricing and will give interested parties an opportunity to review and respond to the new pricing information associated with their services.

For questions on the repricing of existing direct practice expense inputs, please contact Angela Kim, ACR senior director of economics and health policy, at akim@acr.org.