CAFP strives to make our members aware of the opportunities for increased payment available to them because of health care reform. The Patient Protection and Affordable Care Act (PPACA) offers some positive first steps toward addressing the severe differential in payment between primary care and subspecialty services. For example, it provides a 10 percent bonus from Medicare to primary care physicians over a five year period.

More must be done, of course; the payment structure in the U.S. health care system must be reformed as well. It devalues primary care, paying subspecialists at disproportionately higher rates, leading to the primary care physician shortage. Medicare's most recent payment for a half-hour primary care visit, for example, was as low as $70 per visit. By contrast, a colonoscopy requires roughly the same time, but gastroenterologists receive $449.  

CAFP is working to increase payment for primary care services, ensure that family physicians are paid for work they do now, such as patient communication and care coordination, and make certain we have a quality primary care workforce for years to come.

MEDICARE

Bonus Payments

Thanks to the advocacy of organizations like CAFP and AAFP, legislators now understand that improving the cost and quality of health care will mean building a strong primary care foundation. PPACA recognizes the value of primary care with a Medicare bonus payment for primary care practitioners, whereby eligible practitioners will receive incentive payments equal to 10 percent of their allowed charges under Medicare Part B for primary care services provided between 2011 and 2016.The law defines the term "primary care practitioner" as a physician who has a primary care specialty designation of family medicine, internal medicine, geriatric medicine or pediatric medicine. The definition also includes nurse practitioners, clinical nurse specialists and physician assistants.

To qualify for the bonus, primary care services must account for at least 60 percent of Medicare Part B allowable charges. According to the legislation, eligible primary care services are identified by specific Healthcare Common Procedure Coding System (HCPCS) codes that cover office visits, nursing home visits and home health care visits. CAFP and AAFP have urged the Centers for Medicare and Medicaid Services (CMS) to expand the list so that more family physicians (especially those in rural areas with broader scopes of practice) will be eligible. Although the legislation gives CMS some authority to modify the code list that defines primary care services, the codes currently in the law include HCPCS codes 99201-00215, 99304-99340 and 99341-99350. Click here for a complete list of codes.

PPACA specifies that eligibility for the primary care incentive payment is not related to any other payment Congress has authorized. For example, family physicians practicing in federally designated Health Professional Shortage Areas are eligible for a separate 10 percent bonus payment, as well as the primary care incentive payment.

It appears that the payment will be automatic; physicians do not need to enroll or apply. CMS initially will identify primary care professionals eligible for the bonus payment based on each professional's 2009 claims data and national provider identifier number. The bonus will be paid on a quarterly basis for each service that qualifies for payment. CMS will determine a physician's specialty and then look at a full-year's data to see if 60 percent of the allowable charges were for primary care services. It appears that physicians will have to have a prior year's Medicare claims data to receive the bonus. Family physicians who qualify should receive their first checks from CMS sometime after March 31, 2011. That check from CMS will represent 10 percent of the physician's allowable charges for primary care services that were submitted to Medicare in January, February and March. This process will be repeated quarterly.

PQRI

PPACA makes several changes to Medicare's voluntary reporting program known as the Physician Quality Reporting Initiative (PQRI). This program currently offers bonuses to family physicians and other qualified professionals who report on designated quality measures.

Under the new law, physicians can earn incentive payments of one percent of their total estimated allowed charges under Medicare Part B in 2011 and 0.5 percent in 2012 through 2014. Participation in PQRI will continue to be voluntary in these years. An additional 0.5 percent incentive payment will be made to physicians who participate in a qualified Maintenance of Certification Program (quality practice-based learning programs through specialty boards). Following the practice now in place for hospitals, beginning in 2015 physician payments will be reduced if they do not successfully participate in the PQRI program. In 2015, the penalty will be 1.5 percent; in subsequent years it will be 2.0 percent. 

CMS has a step-by-step guide to assist eligible providers with enrollment and determine the best reporting option (claims-based or registry-based and individual or group measures reporting). Providers can select the measures they would like to report based on the approved measures list and follow instructions for appropriate reporting. Details are outlined on the CMS website. Analysis is expected to be performed at the individual physician level; therefore, accurate and consistent use of individual National Provider Identifier (NPI) on claims is required.

More information is available on the American Medical Association website and the CMS website.

Physician Utilization

PPACA eliminates the five percent penalty for physician utilization outliers. It continues the current program of providing confidential feedback to physicians comparing their utilization and resources use to their peers.

Value-Based Payment Modifier

PPACA establishes a value-based payment modifier to increase payment for Medicare physicians who deliver high-quality care at low cost and decrease payment for "low-value" physicians, effective 2015. This system provides for different payments to physicians under the Medicare Fee Schedule based upon quality of care compared with cost during a specified performance period. As of 2017, the payment modifier must be applied to all physicians. It appears that the law will ensure that the rate is adjusted for geographic practice expense and the socioeconomic status of patient population. CAFP will provide additional information as it becomes available.

MEDI-CAL

In 2013 and 2014, all Medicaid payments for primary care services (evaluation and management codes and immunizations), will be increased so they are at least equal to Medicare payments. In California, Medi-Cal currently pays significantly less than Medicare and so family physicians caring for Medi-Cal patients will see significant increases in their payments. It appears that the increase is limited to primary care services and may be only for those with primary care specialty designations. CAFP will provide additional information as it becomes available.

ACCOUNTABLE CARE ORGANIZATIONS

Under PPACA, CMS must establish a program that allows accountable care organizations (ACOs) to share in savings they produce, effective 2012. Groups of providers who report on quality and coordinate care can share in the savings achieved in their region, from, for example, the prevention of unnecessary emergency room visits or hospitalizations. There is currently a great deal of flexibility in the ways ACOs can be structured; ACOs can be small groups of loosely affiliated physicians or large, organized groups. ACOs do not have to involve a hospital or hospital system, although it appears that many of them will. The financial benefit to individual physicians of joining an ACO will largely depend on the ACO's internal design.

Physicians should carefully scrutinize any contract under which they agree to participate in an ACO. Family physicians should become active participants in the development and leadership of ACOs to ensure a strong primary care focus in these organizations. The AAFP has adopted the following principles for payment in the ACO context and these principles may provide a good lens through which to view a contract.

ACOs have the potential to support the PCMH model and lead to payment reform. To learn more visit the online CAFP PCMH Resource Center (Coming Soon).

PILOTS AND DEMONSTRATIONS

Physicians should be aware that pilots and demonstration projects may offer opportunities for additional payment or payment reform. While the state government in California declined to participate in the Multi-Payer Advanced Primary Care Practice Demonstration Project, other opportunities exist, which CAFP will closely monitor and, where appropriate, promote.

Medicaid PCMH for Patients with Chronic Conditions Demonstrations

PPACA establishes a demonstration program to create primary care medical homes for Medicaid enrollees with multiple chronic conditions. The medical homes are equated with PCMH; guidelines and general definitions conforming to common PCMH definitions are outlined in the PPACA provisions. In this demonstration, eligible physicians will receive shared savings bonus payments.

States may file plan amendments with HHS to have the option ready to begin in January 2011. The legislation provides no additional funding, save for matching funds for planning grants. It appears unlikely that, given the current economic and political climate, California will file.

Payment Bundling Demonstration

PPACA establishes a national pilot program to test payment bundling arrangements for acute Medicare inpatient hospital services, physician services, outpatient hospital services and post-acute care services for an episode of care spanning 30 days. The goal is to encourage hospitals, physicians and other providers to work together to achieve savings for Medicare through increased collaboration and improved coordination of patient care. Currently little else is known about this demonstration, which is set to begin in 2013 and has unspecified funding. CAFP will provide additional information as it becomes available.

CMS Innovation Center

PPACA establishes a new center to test innovative payment and service delivery models to reduce health care costs and enhance the quality of care provided to individuals, effective 2011. CAFP will provide additional information as it becomes available.