[Federal Register Volume 77, Number 222 (Friday, November 16, 2012)]
[Rules and Regulations]
[Pages 68892-69373]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-26900]



[[Page 68891]]

Vol. 77

Friday,

No. 222

November 16, 2012

Part II





Department of Health and Human Services





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Centers for Medicare & Medicaid Services





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42 CFR Parts 410, 414, 415, et al.





Medicare Program; Revisions to Payment Policies Under the Physician Fee 
Schedule, DME Face-to-Face Encounters, Elimination of the Requirement 
for Termination of Non-Random Prepayment Complex Medical Review and 
Other Revisions to Part B for CY 2013; Final Rule

  Federal Register / Vol. 77 , No. 222 / Friday, November 16, 2012 / 
Rules and Regulations  

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Parts 410, 414, 415, 421, 423, 425, 486, and 495

[CMS-1590-FC]
RIN 0938-AR11


Medicare Program; Revisions to Payment Policies Under the 
Physician Fee Schedule, DME Face-to-Face Encounters, Elimination of the 
Requirement for Termination of Non-Random Prepayment Complex Medical 
Review and Other Revisions to Part B for CY 2013

AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION: Final rule with comment period.

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SUMMARY: This major final rule with comment period addresses changes to 
the physician fee schedule, payments for Part B drugs, and other 
Medicare Part B payment policies to ensure that our payment systems are 
updated to reflect changes in medical practice and the relative value 
of services. It also implements provisions of the Affordable Care Act 
by establishing a face-to-face encounter as a condition of payment for 
certain durable medical equipment (DME) items. In addition, it 
implements statutory changes regarding the termination of non-random 
prepayment review. This final rule with comment period also includes a 
discussion in the Supplementary Information regarding various programs 
. (See the Table of Contents for a listing of the specific issues 
addressed in this final rule with comment period.)

DATES: Effective date: The provisions of this final rule with comment 
period are effective on January 1, 2013 with the exception of 
provisions in Sec.  410.38 which are effective on July 1, 2013. The 
incorporation by reference of certain publications listed in the rule 
was approved by the Director of the Federal Register on May 16, 2012.
    Comment date: To be assured consideration, comments must be 
received at one of the addresses provided below, no later than 5 p.m. 
on December 31, 2012. (See the SUPPLEMENTARY INFORMATION section of 
this final rule with comment period for a list of the provisions open 
for comment.)

ADDRESSES: In commenting, please refer to file code CMS-1590-FC. 
Because of staff and resource limitations, we cannot accept comments by 
facsimile (FAX) transmission.
    You may submit comments in one of four ways (please choose only one 
of the ways listed):
    1. Electronically. You may submit electronic comments on this 
regulation to www.regulations.gov. Follow the instructions for 
``submitting a comment.''
    2. By regular mail. You may mail written comments to the following 
address ONLY: Centers for Medicare & Medicaid Services, Department of 
Health and Human Services, Attention: CMS-1590-FC, P.O. Box 8013, 
Baltimore, MD 21244-8013.
    Please allow sufficient time for mailed comments to be received 
before the close of the comment period.
    3. By express or overnight mail. You may send written comments to 
the following address ONLY: Centers for Medicare & Medicaid Services, 
Department of Health and Human Services, Attention: CMS-1590-FC, Mail 
Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850.
    4. By hand or courier. If you prefer, you may deliver (by hand or 
courier) your written comments before the close of the comment period 
to either of the following addresses:

a. For delivery in Washington, DC--Centers for Medicare & Medicaid 
Services, Department of Health and Human Services, Room 445-G, Hubert 
H. Humphrey Building, 200 Independence Avenue SW., Washington, DC 
20201.

    (Because access to the interior of the Hubert H. Humphrey Building 
is not readily available to persons without federal government 
identification, commenters are encouraged to leave their comments in 
the CMS drop slots located in the main lobby of the building. A stamp-
in clock is available for persons wishing to retain a proof of filing 
by stamping in and retaining an extra copy of the comments being 
filed.)

b. For delivery in Baltimore, MD--Centers for Medicare & Medicaid 
Services, Department of Health and Human Services, 7500 Security 
Boulevard, Baltimore, MD 21244-1850.

    If you intend to deliver your comments to the Baltimore address, 
please call telephone number (410) 786-7195 in advance to schedule your 
arrival with one of our staff members.
    Comments mailed to the addresses indicated as appropriate for hand 
or courier delivery may be delayed and received after the comment 
period.

FOR FURTHER INFORMATION CONTACT:

Elliott Isaac, (410) 786-4735, for any physician payment issue not 
identified below.
Ryan Howe, (410) 786-3355, for issues related to practice expense 
methodology and direct practice expense inputs, telehealth services, 
and issues related to primary care and care coordination.
Sara Vitolo, (410) 786-5714, for issues related to potentially 
misvalued services, malpractice RVUs, molecular pathology, and payment 
for new preventive service HCPCS G-codes, and the sustainable growth 
rate.
Carol Schwartz, (410) 786- 0576, for issues related to colonoscopy and 
preventive services.
Ken Marsalek, (410) 786-4502, for issues related to the multiple 
procedure payment reduction and payment for the technical component of 
pathology services.
Craig Dobyski, (410) 786-4584, for issues related to geographic 
practice cost indices.
Pam West, (410) 786-2302, for issues related to therapy services.
Chava Sheffield, (410) 786-2298, for issues related to certified 
registered nurse anesthetists scope of benefit.
Roberta Epps, (410) 786-4503, for issues related to portable x-ray.
Anne Tayloe-Hauswald, (410) 786-4546, for issues related to ambulance 
fee schedule and Part B drug payment.
Amanda Burd, (410) 786-2074, for issues related to the DME provisions.
Debbie Skinner, (410) 786-7480, for issues related to non-random 
prepayment complex medical review.
Latesha Walker, (410) 786-1101, for issues related to ambulance 
coverage--physician certification statement.
Alexandra Mugge, (410) 786-4457, for issues related to physician 
compare.
Christine Estella, (410) 786-0485, for issues related to the physician 
quality reporting system, incentives for e-prescribing, and Medicare 
shared savings program.
Pauline Lapin, (410) 786-6883, for issues related to the chiropractic 
services demonstration budget neutrality issue.
Gift Tee, (410) 786-9316, for issues related to the physician feedback 
reporting program and value-based payment modifier.
Jamie Hermansen, (410) 786-2064, for issues related to Medicare 
coverage for hepatitis B vaccine.
Andrew Morgan, (410) 786-2543, for issues related to e-prescribing 
under Medicare Part D.

SUPPLEMENTARY INFORMATION:

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    Provisions open for comment: We will consider comments that are 
submitted as indicated above in the ``Dates'' and ``Addresses'' 
sections on the following subject areas discussed in this final rule 
with comment period:
     Interim final work, practice expense, and malpractice RVUs 
(including physician time, direct practice expense (PE) inputs, and the 
equipment utilization rate assumption) for new, revised, potentially 
misvalued, and certain other CY 2013 HCPCS codes as indicated in the 
sections that follow and listed in Addendum C to this final rule with 
comment period; and
     The appropriate direct PE inputs for establishing 
nonfacility PE RVUs for CPT code 63650 (Percutaneous implantation of 
neurostimulator electrode array, epidural).
    Inspection of Public Comments: All comments received before the 
close of the comment period are available for viewing by the public, 
including any personally identifiable or confidential business 
information that is included in a comment. We post all comments 
received before the close of the comment period on the following Web 
site as soon as possible after they have been received: 
www.regulations.gov. Follow the search instructions on that Web site to 
view public comments.
    Comments received timely will also be available for public 
inspection as they are received, generally beginning approximately 3 
weeks after publication of a document, at the headquarters of the 
Centers for Medicare & Medicaid Services, 7500 Security Boulevard, 
Baltimore, Maryland 21244, Monday through Friday of each week from 8:30 
a.m. to 4 p.m. To schedule an appointment to view public comments, 
phone 1 (800) 743-3951.

Table of Contents

    To assist readers in referencing sections contained in this 
preamble, we are providing a table of contents. Some of the issues 
discussed in this preamble affect the payment policies, but do not 
require changes to the regulations in the Code of Federal Regulations 
(CFR). Information on the regulations impact appears throughout the 
preamble and, therefore, is not discussed exclusively in section VIII. 
of this final rule with comment period.

I. Executive Summary and Background
II. Provisions of the Final Rule With Comment Period
    A. Resource-Based Practice Expense (PE) Relative Value Units 
(RVUs)
    B. Potentially Misvalued Codes Under the Physician Fee Schedule
    C. Malpractice RVUs
    D. Geographic Practice Cost Indices (GPCIs)
    E. Medicare Telehealth Services for the Physician Fee Schedule
    F. Extension of Payment for Technical Component of Certain 
Physician Pathology Services
    G. Therapy Services
    H. Primary Care and Care Coordination
    I. Payment for Molecular Pathology Services
    J. Payment for New Preventive Services HCPCS G Codes
    K. Certified Registered Nurse Anesthetists Scope of Benefit
    L. Ordering of Portable X-Ray Services
    M. Addressing Interim Final Relative Value Units (RVUs) From CY 
2012 and Establish Interim Final Rule RVU's for CY 2013
    N. Allowed Expenditures for Physicians' Services and the 
Sustainable Growth Rate
III. Other Provisions of the Final Rule With Comment Period
    A. Ambulance Fee Schedule
    B. Part B Drug Payment: Average Sales Price (ASP) Issues
    C. Durable Medical Equipment (DME) Face-to-Face Encounters and 
Written Orders Prior to Delivery
    D. Elimination of the Requirement for Termination of Non-Random 
Prepayment Complex Medical Review
    E. Ambulance Coverage-Physician Certification Statement
    F. Physician Compare Web Site
    G. Physician Payment, Efficiency, and Quality Improvements--
Physician Quality Reporting System
    H1. Electronic Prescribing (eRx) Incentive Program
    H2. The PQRS-Medicare EHR Incentive Pilot
    I. Medicare Shared Savings Program
    J. Discussion of Budget Neutrality for the Chiropractic Services 
Demonstration
    K. Physician Value-Based Payment Modifier and the Physician 
Feedback Reporting Program
    L. Medicare Coverage of Hepatitis B Vaccine
    M. Updating Existing Standards for E-Prescribing Under Medicare 
Part D and Lifting the LTC Exemption
IV. Additional Provisions
    A. Waiver of Deductible for Surgical Services Furnished on the 
Same Date as a Planned Screening Colorectal Cancer Test and 
Colorectal Cancer Screening Test Definition--Technical Correction
    B. Physician Self-Referral Prohibition: Annual Update to the 
List of CPT/HCPCS Codes
V. Collection of Information Requirements
VI. Waiver of Proposed Rulemaking
VII. Response to Comments
VIII. Regulatory Impact Analysis

Acronyms

    Because of the many organizations and terms to which we refer by 
acronym in this final rule with comment period, we are listing these 
acronyms and their corresponding terms in alphabetical order below:

AHRQ [HHS] Agency for Healthcare Research and Quality
AMA American Medical Association
AMA RUC AMA [/Specialty Society] Relative [Value] Update Committee
ARRA American Recovery and Reinvestment Act (Pub. L. 111-5)
BBA Balanced Budget Act of 1997 (Pub. L. 105-33)
BBRA [Medicare, Medicaid and State Child Health Insurance Program] 
Balanced Budget Refinement Act of 1999 (Pub. L. 106-113)
BIPA [Medicare, Medicaid, and SCHIP] Benefits Improvement Protection 
Act of 2000 (Pub. L. 106-554)
BLS Bureau of Labor Statistics
BN Budget neutrality
CAH Critical access hospital
CBSA Core-Based Statistical Area
CF Conversion factor
CfC Conditions for Coverage
CFR Code of Federal Regulations
CNS Clinical nurse specialist
CoPs Conditions of Participation
CORF Comprehensive Outpatient Rehabilitation Facility
CPI Consumer Price Index
CPT [Physicians] Current Procedural Terminology (CPT codes, 
descriptions and other data only are copyright 2012 American Medical 
Association. All rights reserved.)
CRNA Certified registered nurse anesthetist
CY Calendar year
DHS Designated health services
DME Durable medical equipment
DMEPOS Durable medical equipment, prosthetics, orthotics, and 
supplies
DOTPA Development of Outpatient Therapy Payment Alternatives
DRA Deficit Reduction Act of 2005 (Pub. L. 109-171)
E/M Evaluation and management
EHR Electronic health record
eRx Electronic prescribing
FFS Fee-for-service
FR Federal Register
GAF Geographic adjustment factor
GAO [U.S.] Government Accountability Office
GPRO Group Practice Reporting Option
GPCI Geographic practice cost index
HAC Hospital-acquired conditions
HCPCS Healthcare Common Procedure Coding System
HHA Home health agency
HIPAA Health Insurance Portability and Accountability Act of 1996 
(Pub. L. 104-191)
HIT Health information technology
HITECH Health Information Technology for Economic and Clinical 
Health Act (Title IV of Division B of the Recovery Act, together 
with Title XIII of Division A of the Recovery Act)
HPSA Health Professional Shortage Area
ICD International Classification of Diseases
IMRT Intensity Modulated Radiation Therapy
IOM Internet-only Manual
IPCI Indirect practice cost index
IPPS Inpatient prospective payment system
IWPUT Intra-service work per unit of time
MAC Medicare Administrative Contractor
MCTRJCA Middle Class Tax Relief and Job Creation Act of 2012 (Pub. 
L. 112-96)
MEDCAC Medicare Evidence Development and Coverage Advisory Committee

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(formerly the Medicare Coverage Advisory Committee)
MedPAC Medicare Payment Advisory Commission
MEI Medicare Economic Index
MIEA-TRHCA Medicare Improvements and Extension Act of 2006 (that is, 
Division B of the Tax Relief and Health Care Act of 2006 (TRHCA) 
(Pub. L. 109-432)
MIPPA Medicare Improvements for Patients and Providers Act of 2008 
(Pub. L. 110-275)
MMA Medicare Prescription Drug, Improvement, and Modernization Act 
of 2003 (Pub. L. 108-173)
MMEA Medicare and Medicaid Extenders Act of 2010 (Pub. L. 111-309)
MMSEA Medicare, Medicaid, and SCHIP Extension Act of 2007 (Pub. L. 
110-173)
MPPR Multiple procedure payment reduction
MQSA Mammography Quality Standards Act of 1992 (Pub. L. 102-539)
NP Nurse practitioner
NPP Nonphysician practitioner
OACT [CMS] Office of the Actuary
OBRA Omnibus Budget Reconciliation Act (Pub. L. 101-239)
OIG [HHS] Office of Inspector General
PA Physician assistant
PC Professional component
PE Practice expense
PE/HR Practice expense per hour
PERC Practice Expense Review Committee
PFS Physician Fee Schedule
PGP [Medicare] Physician Group Practice
PLI Professional liability insurance
PPS Prospective payment system
PQRS Physician Quality Reporting System
PRA Paperwork Reduction Act
PPTRA Physician Payment and Therapy Relief Act of 2010 (Pub. L. 111-
286)
PVBP Physician and Other Health Professional Value-Based Purchasing 
Workgroup
RAC [Medicare] Recovery Audit Contractor
RFA Regulatory Flexibility Act
RIA Regulatory impact analysis
RVU Relative value unit
SBRT Stereotactic body radiation therapy
SGR Sustainable growth rate
TC Technical component
TIN Tax identification number
TPTCCA Temporary Payroll Tax Cut Continuation Act of 2011 (Pub. L. 
112-78)
TRHCA Tax Relief and Health Care Act of 2006 (Pub. L. 109-432)
VBP Value-based purchasing

Addenda Available Only Through the Internet on the CMS Web Site

    In the past, the Addenda referred to throughout the preamble of our 
annual PFS proposed and final rules with comment period were included 
in the printed Federal Register. However, effective with the CY 2012 
PFS final rule with comment period, the PFS Addenda no longer appear in 
the Federal Register. Instead these Addenda to the annual proposed and 
final rules with comment period will be available only through the 
Internet. The PFS Addenda along with other supporting documents and 
tables referenced in this final rule with comment period are available 
through the Internet on the CMS Web site at www.cms.gov/PhysicianFeeSched/. Click on the link on the left side of the screen 
titled, ``PFS Federal Regulations Notices'' for a chronological list of 
PFS Federal Register and other related documents. For the CY 2013 PFS 
final rule with comment period, refer to item CMS-1590-FC. Readers who 
experience any problems accessing any of the Addenda or other documents 
referenced in this final rule with comment period and posted on the CMS 
Web site identified above should contact Elliott Isaac at (410) 786-
4735.

CPT (Current Procedural Terminology) Copyright Notice

    Throughout this final rule with comment period, we use CPT codes 
and descriptions to refer to a variety of services. We note that CPT 
codes and descriptions are copyright 2012 American Medical Association. 
All Rights Reserved. CPT is a registered trademark of the American 
Medical Association (AMA). Applicable Federal Acquisition Regulations 
(FAR) and Defense Federal Acquisition Regulations (DFAR) apply.

I. Executive Summary and Background

A. Executive Summary

1. Purpose
    This major final rule with comment period revises payment policies 
under the Medicare Physician Fee Schedule (PFS) and makes other policy 
changes related to Medicare Part B payment. These changes are 
applicable to services furnished in CY 2013. It also implements 
provisions of the Affordable Care Act by establishing a face-to-face 
encounter as a condition of payment for certain durable medical 
equipment (DME) items. In addition, it implements statutory changes 
regarding the termination of non-random prepayment review.
2. Summary of the Major Provisions
    The Social Security Act (Act) requires us to establish payments 
under the PFS based on national uniform relative value units (RVUs) and 
the relative resources used in furnishing a service. The Act requires 
that national RVUs be established for physician work, practice expense 
(PE), and malpractice expense. In this major final rule with comment 
period, we establish payment rates for CY 2013 for the PFS, payments 
for Part B drugs, and other Medicare Part B payment policies to ensure 
that our payment systems are updated to reflect changes in medical 
practice and in the relative value of services. It also implements 
provisions of the Affordable Care Act by establishing a face-to-face 
encounter as a condition of payment for certain durable medical 
equipment (DME) items, and by removing certain regulations regarding 
the termination of non-random prepayment review. It also establishes 
new claims-based data reporting requirements for therapy services to 
implement a provision in the Middle Class Tax Relief and Jobs Creation 
Act (MCTRCA). In addition, this rule:
     Identifies Potentially Misvalued Codes to be Evaluated.
     Establishes Additional Multiple Procedure Payment 
Reductions (MPPR).
     Expands Medicare Telehealth Services.
     Implements Regulatory Changes Regarding Payment for 
Technical Component of Certain Physician Pathology Services to Conform 
to Statute.
     Requires the Inclusion of Specific Information on Claims 
for Therapy Services.
     Establishes New Transitional Care Management Services.
     Clarifies Services Included in the Certified Registered 
Nurse Anesthetists Scope of Benefit.
     Modifies Ordering Requirements for Portable X-ray 
Services.
     Updates the Ambulance Fee Schedule.
     Sets Part B Drug Payment Rates for 2013.
     Addresses Ambulance Coverage--Physician Certification 
Statement.
     Updates policies regarding the--
    ++ Physician Compare Web site.
    ++ Physician Quality Reporting System.
    ++ Electronic Prescribing (eRx) Incentive Program.
    ++ Electronic Health Record (EHR) Incentive Program.
    ++ Medicare Shared Savings Program.
     Discusses Budget Neutrality for the Chiropractic 
Demonstration.
     Addresses Implementation of the Physician Value-Based 
Payment Modifier and the Physician Feedback Reporting Program.
     Establishes Medicare Coverage of Hepatitis B Vaccine.
     Updates Existing Standards for e-prescribing under 
Medicare Part D and Lifting the LTC Exemption.
3. Summary of Costs and Benefits
    The statute requires that we establish by regulation each year 
payment amounts for all physicians' service. These payment amounts are 
required to be adjusted to reflect the variations in

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the costs of providing services in different geographic areas. The 
statute also requires that annual adjustments to the RVUs not cause 
annual estimated expenditures to differ by more than $20 million from 
what they would have been had the adjustments not been made. If 
adjustments to RVUs would cause expenditures to change by more than $20 
million, we must make adjustments to preserve budget neutrality.
    Several changes affect the specialty distribution of Medicare 
expenditures. This final rule with comment period reflects the 
Administration's priority to improve payment for primary care services. 
As described in Section II.N, in the absence of Congressional action, 
an overall reduction of 26.5 percent will be imposed in the conversion 
factor used to calculate payment for physicians' services on or after 
January 1, 2013 due to the Sustainable Growth Rate (SGR). To isolate 
the impact of changes that we are proposing in this final rule with 
comment period, we analyze and discuss the policies' impact with a 
constant conversion factor. In the absence of a change in the 
conversion factor, payments to primary care specialties will increase 
and payments to select other specialties will decrease due to several 
changes in how we calculate payments for CY 2013.
    The largest payment increase for primary care specialties overall 
will result from a new payment for managing a beneficiary's care when 
the beneficiary is discharged from an inpatient hospital, a SNF, an 
outpatient hospital observation, partial hospitalization services, or a 
community mental health center. Payments to primary care specialties 
also will increase due to redistributions from changes in payments for 
services furnished by other specialties. Because of the budget-neutral 
nature of this system, decreases in payments for one service result in 
increases in payments in others.
    Payments to primary care specialties are also impacted by the 
completion of the 4-year transition to new PE RVUs using the new 
Physician Practice Information Survey (PPIS) data that was adopted in 
the CY 2010 PFS final rule with comment period. The projected impacts 
of using the new PPIS data are generally consistent with the impacts 
discussed in the CY 2012 final rule with comment period (76 FR 72452).
    Several types of providers are projected to see decreases in 
Medicare PFS payments, mainly as a result of the potentially misvalued 
codes initiative. We have received numerous new codes with new values 
and revised codes with new values for CY 2013 as a result of our 
ongoing misvalued codes initiative, an effort to improve payment 
accuracy. Many of the new and revised codes that we valued on an 
interim basis for CY 2013 originated with the potentially misvalued 
codes initiative. Reductions for pathology, neurology, and independent 
laboratories are a result of the misvalued code initiative. In the case 
of independent laboratories, we note that independent laboratories 
receive the majority of the Medicare revenue from the Clinical Lab Fee 
Schedule, which is unaffected by the misvalued code initiative. 
Radiation therapy centers will see an overall decrease of 9 percent 
primarily as a result of the PPIS transition discussed above and a 
change in the interest rate assumption used to calculate PE. Radiation 
oncology sees a 7 percent decrease for the same reasons as radiation 
therapy centers.

B. Background

    We note that throughout this final rule with comment period, unless 
otherwise noted, the term ``practitioner'' is used to describe both 
physicians and nonphysician practitioners (such as physician 
assistants, nurse practitioners, clinical nurse specialists, certified 
nurse-midwives, psychologists, or clinical social workers) who are 
permitted to bill Medicare under the PFS for their services. Since 
January 1, 1992, Medicare has paid for physicians' services under 
section 1848 of the Act, ``Payment for Physicians' Services.'' The Act 
requires that CMS make payments under the PFS using national uniform 
relative value units (RVUs) based on the relative resources used in 
furnishing a service. Section 1848(c) of the Act requires that national 
RVUs be established for physician work, PE, and malpractice expense. 
Before the establishment of the resource-based relative value system, 
Medicare payment for physicians' services was based on reasonable 
charges.
1. Development of the Relative Value System
a. Work RVUs
    The concepts and methodology underlying the PFS were enacted as 
part of the Omnibus Budget Reconciliation Act (OBRA) of 1989 (Pub. L. 
101-239), and OBRA 1990, (Pub. L. 101-508). The final rule published on 
November 25, 1991 (56 FR 59502) set forth the fee schedule for payment 
for physicians' services beginning January 1, 1992.
    The physician work RVUs established for the implementation of the 
fee schedule in January 1992 were developed with extensive input from 
the physician community. A research team at the Harvard School of 
Public Health developed the original physician work RVUs for most codes 
in a cooperative agreement with the Department of Health and Human 
Services (HHS). In constructing the code-specific vignettes for the 
original physician work RVUs, Harvard worked with panels of experts, 
both inside and outside the federal government, and obtained input from 
numerous physician specialty groups.
    Section 1848(b)(2)(B) of the Act specifies that the RVUs for 
anesthesia services are based on RVUs from a uniform relative value 
guide, with appropriate adjustment of the conversion factor (CF), in a 
manner to assure that fee schedule amounts for anesthesia services are 
consistent with those for other services of comparable value. We 
established a separate CF for anesthesia services, and we continue to 
utilize time units as a factor in determining payment for these 
services. As a result, there is a separate payment methodology for 
anesthesia services.
    We establish physician work RVUs for new and revised codes based, 
in part, on our review of recommendations received from the American 
Medical Association/Specialty Society Relative Value Update Committee 
(AMA RUC).
b. Practice Expense Relative Value Units (PE RVUs)
    Initially, only the physician work RVUs were resource-based, and 
the PE and malpractice RVUs were based on average allowable charges. 
Section 121 of the Social Security Act Amendments of 1994 (Pub. L. 103-
432), and Section 4505(a) of the Balanced Budget Act of 1997 (BBA) 
(Pub. L. 105-33) amended section 1848(c)(2)(C)(ii) of the Act and 
required us to develop resource-based PE RVUs for each physicians' 
service. We were to consider general categories of expenses (such as 
office rent and wages of personnel, but excluding malpractice expenses) 
comprising PEs.
    We established the resource-based PE RVUs for each physicians' 
service in a final rule, published November 2, 1998 (63 FR 58814), 
effective for services furnished in 1999. Separate PE RVUs are 
established for procedures that can be furnished in both a nonfacility 
setting, such as a physician's office, and a facility setting, such as 
a hospital outpatient department (HOPD). The difference between the 
facility and nonfacility RVUs reflects the fact that a facility 
typically receives separate payment from Medicare for its costs of 
furnishing the service, apart from payment under the PFS. The 
nonfacility

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RVUs reflect all of the direct and indirect PEs of furnishing a 
particular service. Based on the BBA requirement to transition to a 
resource-based system for PE over a 4-year period, resource-based PE 
RVUs did not become fully effective until 2002.
    This resource-based system was based on two significant sources of 
actual PE data. Panels of physicians, practice administrators, and 
nonphysician health professionals (for example, registered nurses 
(RNs)), who were nominated by physician specialty societies and other 
groups identified the direct inputs required for each physicians' 
service. (We have since refined and revised these inputs based on 
recommendations from the AMA RUC.) Aggregate specialty-specific 
information on hours worked and PEs was obtained from the AMA's 
Socioeconomic Monitoring System (SMS).
    Section 212 of the Balanced Budget Refinement Act of 1999 (BBRA) 
(Pub. L. 106-113) directed us to establish a process under which we 
accept and use, to the maximum extent practicable and consistent with 
sound data practices, data collected or developed by entities and 
organizations to supplement the data we normally collect in determining 
the PE component. On May 3, 2000, we published the interim final rule 
(65 FR 25664) that set forth the criteria for the submission of these 
supplemental PE survey data. The criteria were modified in response to 
comments received, and published in the Federal Register (65 FR 65376) 
as part of a November 1, 2000 final rule. The PFS final rules published 
in 2001 and 2003, respectively, (66 FR 55246 and 68 FR 63196) extended 
the period during which we would accept these supplemental data through 
March 1, 2005.
    In the CY 2007 PFS final rule with comment period (71 FR 69624), we 
revised the methodology for calculating direct PE RVUs from the top-
down to the bottom-up methodology beginning in CY 2007. We adopted a 4-
year transition to the new PE RVUs. This transition was completed in CY 
2010. Direct PE RVUs were calculated for CY 2013 using this 
methodology, unless otherwise noted.
    In the CY 2010 PFS final rule with comment period, we updated the 
practice expense per hour (PE/HR) data that are used in the calculation 
of PE RVUs for most specialties (74 FR 61749). For this update, we used 
the Physician Practice Information Survey (PPIS) conducted by the AMA. 
The PPIS is a multispecialty, nationally representative, PE survey of 
both physicians and nonphysician practitioners (NPPs) using a survey 
instrument and methods highly consistent with those used prior to CY 
2010. We note that in CY 2010, for oncology, clinical laboratories, and 
independent diagnostic testing facilities (IDTFs), we continued to use 
the supplemental survey data to determine PE/HR values (74 FR 61752). 
Beginning in CY 2010, we provided for a 4-year transition for the new 
PE RVUs using the updated PE/HR data. In CY 2013, the final year of the 
transition, PE RVUs are calculated based on the new data.
c. Resource-Based Malpractice RVUs
    Section 4505(f) of the BBA amended section 1848(c) of the Act to 
require that we implement resource-based malpractice RVUs for services 
furnished on or after CY 2000. The resource-based malpractice RVUs were 
implemented in the PFS final rule with comment period published 
November 2, 1999 (64 FR 59380). The malpractice RVUs were based on 
malpractice insurance premium data collected from commercial and 
physician-owned insurers.
d. Refinements to the RVUs
    Section 1848(c)(2)(B)(i) of the Act requires that we review all 
RVUs no less often than every 5 years. Prior to CY 2013, we conducted 
separate periodic reviews of work RVUs and PE RVUs. The First Five-Year 
Review of Work RVUs was published on November 22, 1996 (61 FR 59489) 
and was effective in 1997. The Second Five-Year Review of Work RVUs was 
published in the CY 2002 PFS final rule with comment period (66 FR 
55246) and was effective in 2002. The Third Five-Year Review of Work 
RVUs was published in the CY 2007 PFS final rule with comment period 
(71 FR 69624) and was effective on January 1, 2007. The Fourth Five-
Year Review of Work RVUs was published in the CY 2012 PFS final rule 
with comment period (76 FR 73026).
    Initially refinements to the direct PE inputs relied on input from 
the AMA RUC-established the Practice Expense Advisory Committee (PEAC). 
Through March 2004, the PEAC provided recommendations to CMS for more 
than 7,600 codes (all but a few hundred of the codes included in the 
AMAs Current Procedural Terminology (CPT) codes). As part of the CY 
2007 PFS final rule with comment period (71 FR 69624), we implemented a 
new bottom-up methodology for determining resource-based PE RVUs and 
transitioned the new methodology over a 4-year period. A comprehensive 
review of PE was undertaken prior to the 4-year transition period for 
the new PE methodology from the top-down to the bottom-up methodology, 
and this transition was completed in CY 2010. In CY 2010, we also 
incorporated the new PPIS data to update the specialty-specific PE/HR 
data used to develop PE RVUs, adopting a 4-year transition to PE RVUs 
developed using the PPIS data.
    In the CY 2012 PFS final rule with comment period (76 FR 73057), we 
finalized a proposal to consolidate reviews of work and PE RVUs under 
section 1848(c)(2)(B) of the Act and reviews of potentially misvalued 
codes under section 1848(c)(2)(K) of the Act into one annual process.
    In the CY 2005 PFS final rule with comment period (69 FR 66236), we 
implemented the first Five-Year Review of the malpractice RVUs (69 FR 
66263). Minor modifications to the methodology were addressed in the CY 
2006 PFS final rule with comment period (70 FR 70153). The second Five-
Year Review and update of resource-based malpractice RVUs was published 
in the CY 2010 PFS final rule with comment period (74 FR 61758) and was 
effective in CY 2010.
    In addition to the Five-Year Reviews, beginning for CY 2009, CMS 
and the AMA RUC have identified and reviewed a number of potentially 
misvalued codes on an annual basis based on various identification 
screens. This annual review of work and PE RVUs for potentially 
misvalued codes was supplemented by the amendments to Section 1848 of 
the Act, as enacted by section 3134 of the Affordable Care Act, which 
requires the agency to periodically identify, review and adjust values 
for potentially misvalued codes with an emphasis on the following 
categories: (1) Codes and families of codes for which there has been 
the fastest growth; (2) codes or families of codes that have 
experienced substantial changes in PEs; (3) codes that are recently 
established for new technologies or services; (4) multiple codes that 
are frequently billed in conjunction with furnishing a single service; 
(5) codes with low relative values, particularly those that are often 
billed multiple times for a single treatment; (6) codes which have not 
been subject to review since the implementation of the fee schedule 
(the so-called `Harvard valued codes'); and (7) other codes determined 
to be appropriate by the Secretary.
e. Application of Budget Neutrality to Adjustments of RVUs
    Budget neutrality (BN) typically requires that expenditures not 
increase or decrease as a result of changes or revisions to policy. 
However, section 1848(c)(2)(B)(ii)(II) of the Act requires

[[Page 68897]]

adjustment only if the change in expenditures resulting from the annual 
revisions to the PFS exceeds a threshold amount. Specifically, 
adjustments in RVUs for a year may not cause total PFS payments to 
differ by more than $20 million from what they would have been if the 
adjustments were not made. In accordance with section 
1848(c)(2)(B)(ii)(II) of the Act, if revisions to the RVUs would cause 
expenditures to change by more than $20 million, we make adjustments to 
ensure that expenditures do not increase or decrease by more than $20 
million.
2. Components of the Fee Schedule Payment Amounts
    To calculate the payment for each physicians' service, the 
components of the fee schedule (work, PE, and malpractice RVUs) are 
adjusted by geographic practice cost indices (GPCIs). The GPCIs reflect 
the relative costs of physician work, PE, and malpractice in an area 
compared to the national average costs for each component.
    RVUs are converted to dollar amounts through the application of a 
CF, which is calculated by CMS' Office of the Actuary (OACT).
    The formula for calculating the Medicare fee schedule payment 
amount for a given service and fee schedule area can be expressed as:

    Payment = [(RVU work x GPCI work) + (RVU PE x GPCI PE) + (RVU 
malpractice x GPCI malpractice)] x CF.
3. Most Recent Changes to the Fee Schedule
    The CY 2012 PFS final rule with comment period (76 FR 73026) 
implemented changes to the PFS and other Medicare Part B payment 
policies. It also finalized many of the CY 2011 interim RVUs and 
implemented interim RVUs for new and revised codes for CY 2012 to 
ensure that our payment systems are updated to reflect changes in 
medical practice and the relative values of services. In the CY 2012 
PFS final rule with comment period, we announced the following for CY 
2012: the total PFS update of -27.4 percent; the initial estimate for 
the sustainable growth rate (SGR) of -16.9 percent; and the conversion 
factor (CF) of $24.6712. These figures were calculated based on the 
statutory provisions in effect on November 1, 2011, when the CY 2012 
PFS final rule with comment period was issued.
    A correction notice was issued (77 FR 227) to correct several 
technical and typographical errors that occurred in the CY 2012 PFS 
final rule with comment period.
    On December 23, 2011, the Temporary Payroll Tax Cut Continuation 
Act of 2011 (TPTCCA) (Pub. L. 112-78) was signed into law. Section 301 
of the TPTCCA specified a zero percent update to the PFS from January 
1, 2012 through February 29, 2012. As a result, the CY 2012 PFS 
conversion factor was revised to $34.0376 for claims with dates of 
service on or after January 1, 2012 through February 29, 2012. In 
addition, the TPTCCA extended several provisions affecting Medicare 
services furnished on or after January 1, 2012 through February 29, 
2012, including:
     Section 303--the 1.0 floor on the physician work 
geographic practice cost index;
     Section 304--the exceptions process for outpatient therapy 
caps;
     Section 305--the payment to independent laboratories for 
the technical component (TC) of physician pathology services furnished 
to certain hospital patients, and
     Section 307--the 5 percent increase in payments for mental 
health services.
    On February 22, 2012, the Middle Class Tax Relief and Job Creation 
Act of 2012 (Pub. L. 112-96) (MCTRJCA) was signed into law. Section 
3003 of the MCTRJCA extended the zero percent PFS update to the 
remainder of CY 2012. As a result of the MCTRJCA, the CY 2012 PFS CF 
was maintained as $34.0376 for claims with dates of service on or after 
March 1, 2012 through December 31, 2012. In addition:
     Section 3004 of MCTRJCA extended the 1.0 floor on the 
physician work geographic practice cost index through December 31, 
2012;
     Section 3006 continued payment to independent laboratories 
for the TC of physician pathology services furnished to certain 
hospital patients through June 30, 2012; and
     Section 3005 extended the exceptions process for 
outpatient therapy caps through CY 2012 and made several other changes 
related to therapy claims and caps.

II. Provisions of the Final Rule for the Physician Fee Schedule

A. Resource-Based Practice Expense (PE) Relative Value Units (RVUs)

1. Overview
    Practice expense (PE) is the portion of the resources used in 
furnishing the service that reflects the general categories of 
physician and practitioner expenses, such as office rent and personnel 
wages but excluding malpractice expenses, as specified in section 
1848(c)(1)(B) of the Act. Section 121 of the Social Security Amendments 
of 1994 (Pub. L. 103-432), enacted on October 31, 1994, amended section 
1848(c)(2)(C)(ii) of the Act to require us to develop a methodology for 
a resource-based system for determining PE RVUs for each physician's 
service. We develop PE RVUs by looking at the direct and indirect 
physician practice resources involved in furnishing each service. 
Direct expense categories include clinical labor, medical supplies, and 
medical equipment. Indirect expenses include administrative labor, 
office expense, and all other expenses. The sections that follow 
provide more detailed information about the methodology for translating 
the resources involved in furnishing each service into service-specific 
PE RVUs. In addition, we note that section 1848(c)(2)(B)(ii)(II) of the 
Act provides that adjustments in RVUs for a year may not cause total 
PFS payments to differ by more than $20 million from what they would 
have otherwise been if the adjustments were not made. Therefore, if 
revisions to the RVUs cause expenditures to change by more than $20 
million, we make adjustments to ensure that expenditures do not 
increase or decrease by more than $20 million. We refer readers to the 
CY 2010 PFS final rule with comment period (74 FR 61743 through 61748) 
for a more detailed explanation of the PE methodology.
2. Practice Expense Methodology
a. Direct Practice Expense
    We use a ``bottom-up'' approach to determine the direct PE by 
adding the costs of the resources (that is, the clinical staff, 
equipment, and supplies) typically involved with furnishing each 
service. The costs of the resources are calculated using the refined 
direct PE inputs assigned to each CPT code in our PE database, which 
are based on our review of recommendations received from the AMA RUC. 
For a detailed explanation of the bottom-up direct PE methodology, 
including examples, we refer readers to the Five-Year Review of Work 
Relative Value Units Under the PFS and Proposed Changes to the Practice 
Expense Methodology proposed notice (71 FR 37242) and the CY 2007 PFS 
final rule with comment period (71 FR 69629).
b. Indirect Practice Expense per Hour Data
    We use survey data on indirect PEs incurred per hour worked in 
developing the indirect portion of the PE RVUs. Prior to CY 2010, we 
primarily used the practice expense per hour (PE/HR) by specialty that 
was obtained from the

[[Page 68898]]

AMA's Socioeconomic Monitoring Surveys (SMS). The AMA administered a 
new survey in CY 2007 and CY 2008, the Physician Practice Expense 
Information Survey (PPIS), which was expanded (relative to the SMS) to 
include nonphysician practitioners (NPPs) paid under the PFS.
    The PPIS is a multispecialty, nationally representative, PE survey 
of both physicians and NPPs using a consistent survey instrument and 
methods highly consistent with those used for the SMS and the 
supplemental surveys. The PPIS gathered information from 3,656 
respondents across 51 physician specialty and healthcare professional 
groups. We believe the PPIS is the most comprehensive source of PE 
survey information available to date. Therefore, we used the PPIS data 
to update the PE/HR data for the CY 2010 PFS for almost all of the 
Medicare-recognized specialties that participated in the survey.
    When we began using the PPIS data beginning in CY 2010, we did not 
change the PE RVU methodology itself or the manner in which the PE/HR 
data are used in that methodology. We only updated the PE/HR data based 
on the new survey. Furthermore, as we explained in the CY 2010 PFS 
final rule with comment period (74 FR 61751), because of the magnitude 
of payment reductions for some specialties resulting from the use of 
the PPIS data, we finalized a 4-year transition (75 percent old/25 
percent new for CY 2010, 50 percent old/50 percent new for CY 2011, 25 
percent old/75 percent new for CY 2012, and 100 percent new for CY 
2013) from the previous PE RVUs to the PE RVUs developed using the new 
PPIS data.
    Section 1848(c)(2)(H)(i) of the Act requires us to use the medical 
oncology supplemental survey data submitted in 2003 for oncology drug 
administration services. Therefore, the PE/HR for medical oncology, 
hematology, and hematology/oncology reflects the continued use of these 
supplemental survey data.
    We do not use the PPIS data for reproductive endocrinology and 
spine surgery since these specialties currently are not separately 
recognized by Medicare, nor do we have a method to blend these data 
with Medicare-recognized specialty data. Similarly, we do not use the 
PPIS data for sleep medicine since there is not a full year of Medicare 
utilization data for that specialty given when the specialty code was 
created.
    Supplemental survey data on independent labs, from the College of 
American Pathologists, were implemented for payments in CY 2005. 
Supplemental survey data from the National Coalition of Quality 
Diagnostic Imaging Services (NCQDIS), representing independent 
diagnostic testing facilities (IDTFs), were blended with supplementary 
survey data from the American College of Radiology (ACR) and 
implemented for payments in CY 2007. Neither IDTFs nor independent labs 
participated in the PPIS. Therefore, we continue to use the PE/HR that 
was developed from their supplemental survey data.
    Consistent with our past practice, the previous indirect PE/HR 
values from the supplemental surveys for medical oncology, independent 
laboratories, and IDTFs were updated to CY 2006 using the MEI to put 
them on a comparable basis with the PPIS data.
    Previously, we have established PE/HR values for various 
specialties without SMS or supplemental survey data by crosswalking 
them to other similar specialties to estimate a proxy PE/HR. For 
specialties that were part of the PPIS for which we previously used a 
crosswalked PE/HR, we instead use the PPIS-based PE/HR. We continue 
previous crosswalks for specialties that did not participate in the 
PPIS. However, beginning in CY 2010 we changed the PE/HR crosswalk for 
portable x-ray suppliers from radiology to IDTF, a more appropriate 
crosswalk because these specialties are more similar to each other for 
physician time.
    For registered dietician services, the resource-based PE RVUs have 
been calculated in accordance with the final policy that crosswalks the 
specialty to the ``All Physicians'' PE/HR data, as adopted in the CY 
2010 PFS final rule with comment period (74 FR 61752) and discussed in 
more detail in the CY 2011 PFS final rule with comment period (75 FR 
73183).
    There were five specialties whose utilization data were newly 
incorporated into ratesetting for CY 2012. In accordance with the final 
policies adopted in the CY 2012 final rule with comment period (76 FR 
73036), we use proxy PE/HR values for these specialties by crosswalking 
values from other, similar specialties as follows: Speech Language 
Pathology from Physical Therapy; Hospice and Palliative Care from All 
Physicians; Geriatric Psychiatry from Psychiatry; Intensive Cardiac 
Rehabilitation from Cardiology, and Certified Nurse Midwife from 
Obstetrics/gynecology.
    For CY 2013, there are two specialties whose utilization data will 
be newly incorporated into ratesetting. We proposed to use proxy PE/HR 
values for these specialties by crosswalking values from other 
specialties that furnish similar services as follows: Cardiac 
Electrophysiology from Cardiology; and Sports Medicine from Family 
Practice. These proposed changes are reflected in the ``PE HR'' file 
available on the CMS Web site under the supporting data files for the 
CY 2013 PFS final rule with comment period at www.cms.gov/PhysicianFeeSched/.
    We did not receive any comments regarding our proposal to use these 
proxy PE/HR values for these specialties, and we continue to believe 
that the values crosswalked from other specialties that furnish similar 
services are appropriate. Therefore, we are finalizing our CY 2013 
proposals to update the PE/HR data as reflected in the ``PE HR'' file 
available on the CMS Web site under the supporting data files for the 
CY 2013 PFS final rule with comment period at http://www.cms.gov/PhysicianFeeSched/.
    As provided in the CY 2010 PFS final rule with comment period (74 
FR 61751), CY 2013 is the final year of the 4-year transition to the PE 
RVUs calculated using the PPIS data. Therefore, the CY 2013 PE RVUs are 
developed based entirely on the PPIS data, except as noted in this 
section.
c. Allocation of PE to Services
    To establish PE RVUs for specific services, it is necessary to 
establish the direct and indirect PE associated with each service.
(1) Direct Costs
    The relative relationship between the direct cost portions of the 
PE RVUs for any two services is determined by the relative relationship 
between the sum of the direct cost resources (that is, the clinical 
staff, equipment, and supplies) typically involved with furnishing the 
services. The costs of these resources are calculated from the refined 
direct PE inputs in our PE database. For example, if one service has a 
direct cost sum of $400 from our PE database and another service has a 
direct cost sum of $200, the direct portion of the PE RVUs of the first 
service would be twice as much as the direct portion of the PE RVUs for 
the second service.
(2) Indirect Costs
    Section II.A.2.b. of this final rule with comment period describes 
the current data sources for specialty-specific indirect costs used in 
our PE calculations. We allocated the indirect costs to the code level 
on the basis of the direct costs specifically associated with a code 
and the greater of either the clinical labor costs or the physician 
work RVUs. We also incorporated the

[[Page 68899]]

survey data described earlier in the PE/HR discussion. The general 
approach to developing the indirect portion of the PE RVUs is described 
as follows:
     For a given service, we use the direct portion of the PE 
RVUs calculated as previously described and the average percentage that 
direct costs represent of total costs (based on survey data) across the 
specialties that furnish the service to determine an initial indirect 
allocator. For example, if the direct portion of the PE RVUs for a 
given service was 2.00 and direct costs, on average, represented 25 
percent of total costs for the specialties that furnished the service, 
the initial indirect allocator would be 6.00 since 2.00 is 25 percent 
of 8.00 and 6.00 is 75 percent of 8.00.
     Next, we add the greater of the work RVUs or clinical 
labor portion of the direct portion of the PE RVUs to this initial 
indirect allocator. In our example, if this service had work RVUs of 
4.00 and the clinical labor portion of the direct PE RVUs was 1.50, we 
would add 6.00 plus 4.00 (since the 4.00 work RVUs are greater than the 
1.50 clinical labor portion) to get an indirect allocator of 10.00. In 
the absence of any further use of the survey data, the relative 
relationship between the indirect cost portions of the PE RVUs for any 
two services would be determined by the relative relationship between 
these indirect cost allocators. For example, if one service had an 
indirect cost allocator of 10.00 and another service had an indirect 
cost allocator of 5.00, the indirect portion of the PE RVUs of the 
first service would be twice as great as the indirect portion of the PE 
RVUs for the second service.
     Next, we next incorporate the specialty-specific indirect 
PE/HR data into the calculation. As a relatively extreme example for 
the sake of simplicity, assume in our previous example that, based on 
the survey data, the average indirect cost of the specialties 
furnishing the first service with an allocator of 10.00 was half of the 
average indirect cost of the specialties furnishing the second service 
with an indirect allocator of 5.00. In this case, the indirect portion 
of the PE RVUs of the first service would be equal to that of the 
second service.
d. Facility and Nonfacility Costs
    For procedures that can be furnished in a physician's office, as 
well as in a hospital or facility setting, we establish two PE RVUs: 
facility and nonfacility. The methodology for calculating PE RVUs is 
the same for both the facility and nonfacility RVUs, but is applied 
independently to yield two separate PE RVUs. Because Medicare makes a 
separate payment to the facility for its costs of furnishing a service, 
the facility PE RVUs are generally lower than the nonfacility PE RVUs.
e. Services With Technical Components (TCs) and Professional Components 
(PCs)
    Diagnostic services are generally comprised of two components: a 
professional component (PC) and a technical component (TC), each of 
which may be furnished independently or by different providers, or they 
may be furnished together as a ``global'' service. When services have 
PC and TC components that can be billed separately, the payment for the 
global component equals the sum of the payment for the TC and PC. This 
is a result of using a weighted average of the ratio of indirect to 
direct costs across all the specialties that furnish the global 
components, TCs, and PCs; that is, we apply the same weighted average 
indirect percentage factor to allocate indirect expenses to the global 
components, PCs, and TCs for a service. (The direct PE RVUs for the TC 
and PC sum to the global under the bottom-up methodology.)
f. PE RVU Methodology
    For a more detailed description of the PE RVU methodology, we refer 
readers to the CY 2010 PFS final rule with comment period (74 FR 61745 
through 61746).
(1) Setup File
    First, we create a setup file for the PE methodology. The setup 
file contains the direct cost inputs, the utilization for each 
procedure code at the specialty and facility/nonfacility place of 
service level, and the specialty-specific PE/HR data from the surveys.
(2) Calculate the Direct Cost PE RVUs
    Sum the costs of each direct input.
    Step 1: Sum the direct costs of the inputs for each service. Apply 
a scaling adjustment to the direct inputs.
    Step 2: Calculate the current aggregate pool of direct PE costs. 
This is the product of the current aggregate PE (aggregate direct and 
indirect) RVUs, the CF, and the average direct PE percentage from the 
survey data.
    Step 3: Calculate the aggregate pool of direct costs. This is the 
sum of the product of the direct costs for each service from Step 1 and 
the utilization data for that service.
    Step 4: Using the results of Step 2 and Step 3 calculate a direct 
PE scaling adjustment so that the aggregate direct cost pool does not 
exceed the current aggregate direct cost pool and apply it to the 
direct costs from Step 1 for each service.
    Step 5: Convert the results of Step 4 to an RVU scale for each 
service. To do this, divide the results of Step 4 by the CF. Note that 
the actual value of the CF used in this calculation does not influence 
the final direct cost PE RVUs, as long as the same CF is used in Step 2 
and Step 5. Different CFs will result in different direct PE scaling 
factors, but this has no effect on the final direct cost PE RVUs since 
changes in the CFs and changes in the associated direct scaling factors 
offset one another.
(3) Create the Indirect Cost PE RVUs
    Create indirect allocators.
    Step 6: Based on the survey data, calculate direct and indirect PE 
percentages for each physician specialty.
    Step 7: Calculate direct and indirect PE percentages at the service 
level by taking a weighted average of the results of Step 6 for the 
specialties that furnish the service. Note that for services with TCs 
and PCs, the direct and indirect percentages for a given service do not 
vary by the PC, TC, and global components.
    Step 8: Calculate the service level allocators for the indirect PEs 
based on the percentages calculated in Step 7. The indirect PEs are 
allocated based on the three components: the direct PE RVUs, the 
clinical PE RVUs, and the work RVUs. For most services the indirect 
allocator is: indirect percentage * (direct PE RVUs/direct percentage) 
+ work RVUs.
    There are two situations where this formula is modified:
     If the service is a global service (that is, a service 
with global, professional, and technical components), then the indirect 
allocator is: indirect percentage (direct PE RVUs/direct percentage) + 
clinical PE RVUs + work RVUs.
     If the clinical labor PE RVUs exceed the work RVUs (and 
the service is not a global service), then the indirect allocator is: 
indirect percentage (direct PE RVUs/direct percentage) + clinical PE 
RVUs.
    (Note: For global services, the indirect allocator is based on both 
the work RVUs and the clinical labor PE RVUs. We do this to recognize 
that, for the PC service, indirect PEs will be allocated using the work 
RVUs, and for the TC service, indirect PEs will be allocated using the 
direct PE RVUs and the clinical labor PE RVUs. This also allows the 
global component RVUs to equal the sum of the PC and TC RVUs.)
    For presentation purposes in the examples in Table 1, the formulas 
were divided into two parts for each service.

[[Page 68900]]

     The first part does not vary by service and is the 
indirect percentage (direct PE RVUs/direct percentage).
     The second part is either the work RVUs, clinical PE RVUs, 
or both depending on whether the service is a global service and 
whether the clinical PE RVUs exceed the work RVUs (as described earlier 
in this step).
    Apply a scaling adjustment to the indirect allocators.
    Step 9: Calculate the current aggregate pool of indirect PE RVUs by 
multiplying the current aggregate pool of PE RVUs by the average 
indirect PE percentage from the survey data.
    Step 10: Calculate an aggregate pool of indirect PE RVUs for all 
PFS services by adding the product of the indirect PE allocators for a 
service from Step 8 and the utilization data for that service.
    Step 11: Using the results of Step 9 and Step 10, calculate an 
indirect PE adjustment so that the aggregate indirect allocation does 
not exceed the available aggregate indirect PE RVUs and apply it to 
indirect allocators calculated in Step 8.
    Calculate the indirect practice cost index.
    Step 12: Using the results of Step 11, calculate aggregate pools of 
specialty-specific adjusted indirect PE allocators for all PFS services 
for a specialty by adding the product of the adjusted indirect PE 
allocator for each service and the utilization data for that service.
    Step 13: Using the specialty-specific indirect PE/HR data, 
calculate specialty-specific aggregate pools of indirect PE for all PFS 
services for that specialty by adding the product of the indirect PE/HR 
for the specialty, the physician time for the service, and the 
specialty's utilization for the service across all services furnished 
by the specialty.
    Step 14: Using the results of Step 12 and Step 13, calculate the 
specialty-specific indirect PE scaling factors.
    Step 15: Using the results of Step 14, calculate an indirect 
practice cost index at the specialty level by dividing each specialty-
specific indirect scaling factor by the average indirect scaling factor 
for the entire PFS.
    Step 16: Calculate the indirect practice cost index at the service 
level to ensure the capture of all indirect costs. Calculate a weighted 
average of the practice cost index values for the specialties that 
furnish the service. (Note: For services with TCs and PCs, we calculate 
the indirect practice cost index across the global components, PCs, and 
TCs. Under this method, the indirect practice cost index for a given 
service (for example, echocardiogram) does not vary by the PC, TC, and 
global component.)
    Step 17: Apply the service level indirect practice cost index 
calculated in Step 16 to the service level adjusted indirect allocators 
calculated in Step 11 to get the indirect PE RVUs.
(4) Calculate the Final PE RVUs
    Step 18: Add the direct PE RVUs from Step 6 to the indirect PE RVUs 
from Step 17 and apply the final PE budget neutrality (BN) adjustment.
    The final PE BN adjustment is calculated by comparing the results 
of Step 18 to the current pool of PE RVUs. This final BN adjustment is 
required in order to redistribute RVUs from step 18 to all PE RVUs in 
the PFS and because certain specialties are excluded from the PE RVU 
calculation for ratesetting purposes, but all specialties are included 
for purposes of calculating the final BN adjustment. (See ``Specialties 
excluded from ratesetting calculation'' later in this section.)
(5) Setup File Information
     Specialties excluded from ratesetting calculation: For the 
purposes of calculating the PE RVUs, we exclude certain specialties, 
such as certain nonphysician practitioners paid at a percentage of the 
PFS and low-volume specialties, from the calculation. These specialties 
are included for the purposes of calculating the BN adjustment. They 
are displayed in Table 1.

                           Table 1--Specialties Excluded From Ratesetting Calculation
----------------------------------------------------------------------------------------------------------------
        Specialty code                                       Specialty description
----------------------------------------------------------------------------------------------------------------
49...........................  Ambulatory surgical center.
50...........................  Nurse practitioner.
51...........................  Medical supply company with certified orthotist.
52...........................  Medical supply company with certified prosthetist.
53...........................  Medical supply company with certified prosthetist[dash]orthotist.
54...........................  Medical supply company not included in 51, 52, or 53.
55...........................  Individual certified orthotist.
56...........................  Individual certified prosthestist.
57...........................  Individual certified prosthetist[dash]orthotist.
58...........................  Individuals not included in 55, 56, or 57.
59...........................  Ambulance service supplier, e.g., private ambulance companies, funeral homes,
                                etc.
60...........................  Public health or welfare agencies.
61...........................  Voluntary health or charitable agencies.
73...........................  Mass immunization roster biller.
74...........................  Radiation therapy centers.
87...........................  All other suppliers (e.g., drug and department stores).
88...........................  Unknown supplier/provider specialty.
89...........................  Certified clinical nurse specialist.
95...........................  Competitive Acquisition Program (CAP) Vendor.
96...........................  Optician.
97...........................  Physician assistant.
A0...........................  Hospital.
A1...........................  SNF.
A2...........................  Intermediate care nursing facility.
A3...........................  Nursing facility, other.
A4...........................  HHA.
A5...........................  Pharmacy.
A6...........................  Medical supply company with respiratory therapist.
A7...........................  Department store.
1............................  Supplier of oxygen and/or oxygen related equipment.
2............................  Pedorthic personnel.

[[Page 68901]]

 
3............................  Medical supply company with pedorthic personnel.
----------------------------------------------------------------------------------------------------------------

    In the CY 2013 PFS proposed rule, we proposed to calculate the 
specialty mix for low volume services (fewer than 100 billed services 
in the previous year) using the same methodology we used for non-low 
volume services. We currently use the survey data from the dominant 
specialty for these low volume services. We proposed to calculate a 
specialty mix for these services rather than use the dominant specialty 
in order to smooth year-to-year fluctuations in PE RVUs due to changes 
in the dominant specialty. However, the PE RVUs for the affected HCPCS 
codes were inadvertently displayed in Addendum B for the CY 2013 PFS 
proposed rule using our previously established methodology of using the 
dominant specialty for these services. While we received comments on 
our proposal, including some suggesting alternative methods for 
handling low volume services, we do not believe that it would be 
appropriate to make changes to the current methodology since the 
correct impact of the proposed calculation was not reflected in the 
displayed PE RVUs. We appreciate the commenters' perspective on the 
proposal, and will take those comments into account as we consider the 
best methodology for calculating the specialty mix for low volume 
services in future rulemaking.
     Crosswalk certain low volume physician specialties: 
Crosswalk the utilization of certain specialties with relatively low 
PFS utilization to the associated specialties.
     Physical therapy utilization: Crosswalk the utilization 
associated with all physical therapy services to the specialty of 
physical therapy.
     Identify professional and technical services not 
identified under the usual TC and 26 modifiers: Flag the services that 
are PC and TC services, but do not use TC and 26 modifiers (for 
example, electrocardiograms). This flag associates the PC and TC with 
the associated global code for use in creating the indirect PE RVUs. 
For example, the professional service, CPT code 93010 
(Electrocardiogram, routine ECG with at least 12 leads; interpretation 
and report only), is associated with the global service, CPT code 93000 
(Electrocardiogram, routine ECG with at least 12 leads; with 
interpretation and report).
     Payment modifiers: Payment modifiers are accounted for in 
the creation of the file consistent with current payment policy as 
implemented in claims processing. For example, services billed with the 
assistant at surgery modifier are paid 16 percent of the PFS amount for 
that service; therefore, the utilization file is modified to only 
account for 16 percent of any service that contains the assistant at 
surgery modifier. Similarly, for those services to which volume 
adjustments are made to account for the payment modifiers, time 
adjustments are applied as well. For time adjustments to surgical 
services, the intraoperative portion in the physician time file is 
used; where it is not present, the intraoperative percentage from the 
payment files used by Medicare contractors to process Medicare claims 
is used instead. Where neither is available, we use the payment 
adjustment ratio to adjust the time accordingly. Table 2 details the 
manner in which the modifiers are applied.

                         Table 2--Application of Payment Modifiers to Utilization Files
----------------------------------------------------------------------------------------------------------------
           Modifier                 Description         Volume adjustment              Time adjustment
----------------------------------------------------------------------------------------------------------------
80, 81, 82...................  Assistant at Surgery.  16%..................  Intraoperative portion.
AS...........................  Assistant at Surgery-- 14% (85% * 16%)......  Intraoperative portion.
                                Physician Assistant.
50 or LT and RT..............  Bilateral Surgery....  150%.................  150% of physician time.
51...........................  Multiple Procedure...  50%..................  Intraoperative portion.
52...........................  Reduced Services.....  50%..................  50%.
53...........................  Discontinued           50%..................  50%.
                                Procedure.
54...........................  Intraoperative Care    Preoperative +         Preoperative + Intraoperative
                                only.                  Intraoperative         portion.
                                                       Percentages on the
                                                       payment files used
                                                       by Medicare
                                                       contractors to
                                                       process Medicare
                                                       claims.
55...........................  Postoperative Care     Postoperative          Postoperative portion.
                                only.                  Percentage on the
                                                       payment files used
                                                       by Medicare
                                                       contractors to
                                                       process Medicare
                                                       claims.
62...........................  Co-surgeons..........  62.5%................  50%.
66...........................  Team Surgeons........  33%..................  33%.
----------------------------------------------------------------------------------------------------------------

    We also make adjustments to volume and time that correspond to 
other payment rules, including special multiple procedure endoscopy 
rules and multiple procedure payment reductions (MPPR) including the 
final ophthalmology and cardiovascular diagnostic services MPPR 
discussed in section II.B.4. of this final rule with comment period. We 
note that section 1848(c)(2)(B)(v) of the Act exempts certain reduced 
payments for multiple imaging procedures and multiple therapy services 
from the budget-neutrality calculation under section 
1848(c)(2)(B)(ii)(II) of the Act. These MPPRs are not included in the 
development of the RVUs.
    For anesthesia services, we do not apply adjustments to volume 
since the average allowed charge is used when simulating RVUs and 
therefore includes all discounts. A time adjustment of 33 percent is 
made only for medical direction of two to four cases since that it is 
the only occasion where time units are duplicative.
    Comment: One commenter expressed concern regarding the accuracy of 
the 33 percent time adjustment made for these services.
    Response: We note that we did not make any proposals regarding the 
33 percent time adjustment for medical direction in the CY 2013 PFS 
proposed rule. As such, we do not believe it would be appropriate to 
modify that

[[Page 68902]]

figure in this final rule. However, we would welcome any independently 
verifiable data that could inform the accuracy of our assumption 
regarding duplicative time units. The 33 percent time adjustment 
effectively assumes medical direction of three cases. We would consider 
any such data for future rulemaking.
     Work RVUs: The setup file contains the work RVUs from this 
final rule with comment period.
(6) Equipment Cost per Minute
    The equipment cost per minute is calculated as:

(1/(minutes per year * usage)) * price * ((interest rate/(1 - (1/((1 + 
interest rate)[supcaret] life of equipment)))) + maintenance)

Where:

minutes per year = maximum minutes per year if usage were continuous 
(that is, usage = 1); generally 150,000 minutes.
usage = 0.5 is the standard equipment utilization assumption; 0.75 
for certain expensive diagnostic imaging equipment (see 74 FR 61753 
through 61755 and section II.A.3. of the CY 2011 PFS final rule with 
comment period).
price = price of the particular piece of equipment.
interest rate = sliding scale (see proposal below)
life of equipment = useful life of the particular piece of 
equipment.
maintenance = factor for maintenance; 0.05.

The interest rate we have previously used was proposed and finalized 
during rulemaking for CY 1998 PFS (62 FR 33164). In the CY 2012 
proposed rule (76 FR 42783), we solicited comment regarding reliable 
data on current prevailing loan rates for small businesses. In response 
to that request, the AMA RUC recommended that rather than applying the 
same interest rate across all equipment, CMS should consider a 
``sliding scale'' approach which varies the interest rate based on the 
equipment cost, useful life, and SBA (Small Business Administration) 
maximum interest rates for different categories of loan size and 
maturity. The maximum interest rates for SBA loans are as follows:
     Fixed rate loans of $50,000 or more must not exceed Prime 
plus 2.25 percent if the maturity is less than 7 years, and Prime plus 
2.75 percent if the maturity is 7 years or more.
     For loans between $25,000 and $50,000, maximum rates must 
not exceed Prime plus 3.25 percent if the maturity is less than 7 
years, and Prime plus 3.75 percent if the maturity is 7 years or more.
     For loans of $25,000 or less, the maximum interest rate 
must not exceed Prime plus 4.25 percent if the maturity is less than 7 
years, and Prime plus 4.75 percent, if the maturity is 7 years or more.

The current Prime rate is 3.25 percent.
    Based on that recommendation, for CY 2013, we proposed to use a 
``sliding scale'' approach based on the current SBA maximum interest 
rates for different categories of loan size (price of the equipment) 
and maturity (useful life of the equipment). Additionally, we proposed 
to update this assumption through annual PFS rulemaking to account for 
fluctuations in the Prime rate and/or changes to the SBA's formula to 
determine maximum allowed interest rates.
    Comment: Both MedPAC and the AMA RUC supported the proposal. MedPAC 
stated:

    We support CMS's proposal to use more accurate interest rate 
information because this will improve the accuracy of practice expense 
payment rates and redistribute dollars from overvalued codes to 
undervalued codes.
    The AMA RUC commented:
    The RUC appreciates that CMS intends to adopt the RUC 
recommendation of implementing a ``sliding scale'' for the interest 
rate utilized in computing equipment costs.
    Other commenters, also supported the proposal. However, while 
physician organizations that represent specialties that provide medical 
equipment intensive services and medical equipment manufacturers 
generally acknowledged that the interest rate used in the calculation 
had not been updated in over 12 years, they did not support the 
specific proposed update approach. These commenters assertions 
included: The proposal is ``overly complicated'' to administer since 
the interest rates vary by loan size and maturity, and interest rates 
can fluctuate; the SBA loan program is designed to encourage loans to 
small businesses so the SBA rates are below market rates unrelated to 
the cost of capital for physician practices; the proposed methodology 
may be inconsistent with the statute since it does not reflect relative 
resources; CMS should factor in the opportunity cost for practices that 
pay cash for the equipment (a weighted average cost of capital (WACC) 
approach) using WACC measures available in the private sector; CMS 
should transition this policy given the investments in equipment that 
have already been made; CMS should use a multiyear average of the Prime 
rate rather than the most recent Prime rate in the calculation; and, 
CMS should only update the interest rate every few years to help ensure 
more stable practice expenses.
    Response: We agree with MedPAC, the AMA RUC, and the commenters who 
supported our proposed approach for the interest rate calculation. Our 
proposed approach recognizes that the goal of the practice expense 
methodology is to calculate, as accurately as possible given the 
available data sources, the relative resources required to furnish 
services that are paid under the physician fee schedule. To continue to 
use an 11 percent interest rate assumption in the calculation of the 
equipment portion of the practice expense RVUs when this rate does not 
reflect a market rate would unnecessarily distort this relativity. We 
are unaware of, nor did commenters suggest, a readily available and 
transparent data source that specifically provides nationally 
representative data on the typical interest rates charged to physicians 
when obtaining financing for medical equipment. We believe that the use 
of the SBA maximum loan rates leads to a more reasonable estimate of 
relative resource used across the fee schedule and, consistent with the 
MedPAC comment, that the continued use of an 11 percent interest rate 
would inappropriately skew physician fee schedule relativity towards 
equipment intensive services.
    Additionally, we disagree that the maximum SBA loan rates are not 
sufficient as an assumption for the rate at which a typical physician 
practice would obtain financing, nor did the commenters offer 
nationally representative data indicating that this is the case.
    We agree with commenters that, in an ideal world, the interest rate 
assumption used in the equipment calculation would explicitly factor in 
the opportunity costs for practices that pay cash for the equipment (a 
WACC approach) and not just the cost of financing. However, as with the 
interest rates typically charged to physicians for medical equipment 
financing, we are unaware of any nationally representative data source 
that would provide the opportunity cost for physician practices 
deciding on purchasing medical equipment. Some commenters suggested we 
use proprietary WACC measures designed for industry and company stock 
valuations. We do not believe it would be appropriate to use 
proprietary measures in this calculation, nor do we believe that 
measures developed to value the stock prices of individual medical 
equipment companies or the medical device industry are necessarily 
applicable to the opportunity costs of

[[Page 68903]]

typical medical practices. Also, we do not agree that the opportunity 
cost of a physician practice purchase of medical equipment, if known or 
estimable, would exceed the SBA maximum loan rates.
    We also do not believe that our proposal is overly complicated to 
administer. The Prime rate is readily available, as are the SBA loan 
maximums. As such, we believe our proposal is a very transparent 
approach. We stated that we would update the rate through our annual 
PFS rulemaking process. In response to comments on this aspect of our 
proposal, we are clarifying that we generally intend to update the 
interest rate calculation through future rulemaking when we broadly 
update one or more of the other direct practice expense inputs, such as 
pricing or labor wage rates, to maintain relatively between the 
practice expense components. Given that we do not anticipate updating 
the interest rate assumption every year, we do not believe it is 
necessary to use a rolling average in the calculation. Periodic updates 
using the most recent Prime rate will balance commenters' desire for 
stability in the PE RVUs with the need to maintain appropriate 
relativity under the PFS. We also do not believe a transition is 
appropriate in this situation. We believe it is important to update the 
interest rate assumptions to appropriately adjust the relativity of 
equipment in relation to other PE inputs and the relation of equipment 
intensive services to other services on the PFS.
    In summary, we are finalizing without modification our proposal to 
use a ``sliding scale'' approach based on the current SBA maximum 
interest rates for different categories of loan size (price of the 
equipment) and maturity (useful life of the equipment). We will update 
the interest rate assumption through PFS rulemaking to account for 
fluctuations in the Prime rate and/or changes to the SBA's formula to 
determine maximum allowed interest rates. We are clarifying that we 
generally intend to update the interest rate calculation through future 
rulemaking only in years when we broadly update one or more of the 
other direct practice expense inputs. Accordingly, we anticipate 
updating the interest rate calculation less frequently than annually.
    The effects of this policy on direct equipment inputs are reflected 
in the CY 2013 direct PE input database, available on the CMS Web site 
under the downloads for the CY 2013 PFS final rule with comment period 
at http://www.cms.gov/PhysicianFeeSched/. Additionally, we note that 
the PE RVUs included in Addendum B reflect this policy.
BILLING CODE 4120-01-P

[[Page 68904]]

[GRAPHIC] [TIFF OMITTED] TR16NO12.000


[[Page 68905]]


[GRAPHIC] [TIFF OMITTED] TR16NO12.001


[[Page 68906]]


[GRAPHIC] [TIFF OMITTED] TR16NO12.002


[[Page 68907]]


BILLING CODE 4120-01-C
3. Changes to Direct PE Inputs for Specific Services
    In this section, we discuss other specific CY 2013 proposals and 
changes related to direct PE inputs for specific services. The changes 
we proposed and are finalizing are included in the final rule CY 2012 
direct PE database, which is available on the CMS Web site under the 
supporting data files for the CY 2012 PFS final rule with comment 
period at www.cms.gov/PhysicianFeeSched/. We note that we address 
comments on the interim direct PE inputs established in the CY 2012 PFS 
final rule with comment period in section II.M. of this final rule with 
comment period.
a. Equipment Minutes for Interrogation Device Evaluation Services
    It has come to our attention that the pacemaker follow-up system 
(EQ138) associated with two interrogation device management service 
codes does not have minutes allocated in the direct PE input database. 
Based on our analysis of these services, we believed that 10 minutes 
should be allocated to the equipment for each of the following CPT 
codes: 93294 (Interrogation device evaluation(s) (remote), up to 90 
days; single, dual, or multiple lead pacemaker system with interim 
physician analysis, review(s) and report(s)), and 93295 (Interrogation 
device evaluation(s) (remote), up to 90 days; single, dual, or multiple 
lead implantable cardioverter-defibrillator system with interim 
physician analysis, review(s) and report(s)). Therefore, the direct PE 
input database was modified to allocate 10 minutes to the pacemaker 
follow-up system for CPT codes 93294 and 93295.
    Comment: One commenter expressed support for this modification.
    Response: We appreciate the support for the modification and will 
maintain the allocated equipment minutes in the final direct PE input 
database.
b. Clinical Labor for Pulmonary Rehabilitation Services (HCPCS Code 
G0424)
    It has come to our attention that the direct PE input database 
includes 15 minutes of clinical labor time in the nonfacility setting 
allocated for a CORF social worker/psychologist (L045C) associated with 
HCPCS code G0424 (Pulmonary rehabilitation, including exercise 
(includes monitoring), one hour, per session, up to two sessions per 
day). Based on our analysis of this service, we believed that these 15 
minutes should be added to the 15 minutes currently allocated to the 
Respiratory Therapist (L042B) associated with this service. Therefore, 
we proposed to modify the direct PE input database to allocate 15 
additional minutes to the Respiratory Therapist (L042B) (for a total of 
30 minutes) and to delete the CORF social worker/psychologist (L045C) 
associated with HCPCS code G0424.
    Comment: One commenter supported the modification as accurate and 
fair. Another commenter suggested that the appropriate clinical staff 
time for the code should be 60 minutes since the code describes an hour 
long session. Furthermore, the same commenter expressed opposition to 
reassigning the 15 minutes to the Respiratory Therapist because the 
rate per minute of the Respiratory Therapist is lower than the rate per 
minute of the CORF social worker/psychologist and the change, however 
modest, may potentially reduce the PE RVUs for the service.
    Response: We appreciate the support for the modification and 
understand the commenter's concerns. We recognize that for many 
services with code descriptors that include procedure time assumptions, 
the number of clinical labor minutes allocated during the service 
period corresponds to the time as described by the code. However, as we 
explained in the CY 2011 PFS final rule with comment period (75 FR 
73299), because pulmonary rehabilitation services reported under HCPCS 
code G0424 can be furnished either individually or in groups, we 
believe that 30 minutes of respiratory therapist time would be more 
appropriate for valuing the typical pulmonary rehabilitation service. 
We also recognize that reclassifying the direct PE input labor category 
from CORF social worker/psychologist to Respiratory Therapist for 15 
minutes will reduce the direct labor costs used in calculating PE RVUs 
for the service. However, we continue to believe that the Respiratory 
Therapist is the most appropriate labor category to include as a direct 
PE input for this service.
    After consideration of the comments we received, we are finalizing 
the modification of the direct PE labor inputs for this service to 
allocate 15 additional minutes to the Respiratory Therapist (L042B) 
(for a total of 30 minutes) and to delete the CORF social worker/
psychologist (L045C) associated with HCPCS code G0424.
c. Transcranial Magnetic Stimulation Services
    For CY 2011, the CPT Editorial Panel converted Category III CPT 
codes 0160T and 0161T to Category I status (CPT codes 90867 
(Therapeutic repetitive transcranial magnetic stimulation (TMS) 
treatment; initial, including cortical mapping, motor threshold 
determination, delivery and management), and 90868 (Therapeutic 
repetitive transcranial magnetic stimulation (TMS) treatment; 
subsequent delivery and management, per session)), which were 
contractor priced on the PFS. For CY 2012, the CPT Editorial Panel 
modified CPT codes 90867 and 90868, and created CPT code 90869 
((Therapeutic repetitive transcranial magnetic stimulation (TMS) 
treatment; subsequent motor threshold re-determination with delivery 
and management.) In the CY 2012 PFS final rule with comment period, we 
established interim final values based on refinement of RUC-recommended 
work RVUs, direct PE inputs, and malpractice risk factor crosswalks for 
these services (76 FR 73201).
    Subsequent to the development of interim final PE RVUs, it came to 
our attention that the application of our usual PE methodology resulted 
in anomalous PE values for these services. As we explain in section 
II.A.2.c.2 of this final rule with comment period, for a given service, 
we use the direct costs associated with a service (clinical staff, 
equipment, and supplies) and the average percentage that direct costs 
represent of total costs (based on survey data) across the specialties 
that furnish the service to determine an initial indirect allocator.
    For services almost exclusively furnished by one specialty, the 
average percentage of indirect costs relative to direct costs would 
ordinarily be used to determine the initial indirect allocator. For 
specialties that typically incur significant direct costs relative to 
indirect costs, the initial indirect allocator for their services is 
generally lower than for the specialties that typically incur lower 
direct costs relative to indirect costs. Relative to direct costs, the 
methodology generally allocates a greater proportion of indirect PE to 
services furnished by psychiatrists, for example, than to services 
furnished by specialties that typically incur significant direct costs, 
such as radiation oncologists. In the case of TMS, however, the direct 
costs incurred by psychiatrists reporting the codes far exceed the 
direct costs typical to any other service predominantly furnished by 
psychiatrists. This drastic difference in the direct costs of TMS 
relative to most other services furnished by psychiatrists, results in 
anomalous PE values since code-level indirect PE allocation relies on 
typical resource costs for the specialties that furnish the service. In 
other words, the amount of indirect PE allocated to TMS services is

[[Page 68908]]

based on the proportion of indirect expense to direct expense that is 
typical of other psychiatric services, and is not on par with other 
services that require similar investments in capital equipment and 
high-cost, disposable supplies.
    Historically, we have contractor-priced (meaning our claims 
processing contractors develop payment rates) for services with 
resource costs that cannot be appropriately valued within the generally 
applicable PE methodology used to price services across the PFS. 
Because there is no mechanism to develop appropriate payment rates for 
these services within our current methodology, we proposed to 
contractor price these codes for CY 2013.
    Comment: One commenter objected to the proposal to contractor price 
these codes for CY 2013 and suggested that CMS should establish PE RVUs 
using the generally applicable PE methodology and must endeavor in 
ensuing rulemaking to revise the methodology to refine any values the 
agency views as ``anomalous.'' The commenter also questioned CMS's 
assumption that the direct costs for psychiatrists who furnish these 
services ``far exceed'' the direct costs for psychiatrists who do not 
furnish these services. The commenter stated that CMS made this 
assessment without any empirical support and that CMS needs to conduct 
a survey or obtain other data from psychiatrists before drawing any 
conclusions regarding the appropriateness of Medicare payment rates on 
this basis.
    Response: We understand the commenter's objections, but as we 
explained in the proposal, we do not believe that there is a mechanism 
within the current methodology that allows us to develop appropriate 
payment rates for these services. We agree with the commenter that it 
may be appropriate to consider potential changes to the practice 
expense methodology to accommodate changing circumstances of medical 
practice. We do not agree with the commenter, however, that we have no 
means to pay appropriately for services when we recognize areas where 
the practice expense methodology is inadequate and that we must 
establish national RVUs based on that methodology, even when it does 
not accommodate the unique circumstances of particular services. 
Instead, we believe that in outlier cases, contractor pricing allows 
Medicare to pay more appropriately for particular services furnished to 
beneficiaries.
    In our proposal, we pointed out that the direct costs incurred by 
psychiatrists reporting the codes far exceed the direct costs typical 
to any other service predominantly furnished by psychiatrists. The 
commenter objected to this assertion and claimed it was made without 
any empirical support. We made that assertion based on comparing the 
direct practice expense input costs for transcranial magnetic 
stimulation services and the current direct practice expense input 
costs in the direct PE database for services predominantly furnished by 
the specialty based on Medicare claims data. In our examination of 20 
frequently billed psychiatry services (where greater than half of the 
Medicare allowed services were reported by psychiatrists), the total 
direct costs (clinical labor, disposable medical supplies, or medical 
equipment) in the direct PE input database summed to under $10 for all 
but 3 of these 20 services. Examples of these services include CPT 
codes 90807 (Individual psychotherapy, insight oriented, behavior 
modifying and/or supportive, in an office or outpatient facility, 
approximately 45 to 50 minutes face-to-face with the patient; with 
medical evaluation and management services), 90862 (Pharmacologic 
management, including prescription, use, and review of medication with 
no more than minimal medical psychotherapy), and 90845 
(Psychoanalysis). For the three where the direct PE input costs summed 
to greater than $10, HCPCS code M0064 (Brief office visit for the sole 
purpose of monitoring or changing drug prescriptions used in the 
treatment of mental psychoneurotic and personality disorders), and CPT 
codes 90865 (Narcosynthesis for psychiatric diagnostic and therapeutic 
purposes (eg, sodium amobarbital (Amytal) interview)), and 90870 
(Electroconvulsive therapy (includes necessary monitoring)), the 
service with the highest direct cost sum was $32.24. In contrast, the 
transcranial magnetic stimulation services treatment delivery (CPT code 
90867) included direct PE inputs that summed to direct costs of 
$145.19. The disparity between the TMS direct costs and the direct 
costs in other frequent psychiatry codes was the basis for our 
assertion that the direct costs for this service far exceeded the 
direct costs typical to any other service predominantly furnished by 
psychiatrists. Thus, we continue to believe our decision to contractor 
price these codes is the proper one.
    Comment: Another commenter requested that CMS use the existing 
methodology to price the codes or contractor price the codes. This 
commenter also urged CMS to consider alternate sources of data for 
resource costs as they become available, or to make appropriate future 
refinements to the practice expense methodology.
    Response: We appreciate the commenter's support for our proposal as 
a suitable means of pricing the services. We will consider appropriate 
means to develop national prices for these services in the context of 
potential changes to the practice expense methodology and the 
availability of new data sources.
    After consideration of these public comments, we are finalizing our 
proposal to contractor price CPT codes 90867, 90868, and 90869 for CY 
2013.
d. Spinal Cord Stimulation Trial Procedures in the Nonfacility Setting
    Stakeholders have recently brought to our attention that CPT code 
63650 (Percutaneous implantation of neurostimulator electrode array, 
epidural) is frequently furnished in the physician office setting but 
is not priced in that setting. We note that the valuation of a service 
under the PFS in particular settings does not address whether those 
services are medically reasonable and necessary in the case of 
individual patients, including being furnished in a setting appropriate 
to the patient's medical needs and condition. However, because these 
services are being furnished in the nonfacility setting, we believed 
that CPT code 63650 should be reviewed to establish appropriate 
nonfacility inputs. We proposed to review CPT code 63650 and requested 
recommendations from the AMA RUC and other public commenters on the 
appropriate physician work RVUs (as measured by time and intensity), 
and facility and nonfacility direct PE inputs for this service. We 
understand that disposable leads comprise a significant resource cost 
for this service and are currently separately reportable to Medicare 
for payment purposes when the service is furnished in the physician 
office setting. Disposable medical supplies are not considered 
prosthetic devices paid under the Durable Medical Equipment, 
Prosthetic/Orthotic, and Supplies (DMEPOS) fee schedule and generally 
are incorporated as nonfacility direct PE inputs to PE RVUs. We sought 
comment on establishing nonfacililty PE RVUs for CPT code 63650.
    Comment: Several commenters expressed concerns regarding the 
possibility of establishing nonfacility PE RVUs for this service based 
on the assumption that the nonfacility PFS payment rate would be lower 
than the rate paid by the Medicare hospital outpatient prospective 
payment system

[[Page 68909]]

(OPPS). These commenters stated that the supply, personnel, and 
administration costs are higher in the non-facility setting than in the 
facility setting and that current Medicare payment for L8680 under the 
DMEPOS fee schedule offsets the difference in costs between the 
facility and nonfacility setting. Many of these commenters also stated 
that it is more cost effective for the Medicare program for these 
services to be furnished in the nonfacility setting. These commenters 
also stated that it is more convenient for patients to receive this 
service in the nonfacility setting, so that Medicare should not 
implement nonfacility payment rates because doing so might discourage 
practitioners from furnishing the service in the nonfacility setting.
    Response: We understand the commenters' interest in ensuring that 
Medicare beneficiaries retain access to the service in the nonfacility 
setting. We do not agree with the commenters' underlying assumption 
that developing accurate payment rates for the service in the 
nonfacility setting will necessarily deter practitioners from 
furnishing the service to Medicare beneficiaries outside the facility 
setting. Additionally, we do not know how to reconcile the 
contradictory contentions of many individual commenters that the costs 
of furnishing the services in the nonfacility setting are greater so 
that payment rates should be higher, but furnishing services there 
would still be more cost effective for Medicare.
    Comment: One commenter supported the proposal to create nonfacility 
RVUs for this service since it would reduce overutilization of the 
service and lower the likelihood of fraud.
    Response: We appreciate the support for the proposal, and we 
generally agree that developing accurate payment rates encourages 
appropriate utilization.
    Comment: One commenter stated that CMS should continue to provide 
payment for HCPCS code L8680 until non-facility PE inputs for CPT code 
63650 including the leads have been developed.
    Response: We appreciate the commenter's concerns. We would continue 
a mechanism to provide payment for the disposable leads used in 
furnishing the service while we develop non-facility PE inputs. We also 
agree that once a practice expense payment reflects these disposable 
leads, that a separate payment mechanism would no longer be necessary.
    Comment: The AMA RUC agreed that the direct practice expense inputs 
for the service should be reviewed to establish appropriate inputs in 
both the facility and nonfacility setting.
    After consideration of the comments we received regarding our 
proposal to establish nonfacility PE RVUs for CPT code 63650 
(Percutaneous implantation of neurostimulator electrode array, 
epidural), we continue to believe that it would be appropriate to do so 
since these services are being furnished in the nonfacility setting. 
The AMA RUC expects to review the direct PE inputs for this service 
during CY 2013. We anticipate receiving recommendations from the AMA 
RUC for the CY 2014 PFS, and we request comments from other 
stakeholders regarding the appropriate direct PE inputs for this 
service

B. Potentially Misvalued Codes Under the Physician Fee Schedule

1. Valuing Services Under the PFS
    To value services under the PFS, section 1848(c) of the Act 
requires the Secretary to determine relative values for physicians' 
services based on three components: work; practice expense (PE); and 
malpractice. Section 1848(c)(1)(A) of the Act defines the work 
component to include ``the portion of the resources used in furnishing 
the service that reflects physician time and intensity in furnishing 
the service.'' In addition, section 1848(c)(2)(C)(i) of the Act 
specifies that ``the Secretary shall determine a number of work 
relative value units (RVUs) for the service based on the relative 
resources incorporating physician time and intensity required in 
furnishing the service.''
    As discussed in detail in sections II.B.1.b. and II.B.1.c. of this 
final rule with comment period, the statute also defines the PE and 
malpractice components and provides specific guidance in the 
calculation of the RVUs for each of these components. Section 
1848(c)(1)(B) of the Act defines the PE component as ``the portion of 
the resources used in furnishing the service that reflects the general 
categories of expenses (such as office rent and wages of personnel, but 
excluding malpractice expenses) comprising practice expenses.'' Section 
1848(c)(1)(C) of the Act defines the malpractice component as ``the 
portion of the resources used in furnishing the service that reflects 
malpractice expenses in furnishing the service.'' Clause (ii) and 
clause (iii) of section 1848 (c)(2)(C) of the Act specify that PE and 
malpractice expense RVUs shall be determined based on the relative PE/
malpractice expense resources involved in furnishing the service.
    Section 1848(c)(2)(B) of the Act directs the Secretary to conduct a 
periodic review, not less often than every 5 years, of the RVUs 
established under the PFS. On March 23, 2010, the Affordable Care Act 
was enacted, further requiring the Secretary to periodically identify 
and review potentially misvalued codes and make appropriate adjustments 
to the relative values of those services identified as being 
potentially misvalued. Section 1848(c)(2)(K) to the Act requires the 
Secretary to periodically identify potentially misvalued services using 
certain criteria and to review and make appropriate adjustments to the 
relative values for those services. Section 1848(c)(2)(L) of the Act 
requires the Secretary to develop a process to validate the RVUs of 
certain potentially misvalued codes under the PFS, identified using the 
same criteria used to identify potentially misvalued codes, and to make 
appropriate adjustments.
    As discussed in section I.B.1.a. of this final rule with comment 
period, each year we develop and propose appropriate adjustments to the 
RVUs, taking into account the recommendations provided by the American 
Medical Association Specialty Society Relative Value Scale Update 
Committee (AMA RUC), the Medicare Payment Advisory Commission (MedPAC), 
and others. For many years, the AMA RUC has provided us with 
recommendations on the appropriate relative values for new, revised, 
and potentially misvalued PFS services. We review these recommendations 
on a code-by-code basis and consider these recommendations in 
conjunction with the recommendations of other public commenters, and 
with analyses of data sources, such as claims data, to inform the 
decision-making process as authorized by the law. We may also consider 
analyses of physician time, work RVUs, or direct PE inputs using other 
data sources, such as Department of Veteran Affairs (VA) National 
Surgical Quality Improvement Program (NSQIP), the Society for Thoracic 
Surgeons (STS), and the Physician Quality Reporting Initiative (PQRI) 
databases. In addition to considering the most recently available data, 
we also assess the results of physician surveys and specialty 
recommendations submitted to us by the AMA RUC. We conduct a clinical 
review to assess the appropriate RVUs in the context of contemporary 
medical practice. We note that section 1848(c)(2)(A)(ii) of the Act 
authorizes the use of extrapolation and other techniques to determine 
the RVUs for physicians' services for which specific data are not 
available, in addition to taking into account the

[[Page 68910]]

results of consultations with organizations representing physicians. In 
accordance with section 1848(c) of the Act, we determine appropriate 
adjustments to the RVUs, explain the basis of these adjustments, and 
respond to public comments in the PFS proposed and final rules.
2. Identifying, Reviewing, and Validating the RVUs of Potentially 
Misvalued Services on the PFS
a. Background
    In its March 2006 Report to the Congress, MedPAC noted that 
``misvalued services can distort the price signals for physicians' 
services as well as for other health care services that physicians 
order, such as hospital services.'' In that same report MedPAC 
postulated that physicians' services under the PFS can become misvalued 
over time for a number of reasons: For example, MedPAC stated, ``when a 
new service is added to the PFS, it may be assigned a relatively high 
value because of the time, technical skill, and psychological stress 
that are often required to furnish that service. Over time, the work 
required for certain services would be expected to decline as 
physicians become more familiar with the service and more efficient in 
furnishing it.'' That is, the amount of physician work needed to 
furnish an existing service may decrease as physicians build experience 
furnishing that service. Services can also become overvalued when PEs 
decline. This can happen when the costs of equipment and supplies fall, 
or when equipment is used more frequently than is estimated in the PE 
methodology, reducing its cost per use. Likewise, services can become 
undervalued when physician work increases or PEs rise. In the ensuing 
years since MedPAC's 2006 report, additional groups of potentially 
misvalued services have been identified by the Congress, CMS, MedPAC, 
the AMA RUC, and other stakeholders.
    In recent years, CMS and the AMA RUC have taken increasingly 
significant steps to address potentially misvalued codes. As MedPAC 
noted in its March 2009 Report to Congress, in the intervening years 
since MedPAC made the initial recommendations, ``CMS and the AMA RUC 
have taken several steps to improve the review process.'' Most 
recently, section 1848(c)(2)(K)(ii) of the Act directed the Secretary 
to specifically examine, as determined appropriate, potentially 
misvalued services in seven categories as follows:
     Codes and families of codes for which there has been the 
fastest growth;
     Codes and families of codes that have experienced 
substantial changes in PEs;
     Codes that are recently established for new technologies 
or services;
     Multiple codes that are frequently billed in conjunction 
with furnishing a single service;
     Codes with low relative values, particularly those that 
are often billed multiple times for a single treatment;
     Codes which have not been subject to review since the 
implementation of the PFS (the so-called `Harvard-valued codes'); and
     Other codes determined to be appropriate by the Secretary.
    Section 1848(c)(2)(K)(iii) of the Act also specifies that the 
Secretary may use existing processes to receive recommendations on the 
review and appropriate adjustment of potentially misvalued services. In 
addition, the Secretary may conduct surveys, other data collection 
activities, studies, or other analyses, as the Secretary determines to 
be appropriate, to facilitate the review and appropriate adjustment of 
potentially misvalued services. This section also authorizes the use of 
analytic contractors to identify and analyze potentially misvalued 
codes, conduct surveys or collect data, and make recommendations on the 
review and appropriate adjustment of potentially misvalued services. 
Additionally, this section provides that the Secretary may coordinate 
the review and adjustment of any RVU with the periodic review described 
in section 1848(c)(2)(B) of the Act. Finally, section 
1848(c)(2)(K)(iii)(V) of the Act specifies that the Secretary may make 
appropriate coding revisions (including using existing processes for 
consideration of coding changes) which may include consolidation of 
individual services into bundled codes for payment under the PFS.
    In addition to these requirements, section 3003(b)(1) of the Middle 
Class Tax Relief and Job Creation Act of 2012 (MCTRJCA) (Pub. L. 112-
96), requires that the Secretary conduct a study that examines options 
for bundled or episode-based payment to cover physicians' services 
currently paid under the PFS under section 1848 of the Act for one or 
more prevalent chronic conditions or episodes of care for one or more 
major procedures. In conducting the study, the Secretary shall consult 
with medical professional societies and other relevant stakeholders. 
Additionally, the study shall include an examination of related private 
payer payment initiatives. This section also requires that not later 
than January 1, 2013, the Secretary submit to certain committees of the 
Congress a report on the study. The report shall include 
recommendations on suitable alternative payment options for services 
paid under the PFS and on associated implementation requirements.
    Bundling is one method for aligning incentives for hospitals, post-
acute care providers, physicians, and other practitioners to partner 
closely across all specialties and settings that a patient may 
encounter to improve the patient's experience of care. The typical 
goals of developing an effective bundled payment system are to improve 
quality, reduce costs, and promote efficiency. Current work on bundling 
services paid under the PFS to date has been limited to targeting 
specific codes and sets of codes and repackaging those codes into 
``bundles.'' As detailed above, through the potentially misvalued codes 
initiative we are currently identifying for review codes that are 
frequently billed together and codes with low relative values billed in 
multiples. Many of the codes identified through these screens have been 
referred to the CPT Editorial Panel for the development of a 
comprehensive or bundled code, and several bundled codes have already 
been created and valued. However, we believe that we now need to move 
beyond this ``repackaging'' of codes and examine the potential of a 
larger bundled payment within the PFS. In response to section 
3003(b)(1) of the MCTRJCA, we have consulted with medical professional 
societies, private payers, healthcare system administrators, and other 
stakeholders; met with other CMS staff involved in other bundling 
initiatives; and performed an extensive literature review. 
Additionally, we have had representatives of specialty groups such as 
radiation oncologists volunteer to work with us to create a bundled 
payment for their services. If we were to engage in a bundling project 
for radiation therapy, we would want to do more than provide a single 
episode payment for the normal course of radiation therapy that 
aggregates the sum of the individual treatments. Radiation therapy has 
many common side effects that can vary based on the type of cancer the 
patient has and how it is being treated. Common side effects associated 
with radiation therapy include fatigue, skin problems, eating problems, 
blood count changes, emotional issues such as depression, etc* * * If 
we were to engage in a bundling project that includes radiation 
therapy, we would be interested in exploring whether it could also 
include treating and managing the side effects

[[Page 68911]]

that result from radiation therapy in addition to the radiation therapy 
itself. Such an episode-based payment would allow Medicare to pay for 
the full course of the typical radiation therapy as well as the many 
medical services the patient may be receiving to treat side effects.
    We will continue to examine options for bundled or episode-based 
payments and will include our recommendations and implementation 
options in our report to the Congress. Following completion of this 
report, we will look forward with interest to the view of stakeholders 
that are interested in testing some of these concepts within the PFS.
b. Progress in Identifying and Reviewing Potentially Misvalued Codes
    In accordance with our statutory mandate, we have identified and 
reviewed numerous potentially misvalued codes in all seven of the 
categories specified in section 1848(c)(2)(K)(ii) of the Act, and we 
plan to continue our work examining potentially misvalued codes in 
these areas over the upcoming years. In the current process, we 
identify potentially misvalued codes for review, and request 
recommendations from the AMA RUC and other public commenters on revised 
work RVUs and direct PE inputs for those codes. The AMA RUC, through 
its own processes, identifies potentially misvalued codes for review, 
and through our public nomination process for potentially misvalued 
codes established in the CY 2012 PFS final rule, other individuals and 
stakeholder groups submit nominations for review of potentially 
misvalued codes as well.
    Since CY 2009, as a part of the annual potentially misvalued code 
review and Five-Year Review processes, we have reviewed over 1,000 
potentially misvalued codes to refine work RVUs and direct PE inputs. 
We have adopted appropriate work RVUs and direct PE inputs for these 
services as a result of these reviews.
    Our prior reviews of codes under the potentially misvalued codes 
initiative have included codes in all seven categories specified in 
section 1848(c)(2)(K)(ii) of the Act, listed above. A more detailed 
discussion of the extensive prior reviews of potentially misvalued 
codes is included in the CY 2012 PFS final rule with comment period (76 
FR 73052 through 73055).
    In the CY 2012 final rule with comment period, under the 
potentially misvalued codes category of ``Other codes determined to be 
appropriate by the Secretary,'' we finalized our proposal to review a 
list of the highest PFS expenditure services, by specialty, that had 
not been recently reviewed (76 FR 73059 through 73068). In the CY 2012 
final rule with comment period we also finalized policy to consolidate 
the periodic reviews of physician work and PE at the same time (76 FR 
73055 through 73958), and established a process for the annual public 
nomination of potentially misvalued services to replace the Five-Year 
review process (76 FR 73058 through 73059). Below we discuss the CY 
2013 PFS proposals that support our continuing efforts to appropriately 
identify, review, and adjust values for potentially misvalued codes.
c. Validating RVUs of Potentially Misvalued Codes
    In addition to identifying and reviewing potentially misvalued 
codes, section 1848(c)(2)(L) of the Act specifies that the Secretary 
shall establish a formal process to validate RVUs under the PFS. The 
validation process may include validation of work elements (such as 
time, mental effort and professional judgment, technical skill and 
physical effort, and stress due to risk) involved with furnishing a 
service and may also include validation of the pre-, post-, and intra-
service time components of work. The Secretary is directed, as part of 
the validation, to validate a sampling of the work RVUs of codes 
identified through any of the seven categories of potentially misvalued 
codes specified by section 1848(c)(2)(K)(ii) of the Act. Furthermore, 
the Secretary may conduct the validation using methods similar to those 
used to review potentially misvalued codes, including conducting 
surveys, other data collection activities, studies, or other analyses 
as the Secretary determines to be appropriate to facilitate the 
validation of RVUs of services.
    In the CY 2011 PFS proposed rule (75 FR 40068) and CY 2012 PFS 
proposed rule (76 FR 42790), we solicited public comments on possible 
approaches, methodologies, and data sources that we should consider for 
a validation process. A summary of the comments along with our 
responses are included in the CY 2011 PFS final rule with comment 
period (75 FR 73217) and the CY 2012 PFS final rule with comment period 
(77 FR 73054 through 73055). In September 2012 we entered into two 
contracts to assist us in validating RVUs of potentially misvalued 
codes; the implementation details for these contracts are currently 
under development. Contractors will explore models for the validation 
of physician work under the PFS, both for new and existing services. We 
plan to discuss these models further in future rulemaking.
d. Improving the Valuation of the Global Surgical Package
(1) Background
    We applied the concept of payment for a global surgical package 
under the PFS at its inception on January 1, 1992 (56 FR 59502). For 
each global surgical procedure, we establish a single payment, which 
includes payment for a package of all related services typically 
furnished by the surgeon furnishing the procedure during the global 
period. Each global surgery is paid on the PFS as a single global 
surgical package. Each global surgical package payment rate is based on 
the work necessary for the typical surgery and related pre- and post-
operative work. The global period may include 0, 10, or 90 days of 
post-operative care, depending on the procedure. For major procedures, 
those with a 90-day global period, the global surgical package payment 
also includes services typically furnished the day prior to the day of 
surgery.
    Some global surgical packages have been valued by adding the RVU of 
the surgical procedure and all pre- and post-operative evaluation and 
management (E/M) services included in the global period. Others have 
been valued using magnitude estimation, in which case the overall RVU 
for the surgical package was determined without factoring in the 
specific RVUs associated with the E/M services in the global period. 
The number and level of E/M services identified with a global surgery 
payment are based on the typical case. Even though a surgical package 
may have been developed with several E/M services included, a physician 
is not required to furnish each pre- or post-operative visit to bill 
for the global surgical package.
    Similar to other bundled services on the PFS, when a global surgery 
code is billed, the bundled pre- and post-operative care is not 
separately payable; surgeons or other physicians billing a surgical 
procedure, cannot separately bill for the E/M services that are 
included in the global surgical package.
(2) Measuring Post-Operative Work
    The use of different methodologies for valuing global surgical 
packages since 1992 has created payment rates that reflect a wide range 
of E/M services within the post-operative period. This is especially 
true among those with 90-day global periods. More recently reviewed 
codes tend to have fewer E/M services in the global period, and the 
work RVUs of those E/M services are often

[[Page 68912]]

accounted for in the value for the global surgical package. The values 
of global surgical packages reviewed less recently frequently do not 
appear to include the full work RVUs of each E/M service in the global 
surgical package, and the numbers of E/M services included in the post-
operative period can be inconsistent within a family of procedures.
    In 2005, the HHS Office of Inspector General (OIG) examined whether 
global surgical packages are appropriately valued. In its report on eye 
and ocular surgeries, ``National Review of Evaluation and Management 
Services Included in Eye and Ocular Adnexa Global Surgery Fees for 
Calendar Year 2005'' (A-05-07-00077), the OIG reviewed a sample of 300 
eye and ocular surgeries, and counted the actual number of face-to-face 
services in the surgeons' medical records to establish whether the 
surgeon furnished post-operative E/M services. The OIG findings show 
that surgeons typically furnished fewer E/M services in the post-
operative period than were identified with the global surgical package 
payment for each procedure. A smaller percentage of surgeons furnished 
more E/M services than were identified with the global surgical package 
payment. The OIG could only review the number of face-to-face services 
and was not able to review the level of the E/M services that the 
surgeons furnished due to a lack of documentation in surgeons' medical 
records. The OIG concluded that the RVUs for the global surgical 
package are too high because they include the work of E/M services that 
are not typically furnished within the global period for the reviewed 
procedures.
    Following the 2005 report, the OIG continued to investigate E/M 
services furnished during the global surgical period. In May 2012, the 
OIG published a report titled ``Musculoskeletal Global Surgery Fees 
Often Did Not Reflect the Number of Evaluation and Management Services 
Provided'' (A-05-09-00053). For this investigation, the OIG sampled 300 
musculoskeletal global surgeries and again found that, for the majority 
of sampled surgeries, physicians furnished fewer E/M services than were 
identified as part of the global period for that service. Once again, a 
smaller percentage of surgeons furnished more E/M services than were 
identified with the global surgical package payment. The OIG concluded 
that the RVUs for the global surgical package are too high because they 
include the work of E/M services that are not typically furnished 
within the global period for the reviewed procedures.
    In both reports, the OIG recommended that we adjust the number of 
E/M services identified with the global surgical payments to reflect 
the number of E/M services that are actually being furnished. Under the 
PFS, we do not ask surgeons to detail the component bundled services on 
their claim when billing for the global surgical package as we do 
providers furnishing bundled services under other Medicare payment 
systems. Since it is not necessary for a surgeon to identify the level 
or CPT code of the E/M services actually furnished during the global 
period, there is very limited documentation on the frequency or level 
of post-operative services. Without sufficient documentation, a review 
of the medical record cannot accurately determine the number or level 
of E/M services furnished in the post-operative period. This is an area 
of concern, and is discussed in more detail later in this section.
    As noted above, section 1848(c)(2)(K) of the Act, which codified 
and expanded the potentially misvalued codes initiative that CMS had 
begun, requires that the Secretary identify and review potentially 
misvalued services with an emphasis on several categories, and 
recognizes the Secretary's discretion to identify additional 
potentially misvalued codes. Several of the categories of potentially 
misvalued codes support better valuation of global surgical package 
codes. We have made efforts to prioritize the review of RVUs for 
services on the PFS that have not been reviewed recently or for 
services where there is a potential for misuse. One of the priority 
categories for review of potentially misvalued codes is services that 
have not been subject to review since the implementation of the PFS 
(the so-called ``Harvard-valued codes''). In the CY 2009 PFS proposed 
rule, we requested that the AMA RUC engage in an ongoing effort to 
review the remaining Harvard-valued codes, focusing first on the high-
volume codes (73 FR 38589). For the Fourth Five-Year Review (76 FR 
32410), we requested that the AMA RUC review services that have not 
been reviewed since the original implementation of the PFS with 
utilization greater than 30,000 (Harvard-valued--Utilization > 30,000). 
In the CY 2013 PFS proposed rule, we proposed to review Harvard-valued 
services with annual allowed charges that totaled at least $10,000,000 
(Harvard-valued--Allowed charges >=$10,000,000), and requested 
recommendations from the AMA RUC and other public commenters on 
appropriate values for these services (77 FR 44741).
    Of the more than 1,000 identified potentially misvalued codes, just 
over 650 are surgical services with a global period of 0, 10, or 90 
days. We have completed our review of 450 of these potentially 
misvalued surgical codes. As we stated in the CY 2013 PFS proposed 
rule, these efforts are important, but we believe the usual review 
process does not go far enough to assess whether the valuation of 
global surgical packages reflects the number and level of post-
operative services that are typically furnished. To support our 
statutory obligation to identify and review potentially misvalued 
services and to respond to the OIG's concern that global surgical 
package payments are misvalued, we believe that we should gather more 
information on the E/M services that are typically furnished with 
surgical procedures. Information regarding the typical work involved in 
surgical procedures with a global period is necessary to evaluate 
whether certain surgical procedures are appropriately valued. While the 
AMA RUC reviews and recommends RVUs for services on the PFS, we 
complete our own assessment of those recommendations, and may adopt 
different RVUs. However, for procedures with a global period, the lack 
of detail in claims data and documentation restrict our ability to 
review and assess the appropriateness of their RVUs.
    In the CY 2013 proposed rule, we requested comments on methods of 
obtaining accurate and current data on E/M services furnished as part 
of a global surgical package. We stated that we were especially 
interested in and invited comments on a claims-based data collection 
approach that would include reporting E/M services furnished as part of 
a global surgical package, as well as other valid, reliable, 
generalizable, and robust data to help us identify the number and level 
of E/M services typically furnished in the global surgical period for 
specific procedures.
    The following is summary of the comments we received regarding the 
methods of obtaining accurate and current data on E/M services 
furnished as part of a global surgical package proposal.
    Comment: Several commenters stated that the global payment 
methodology has restricted CMS' ability to audit the accuracy of the 
current value of services as well as the accuracy of the AMA RUC 
recommendations for services with a global period. Many commenters 
offered recommendations on how CMS could validate the current global 
surgical packages or obtain accurate and current data on E/M services 
furnished as a part

[[Page 68913]]

of the global surgical package. Some commenters recommended that CMS 
establish auditable documentation requirements for inpatient and 
outpatient post-operative visits, and many believed that these 
auditable post-operative visit notes should follow E/M documentation 
guidelines. Other commenters suggested that CMS adjust all surgical 
services to a 0-day global period, require surgeons to bill post-
operative E/M services separately for payment purposes, and subject 
those billings to the same coding and documentation standards and 
audits to which other practitioners are already subject. Several 
commenters noted that CMS could validate the global surgical packages 
with the hospital Diagnosis-Related Group (DRG) length of stay data, 
and that CMS could explore the use of surgical specialties' registries 
to collect data on services furnished within the global period. 
Commenters also suggested that CMS could draw upon the OIG's approach 
and review the medical record for a statistically valid sample of 
claims and then extrapolate those results to clinically similar 
families of codes. One commenter suggested that CMS could establish G-
codes through which a large sample of surgeons might report the number 
and intensity of post-operative visits.
    In response to our request for comments on methods of obtaining 
accurate and current data on E/M services furnished as part of a global 
surgical package, some commenters stated that they believe post-
operative work is appropriately surveyed, vetted and valued by the AMA 
RUC during its ongoing reviews of surgical procedures, and therefore, 
claims-based reporting is unnecessary in order to verify that the 
number of visits assigned to global surgical procedures is accurate. 
Some commenters stated that if CMS has concerns with a specific code, 
or group of codes, regarding the number of E/M visits valued within the 
physician work RVU, CMS should work with the AMA RUC to review these 
services. One commenter noted that there are 4,258 CPT codes on the PFS 
with a global period, but that only 271 of these CPT codes are billed 
more than 10,000 times annually, and most of the 271 CPT codes have 
been reviewed by CMS and the AMA RUC since 2005.
    Response: We thank the commenters for their recommendations on this 
important issue. We will carefully weigh all comments received as we 
consider how best to measure the number and level of visits that occur 
during the global period.
    In addition to the broader comments on measuring post-operative 
work, we also received a comment from the AMA RUC noting that the 
hospital and discharge management services included in the global 
period for many surgical procedures may have been inadvertently removed 
from the time file in 2007. With its comment letter, the AMA RUC sent 
us a revised time file with updated post-operative visits for the 
services that may be incorrectly displayed with zero visits. We are 
reviewing this file, and if appropriate, we intend to propose 
modifications to the physician time file in the CY 2014 PFS proposed 
rule. We note that should time have been removed from the physician 
time file inadvertently, it would not have affected the physician work 
RVUs or direct practice expense inputs for these services. It would 
have a small impact on the indirect allocation of practice expense at 
the specialty level, which we will review when we explore this 
potential time file change.
3. CY 2013 Identification and Review of Potentially Misvalued Services
a. Public Nomination of Potentially Misvalued Codes
    In the CY 2012 PFS final rule, we finalized a public nomination 
process for potentially misvalued codes (76 FR 73058). Under the 
previous Five-Year Reviews for PE and work, we invited the public to 
nominate potentially misvalued codes for review. To allow for public 
input and to preserve the public's ability to identify and nominate 
potentially misvalued codes for review under our annual potentially 
misvalued codes initiative, we established a process by which the 
public can submit codes, along with documentation supporting the need 
for review, on an annual basis. Stakeholders may nominate potentially 
misvalued codes for review by submitting the code with supporting 
documentation during the 60-day public comment period following the 
release of the annual PFS final rule with comment period. Supporting 
documentation for codes nominated for the annual review of potentially 
misvalued codes may include the following:
     Documentation in the peer reviewed medical literature or 
other reliable data that there have been changes in physician work due 
to one or more of the following: technique; knowledge and technology; 
patient population; site-of-service; length of hospital stay; and 
physician time.
     Evidence of an anomalous relationship between the code 
being proposed for review and other codes.
     Evidence that technology has changed physician work, that 
is, diffusion of technology.
     Analysis of other data on time and effort measures, such 
as operating room logs or national and other representative databases.
     Evidence that incorrect assumptions were made in the 
previous valuation of the service, such as a misleading vignette, 
survey, or flawed crosswalk assumptions in a previous evaluation.
     Prices for certain high cost supplies or other direct PE 
inputs that are used to determine PE RVUs are inaccurate and do not 
reflect current information.
     Analyses of physician time, work RVU, or direct PE inputs 
using other data sources (for example, Department of Veteran Affairs 
(VA) National Surgical Quality Improvement Program (NSQIP), the Society 
for Thoracic Surgeons (STS), and the Physician Quality Reporting System 
(PQRS) databases).
     National surveys of physician time and intensity from 
professional and management societies and organizations, such as 
hospital associations.
    Under this newly established process, after we receive the 
nominated codes during the 60-day comment period following the release 
of the annual PFS final rule with comment period, we evaluate the 
supporting documentation and assess whether the submitted codes appear 
to be potentially misvalued codes appropriate for review under the 
annual process. In the following year's PFS proposed rule, we publish 
the list of nominated codes, and propose -which nominated codes will be 
reviewed as potentially misvalued. We encourage the public to submit 
nominations for potentially misvalued codes in the 60-day comment 
period following the publication of this CY 2013 PFS final rule with 
comment period.

[[Page 68914]]



    Table 4--CPT Codes Nominated as Potentially Misvalued for CY 2013
                               Rulemaking
------------------------------------------------------------------------
         CPT Code            Short descriptor          CMS Action
------------------------------------------------------------------------
33282....................  Implant pat-active   Establish nonfacility
                            ht record.           inputs, and review the
                                                 work, facility and
                                                 nonfacility inputs
                                                 together. Not
                                                 considered a
                                                 potentially misvalued
                                                 code.
33284....................  Remove pat-active    Establish nonfacility
                            ht record.           inputs, and review the
                                                 work, facility and
                                                 nonfacility inputs
                                                 together. Not
                                                 considered a
                                                 potentially misvalued
                                                 code.
36819....................  Av fuse uppr arm     Review as a potentially
                            basilic.             misvalued code.
36825....................  Artery-vein          Review as a potentially
                            autograft.           misvalued code.
53445....................  Insert uro/ves nck   Interim Final in CY
                            sphincter.           2012, Final for CY
                                                 2013. Comments
                                                 addressed in section
                                                 II.M.2.a. of this CY
                                                 2013 PFS final rule
                                                 with comment period.
77336....................  Radiation physics    Review as a potentially
                            consult.             misvalued code.
94762....................  Measure blood        Adopt direct PE
                            oxygen level.        revisions discussed
                                                 below on an interim
                                                 final basis for CY
                                                 2013.
28820....................  Amputation of toe..  Last reviewed for CY
                                                 2012. No further review
                                                 required at this time.
28825....................  Partial amputation   Last reviewed for CY
                            of toe.              2012. No further review
                                                 required at this time.
35188....................  Repair blood vessel  Last reviewed for CY
                            lesion.              2012. No further review
                                                 required at this time.
35612....................  Artery bypass graft  Last reviewed for CY
                                                 2012. No further review
                                                 required at this time.
35800....................  Explore neck         Last reviewed for CY
                            vessels.             2012. No further review
                                                 required at this time.
35840....................  Explore abdominal    Last reviewed for CY
                            vessels.             2012. No further review
                                                 required at this time.
35860....................  Explore limb         Last reviewed for CY
                            vessels.             2012. No further review
                                                 required at this time.
43283....................  Lap esoph            Last reviewed for CY
                            lengthening.         2012. No further review
                                                 required at this time.
43327....................  Esoph fundoplasty    Last reviewed for CY
                            lap.                 2012. No further review
                                                 required at this time.
43328....................  Esoph fundoplasty    Last reviewed for CY
                            thor.                2012. No further review
                                                 required at this time.
43332....................  Transab esoph hiat   Last reviewed for CY
                            hern rpr.            2012. No further review
                                                 required at this time.
43333....................  Transab esoph hiat   Last reviewed for CY
                            hern rpr.            2012. No further review
                                                 required at this time.
43334....................  Transthor diaphrag   Last reviewed for CY
                            hern rpr.            2012. No further review
                                                 required at this time.
43335....................  Transthor diaphrag   Last reviewed for CY
                            hern rpr.            2012. No further review
                                                 required at this time.
43336....................  Thorabd diaphr hern  Last reviewed for CY
                            repair.              2012. No further review
                                                 required at this time.
43337....................  Thorabd diaphr hern  Last reviewed for CY
                            repair.              2012. No further review
                                                 required at this time.
43338....................  Esoph lengthening..  Last reviewed for CY
                                                 2012. No further review
                                                 required at this time.
47563....................  Laparo               Last reviewed for CY
                            cholecystectomy/     2012. No further review
                            graph.               required at this time.
49507....................  Prp i/hern init      Last reviewed for CY
                            block >5 yr.         2012. No further review
                                                 required at this time.
49521....................  Rerepair ing hernia  Last reviewed for CY
                            blocked.             2012. No further review
                                                 required at this time.
49587....................  Rpr umbil hern       Last reviewed for CY
                            block > 5 yr.        2012. No further review
                                                 required at this time.
49652....................  Lap vent/abd hernia  Last reviewed for CY
                            repair.              2012. No further review
                                                 required at this time.
49653....................  Lap vent/abd hern    Last reviewed for CY
                            proc comp.           2012. No further review
                                                 required at this time.
49654....................  Lap inc hernia       Last reviewed for CY
                            repair.              2012. No further review
                                                 required at this time.
49655....................  Lap inc hern repair  Last reviewed for CY
                            comp.                2012. No further review
                                                 required at this time.
60220....................  Partial removal of   Last reviewed for CY
                            thyroid.             2012. No further review
                                                 required at this time.
60240....................  Removal of thyroid.  Last reviewed for CY
                                                 2012. No further review
                                                 required at this time.
60500....................  Explore parathyroid  Last reviewed for CY
                            glands.              2012. No further review
                                                 required at this time.
95800....................  Slp stdy unattended  Last reviewed for CY
                                                 2012. No further review
                                                 required at this time.
------------------------------------------------------------------------

    In the 60 days following the release of the CY 2012 PFS final rule 
with comment period, we received nominations and supporting 
documentation for review of the codes listed above in Table 4. A total 
of 36 CPT codes were nominated. The majority of the nominated codes 
were codes for which we finalized RVUs in the CY 2012 PFS final rule. 
That is, the RVUs were interim in CY 2011 and finalized for CY 2012, or 
proposed in either the Fourth Five-Year Review of Work or the CY 2012 
PFS proposed rule and finalized for CY 2012. In the CY 2013 proposed 
rule, we noted that under this annual public nomination process it 
would be highly unlikely that we would determine that a nominated code 
is appropriate for review under the potentially misvalued codes 
initiative if it had been reviewed in the years immediately preceding 
its nomination since we believe that the best information on the level 
of physician work and PE inputs already would have been available 
through that recent review. We stated that, nonetheless, we would 
evaluate the supporting documentation for each nominated code to 
ascertain whether the submitted information demonstrated that the code 
is potentially misvalued.
    CPT codes 33282 (Implantation of patient-activated cardiac event 
recorder) and 33284 (Removal of an implantable, patient-activated 
cardiac event recorder) were nominated for review as potentially 
misvalued codes. The requestor stated that CPT codes 33282 and 33284 
are misvalued in the nonfacility setting because these CPT codes 
currently are only priced in the facility setting even though 
physicians furnish these services in the office setting. The requestor 
asked that we establish appropriate payment for the services when 
furnished in a physician's office. Specifically, the requestor asked 
that CMS establish nonfacility PE RVUs for these services. In the CY 
2013 proposed rule, we stated that we do not consider the lack of 
pricing in a particular setting as an indicator of a potentially 
misvalued code. However, given that these services are now furnished in 
the nonfacility setting, we believe that CPT codes 33282 and 33284 
should be reviewed to establish appropriate nonfacility inputs. We 
noted, as did the requestor, that the valuation of a service under the 
PFS in a particular setting does not address whether those services and 
the setting in which they are furnished are medically reasonable and 
necessary for a patient's medical needs and condition. We proposed to 
review CPT codes 33282 and 33284 and requested recommendations from the 
AMA RUC and other public commenters on the appropriate physician work 
RVUs (as measured by time and intensity), and facility and nonfacility 
direct PE inputs for these services.
    Like CPT codes 33282 and 33284, stakeholders requested that we 
establish appropriate payment for CPT code 63650 (Percutaneous 
implantation of neurostimulator electrode array, epidural) when 
furnished in an office

[[Page 68915]]

setting. In the CY 2013 proposed rule, we noted that this request was 
not submitted as a potentially misvalued code nomination. However, 
given that these services are now furnished in the nonfacility setting, 
we stated that we believed CPT code 63650 should be reviewed to 
establish appropriate nonfacility inputs. Please see section III.A.3 
(Changes to Direct Inputs for Specific Services) for a discussion of 
spinal code stimulation trial procedures in the nonfacility setting.
    The following is a summary of the comments we received in response 
to our proposal to review the physician work, facility, and nonfacility 
direct PE inputs for CPT codes 33282 and 33284.
    Comment: Several commenters did not support our proposal to review 
CPT codes 33282 and 33284. Commenters stated that the very low 
utilization in the nonfacility setting does not justify a review of the 
codes for nonfacility PE inputs. One commenter noted that physicians 
are not interested in furnishing these services in the nonfacility 
setting due to concerns for patient safety. Commenters recommended that 
we not consider establishing nonfacility PE RVUs for these CPT codes 
until additional studies indicate a clinical need to furnish these 
services in the nonfacility setting. Additionally, commenters stated 
that they do not believe it is necessary to review physician work and 
PE in the facility setting, as that was not the concern that the 
stakeholder brought forward. The AMA RUC stated that it continues to 
support the current work RVUs and facility PE inputs for these 
services.
    Another commenter recommended that CMS finalize the proposal to 
revalue CPT codes 33282 and 33284 in order to establish nonfacility PE 
RVUs. The commenter stated that the lack of nonfacility PE RVUs 
prevents physicians from furnishing these services in the office for 
select patients for whom this setting of care is safe and appropriate. 
This commenter recommended that CMS maintain the existing work RVUs, 
and focus the revaluation on the nonfacility PE inputs. The commenter 
requested that CMS remain flexible in its approach to nominated codes 
and allow for more expeditious review of codes by not requiring full 
provider surveys.
    Response: After reviewing the comments received, we are finalizing 
our proposal to review the physician work, and facility and nonfacility 
direct PE inputs for CPT codes 33282 and 33284. We acknowledge that we 
received very few Medicare claims for these services in the nonfacility 
setting in CY 2011; nonetheless, we believe it is appropriate to 
consider the relative resources involved in furnishing this service in 
the nonfacility setting. We reiterate that the valuation of a service 
under the PFS in a particular setting does not address whether those 
services and the setting in which they are furnished are medically 
reasonable and necessary for a patient's medical needs and condition.
    We acknowledge that commenters support the current work and 
facility RVUs, however, it is our policy generally to review the 
physician work, facility, and nonfacility direct PE inputs for each 
service together to ensure consistency in the inputs used to value the 
service. Based on information provided by the requestor and the 2011 
nonfacility utilization for this code, we believe it is appropriate to 
review this service for nonfacility PE inputs. As explained above, we 
intend to review the work and facility inputs as well. Additionally, we 
note that the physician work and facility PE inputs for these two 
services have not been reviewed in over a decade, so we believe it is 
reasonable to assess whether the inputs on which the current payment 
rates are based accurately reflect the resources involved in furnishing 
these services today. Accordingly, we are finalizing our proposal to 
review the physician work, and facility and nonfacility direct practice 
expense inputs for CPT codes 33282 and 33284, and request comments on 
the appropriate physician work, and facility and nonfacility direct 
practice expense inputs for these services.
    Traditionally, we have received recommendations from the AMA RUC on 
the appropriate physician work, PE, and malpractice inputs for services 
CMS plans to review and revalue. However, we understand that the AMA 
RUC may not issue recommendations for all codes under review by CMS. In 
addition to requesting recommendations from the AMA RUC on services we 
intend to review, we request and encourage recommendations on these 
services from other public commenters as well. We acknowledge the 
requestor's comment that CMS remain flexible in its approach to 
nominated codes and not require full practitioner surveys for CPT codes 
33282 and 33284. We understand that practitioner surveys regarding 
work, malpractice, and PE are not always available, practical, or 
reliable. We encourage commenters to submit the best data available on 
the appropriate valuation and inputs for the services under review, 
including the information listed above under supporting documentation 
for the nomination of potentially misvalued codes.
    In the CY 2013 proposed rule, we stated that we did not consider 
CPT codes 36819 (Arteriovenous anastomosis, open; by upper arm basilic 
vein transposition) and 36825 (Creation of arteriovenous fistula by 
other than direct arteriovenous anastomosis (separate procedure); 
autogenous graft) to be potentially misvalued because these codes were 
last reviewed and valued for CY 2012 and the supporting documentation 
did not provide sufficient evidence to demonstrate that the codes 
should be reviewed as potentially misvalued for CY 2013 or CY 2014. The 
following is a summary of the comments we received in response to our 
proposal not to review CPT codes 36819 and 36825 as potentially 
misvalued codes.
    Comment: One commenter reiterated its belief that CPT codes 36819 
and 36825 are potentially misvalued because the work RVUs finalized by 
CMS in CY 2012 place these services out of rank order with services 
that involve similar resources. To support this position, the commenter 
provided a list showing these services relative to all services with a 
similar global period, intra-service time, and work RVU. The commenter 
also restated the rationale previously submitted to CMS when it 
nominated these services as potentially misvalued. The commenter 
requested that CMS reconsider the work RVUs of these two services.
    Response: After reviewing the comments received and conducting a 
clinical review of CPT codes 36819 and 36825 alongside similar 
services, we agree with the commenter that these services may be out of 
rank order and are potentially misvalued. Therefore, we are modifying 
our proposal to not review CPT codes 36819 and 36825 as potentially 
misvalued codes. We will review CPT codes 36819 and 36825 along with 
their code families, which include CPT codes 36818 through 36821 and 
CPT codes 36825 through 36830, as potentially misvalued. We thank 
commenters for the additional supporting documentation provided, and 
request additional comments on the appropriate physician work and 
direct PE inputs for these services.
    CPT code 53445 (Insertion of inflatable urethral/bladder neck 
sphincter, including placement of pump, reservoir, and cuff) was 
nominated for review as a potentially misvalued code. CPT code 53445 
was identified through the site-of-service anomaly potentially 
misvalued code screen for CY 2008. We completed our review and 
established RVUs for this

[[Page 68916]]

code on an interim basis for CY 2012 subject to public comment. In the 
CY 2013 proposed rule, we stated that we would consider the supporting 
documentation submitted under the potentially misvalued code nomination 
process for CPT code 53445 as comments on the CY 2012 interim final 
value, and would address the comments in the CY 2013 PFS final rule 
with comment period when we address the final value of the CPT code. A 
summary of the comments received on CPT code 53445 and our response to 
those comments is included in section II.M.2 of this final rule with 
comment period.
    CPT code 77336 (Continuing medical physics consultation, including 
assessment of treatment parameters, quality assurance of dose delivery, 
and review of patient treatment documentation in support of the 
radiation oncologist, reported per week of therapy) was nominated for 
review as a potentially misvalued code. The requestor stated that CPT 
code 77336 is misvalued because changes in the technique for furnishing 
continuing medical physics consultations have resulted in changes to 
the knowledge required, time, and effort expended, and complexity of 
technology associated with the tasks performed by the physicist and 
other staff. Additionally the requestor stated that the direct PE 
inputs no longer accurately reflect the resources used to deliver this 
service and may be undervalued. CPT code 77336 was last reviewed for CY 
2003. In the CY 2013 proposed rule, we stated that after evaluating the 
detailed supporting information that the commenter provided, we 
believed there may have been changes in technology and other PE inputs 
since we last reviewed the service, and that further review is 
warranted. As such, we proposed to review CPT code 77336 as potentially 
misvalued and requested recommendations from the AMA RUC and other 
public commenters on the direct PE inputs for this service and for the 
other services within this family of CPT codes.
    The following is a summary of the comments we received in response 
to our proposal to review CPT code 77336 as potentially misvalued.
    Comment: Commenters supported the CMS proposal to review CPT code 
77336 and urged CMS to finalize it. The AMA RUC stated that it would 
review this service and provide recommendations to CMS on its 
valuation. Several commenters reiterated their rationale for why they 
believe CPT code 77336 is potentially misvalued and provided supporting 
documentation. Additionally, commenters indicated that the American 
Society for Physicists in Medicine (AAPM) would submit information on 
practice expense inputs and other data to support the revaluation of 
this CPT code, and expressed appreciation that CMS is willing to 
consider data and input from professional medical societies that do not 
participate in the AMA RUC process.
    Response: After reviewing the comments received, we continue to 
believe that changes in technology may have altered the direct practice 
expense inputs associated with CPT code 77336 and are finalizing our 
proposal to review this service as potentially misvalued. We thank 
commenters for the supporting documentation provided, and request 
additional comments on the appropriate direct PE inputs for this 
service, as well as any other services that may be within this family 
of CPT codes.
    CPT code 94762 (Noninvasive ear or pulse oximetry for oxygen 
saturation; by continuous overnight monitoring (separate procedure)) 
was nominated for review as a potentially misvalued code. Requestors 
stated that CPT code 94762 is misvalued because the time currently 
allocated to the various direct PE inputs does not accurately reflect 
current practice. Requestors also stated that independent diagnostic 
testing facilities are not appropriately accounted for in the current 
indirect PE methodology. In the CY 2013 proposed rule, we stated that, 
in response to these stakeholder concerns, we reviewed the PE inputs 
for CPT code 94762, which was last reviewed for CY 2010. We believed 
that CPT code 94762 is misvalued, and we proposed changes to the PE 
inputs for CY 2013. We stated that, following clinical review, we 
believed that the current time allocated to clinical labor and supplies 
appropriately reflects current practice. However, we believed that 480 
minutes (8 hours) of equipment time for the pulse oximetry recording 
slot and pulse oximeter with printer are more appropriate for this 
overnight monitoring procedure code. As such, we proposed this 
refinement to the direct PE inputs for CPT code 94762 for CY 2013. 
These proposed adjustments were reflected in the CY 2013 proposed 
direct PE input database, available on the CMS Web site under the 
downloads for the CY 2013 PFS final rule with comment period at http://www.cms.gov/PhysicianFeeSched/.
    The following is a summary of the comments received regarding the 
proposed direct PE adjustments to CPT code 94762.
    Comment: Many commenters agreed with CMS' proposal to refine the 
equipment minutes for this service to 480 minutes. One commenter 
suggested that CMS should increase the proposed allocation of minutes 
to account for the time that the equipment is unavailable for use 
because the patient has yet to return it to the office.
    Response: We appreciate the support for the proposal. We believe 
that the appropriate allocation of minutes for the equipment is the sum 
of the times within the intra-service period when a clinician is using 
the piece of equipment, plus any additional time the piece of equipment 
is not available for use for another patient due to its use during the 
designated procedure. However, we also note that the equipment cost per 
minute calculation incorporates a utilization rate assumption that 
appropriately accounts for the time the equipment cannot be used 
because it is being transported to and from the office or between 
patients. Therefore, we are not revising our proposed adjustment to the 
equipment time.
    Comment: Several commenters supported the proposed allocation of 
minutes to the equipment and also submitted invoices and other evidence 
for updating the direct PE inputs for the service. The AMA RUC and 
others submitted information to update the pulse oximeter and the 
recording software used in the service. The information submitted by 
the AMA RUC reflects a pulse oximeter priced at $1,418 and recording 
software priced at $990. Other commenters submitted various disposable 
supplies that might be used to furnish the service, including varying 
types of batteries, oximeter cables, and wristbands that might be used 
when furnishing this service.
    Response: We appreciate the updated information furnished to us by 
stakeholders and other commenters. While we generally urge stakeholders 
to submit such price update requests through the process for updating 
supply and equipment prices we established for CY 2011, because we made 
a proposal specifically related to the equipment minutes allocated for 
this procedure, we believe it would be appropriate to consider the 
supplies and equipment price inputs associated with the service in 
conjunction with the proposal to change the equipment minutes. Based on 
the invoice information we received from commenters, we will update the 
price of the `pulse oximetry recording software (prolonged monitoring)' 
(EQ212) and include a new equipment item ``Pulse Oximeter 920 M Plus'' 
priced at $1,418 as equipment inputs for

[[Page 68917]]

the code. In reviewing the requested supply items to include, we 
believe that it would be appropriate to include 6 AA batteries (SK095) 
as a disposable supply for the service as well as incorporate a new 
item, a disposable oximeter cable, priced at $11.08.
    Based on these comments and our clinical review, we are adopting 
these direct PE inputs, including our adjusted allocation of equipment 
minutes, on an interim basis for CY 2013. These values are reflected in 
the CY 2013 PFS direct PE input database available under downloads for 
the CY 2013 PFS final rule with comment period on the CMS Web site at: 
http://www.cms.gov/PhysicianFeeSched/PFSFRN/list.asp#TopOfPage. We also 
note that the PE RVUs included in Addenda B and C reflect these interim 
direct PE inputs.
    In the CY 2013 proposed rule, we stated that we did not consider 
the nominated codes that were last reviewed and valued for CY 2012 to 
be potentially misvalued because the supporting documentation did not 
provide sufficient evidence to demonstrate that the codes should be 
reviewed as potentially misvalued for CY 2013 or CY 2014. The 
supporting documentation for these services generally mirrored the 
public comments previously submitted, to which CMS has already 
responded. Below is a summary of the comments we received in response 
to our proposal to not review the CPT codes listed above in Table 4 not 
discussed above.
    Comment: We received a few limited comments on the nominated codes 
not previously discussed above, however, like the code nominations, the 
comments and supporting documentation for these services mirrored the 
public comments previously submitted, to which CMS has already 
responded.
    Response: Having received no new information on the CPT codes 
listed in Table 4 not previously discussed, we are finalizing our 
proposal not to review those services as potentially misvalued.
b. Potentially Misvalued Code Lists
    As mentioned above, in the last several annual PFS proposed rules 
we have identified lists of potentially misvalued codes for review. We 
believe it is imperative that we continue to identify new lists of 
potentially misvalued codes for review to appropriately identify, 
review, and adjust values for potentially misvalued codes for CY 2013.
(1) Review of Harvard-Valued Services With Medicare Allowed Charges of 
$10,000,000 or More
    For many years, we have been reviewing `Harvard-valued' CPT codes 
through the potentially misvalued code initiative. The RVUs for 
Harvard-valued CPT codes have not been reviewed since they were 
originally valued in the early 1990s at the beginning of the PFS. While 
the principles underlying the relative value scale have not changed, 
over time the methodologies we use for valuing services on the PFS have 
changed, potentially disrupting the relativity between the remaining 
Harvard-valued codes and other codes on the PFS. At this time, nearly 
all CPT codes that were Harvard-valued and had Medicare utilization of 
over 30,000 allowed services per year have been reviewed. In the CY 
2013 PFS proposed rule, we proposed to review Harvard-valued services 
with annual Medicare allowed charges of $10 million or greater. The CPT 
codes meeting these criteria have relatively low Medicare utilization 
(as we have reviewed the services with utilization over 30,000), but 
account for significant Medicare spending annually and have never been 
reviewed. In the CY 2013 proposed rule, we noted that several of the 
CPT codes meeting these criteria have already been identified as 
potentially misvalued through other screens and were scheduled for 
review for CY 2013. We also recognized that other codes meeting these 
criteria had been referred by the AMA RUC to the CPT Editorial Panel. 
We stated that, in these cases, we were not proposing re-review of 
these already identified services, but for the sake of completeness, we 
included those codes as a part of this category of potentially 
misvalued services. In our proposal, we recognized that the relatively 
low Medicare utilization for these services may make gathering 
information on the appropriate physician work and direct PE inputs 
difficult. We requested recommendations from the AMA RUC and other 
public commenters, and stated that we appreciate efforts expended to 
provide RVU and input recommendations to CMS for these lower volume 
services. Because survey sample sizes could be small for these lower 
volume services, we encouraged the use of valid and reliable 
alternative data sources and methodologies when developing recommended 
values. In sum, we proposed to review Harvard-valued CPT codes with 
annual allowed charges of $10 million or more as a part of the 
potentially misvalued codes initiative. In the CY 2013 proposed rule, 
we stated that the following codes met the criteria for this screen and 
proposed to review these CPT codes as potentially misvalued services.

 Table 5--Proposed Harvard-Valued CPT Codes With Annual Allowed Charges
                              >=$10,000,000
------------------------------------------------------------------------
               CPT Code                         Short descriptor
------------------------------------------------------------------------
13152 *..............................  Repair of wound or lesion.
27446................................  Revision of knee joint.
29823................................  Shoulder arthroscopy/surgery.
36215 **.............................  Place catheter in artery.
36245 **.............................  Ins cath abd/l-ext art 1st.
43264 **.............................  Endo cholangiopancreatograph.
50360................................  Transplantation of kidney.
52353 *..............................  Cystouretero w/lithotripsy.
64450 *..............................  N block other peripheral.
64590................................  Insrt/redo pn/gastr stimul.
66180................................  Implant eye shunt.
67036................................  Removal of inner eye fluid.
67917................................  Repair eyelid defect.
92286 **.............................  Internal eye photography.
92982 *..............................  Coronary artery dilation.
95860 *..............................  Muscle test one limb.
------------------------------------------------------------------------
* Scheduled for CY 2012 AMA RUC Review.
** Referred by the AMA RUC to the CPT Editorial Panel.

    The following is summary of the comments we received in response to 
our proposal to review Harvard-valued CPT codes with annual allowed 
charges of $10 million or more as a part of the potentially misvalued 
codes initiative.
    Comment: Comments on this proposal were specific to the CPT codes 
we proposed to review under this potentially misvalued code screen. A 
few commenters noted that CPT code 64590 (Insertion or replacement of 
peripheral or gastric neurostimulator pulse generator or receiver, 
direct or inductive coupling) does not have annual allowed charges that 
meet the threshold of $10 million and stated that the code should be 
removed from the list. These commenters requested that CMS reexamine 
this list to ensure all codes meet the specified criteria. Other 
commenters pointed out that certain codes on the list are already 
scheduled for review by the medical specialty societies and the AMA 
RUC, and that some codes are scheduled for deletion by the CPT 
Editorial Panel. The AMA RUC stated that it would discuss the list of 
codes that meet the criteria for this screen and would determine the 
next steps in the AMA RUC's review of these services.
    Response: After reviewing the comments received, and reexamining 
the Medicare claims data, we agree with commenters that CPT code 64590 
does not have annual Medicare allowed charges of $10 million or 
greater, nor do CPT codes 29823 (Arthroscopy,

[[Page 68918]]

shoulder, surgical; debridement, extensive) and 95860 (Needle 
electromyography; 1 extremity with or without related paraspinal 
areas). In compiling the list, we inadvertently included allowed 
charges incurred in the ambulatory surgical center setting. We thank 
commenters for bringing this to our attention. Therefore, we have 
removed these three services from the proposed list of CPT codes that 
are Harvard-value with annual allowed charges of $10 million or 
greater.
    In the CY 2013 proposed rule, we noted that several codes that met 
the criteria for this potentially misvalued code screen were currently 
under review for CY 2013 and others were scheduled for review by the 
CPT Editorial Panel. CPT codes 13152 (Repair, complex, eyelids, nose, 
ears and/or lips; 2.6 cm to 7.5 cm), 52353 (Cystourethroscopy, with 
ureteroscopy and/or pyeloscopy; with lithotripsy (ureteral 
catheterization is included)), 64450 (Injection, anesthetic agent; 
other peripheral nerve or branch), 92286 (Special anterior segment 
photography with interpretation and report; with specular endothelial 
microscopy and cell count), and 95860 (Needle electromyography; 1 
extremity with or without related paraspinal areas) were reviewed for 
CY 2013. A discussion of the interim final values for those services is 
in section III.M.3. of this final rule with comment period. CPT code 
92982 (Percutaneous transluminal coronary balloon angioplasty; single 
vessel) has been deleted by the CPT Editorial Panel for CY 2013. We 
have updated the list of CPT codes meeting this potentially misvalued 
code screen to show the review status of the codes, and to remove the 
three CPT codes mentioned above that do not meet the parameters of the 
screen. We are finalizing the list of Harvard-valued CPT codes with 
annual allowed charges of $10 million or more in Table 6, and for CY 
2014, we will review the services not already reviewed. We request 
public comments on the appropriate work RVUs and direct practice 
expense inputs for these services.

                   Table 6--Harvard-Valued CPT Codes With Annual Allowed Charges >=$10,000,000
----------------------------------------------------------------------------------------------------------------
            CPT code                  Short descriptor                          Review status
----------------------------------------------------------------------------------------------------------------
13152..........................  Repair of wound or lesion.  Interim Final for CY 2013.
27446..........................  Revision of knee joint....  Review for CY 2014.
36215..........................  Place catheter in artery..  Review for CY 2014.
36245..........................  Ins cath abd/l-ext art 1st  Review for CY 2014.
43264..........................  Endo                        Review for CY 2014.
                                  cholangiopancreatograph.
50360..........................  Transplantation of kidney.  Review for CY 2014.
52353..........................  Cystouretero w/lithotripsy  Interim Final for CY 2013.
64450..........................  N block other peripheral..  Interim Final for CY 2013.
66180..........................  Implant eye shunt.........  Review for CY 2014.
67036..........................  Removal of inner eye fluid  Review for CY 2014.
67917..........................  Repair eyelid defect......  Review for CY 2014.
92286..........................  Internal eye photography..  Interim Final for CY 2013.
92982..........................  Coronary artery dilation..  Deleted for CY 2013.
----------------------------------------------------------------------------------------------------------------

 (2) Review of Services With Stand Alone PE Procedure Time
    Improving the accuracy of procedure time assumptions used in PFS 
ratesetting continues to be a high priority of the potentially 
misvalued codes initiative. Procedure time is a critical measure of the 
resources typically used in furnishing particular services to Medicare 
beneficiaries, and procedure time assumptions are an important 
component in the development of work and PE RVUs. Discussions in the 
academic community have indicated that certain procedure times used for 
PFS ratesetting are overstated (McCall, N., J. Cromwell, et al. (2006). 
``Validation of physician survey estimates of surgical time using 
operating room logs.'' Med Care Res Rev 63(6): 764-777. Cromwell, J., 
S. Hoover, et al. (2006). ``Validating CPT typical times for Medicare 
office evaluation and management (E/M) services.'' Med Care Res Rev 
63(2): 236-255. Cromwell, J., N. McCall, et al. (2010). ``Missing 
productivity gains in the Medicare physician fee schedule: where are 
they?'' Med Care Res Rev 67(6): 236-255.) MedPAC and others have 
emphasized the importance of using the best available procedure time 
information in establishing accurate PFS payment rates. (MedPAC, Report 
to the Congress: Aligning Incentives in Medicare, June 2010, p. 230)
    In recent years, CMS and the AMA RUC have taken steps to consider 
the accuracy of available data regarding procedure times used in the 
valuation of the physician work component of PFS payment. Generally, 
the AMA RUC derives estimates of physician work time from survey 
responses, and the AMA RUC reviews and analyzes those responses as part 
of its process for developing a recommendation for physician work. 
These procedure time assumptions are also used in determining the 
appropriate direct PE input values used in developing nonfacility PE 
RVUs. Specifically, physician intra-service time serves as the basis 
for allocating the appropriate number of minutes within the service 
period to account for the time used in furnishing the service to the 
patient. The number of intra-service minutes, or occasionally a 
particular proportion thereof, is allocated to both the clinical staff 
that assists the physician in furnishing the service and to the 
equipment used by either the physician or the staff in furnishing the 
service. This allocation reflects only the time the beneficiary 
receives treatment and does not include resources used immediately 
prior to or following the service. Additional minutes are often 
allocated to both clinical labor and equipment resources in order to 
account for the time used for necessary preparatory tasks immediately 
preceding the procedure or tasks typically performed immediately 
following it. For codes without physician work, the procedure times 
assigned to the direct PE inputs for such codes assume that the 
clinical labor performs the procedure. For these codes, the number of 
intra-service minutes assigned to clinical staff is independent and not 
based on any physician intra-service time assumptions. Consequently, 
the procedure time assumptions for these kinds of services have not 
been subject to all of the same mechanisms recently used by the AMA RUC 
and physician community in providing recommendations to CMS, and by CMS 
in the valuation of the physician work component of PFS payment. These

[[Page 68919]]

independent clinical labor time assumptions largely determine the RVUs 
for the procedure. To ensure that procedure time assumptions are as 
accurate as possible across the Medicare PFS, we believe that codes 
without physician work should be examined with the same degree of 
scrutiny as services with physician work.
    For CY 2012, a series of radiation treatment services were reviewed 
as part of the potentially misvalued code initiative. Among these were 
intensity modulated radiation therapy (IMRT) delivery services and 
stereotactic body radiation therapy (SBRT) delivery services reported 
with CPT codes 77418 (Intensity modulated treatment delivery, single or 
multiple fields/arcs, via narrow spatially and temporally modulated 
beams, binary, dynamic MLC, per treatment session) and 77373 
(Stereotactic body radiation therapy, treatment delivery, per fraction 
to 1 or more lesions, including image guidance, entire course not to 
exceed 5 fractions), respectively. CPT code 77418 (IMRT treatment 
delivery) had been identified as potentially misvalued based on 
Medicare utilization data that indicated both fast growth in 
utilization and frequent billing with other codes. We identified this 
code as potentially misvalued in the CY 2009 PFS proposed rule (73 FR 
38586). CPT code 77373 (SBRT treatment delivery) had been identified as 
potentially misvalued by the RUC as a recently established code 
describing services that use new technologies. There is no physician 
work associated with either of these codes since other codes are used 
to bill for planning, dosimetry, and radiation guidance. Both codes are 
billed per treatment session. Because the physician work associated 
with these treatments is reported using codes distinct from the 
treatment delivery, the primary determinant of PE RVUs for these codes 
is the number of minutes allocated for the procedure time to both the 
clinical labor (radiation therapist) and the resource-intensive capital 
equipment included as direct PE inputs.
    In the CY 2012 PFS final rule with comment period, we received and 
accepted without refinement PE recommendations from the AMA RUC for 
these two codes. (We received the recommendation for CPT code 77418 
(IMRT treatment delivery) too late in 2010 to be evaluated for CY 2011 
and it was therefore included in the CY 2012 rulemaking cycle.) The AMA 
RUC recommended minor revisions to the direct PE inputs for the code to 
eliminate duplicative clinical labor, supplies, and equipment to 
account for the frequency with which the code was billed with other 
codes. For CPT code 77373 (SBRT treatment delivery), the RUC 
recommended no significant changes to the direct PE inputs.
    Subsequent to the publication of the final rule, the AMA RUC and 
other stakeholders informed CMS that the direct PE input recommendation 
forwarded to CMS for IMRT treatment delivery (CPT code 77418) 
inadvertently omitted seven equipment items typically used in 
furnishing the service. These items had been used as direct PE inputs 
for the code prior to CY 2012. There is broad agreement among 
stakeholders that these seven equipment items are typically used in 
furnishing the services described by CPT code 77418. We were unable to 
reincorporate the items for CY 2012. These omitted items are listed in 
Table 7. In consideration of the comments from the AMA RUC and other 
stakeholders, we proposed to include the seven equipment items omitted 
from the RUC recommendation for CPT code 77418. These proposed 
adjustments were reflected in the CY 2013 proposed direct PE input 
database, available on the CMS Web site under the downloads for the CY 
2013 PFS proposed rule with comment period at http://www.cms.gov/PhysicianFeeSched/. We note that the proposed PE RVUs included in 
Addendum B reflected the proposed updates.

 Table 7--Equipment Inputs Omitted From RUC Recommendation for CPT Code
                     77418 (IMRT Treatment Delivery)
------------------------------------------------------------------------
          Equipment code                    Equipment description
------------------------------------------------------------------------
ED011.............................  computer system, record and verify.
ED035.............................  video camera.
ED036.............................  video printer, color (Sony medical
                                     grade).
EQ139.............................  intercom (incl. master, pt
                                     substation, power, wiring).
ER006.............................  IMRT physics tools.
ER038.............................  isocentric beam alignment device.
ER040.............................  laser, diode, for patient
                                     positioning (Probe).
------------------------------------------------------------------------

    It has come to our attention that there are discrepancies between 
the procedure time assumptions used in establishing nonfacility PE RVUs 
for these services and the procedure times made widely available to 
Medicare beneficiaries and the general public. Specifically, the direct 
PE inputs for IMRT treatment delivery (CPT code 77418) reflect a 
procedure time assumption of 60 minutes. These procedure minutes were 
first assigned to the code for CY 2002 based on a recommendation from 
the AMA RUC indicating that the typical treatment time for the IMRT 
patient was 40 to 70 minutes. The most recent RUC recommendation that 
CMS received for CY 2012 rulemaking supported the procedure time 
assumption of 60 minutes.
    Information available to Medicare beneficiaries and the general 
public indicates that IMRT sessions typically last between 10 and 30 
minutes. For example, the American Society for Radiation Oncology 
(ASTRO) publishes a patient fact sheet that explains that for all 
external beam radiation therapy, including IMRT, ``treatment is 
delivered in a series of daily sessions, each about 15 minutes long.'' 
[``Radiation Therapy for Prostate Cancer: Facts to Help Patients Make 
an Informed Decision'' available for purchase at www.astro.org/MyASTRO/Products/Product.aspx?AstroID=6901.] This fact sheet is intended for 
patients with prostate cancer, the typical diagnosis for Medicare 
beneficiaries receiving IMRT. Similarly, the American College of 
Radiology (ACR) and the Radiological Society of North America (RSNA) 
co-sponsor a Web site for patients called http://radiologyinfo.org that 
states that IMRT ``treatment sessions usually take between 10 and 30 
minutes.''
    The direct PE inputs for SBRT treatment delivery (CPT code 77373) 
reflect a procedure time assumption of 90 minutes. These procedure 
minutes were first assigned to the code for CY 2007 based on a 
recommendation from the AMA RUC. The most recent RUC recommendation 
that CMS received for CY 2012 rulemaking supported continuing that 
procedure time assumption.
    In 2012, information available to Medicare beneficiaries and the 
general public states that SBRT treatment typically lasts no longer 
than 60 minutes. For example, the American College of Radiology (ACR) 
and the Radiological Society of North America (RSNA) Web site, http://radiologyinfo.org, states that SBRT ``treatment can take up to one 
hour.''
    Given the importance of the procedure time assumption in the 
development of RVUs for these services, using the best available 
information is critical to ensuring that these services are valued 
appropriately. We believe medical societies and practitioners strive to 
offer their cancer patients accurate information regarding the IMRT or 
SBRT treatment experience. Therefore, we believe that the typical 
procedure time for IMRT delivery is between 10 and 30 minutes and that 
the

[[Page 68920]]

typical procedure time for SBRT delivery is under 60 minutes. The 
services are currently valued using procedure time assumptions of 60 
and 90 minutes, respectively. We believe these procedure time 
assumptions, distinct from necessary preparatory or follow-up tasks by 
the clinical labor, are outdated and need to be updated using the best 
information available.
    While we generally have not used publicly available resources to 
establish procedure time assumptions, we believe that the procedure 
time assumptions used in setting payment rates for the Medicare PFS 
should be derived from the most accurate information available. In the 
case of these services, we believe that the need to reconcile the 
discrepancies between our existing assumptions and more accurate 
information outweighs the potential value in maintaining relativity 
offered by only considering data from one source. We proposed to adjust 
the procedure time assumption for IMRT delivery (CPT code 77418) to 30 
minutes. We proposed to adjust the procedure time assumption for SBRT 
delivery (CPT code 77373) to 60 minutes. These procedure time 
assumptions reflect the maximum number of minutes reported as typical 
in publicly available information. We note that in the case of CPT code 
77418, the `accelerator, 6-18 MV' (ER010) and the `collimator, 
multileaf system w-autocrane' (ER017) are used throughout the procedure 
and currently have no minutes allocated for preparing the equipment, 
positioning the patient, or cleaning the room. Since these clinical 
labor tasks are associated with related codes typically reported at the 
same time, we also proposed to allocate minutes to these equipment 
items to account for their use immediately before and following the 
procedure. All of these proposed adjustments are reflected in the CY 
2013 proposed direct PE input database, available on the CMS Web site 
under the downloads for the CY 2013 PFS final rule with comment period 
at http://www.cms.gov/PhysicianFeeSched/. We also note that the 
proposed PE RVUs included in Addendum B reflect the proposed updates. 
We requested recommendations from the AMA RUC and other public 
commenters on the direct PE inputs for these services.
    While we recognize that using these procedure time assumptions will 
result in payment reductions for these particular services, we believe 
such changes are necessary to appropriately value these services. 
Recent attention from popular media sources like the Wall Street 
Journal (online.wsj.com/article/SB10001424052748703904804575631222900534954.html December 7, 2010) and 
the Washington Post (www.washingtonpost.com/wp-dyn/content/article/2011/02/28/AR2011022805378.html) February 28, 2011 has encouraged us to 
consider the possibility that potential overuse of IMRT services may be 
partially attributable to financial incentives resulting from 
inappropriate payment rates. In its 2010 Report to Congress, MedPAC 
referenced concerns that financial incentives may influence how cancer 
patients are treated. In the context of the growth of ancillary 
services in physicians' offices, MedPAC recommended that improving 
payment accuracy for discrete services should be a primary tool used by 
CMS to mitigate incentives to increase volume (Report to Congress: 
Aligning Incentives in Medicare, June 2010, p. 225). We note that in 
recent years, PFS nonfacility payment rates for IMRT treatment delivery 
have exceeded the Medicare payment rate for the same service paid 
through the hospital Outpatient Prospective Payment System (OPPS), 
which includes packaged payment for image guidance also used in 
treatment delivery. We believe that such high-volume services that are 
furnished in both nonfacility and facility settings are unlikely to be 
more resource-intensive in freestanding radiation therapy centers or 
physicians' offices than when furnished in facilities like hospitals 
that generally incur higher overhead costs, maintain a 24 hour, 7 day 
per week capacity, are generally paid in larger bundles, and generally 
furnish services to higher acuity patients than the patients who 
receive services in physicians' offices or freestanding clinics. Given 
that the OPPS payment rates are based on auditable data on hospital 
costs, we believe the relationship between the OPPS and nonfacility PFS 
payment rates reflects inappropriate assumptions within the current 
direct PE inputs for CPT code 77418. The AMA RUC's most recent direct 
PE input recommendations reflect the same procedure time assumptions 
used in developing the recommendations for CY 2002. However, we believe 
that using procedure time assumptions that reflect the maximum times 
reported as typical to Medicare beneficiaries will improve the accuracy 
of those inputs and the resulting nonfacility payment rates.
    We received many comments regarding our proposal to change the 
direct PE inputs for CPT codes 77418 and 77373 based on amended 
procedure time assumptions and consideration of the comments from the 
AMA RUC and other stakeholders to include the seven equipment items 
omitted from the previous AMA RUC recommendation for CPT code 77418. 
The following is summary of the comments we received and our responses 
to those comments.
    Comment: Several commenters agreed with CMS' proposal to add the 
equipment items omitted from the AMA RUC recommendation for CPT code 
77418 to the code.
    Response: We appreciate the support for that aspect of the 
proposal.
    Comment: Many commenters disagreed with CMS' proposal to adjust the 
procedure time assumptions for these services. Some of these commenters 
stated that 35 minutes was a more appropriate estimate, but none 
presented alternative sources of objective information for determining 
accurate procedure time assumptions. Many commenters objected to CMS' 
proposal on the basis that the agency used publicly available 
information to adjust procedure times assumptions instead of basing its 
proposal on information developed through the AMA RUC process. These 
commenters stated that CMS should not finalize its proposed procedure 
time assumptions for one of four reasons: publicly available procedure 
time information does not consider the time resources required prior to 
or following the procedure, that educational information for patients 
is an inappropriate data source because such material is not subject to 
the same degree of scrutiny by the medical community as the information 
presented to the AMA RUC, that CMS only has the authority to review or 
revalue PFS services through the AMA RUC process, or that time has been 
universally inflated by the AMA RUC so that using more accurate time 
assumptions in setting the RVUs for these services would distort their 
value relative to other PFS services.
    Response: We appreciate the commenters' interest in CMS using the 
best available data to identify the time resources required to furnish 
services to Medicare beneficiaries. We address commenters' objections 
to using these patient education materials in the comment summaries and 
response paragraphs that follow.
    Comment: Many commenters stated that patient education materials 
are not an appropriate source of data because the procedure times 
conveyed through such materials may not fully account for the time 
spent positioning the patient for treatment, performing safety checks 
or the work that occurs before and after treatment. Several commenters 
explicitly stated that it is highly likely

[[Page 68921]]

that the patient education materials describe only the time the patient 
is on the treatment table.
    Response: We understand that the procedure times cited in the 
patient education materials may not include the full time for preparing 
the equipment, positioning the patient or other necessary work required 
prior to or following the procedure. The procedure time assumptions 
used in developing direct PE inputs only account for a portion of the 
service period minutes allocated to the clinical labor or the equipment 
direct PE inputs. For example, in our proposal to reduce procedure time 
assumptions for CPT code 77418, we allocated an additional seven 
minutes to the equipment beyond the procedure time assumption for 
additional tasks. These minutes reflect the standard minutes usually 
recommended by the RUC for these tasks. For example, for CY 2013 the 
AMA RUC recommended these minutes for direct PE inputs for CPT code 
31231 (Nasal endoscopy, diagnostic, unilateral or bilateral (separate 
procedure), CPT code 52287 (Cystourethroscopy with injection(s) for 
chemodenervation of the bladder), CPT code 65800 (Paracentesis of 
anterior chamber of eye (separate procedure); with diagnostic 
aspiration of aqueous), and CPT code 11311 (Shaving of epidermal or 
dermal lesion, single lesion, face ears, eyelid, nose, lips, mucous 
membrane; lesion diameter 0.6 to 1.0 cm).
    We also note that the direct PE inputs for codes describing imaging 
guidance services that are typically reported at the same time-include 
minutes for the radiation therapist to prepare the room, position the 
patient, and clean the room. Similarly, the proposed direct PE inputs 
for CPT code 77373 incorporate clinical labor and equipment minutes 
that exceed the minutes assumed for the procedure itself: 24 minutes of 
additional nurse time, 24 minutes of additional time for the radiation 
therapist, and 15 additional minutes for the medical physicist for pre-
service and post-service tasks. On the basis of these tasks, the 
equipment associated with the code has also been allocated 24 minutes 
beyond the procedure time assumption for pre-service and post-service 
work. Therefore, we do not agree with commenters who suggested that our 
proposed revisions are inappropriate because the procedure time 
reported in the patient education materials may underestimate the 
procedure time assumptions used in developing direct PE inputs. 
Instead, we believe that the typical procedure time described in the 
patient education material is generally equivalent to the minutes 
incorporated in the service period for performing the procedure. We 
already have incorporated additional minutes of clinical labor time 
into the direct PE inputs for both CPT codes 77418 and 77373 to account 
for tasks like preparing the equipment and cleaning the room in 
addition to the minutes allocated for the procedure time assumptions. 
This reflects the direct PE inputs used for most services, where we 
allocate minutes to clinical labor and medical equipment for 
preparatory or follow-up tasks in addition to the equipment time 
allocated based on the procedure time assumption. While many commenters 
stated that the procedure times reported in the publicly available 
information do not include necessary preparatory or follow-up tasks, we 
received no comments with specific objections to the number of minutes 
allocated for such tasks in conjunction with our proposal.
    Comment: The AMA RUC and some medical specialty societies expressed 
opposition to CMS using patient education materials in the process of 
setting Medicare payment rates. These commenters claimed that such 
information is not evaluated by the same standards applied to the 
extant data used as part of the AMA RUC process, so that CMS' use of 
these materials is ill-conceived.
    Response: As we stated previously, we believe medical societies and 
practitioners strive to offer their cancer patients accurate 
information regarding the IMRT or SBRT treatment experience. We believe 
that such information, especially for high-volume services, is more 
likely to reflect typical treatment times than information proffered 
solely for the purpose of developing payment rates. While many 
commenters objected in principle to the validity of the patient 
education materials, we do not believe that medical specialty societies 
and providers of care would broadly inform their patients that IMRT 
treatment would last between 10 and 30 minutes per session if the 
typical treatment session actually lasted for one hour or that SBRT 
treatment would last for no more than one hour if it typically takes 90 
minutes.
    Comment: Many commenters claimed that CMS has the responsibility to 
conduct a comprehensive, empirical review of those procedure time 
assumptions utilizing the AMA RUC if CMS has concerns with those 
assumptions.
    Response: We agree that AMA RUC review and recommendations are one 
important component in constructing payment rates under the physician 
fee schedule. While we do not agree with the commenters' statement that 
CMS has a responsibility to conduct all reviews of potentially 
misvalued codes through the AMA RUC process exclusively, we note the 
AMA RUC reviewed both CPT codes 77418 and 77373 as recently as 2010. 
Both of these services had been identified under our potentially 
misvalued code initiative. As noted above, the AMA RUC recommended 
minor revisions to the direct PE inputs for the code to eliminate 
duplicative clinical labor, supplies, and equipment to account for the 
frequency with which the code was billed with other codes. For CPT code 
77373 (SBRT treatment delivery), the AMA RUC recommended no significant 
changes to the direct PE inputs. We note that in response to this 
proposal, the AMA RUC has recently informed us that since there is no 
physician work associated with these codes, it has asked the relevant 
specialty society to conduct a survey for clinical staff time, in order 
to ensure accurate procedure times.
    Comment: Some commenters stated that CMS should only consider the 
accuracy of these procedure time assumptions relative to the procedure 
time estimates for other services. Some of these commenters claimed 
that procedure time assumptions for services across the PFS are 
inflated so that CMS should not use procedure time assumptions for 
these services that are also exaggerated.
    Response: We appreciate the commenters' concerns with maintaining 
the relativity of time used in developing relative value units. We 
understand that procedure times may be overestimated for some other PFS 
services. While we agree that maintaining the resource relativity of 
services within the payment system is very important, we also believe 
that there is no practical means for CMS or stakeholders to engage in a 
complete simultaneous review of time assumptions across all payable 
codes. As such, we must evaluate times (and other factors) and make 
adjustments in smaller increments when we find that adjustments are 
warranted. We strive to maintain relativity by reviewing all RVU 
components for a code or reviewing all codes within families where 
appropriate. Furthermore, we believe that our proposal to use more 
accurate procedure time assumptions for these services should be 
considered in the context of broader efforts to improve the accuracy of 
PFS relative values, where time is a significant component of 
developing relative values.
    Since MedPAC's March 2006 Report to the Congress, CMS has 
implemented a potentially misvalued codes initiative

[[Page 68922]]

and has taken significant steps to identify and address potentially 
misvalued codes, including establishing physician times that accurately 
reflect the resources involved in furnishing the service. For example, 
CMS has reduced the physician times for services that were originally 
valued in the inpatient setting but now are frequently performed in the 
outpatient setting, services that are frequently performed together or 
in multiple units, and services billed on the same day as an E/M 
service. Furthermore, in addition to our proposal to review services 
with stand-alone procedure time, in this CY 2013 PFS final rule with 
comment period, we also discuss recommendations on how best to 
accurately measure post-operative work in the global surgical period, 
and finalize several proposals to adjust times for services with 
anomalous times in the physician time file. Moreover, in September 
2012, we entered into two contracts to assist us in validating RVUs of 
potentially misvalued codes, which may include the validation of 
physician time elements.
    Additionally, we do not agree with the commenters' assertion that 
if time is distorted across the PFS, it is likely to be distorted with 
consistent proportionality. While the distortions may be relatively 
consistent for surveys taken at similar times or data gathered through 
similar methods, the procedure time assumptions used in developing 
practice expense inputs have not originated from consistent sources. 
The 60 minute procedure time assumption for IMRT treatment delivery, 
for example, was originally developed based on a specialty society 
survey for CY 2002.
    Through our misvalued codes initiative and other efforts, we strive 
to prioritize and review values for codes each year and work toward 
achieving greater calibration of values across the PFS over time.
    Comment: MedPAC commented that CMS should implement its proposal to 
reduce the time estimates for these codes based on the credible 
evidence presented in the proposed rule. The commission stated further 
that if stakeholders object to these changes, they should provide 
objective, valid evidence to CMS that the agency's proposed time 
estimates are too low. Furthermore, the commission expressed concerns 
about using physician surveys to develop time estimates since physician 
medical societies have a financial stake in the process. Therefore, 
MedPAC recommended that the AMA RUC should seek evidence other than the 
surveys conducted by specialty societies and that CMS may need to 
regularly collect data on service time and other variables to establish 
more accurate RVUs for practice expense and physician work.
    Response: We appreciate MedPAC's support for the proposal. We agree 
that there are many means to measure time other than through survey 
methodology, and we are open to considering robust data on procedure 
time from many sources.
    Comment: Many commenters objected to CMS' proposal to update the 
procedure time assumptions used in determining the direct PE inputs for 
these services since CMS did not propose corresponding updates to other 
direct PE inputs for the services.
    Response: We appreciate the commenters' interest in CMS' use of the 
most accurate and up-to-date information in establishing practice 
expense RVUs for these services. We note that we recently received 
direct PE input recommendations from the AMA RUC for these services and 
used them to establish interim final direct PE inputs for CY 2012. We 
also note that in the CY 2011 PFS final rule (75 FR 73205 through 
73207) we established a public process for updating prices for supplies 
and equipment used as direct PE inputs. Prior to making our CY 2013 
proposal regarding procedure times for the IMRT and SBRT codes, we had 
received no requests to update prices for the inputs associated with 
these codes.
    Comment: Several commenters submitted specific information 
regarding appropriate input revisions for CPT codes 77418 and 77373. 
Several commenters (including the AMA RUC) suggested that IMRT 
treatment requires two radiation therapists, working simultaneously, to 
furnish the service safely. Others suggested that the linear 
accelerator (ER010) and collimator (ER017) used as direct PE inputs for 
CPT code 77418 IMRT treatment are no longer typical. These commenters 
submitted evidence, consisting of a collection of paid invoices, that 
demonstrated that the typical accelerator used in IMRT includes the 
functionality of the collimator and should be priced at $ 2,641,783 and 
that the price of the ``laser, diode, for patient positioning (Probe)'' 
(ER040) should be $18,160. Several commenters also noted that two 
equipment items included in many other radiation treatment codes, the 
radiation treatment vault (ER056) and water chiller (ER065) ought to be 
included in the equipment inputs for IMRT and SBRT treatment delivery. 
Finally, several commenters suggested that the equipment items used in 
these treatment delivery services require practitioners to purchase 
maintenance and service contracts in addition to the price of the 
equipment itself.
    Response: We appreciate all the submitted information to assist us 
in conducting a comprehensive update of the appropriate direct PE 
inputs for these services. We agree with the commenters that we should 
use the best information available in developing direct PE inputs for 
PFS services. Based on this information, we believe it would be 
appropriate to include two radiation therapists as direct PE inputs for 
CPT code 77418. We also believe it would be appropriate to update the 
current accelerator and collimator equipment inputs used in CPT code 
77418 based on the invoices provided to us by commenters. While we 
generally urge stakeholders to submit such requests through the process 
we established for CY 2011, because we made a proposal specifically 
related to the equipment minutes allocated for these procedures, we 
believe it would be appropriate to consider the associated equipment 
and prices. We have observed that some other radiation treatment codes 
incorporate the water chiller and radiation treatment vault as direct 
PE inputs. We believe it would be appropriate to incorporate the water 
chiller as an equipment item into the IMRT and SBRT treatment delivery 
codes for the sake of consistency with the other radiation treatment 
codes. However, we question whether it is fully consistent with the 
principles underlying the PFS PE methodology to continue to classify 
the radiation treatment vault as medical equipment (a direct cost) 
since it is difficult to distinguish the cost of the construction of 
the vault from the cost of the construction of the building. The 
submitted architectural invoices for vault construction illustrate the 
difficulty in making that distinction. Furthermore, the typical 
circumstances of the vault's use are unclear, especially regarding 
whether or not the vault may be servicing multiple patients at the same 
time. However, we do not believe that it would be appropriate to remove 
the radiation treatment vault as a direct input for all PFS services 
for CY 2013. We expect to address the status of the radiation treatment 
vault as a direct PE input during CY 2014 rulemaking. For CY 2013, we 
believe that it would be appropriate to include the radiation treatment 
vault for CPT codes 77373 and 77418 to align the code with the similar 
radiation treatment delivery codes. In terms of the maintenance and 
service contract costs submitted to us by commenters, we remind 
stakeholders

[[Page 68923]]

that we have generally not considered such costs as direct costs 
attributable to furnishing services to individual Medicare 
beneficiaries and that our standard equipment cost per minute 
calculation includes a maintenance factor that adequately incorporates 
such costs in amortizing the cost of the equipment itself.
    Comment: A few commenters suggested that CMS should re-price the 
capital equipment associated with CPT code 77373. However, none of 
these commenters submitted invoices.
    Response: We urge commenters to submit invoices and other evidence 
appropriate for pricing the capital equipment used in SBRT delivery as 
part of our public process for updating supply and equipment prices. We 
direct interested stakeholders to the CY 2011 PFS final rule (75 FR 
73205-73207) for information regarding that process. We also note that 
as we explained in the CY 2012 PFS final rule with comment period (76 
FR 73214), we could not accept the invoices accompanying the AMA RUC's 
recommendation for CPT Code 77373 to update the price of the ``SRS 
system, SBRT, six systems, average'' equipment (ER083). Each of these 
invoices included line items that we would not accept as part of the 
cost of the equipment, such as costs for training technologists to use 
the equipment, and the prices for these items were not separately 
identifiable. Therefore, we did not update the equipment price for 
ER083 in establishing interim final direct PE inputs for CY 2012. Were 
we to receive updated invoices through the process established during 
CY 2012 that did not include embedded costs that we would not accept as 
part of the cost of the equipment, we would consider those invoices in 
rulemaking for CY 2014.
    Comment: Many commenters suggested that reductions in Medicare 
payment rates for these services would put serious financial strain on 
community radiation oncology practices, and result in significant 
negative impact on patient access to life-saving cancer treatment, 
particularly in rural communities. One commenter provided the results 
of an informal study that suggested that if the proposed RVUs become 
effective for CY 2013, many providers will stop providing charity care, 
lay off staff, limit hours of operation, refrain from purchasing new 
equipment, limit or stop accepting Medicare patients, or consolidate or 
close practice locations.
    Response: We appreciate and share commenters' concerns regarding 
Medicare beneficiaries' access to care for radiation treatment 
services. While we share these concerns in general, we believe that 
accurately valuing services promotes Medicare beneficiaries' access to 
many different kinds of important services paid under the PFS, 
including radiation treatment. We continue to be interested in 
information related to beneficiaries' access to these kinds of 
services, and we will monitor for evidence of such problems. We would 
welcome being alerted to access problems, should they arise. At 
present, we do not have reason to believe that the proposed changes in 
procedure time assumptions, in conjunction with other corresponding 
updates in the direct PE inputs for these services, will jeopardize 
access to care for Medicare beneficiaries. We note that the final PE 
RVUs for these services, based on direct PE inputs updated with 
information provided by commenters, are significantly greater than 
those reflected in the proposed rule. We also note that the specialty-
level impact of this final rule with comment period is significantly 
reduced relative to the policy as proposed. We direct interested 
readers to the section VIII.C. of this final rule with comment period 
regarding the specialty-level impacts of this and other finalized 
policies.
    Comment: Many commenters objected to CMS' assumptions that the 
services would be more costly for facilities such as hospital 
outpatient departments that generally have Emergency Medical Treatment 
and Labor Act (EMTALA) obligations and standby capacity than for free-
standing centers or offices. These commenters stated that the cost 
structure and the services furnished in freestanding and hospital 
outpatient settings are the same. These commenters stated that, while 
outpatient hospital departments may have to maintain standby capacity, 
they do not typically furnish IMRT 24 hours per day, seven days a week 
nor do the radiation oncology departments of hospitals generally 
furnish radiation treatment to higher acuity patients than the patients 
who receive services in physicians' offices or freestanding clinics.
    Several other commenters suggested that the payment decrease 
expected to result from this proposal will force patients into the more 
expensive hospital setting and patients will be steered toward 
treatment options that result in greater financial returns. These 
commenters stated that this migration will increase costs both to the 
Medicare program and to patients through higher co-insurance payments. 
Others suggested that significant differences between nonfacility PFS 
and OPPS payment are likely to result in consolidation of free-standing 
cancer centers and hospitals that will reduce competition, inhibit 
access to care, and undermine focused care for cancer patients.
    Response: As we stated in the proposal, we continue to believe that 
high-volume services, such as IMRT, that are widely furnished in both 
nonfacility and facility settings are highly unlikely to be more 
resource-intensive in freestanding radiation therapy centers or 
physicians' offices than when furnished in facilities like hospitals. 
We agree with commenters that the direct costs of furnishing the 
service may be similar, but we continue to believe that hospitals are 
likely to incur additional indirect costs. For example, hospitals incur 
greater costs for maintaining the capacity to furnish services 7 days 
per week, 24 hours per day, even if IMRT delivery is not typically 
furnished during all of those hours. As we have already noted, the 
disparity between OPPS and PFS payment is even greater than a direct 
comparison of the payment rates would suggest. OPPS payment for CPT 
code 77148 includes packaged payment for image guidance, which is 
almost always furnished and billed with CPT code 77418. The PFS 
continues to make separate payment for several forms of image guidance.
    We understand commenters' concerns regarding the inadvertent impact 
that financial incentives may make on the usual site of service for 
particular services. We believe that utilizing the most accurate cost 
inputs possible is a reasonable approach to mitigating the impact of 
such potential incentives.
    As a result of the comments we received regarding our proposal to 
change the procedure time assumptions used in determining direct PE 
inputs for CPT codes 77418 and 77373, we are finalizing our proposals 
to adjust the procedure time assumption for IMRT delivery (CPT code 
77418) to 30 minutes and to adjust the procedure time assumption for 
SBRT delivery (CPT code 77373) to 60 minutes. These codes continue to 
include clinical labor time for preparatory and follow-up tasks in 
addition to revisions to the procedure times. Based on comments 
received regarding additional updates to the direct PE inputs for these 
services, we are also adjusting other direct PE inputs for these 
services on an interim final basis for CY 2013. Based on comments 
received on our proposal, we are incorporating a second radiation 
therapist for CPT code 77418. The second therapist will be allocated 30 
minutes of service period time, consistent with the first. Furthermore, 
we are incorporating a new equipment

[[Page 68924]]

item called ``IMRT accelerator'' to replace the linear accelerator 
(ER010) and collimator (ER017) used as current direct PE inputs for CPT 
code 77418. Based on the evidence submitted by commenters, the new 
equipment item will be priced at $2,641,783 in the direct PE input 
database. Additionally, we are incorporating the radiation treatment 
vault (ER056) and water chiller (ER065) as direct PE inputs for both 
CPT codes 77418 and 77373. We are also updating the price of the 
``laser, diode, for patient positioning (Probe)'' (ER040) from $7,678 
to $18,160. We are adopting these direct PE inputs on an interim basis 
for CY 2013 and these values are reflected in the CY 2013 PFS direct PE 
input database. That database is available under downloads for the CY 
2013 PFS final rule with comment period on the CMS Web site at: http://www.cms.gov/PhysicianFeeSched/PFSFRN/list.asp#TopOfPage. We also note 
that the PE RVUs included in Addenda B and C reflect these interim 
direct PE inputs.
    These two IMRT and SBRT treatment delivery codes are PE only codes 
and are fairly unique in that the resulting RVUs are largely comprised 
of resources for staff and equipment based on the minutes associated 
with clinical labor. There are several other codes on the PFS 
established through the same methodology. As we previously stated, we 
believe that the procedure time assumptions for these kinds of services 
have not been subject to all of the same mechanisms recently used by 
CMS in the valuation of the physician work component of PFS payment. In 
light of observations about publicly available procedure times for CPT 
codes 77418 (IMRT treatment delivery) and 77373 (SBRT treatment 
delivery) and public awareness of potential adverse financial 
incentives associated with IMRT treatment delivery in particular, we 
believe that similar codes may be potentially misvalued.
    Therefore, consistent with the requirement in section 
1848(c)(2)(K)(ii) of the Act to examine other codes determined to be 
appropriate by the Secretary, we proposed to review and make 
adjustments to CPT codes with stand-alone procedure time assumptions 
used in developing nonfacility PE RVUs. These procedure time 
assumptions are not based on physician time assumptions. We prioritized 
for review CPT codes that have annual Medicare allowed charges of 
$100,000 or more, include direct equipment inputs that amount to $100 
or more, and have PE procedure times of greater than 5 minutes. We did 
not propose to include in this category services with payment rates 
subject to the OPPS cap (as specified in the statute under section 
1848(b)(4) of the Act and listed in Addendum G to this proposed rule) 
or services with PE minutes established through code descriptors. (For 
example, an overnight monitoring code might contain 480 minutes of 
monitoring equipment time to account for 8 hours of overnight 
monitoring.) The CPT codes meeting these criteria appear in Table 8. We 
recognized that there are other CPT codes that are valued in the same 
manner. We may consider evaluating those services as potentially 
misvalued codes in future rulemaking.
    For the services in Table 8, we requested recommendations from the 
AMA RUC and other public commenters on the appropriate direct PE inputs 
for these services. We encourage the use of valid and reliable 
alternative data sources when developing recommended values, including 
electronic medical records (with personally-identifiable information 
redacted) and other independent data sources. We note that many of the 
CPT codes in Table 8 have been identified through other potentially 
misvalued code screens and have been recently reviewed. Given our 
concerns with the inputs for the recently reviewed IMRT and SBRT direct 
PE inputs discussed above, we believe it is necessary to re-review 
other recently reviewed services with stand-alone PE procedure time.

          Table 8--Services with Stand-Alone PE Procedure Time
------------------------------------------------------------------------
               CPT code                         Short descriptor
------------------------------------------------------------------------
77280................................  Set radiation therapy field.
77285................................  Set radiation therapy field.
77290................................  Set radiation therapy field.
77301................................  Radiotherapy dose plan imrt.
77338................................  Design mlc device for imrt.
77372................................  Srs linear based.
77373................................  Sbrt delivery.
77402................................  Radiation treatment delivery.
77403................................  Radiation treatment delivery.
77404................................  Radiation treatment delivery.
77406................................  Radiation treatment delivery.
77407................................  Radiation treatment delivery.
77408................................  Radiation treatment delivery.
77409................................  Radiation treatment delivery.
77412................................  Radiation treatment delivery.
77413................................  Radiation treatment delivery.
77414................................  Radiation treatment delivery.
77416................................  Radiation treatment delivery.
77418................................  Radiation tx delivery imrt.
77600................................  Hyperthermia treatment.
77785................................  Hdr brachytx 1 channel.
77786................................  Hdr brachytx 2-12 channel.
77787................................  Hdr brachytx over 12 chan.
88348................................  Electron microscopy.
------------------------------------------------------------------------

    Comment: Several commenters objected to our proposal to review 
these codes. Some of these commenters objected to the premise that the 
procedure time assumptions for these services have not been subject to 
the same scrutiny as for services with procedure time assumptions tied 
directly to physician time. One of these commenters explained that the 
AMA RUC process of reviewing direct practice expense inputs involves 
three main levels of expert panel review: specialty society expert 
panel review and attestation of the data provided; RUC Practice Expense 
Subcommittee review; and full RUC member review. Other commenters 
suggested that many of the identified services have procedure time 
assumptions related to physician time and therefore should be removed 
from the list. Another commenter claimed that services with 
professional and technical components should be removed from the list 
since services with professional components ought not to be considered 
``stand-alone.'' Another commenter suggested that CPT code CPT Code 
77600 should be removed from the list since few -TC claims had been 
submitted. One commenter claimed that the AMA RUC had extensive 
discussions regarding the procedure time assumptions used in developing 
direct PE inputs for some of the codes, so that those codes should be 
removed from the list.
    Response: As we stated in the proposal, we believe that the 
procedure time assumptions used in developing direct PE inputs for 
these services have not been subject to the same rigor as other 
recently-reviewed services. Procedure time assumptions developed and 
validated by a series of expert panels have not generally been subject 
to the same scrutiny as the times developed through survey data or data 
gathered through electronic health records, for example. We identified 
the services by calling the services ``stand-alone PE procedure time,'' 
because they are services that include significant amounts of time 
resources allocated outside of physician time. We understand that some 
of these codes may be ``technical only'' codes and that in other cases 
these codes are used in reporting both the professional and technical 
component using the -TC or -26 modifiers, but we do not believe the 
divergent reporting mechanisms would mean that any services should be 
removed from the list. For CPT code 77600, we note that while few 
services were reported with the -TC modifier, many more services were 
billed globally in the nonfacility setting, so we continue to believe 
that the procedure time assumption that determines the inputs used in 
valuing the technical

[[Page 68925]]

component of the payment remains relevant for prioritization.
    While we assume that the AMA RUC deliberated on the procedure time 
assumptions used in developing the direct PE input recommendations for 
these services, we do not believe that extensive committee discussions 
would mitigate the need for more extensive review of these services as 
potentially misvalued since the assumptions that were developed through 
discussion could benefit from the objective data of many kinds.
    Comment: MedPAC supported CMS's proposal to review these services. 
However, it expressed concern that CMS exempted imaging services that 
are subject to the OPPS cap from this review. MedPAC pointed out that 
the procedure time assumptions used in several high-priced and high-
expenditure imaging codes have not been reviewed by the AMA RUC since 
2002 or 2003 and may be too high. MedPAC also noted that recent 
advances in CT and MRI machines have made it possible to scan patients 
faster and that even practitioners who are using older equipment could 
be performing studies in less time as they become more familiar with 
the procedures and equipment.
    Response: We appreciate MedPAC's support for this proposal. We 
agree that the procedure time assumptions used in imaging codes subject 
to the OPPS cap may be inaccurate or outdated. We did not propose to 
prioritize review of these procedure time assumptions since the 
services are subject to the OPPS payment caps, but we will consider the 
appropriate means for reviewing the procedure time assumptions for 
those services in future rulemaking.
    Based on the comments we received, we are finalizing our proposal 
to review and make adjustments to CPT codes with stand-alone procedure 
time assumptions used in developing nonfacility PE RVUs.
c. Services With Anomalous Time
    Each year when we publish the PFS proposed and final rules, we 
publish on the CMS Web site several files that support annual PFS 
ratesetting. One of these supporting files is the physician time file, 
which lists the physician time associated with the HCPCS codes on the 
PFS. The physician time file associated with the CY 2013 PFS final rule 
with comment period is available on the CMS Web site under the 
downloads for the CY 2013 PFS final rule with comment period at http://www.cms.gov/PhysicianFeeSched/.
    As we stated in the CY 2013 PFS proposed rule, in our review of 
potentially misvalued codes and their inputs, we became aware of 
several HCPCS codes that have anomalous times in our physician time 
file. Physician work is a measure of physician time and intensity, so 
there should be no services that have payable physician work RVUs but 
no time in the physician time file, and there should be no payable 
services with time in the physician time file and no physician work 
RVUs. For CY 2013 we proposed to make the physician time file changes 
detailed below to address these anomalous time file entries.
(1) Review of Services With Physician Work and No Listed Physician Time
    CPT code 94014 (Patient-initiated spirometric recording per 30-day 
period of time; includes reinforced education, transmission of 
spirometric tracing, data capture, analysis of transmitted data, 
periodic recalibration and physician review and interpretation) has a 
physician work RVU of 0.52 and for CY 2012 was listed with 0 physician 
time. CPT code 94014 is a global service that includes CPT code 94015 
(Patient-initiated spirometric recording per 30-day period of time; 
recording (includes hook-up, reinforced education, data transmission, 
data capture, trend analysis, and periodic recalibration)) (the 
technical component), and CPT code 94016 (Patient-initiated spirometric 
recording per 30-day period of time; physician review and 
interpretation only) (the professional component). We stated that we 
believe it is appropriate for the physician time of CPT code 94014 to 
match the physician time of the code's component professional service--
CPT code 94016. As such, for CPT code 94014 for CY 2013, we proposed to 
assign 2 minutes of pre-service evaluation time, and 20 minutes of 
intra-service time, which matches the times associated with CPT code 
94016.
    HCPCS codes G0117 (Glaucoma screening for high risk patients 
furnished by an optometrist or ophthalmologist) and G0118 (Glaucoma 
screening for high risk patient furnished under the direct supervision 
of an optometrist or ophthalmologist) both have physician work RVUs 
(0.45, and 0.17, respectively), but neither code was included in the CY 
2012 physician time file. HCPCS codes G0117 and G0118 have a PFS 
procedure status indicator of T indicating that these services are only 
paid if there are no other services payable under the PFS billed on the 
same date by the same provider.
    In the CY 2002 PFS final rule (66 FR 55274), we crosswalked the 
physician work of HCPCS code G0117 from CPT code 99212 (Level 2 office 
or other outpatient visit, established patient), and we crosswalked the 
physician work of HCPCS code G0118 from CPT code 99211 (Level 1 office 
or other outpatient visit, established patient). Based on these 
finalized physician work crosswalks, we proposed to assign HCPCS code 
G0117 physician times matching CPT code 99212, and HCPCS code G0118 
physician times matching CPT code 99211. Specifically, we proposed 2 
minutes of pre-service time, 10 minutes of intra-service time, and 4 
minutes of immediate post-service time for HCPCS code G0117, and 5 
minutes of intra-service time, and 2 minutes of immediate post-service 
time for HCPCS code G0118.
    HCPCS code G0128 (Direct (face-to-face with patient) skilled 
nursing services of a registered nurse provided in a comprehensive 
outpatient rehabilitation facility, each 10 minutes beyond the first 5 
minutes) currently has a physician work RVU (0.08), but was not listed 
in the CY 2012 physician time file. In the CY 2013 proposed rule we 
stated that, after review of this HCPCS code, we do not believe that 
HCPCS code G0128 describes a service that includes physician work. Time 
for a registered nurse to furnish the service is included in the PE for 
the code. As such, for CY 2013, we proposed to remove the physician 
work RVU for HCPCS code G0128. HCPCS code G0128 continues to have PE 
and malpractice expense RVUs.
    HCPCS codes G0245 (Initial physician evaluation and management of a 
diabetic patient with diabetic sensory neuropathy resulting in a loss 
of protective sensation (LOPS) which must include: (1) The diagnosis of 
LOPS; (2) a patient history; (3) a physical examination that consists 
of at least the following elements: (a) Visual inspection of the 
forefoot, hindfoot and toe web spaces; (b) evaluation of a protective 
sensation; (c) evaluation of foot structure and biomechanics; (d) 
evaluation of vascular status and skin integrity; and (e) evaluation 
and recommendation of footwear; and (4) patient education), G0246 
(Follow-up physician evaluation and management of a diabetic patient 
with diabetic sensory neuropathy resulting in a loss of protective 
sensation (LOPS) to include at least the following: (1) A patient 
history; (2) a physical examination that includes: (a) Visual 
inspection of the forefoot, hindfoot and toe web spaces; (b) evaluation 
of protective sensation; (c) evaluation of foot structure and 
biomechanics; (d) evaluation of vascular status and skin integrity; and 
(e) evaluation and recommendation of

[[Page 68926]]

footwear; and (3) patient education), and G0247 (Routine foot care by a 
physician of a diabetic patient with diabetic sensory neuropathy 
resulting in a loss of protective sensation (LOPS) to include, the 
local care of superficial wounds (that is, superficial to muscle and 
fascia) and at least the following if present: (1) Local care of 
superficial wounds; (2) debridement of corns and calluses; and (3) 
trimming and debridement of nails) have physician work RVUs of 0.88, 
0.45, and 0.50, respectively, but were not listed in the CY 2012 
physician time file. HCPCS codes G0245, G0246, and G0247 have a 
procedure status indicator of R on the PFS indicating that coverage of 
these services is restricted.
    In the CY 2003 PFS final rule (67 FR 79990), we crosswalked the 
physician work of HCPCS code G0245 from CPT code 99202 (Level 2 office 
or other outpatient visits, new patient), we crosswalked the physician 
work of HCPCS code G0246 from CPT code 99212, and we crosswalked the 
physician work of HCPCS code G0257 from CPT code 11040 (Debridement; 
skin; partial thickness). Based on these finalized physician work 
crosswalks, we proposed to assign HCPCS code G0245 physician times 
matching CPT code 99202, HCPCS code G0246 physician times matching CPT 
code 99212, and HCPCS code G0247 physician times matching CPT code 
11040. Specifically, for HCPCS code G0245 we proposed 2 minutes of pre-
service time, 15 minutes of intra-service time, and 5 minutes of 
immediate post-service time. For HCPCS code G0246 we proposed 2 minutes 
of pre-service time, 10 minutes of intra-service time, and 4 minutes of 
immediate post-service time. For HCPCS code G0247 we proposed 7 minutes 
of pre-service time, 10 minutes of intra-service time, and 7 minutes of 
immediate post-service time.
    HCPCS code G0250 (Physician review, interpretation, and patient 
management of home INR (International Normalized Ratio) testing for 
patient with either mechanical heart valve(s), chronic atrial 
fibrillation, or venous thromboembolism who meets Medicare coverage 
criteria; testing not occurring more frequently than once a week; 
billing units of service include 4 tests) has a physician work RVU of 
0.18 but was not listed in the CY 2012 physician time file. HCPCS code 
G0250 has a procedure status indicator of R on the PFS indicating that 
coverage of this service is restricted. In the CY 2003 final rule (67 
FR 79991), we assigned HCPCS code G0250 a work RVU of 0.18, which 
corresponds to the work RVU of CPT code 99211. While we did not 
articulate this as a direct crosswalk in the CY 2003 final rule, after 
clinical review we believe that HCPCS code G0250 continues to require 
similar work as CPT code 99211, and should have the same amount of 
physician time as CPT code 99211. As such, we proposed to assign HCPCS 
code G0250 the same physician time as CPT code 99211. Specifically, for 
HCPCS code G0250 we proposed 5 minutes of intra-service time and 2 
minutes of immediate post-service time.
    During our annual review of new, revised, and potentially misvalued 
CPT codes, the assessment of physician time used to furnish a service 
is an important part of the clinical review when determining the 
appropriate work RVU for a service. However, the time in the physician 
time file is not used to automatically adjust the physician work RVUs 
outside of that clinical review process. As such, the proposed addition 
of physician time to the HCPCS codes discussed above will have no 
impact on the current physician work RVUs for these services.
    The time data in the physician time file is used in the PE 
methodology described in section II.A.2. In creating the indirect 
practice cost index (IPCI), we calculate specialty-specific aggregate 
pools of indirect PE for all PFS services for that specialty by adding 
the product of the indirect PE/HR for the specialty, the physician time 
for the service, and the specialty's utilization for the service across 
all services furnished by the specialty. The proposed addition of 
physician time to the HCPCS codes discussed above will affect the 
aggregate pools of indirect PE at the specialty level. However because 
the services discussed above have low utilization and low total time, 
the impact of the physician time changes on the IPCI is negligible, and 
likely would have a modest impact if any on the PE RVUs at the 
individual code level.
    Below is a summary of the comments we received on our proposed 
changes for PFS services with physician work and no listed time in the 
physician time file.
    Comment: Commenters agreed with our proposed time changes for these 
services. The AMA RUC noted that historically the AMA RUC has not 
provided work or time recommendations for HCPCS G-codes, but that they 
will update the AMA RUC database to reflect these new physician time 
components.
    Response: We thank commenters for their input on the times 
associated with these services. We are finalizing our proposals without 
modification. These proposed adjustments are reflected in the physician 
time file associated with this CY 2013 final rule with comment period, 
available on the CMS Web site under the downloads for the CY 2013 PFS 
final rule with comment period at http://www.cms.gov/PhysicianFeeSched/.
(2) Review of Services With No Physician Work and Listed Time in the 
Physician Time File
    There are a number of services that have no physician work RVUs, 
yet include time in the physician time file. Many of these services are 
not payable under the PFS or are contractor priced services where the 
physician time is not used to nationally price the services on the PFS. 
We did not propose to remove the physician time from the time file for 
these services as the time has no effect on the calculation of RVUs for 
the PFS. However, there are several CPT codes, listed in Table 9, that 
are payable under the PFS and have no physician work RVUs yet include 
time in the physician time file. We proposed to remove the physician 
time from the time file for these seven CPT codes.

  Table 9--Payable CPT Codes With Physician Time and No Physician Work
------------------------------------------------------------------------
                                                          CY 2012 Total
      CPT Code             Short        PFS Procedure    physician time
                         descriptor         status          (minutes)
------------------------------------------------------------------------
22841...............  Insert spine     B (Bundled, not                 5
                       fixation         separately
                       device.          payable).
51798...............  Us urine         A (Active,                      9
                       capacity         payable).
                       measure.
95990...............  Spin/brain pump  A (Active,                     40
                       refill & main.   payable).
96904...............  Whole body       R (Restricted                  80
                       photography.     coverage).
96913...............  Photochemothera  A (Active,                     90
                       py uv-a or b.    payable).
97545...............  Work hardening.  R (Restricted                 120
                                        coverage).

[[Page 68927]]

 
97602...............  Wound(s) care    B (Bundled, not                36
                       non-selective.   separately
                                        payable).
------------------------------------------------------------------------

    As mentioned above and as discussed in section II.A.2. of this 
final rule with comment period, to create the IPCI used in the PE 
methodology, we calculated specialty-specific aggregate pools of 
indirect PE for all PFS services for that specialty by adding the 
product of the indirect PE/HR for the specialty, the physician time for 
the service, and the specialty's utilization for the service across all 
services performed by the specialty. As we stated in the CY 2013 PFS 
proposed rule, the proposed removal of physician time from the CPT 
codes discussed above will affect the aggregate pools of indirect PE at 
the specialty level. However because the services discussed above have 
low utilization and/or low total time, the impact of the physician time 
changes on the IPCI is negligible, and likely will have a modest impact 
if any on the PE RVUs at the individual code level.
    Below is a summary of the comments we received on our proposed 
changes for PFS services with no physician work and listed time in the 
physician time file.
    Comment: Commenters agreed with our proposal to remove the time 
listed in the physician time file for CPT codes 22841 (Internal spinal 
fixation by wiring of spinous processes (List separately in addition to 
code for primary procedure)), 95990 (Refilling and maintenance of 
implantable pump or reservoir for drug delivery, spinal (intrathecal, 
epidural) or brain (intraventricular), includes electronic analysis of 
pump, when performed;), 96904 (Whole body integumentary photography, 
for monitoring of high risk patients with dysplastic nevus syndrome or 
a history of dysplastic nevi, or patients with a personal or familial 
history of melanoma), and 96913 (Photochemotherapy (Goeckerman and/or 
PUVA) for severe photoresponsive dermatoses requiring at least 4-8 
hours of care under direct supervision of the physician (includes 
application of medication and dressings)). Commenters noted that CPT 
code 51798 (Measurement of post-voiding residual urine and/or bladder 
capacity by ultrasound, non-imaging) likely had time listed in the 
physician time file because the AMA RUC had recommended work RVUs for 
the service however CMS assigned only practice expense. Similarly, 
commenters noted that CPT code 97602 (Removal of devitalized tissue 
from wound(s), non-selective debridement, without anesthesia (eg, wet-
to-moist dressings, enzymatic, abrasion), including topical 
application(s), wound assessment, and instruction(s) for ongoing care, 
per session) likely had time included in the physician time final 
because the AMA RUC HCPAC recommended work RVUs for the service, 
however CMS assigned CPT code 97602 a bundled procedure status. 
Commenters noted that CPT code 97545 (Work hardening/conditioning; 
initial 2 hours) has a restricted procedure status, but inherently 
involves 2 hours of work, and requested that CMS maintain the time 
entry in the physician time file for this service to assist other 
payers and stakeholder in making payment policy decisions.
    Response: We thank commenters for their input on the times 
associated with these services. After reviewing the comments, we are 
finalizing our proposal to remove the time from the physician time file 
for CPT codes 22841, 51798, 95990, 96913, and 97602. We will maintain 
the time entry in the physician time file for CPT code 97545, as 
requested; while this CPT code has a restricted procedure status 
indicator, it is still payable in some circumstances. CPT code 96904 
also has a restricted procedure status indicator and is payable in some 
circumstances. For consistent treatment of these two CPT codes, we will 
also maintain the time entry in the physician time file for CPT code 
96904. These adjustments are reflected in the physician time file 
associated with this CY 2013 PFS final rule with comment period, 
available on the CMS Web site under the downloads for the CY 2013 PFS 
final rule with comment period at http://www.cms.gov/PhysicianFeeSched/.
4. Expanding the Multiple Procedure Payment Reduction Policy
    Medicare has long employed multiple procedure payment reduction 
(MPPR) policies to adjust payment to more appropriately reflect reduced 
resources involved with furnishing services that are frequently 
furnished together. Under these policies, we reduce payment for the 
second and subsequent services within the same MPPR category furnished 
in the same session or same day. These payment reductions reflect 
efficiencies that typically occur in either the practice expense (PE) 
or professional work or both when services are furnished together. With 
the exception of a few codes that are always reported along with 
another code, the Medicare PFS values services independently to 
recognize relative resources involved when the service is the only one 
furnished in a session. While our general policy for MPPRs precedes the 
Affordable Care Act, MPPRs address the fourth category of potentially 
misvalued codes identified in section 1848(c)(2)(K) of the Act which is 
``multiple codes that are frequently billed in conjunction with 
furnishing a single service'' (see 75 FR 73216).
    For CY 2013, we proposed to continue our work to recognize resource 
efficiencies when certain services are furnished together. We proposed 
to apply an MPPR to the technical component (TC) of certain 
cardiovascular and ophthalmology diagnostic tests. As discussed in the 
CY 2012 final rule with comment period (76 FR 73079), we are also 
proceeding with applying the current MPPR policy for imaging services 
to services furnished in the same session by physicians in the same 
group practice.
a. Background
    Medicare has a longstanding policy to reduce payment by 50 percent 
for the second and subsequent surgical procedures furnished to the same 
beneficiary by a single physician or physicians in the same group 
practice on the same day, largely based on the presence of efficiencies 
in the PE and pre- and post-surgical physician work. Effective January 
1, 1995, the MPPR policy, with this same percentage reduction, was 
extended to nuclear medicine diagnostic procedures (CPT codes 78306, 
78320, 78802, 78803, 78806, and 78807). In the CY 1995 PFS final rule 
with comment period (59 FR 63410), we indicated that we would consider 
applying the policy to other diagnostic tests in the future.
    Consistent with recommendations of MedPAC in its March 2005 Report 
to the Congress on Medicare Payment Policy, for CY 2006 PFS, we 
extended the MPPR policy to the TC of certain

[[Page 68928]]

diagnostic imaging procedures furnished on contiguous areas of the body 
in a single session (70 FR 70261). This MPPR policy recognizes that for 
the second and subsequent imaging procedures furnished in the same 
session, there are some efficiencies in clinical labor, supplies, and 
equipment time. In particular, certain clinical labor activities and 
supplies are not duplicated for subsequent imaging services in the same 
session and, because equipment time and indirect costs are allocated 
based on clinical labor time, we also reduced those accordingly.
    The imaging MPPR policy originally applied to computed tomography 
(CT) and computed tomographic angiography (CTA), magnetic resonance 
imaging (MRI) and magnetic resonance angiography (MRA), and ultrasound 
services within 11 families of codes based on imaging modality and body 
region and only applied to procedures furnished in a single session 
involving contiguous body areas within a family of codes, not across 
families. Additionally, the MPPR policy originally applied to TC-only 
services and to the TC of global services, but not to professional 
component (PC) services.
    There have been several revisions to this policy since it was 
originally adopted. Under the current imaging MPPR policy, full payment 
is made for the TC of the highest paid procedure, and payment for the 
TC is reduced by 50 percent for each additional procedure subject to 
this MPPR policy. We originally planned to phase in the imaging MPPR 
policy over a 2-year period, with a 25 percent reduction in CY 2006 and 
a 50 percent reduction in CY 2007 (70 FR 70263). However, the Deficit 
Reduction Act of 2005 (DRA) (Pub. L. 109-171) amended the statute to 
place a cap on the PFS payment amount for most imaging procedures at 
the amount paid under the hospital outpatient prospective payment 
system (OPPS). In view of this new OPPS payment cap, we decided in the 
PFS final rule with comment period for CY 2006 that it would be prudent 
to retain the imaging MPPR at 25 percent while we continued to examine 
the appropriate payment levels (71 FR 69659). The DRA also exempted 
reduced expenditures attributable to the imaging MPPR policy from the 
PFS BN provision. Effective July 1, 2010, section 1848(b)(4)(C) of the 
Act increased the MPPR on the TC of imaging services under the policy 
established in the CY 2006 PFS final rule with comment period from 25 
to 50 percent. Section 1848(c)(2)(B)(v)(IV) of the Act exempted the 
reduced expenditures attributable to this further change from the PFS 
BN provision.
    In the July 2009 U.S. Government Accountability Office (GAO) report 
entitled, Medicare Physician Payments: Fees Could Better Reflect 
Efficiencies Achieved when Services are Provided Together, the GAO 
recommended that we take further steps to ensure that fees for services 
paid under the PFS reflect efficiencies that occur when services are 
furnished by the same physician to the same beneficiary on the same 
day. The GAO recommended the following: (1) expanding the existing 
imaging MPPR policy for certain services to the PC to reflect 
efficiencies in physician work for certain imaging services; and (2) 
expanding the MPPR to reflect PE efficiencies that occur when certain 
nonsurgical, nonimaging services are furnished together. The GAO report 
also encouraged us to focus on service pairs that have the most impact 
on Medicare spending.
    In its March 2010 report, MedPAC noted its concerns about 
mispricing of services under the PFS. MedPAC indicated that it would 
explore whether expanding the unit of payment through packaging or 
bundling would improve payment accuracy and encourage more efficient 
use of services. In the CYs 2009 and 2010 PFS proposed rules (73 FR 
38586 and 74 FR 33554, respectively), we stated that we planned to 
analyze nonsurgical services commonly furnished together (for example, 
60 to 75 percent of the time) to assess whether an expansion of the 
MPPR policy could be warranted. MedPAC encouraged us to consider 
duplicative physician work, as well as PE, in any expansion of the MPPR 
policy.
    Section 1848(c)(2)(K) of the Act specifies that the Secretary shall 
identify potentially misvalued codes by examining multiple codes that 
are frequently billed in conjunction with furnishing a single service, 
and review and make appropriate adjustments to their relative values. 
As a first step in applying this provision, in the CY 2010 final rule 
with comment period, we implemented a limited expansion of the imaging 
MPPR policy to additional combinations of imaging services.
    Effective January 1, 2011, the imaging MPPR applies regardless of 
code family; that is, the policy applies to multiple imaging services 
furnished within the same family of codes or across families. This 
policy is consistent with the standard PFS MPPR policy for surgical 
procedures that does not group procedures by body region. The current 
imaging MPPR policy applies to CT and CTA, MRI and MRA, and ultrasound 
procedures furnished to the same beneficiary in the same session, 
regardless of the imaging modality, and is not limited to contiguous 
body areas.
    As we noted in the CY 2011 PFS final rule with comment period (75 
FR 73228), while section 1848(c)(2)(B)(v)(VI) of the Act specifies that 
reduced expenditures attributable to the increase in the imaging MPPR 
from 25 to 50 percent (effective for fee schedules established 
beginning with 2010 and for services furnished on or after July 1, 
2010) are excluded from the PFS BN adjustment, it does not apply to 
reduced expenditures attributable to our policy change regarding 
additional code combinations across code families (noncontiguous body 
areas) that are subject to BN under the PFS. The complete list of codes 
subject to the CY 2011 MPPR policy for diagnostic imaging services is 
included in Addendum F.
    As a further step in applying the provisions of section 
1848(c)(2)(K) of the Act, on January 1, 2011, we implemented an MPPR 
for therapy services. The MPPR applies to separately payable ``always 
therapy'' services, that is, services that are only paid by Medicare 
when furnished under a therapy plan of care. As we explained in the CY 
2011 PFS final rule with comment period (75 FR 73232), the therapy MPPR 
does not apply to contractor-priced codes, bundled codes, and add-on 
codes. The complete list of codes subject to the MPPR policy for 
therapy services is included in Addendum H.
    This MPPR for therapy services was first proposed in the CY 2011 
proposed rule (75 FR 44075) as a 50 percent payment reduction to the PE 
component of the second and subsequent therapy services for multiple 
``always therapy'' services furnished to a single beneficiary in a 
single day. It applies to services furnished by an individual or group 
practice or ``incident to'' a physician's service. However, in response 
to public comments, in the CY 2011 PFS final rule with comment period 
(75 FR 73232), we adopted a 25 percent payment reduction to the PE 
component of the second and subsequent therapy services for multiple 
``always therapy'' services furnished to a single beneficiary in a 
single day.
    Subsequent to publication of the CY 2011 PFS final rule with 
comment period, section 3 of the Physician Payment and Therapy Relief 
Act of 2010 (PPTRA) (Pub. L. 111-286) revised the payment reduction 
percentage from 25 percent to 20 percent for therapy services for which 
payment is made under a fee schedule under section 1848 of the Act 
(which are services furnished

[[Page 68929]]

in office settings, or non-institutional services). The payment 
reduction percentage remains at 25 percent for therapy services 
furnished in institutional settings. Section 4 of the PPTRA exempted 
the reduced expenditures attributable to the therapy MPPR policy from 
the PFS BN provision. Under our current policy as amended by the PPTRA, 
for institutional services, full payment is made for the service or 
unit with the highest PE and payment for the PE component for the 
second and subsequent procedures or additional units of the same 
service is reduced by 25 percent. For non-institutional services, full 
payment is made for the service or unit with the highest PE and payment 
for the PE component for the second and subsequent procedures or 
additional units of the same service is reduced by 20 percent.
    This MPPR policy applies to multiple units of the same therapy 
service, as well as to multiple different ``always therapy'' services, 
when furnished to the same beneficiary on the same day. The MPPR 
applies when multiple therapy services are billed on the same date of 
service for one beneficiary by the same practitioner or facility under 
the same National Provider Identifier (NPI), regardless of whether the 
services are furnished in one therapy discipline or multiple 
disciplines, including physical therapy, occupational therapy, or 
speech-language pathology.
    The MPPR policy applies in all settings where outpatient therapy 
services are paid under Part B. This includes both services that are 
furnished in the office setting and paid under the PFS, as well as 
institutional services that are furnished by outpatient hospitals, home 
health agencies, comprehensive outpatient rehabilitation facilities 
(CORFs), and other entities that are paid for outpatient therapy 
services at rates based on the PFS.
    In its June 2011 Report to Congress, MedPAC highlighted continued 
growth in ancillary services subject to the in-office ancillary 
services exception. The in-office ancillary exception to the general 
prohibition under section 1877 of the Act as amended by the Ethics in 
Patient Referrals Act, also known as the Stark law, allows physicians 
to refer Medicare beneficiaries for designated health services, 
including imaging, radiation therapy, home health care, durable medical 
equipment, clinical laboratory tests, and physical therapy, to entities 
with which they have a financial relationship under specific 
conditions. MedPAC recommended that we apply a MPPR to the PC of 
diagnostic imaging services furnished by the same practitioner in the 
same session as one means to curb excess self-referral for these 
services. The GAO already had made a similar recommendation in its July 
2009 report.
    In continuing to apply the provisions of section 1848(c)(2)(K) of 
the Act regarding potentially misvalued codes that result from 
``multiple codes that are frequently billed in conjunction with 
furnishing a single service,'' in the CY 2012 final rule (76 FR 73071), 
we expanded the MPPR to the PC of Advanced Imaging Services (CT, MRI, 
and Ultrasound), that is, the same list of codes to which the MPPR on 
the TC of advanced imaging already applied (see Addendum F). Thus, this 
MPPR policy now applies to the PC and the TC of certain diagnostic 
imaging codes. Specifically, we expanded the payment reduction 
currently applied to the TC to apply also to the PC of the second and 
subsequent advanced imaging services furnished by the same physician 
(or by two or more physicians in the same group practice) to the same 
beneficiary in the same session on the same day. However, in response 
to public comments, in the CY 2012 PFS final rule with comment period, 
we adopted a 25 percent payment reduction to the PC component of the 
second and subsequent imaging services.
    Under this policy, full payment is made for the PC of the highest 
paid advanced imaging service, and payment is reduced by 25 percent for 
the PC for each additional advanced imaging service furnished to the 
same beneficiary in the same session. This policy was based on the 
expected efficiencies in furnishing multiple services in the same 
session due to duplication of physician work, primarily in the pre- and 
post-service periods, but with some efficiencies in the intraservice 
period.
    This policy is consistent with the statutory requirement for the 
Secretary to identify, review, and adjust the relative values of 
potentially misvalued services under the PFS as specified by section 
1848(c)(2)(K) of the Act. This policy is also consistent both with our 
longstanding policy on surgical and nuclear medicine diagnostic 
procedures, under which we apply a 50 percent payment reduction to 
second and subsequent procedures. Furthermore, it was responsive to 
continued concerns about significant growth in imaging spending, and to 
MedPAC (March 2010 and June 2011) and GAO (July 2009) recommendations 
regarding the expansion of MPPR policies under the PFS to account for 
additional efficiencies.
    In the CY 2012 proposed rule (76 FR 42812), we also invited public 
comment on the following MPPR policies under consideration. We noted 
that any proposals would be presented in future rulemaking and subject 
to further public comment:
     Apply the MPPR to the TC of All Imaging Services. This 
approach would apply a payment reduction to the TC of the second and 
subsequent imaging services furnished in the same session. Such an 
approach could define imaging consistent with our existing definition 
of imaging for purposes of the statutory cap on PFS payment at the OPPS 
rate including X-ray, ultrasound (including echocardiography), nuclear 
medicine (including positron emission tomography), magnetic resonance 
imaging, computed tomography, and fluoroscopy, but excluding diagnostic 
and screening mammography. Add-on codes that are always furnished with 
another service and have been valued accordingly could be excluded.
    Such an approach would be based on the expected efficiencies due to 
duplication of clinical labor activities, supplies, and equipment time 
when multiple services are furnished together. This approach would 
apply to approximately 530 HCPCS codes, including the 119 codes to 
which the current imaging MPPR applies. Savings would be redistributed 
to other PFS services as required by the statutory PFS BN provision.
     Apply the MPPR to the PC of All Imaging Services. This 
approach would apply a payment reduction to the PC of the second or 
subsequent imaging services furnished in the same encounter. Such an 
approach could define imaging consistent with our existing definition 
of imaging for the cap on payment at the OPPS rate. Add-on codes that 
are always furnished with another service and have been valued 
accordingly could be excluded.
    Such an approach would be based on efficiencies due to duplication 
of physician work primarily in the pre- and post-service periods, with 
smaller efficiencies in the intraservice period, when multiple services 
are furnished together. This approach would apply to approximately 530 
HCPCS codes, including the 119 codes to which the current imaging MPPR 
applies. Savings would be redistributed to other PFS services as 
required by the statutory PFS BN provision.
     Apply the MPPR to the TC of All Diagnostic Tests. This 
approach would apply a payment reduction to the TC of the second and 
subsequent diagnostic tests (such as radiology, cardiology, audiology, 
etc.) furnished in the same

[[Page 68930]]

encounter. Add-on codes that are always furnished with another service 
and have been valued accordingly could be excluded.
    Such an approach would be based on the expected efficiencies due to 
duplication of clinical labor activities, supplies, and equipment time 
when multiple services are furnished together. The approach would apply 
to approximately 700 HCPCS codes, including the approximately 560 HCPCS 
codes that are currently subject to the OPPS cap. The savings would be 
redistributed to other PFS services as required by the statutory PFS BN 
provision.
b. MPPR Policy Clarifications
(1) Apply the MPPR to Two Nuclear Medicine Procedures
    As indicated previously, effective January 1, 1995, we implemented 
an MPPR for six nuclear medicine codes. Under the current policy, full 
payment is made for the highest paid procedure, and payment is reduced 
by 50 percent for the second procedure furnished to the same 
beneficiary on the same day. As noted in the CY 2013 proposed rule (77 
FR 44748), due to a technical error, the MPPR is not being applied to 
CPT codes 78306 (Bone imaging; whole body) when followed by CPT code 
78320 (Bone imaging; SPECT). We will apply the MPPR to these procedures 
effective January 1, 2013. We received the following comment on this 
provision:
    Comment: A commenter indicated that continuing to apply and extend 
the MPPR for nuclear medicine procedures is unwarranted and 
inconsistent with CMS' aim to improve payment accuracy. The commenter 
noted that decisions made in 1995 were based on qualitative assessments 
rather than on rigorous data analysis. The commenter believes that with 
the wealth of data now available, and improved techniques in data 
analysis, careful evaluation of the applicability of the MPPR for all 
six nuclear medicine procedures is merited.
    Response: We acknowledge the commenter's concerns, but we neither 
proposed discontinuing the MPPR on nuclear medicine procedures, nor 
extending it to new codes. Rather, we noted that the MPPR under current 
policy was, for technical reasons, not being applied to CPT code 78306 
(Bone imaging; whole body) when followed by CPT code 78320 (Bone 
imaging; SPECT), and provided notification that the MPPR would be 
applied effective January 1, 2013. Accordingly, we are finalizing this 
technical correction effective for services furnished on or after 
January 1, 2013.
(2) Apply the MPPR to the PC and TC of Advanced Imaging Procedures to 
Physicians in the Same Group Practice
    As indicated in the CY 2012 final rule (76 FR 73077-73079), we 
finalized a policy to apply the MPPR to the PC and TC of the second and 
subsequent advanced imaging procedures furnished to the same 
beneficiary in the same session by a single physician or by multiple 
physicians in the same group practice. Due to operational limitations, 
we did not apply this MPPR to multiple physicians in the same group 
practice during CY 2012. In addition, after we issued the CY 2012 final 
rule with comment period, some commenters stated that they had not 
commented on the application of the MPPR to physicians in the same 
group practice because that policy was not explicit in the CY 2012 
proposed rule discussion expanding the MPPR for advanced imaging to the 
PC. As noted in the CY 2013 proposed rule (77 FR 44748), we have 
resolved the operational problems and, therefore, for services 
furnished on or after January 1, 2013 we will apply the MPPR to both 
the PC and the TC of advanced imaging procedures to multiple physicians 
in the same group practice (same group NPI). Under this policy, the 
MPPR will apply when one or more physicians in the same group practice 
furnish services to the same beneficiary, in the same session, on the 
same day. This policy is consistent with other PFS MPPR policies for 
surgical and therapy procedures and, effective January 1, 2013, for 
diagnostic cardiovascular and ophthalmology procedures. We continue to 
believe that the typical efficiencies achieved when the same physician 
is furnishing multiple procedures also accrue when different physicians 
in the same group furnish multiple procedures involving the same 
beneficiary in the same session. While we agree with commenters that 
most physicians would not change the way they practice in order to 
avoid application of the MPPR, we believe application of the imaging 
MPPR to physicians in the same group practice will ensure that there is 
no financial incentive for physicians in a group practice to change 
their behavior to split imaging interpretation services for a 
beneficiary among different physicians in the group. It is our 
intention to apply this and future MPPRs to services furnished by one 
or more physicians in the same group unless we determine for a specific 
MPPR that the efficiencies associated with an individual physician 
furnishing multiple procedures do not extend to multiple physicians in 
the same group practice. We received the following comments on this 
provision:
    Comment: Most commenters opposed applying the MPPR on diagnostic 
imaging to physicians in the same group practice, specifically to the 
PC. While many commenters acknowledged minimal efficiencies in the PC 
of second and subsequent procedures when furnished by the same 
physician, they maintained that no such efficiencies exist when 
furnished by multiple physicians.
    Commenters maintained that CMS assumes efficiencies exist, but has 
not presented any clinical evidence or comprehensive resource use 
analysis to justify claims of efficiency. Commenters do not believe 
that substantial economy of time or of effort exist. According to 
commenters, each physician who reviews a beneficiary's imaging results 
must review the beneficiary's medical history, examine the imaging 
results, make diagnoses, draft a report, and enter communications with 
other physicians in the beneficiary's medical chart. Commenters note 
that none of these actions would take less time or effort when 
performed by a second physician in the same practice. Commenters do not 
believe this proposal reflects the true costs incurred by a practice 
when multiple physicians furnish advanced imaging services to the same 
beneficiary on the same day. Another commenter noted that cognitive 
medicine, such as diagnostic imaging cannot have global efficiencies, 
as every observer needs to independently investigate, collect data, 
formulate an educated opinion, and furnish a professional assessment.
    Commenters maintained that clinical best practice dictates that the 
images are read by subspecialized, fellowship-trained radiologists, 
trained to read specific body parts. For example, they stated, 
radiologists are trained to read either breast, musculoskeletal, body, 
neurology or oncology images. Commenters indicated that the proposal 
would penalize or disincentivize practices from having the most 
appropriate radiologist read the study, which may subject beneficiaries 
to undue risks.
    Commenters also noted that beneficiaries suffering from life-
threatening conditions such as trauma, heart attacks, and cancer often 
require multiple imaging scans to accurately and fully assess extent of 
injury and monitor disease progression and/or any improvements in 
condition. This is not uncommon in an urban hospital serving high 
acuity beneficiaries. Commenters maintained that as the complexity of 
the

[[Page 68931]]

beneficiary case increases, the likelihood that multiple scans and/or 
series will be needed in a given day increases, and thus the number of 
physicians needed to review multiple scans and/or regions of the body 
in a series of scans increases, requiring a variety of sub-specialty-
trained radiologists. Commenters concluded that the amount of work in 
the form of time, effort, and skill, does not diminish in this 
situation but rather has an additive effect, reflecting the clinical 
complexity of the beneficiary situation, not a duplication of efforts.
    A commenter noted that multi-modality images on a beneficiary are 
not always interpreted at the same time or by the same physician. 
According to the commenter, the beneficiary encounter that includes 
multiple TCs is not directly related to the performance of the PCs by 
the interpreting physician(s). The commenter indicated that through the 
use of teleradiology, the interpretations often take place at separate 
locations and by separate physicians. Finally, the commenter noted that 
this process allows differently specialized radiologists to interpret 
different images.
    A commenter maintained that CMS' reliance on both the July 2009 GAO 
report and the March 2010 MedPAC report to support its MPPR policies is 
fundamentally flawed because such sources do not appear to justify the 
proposals. The commenter noted that CMS also cites the June 2011 MedPAC 
report as further support for its MPPR application to the PC of 
diagnostic imaging services furnished by the same physician in the same 
session. The commenter indicated that the report's policy 
recommendation is for a multiple procedure payment reduction to the 
professional component of diagnostic imaging services furnished by the 
same practitioner in the same session. The commenter stated that it 
could be unfair to apply the MPPR to physicians who share a practice.
    A commenter recommended that CMS focus on applying the results of 
the Medicare Imaging Demonstration, and pursuing options to encourage 
use of appropriateness criteria, as the best solution to any problems 
of under or overutilization of imaging.
    Response: The policy of applying the imaging MPPR to physicians in 
the same group practice is consistent with other MPPR policies for 
surgical procedures and therapy services, and effective January 1, 
2013, for diagnostic cardiovascular and diagnostic ophthalmology 
procedures under the PFS. We continue to believe that the typical 
efficiencies achieved when the same physician is furnishing multiple 
procedures also accrue when different physicians in the same group 
furnish multiple procedures involving the same beneficiary. We believe 
that efficiencies exist in the parts of the service that deal directly 
with patients, such as gowning and obtaining consent, as well as in the 
interpretation, where the first completed interpretation is commonly 
available to the second interpreting physician at the point of 
interpretation. Although efficiencies may be less when one physician is 
remote, we still believe that efficiencies are within the ranges that 
will typically be seen across the many varied combinations of imaging 
services subject to the MPPR.
    We disagree that radiologists are routinely trained to only read 
organ specific or technology specific images. Radiologists receive 
broad training that allows them to provide services across multiple 
technologies and organ systems. Some may choose to more narrowly focus 
their practice, but in the typical radiology practice across the 
country, many radiologists continue to provide a broad range of imaging 
interpretation services.
    We agree with the commenter that higher complexity patients may 
require multiple scans. However, we disagree that this higher 
complexity negates the efficiencies that are seen with less complex 
patients. Duplication in technical component, such as greeting and 
gowning, would continue irrespective of patient complexity. Higher 
complexity patients, receiving multiple scans, provide greater support 
for the proposed MPPR policy changes. Since interpretation of an image 
builds on the clinical framework that the radiologist(s) develops for 
each patient as she reviews each scan, we believe that interpretation 
of multiple additional scans require diminishing marginal effort.
    Finally, while we agree with commenters that most physicians would 
not change the way they practice in order to avoid application of the 
MPPR, we believe application of the imaging MPPR to physicians in the 
same group practice will ensure that there is no financial incentive 
for physicians in a group practice to change their behavior to split 
imaging interpretation services for a beneficiary among different 
physicians in the group.
    It is our intention to apply this and future MPPR policies to 
services furnished by one or more physicians in the same group. Future 
modifications may be appropriate if we collect or are provided with 
data that indicates that the efficiencies associated with an individual 
physician furnishing multiple procedures do not extend to multiple 
physicians in the same group practice.
    We disagree that we have misinterpreted GAO and MedPAC policy 
recommendations. MedPAC's June 2011 recommendation for an MPPR on the 
professional component of imaging services is silent on application to 
the group practice, but since then, MedPAC has not opposed our proposal 
to apply the MPPR on the PC and TC of diagnostic imaging to physicians 
in the same group practice. Finally, the Medicare Imaging Demonstration 
is designed to test whether the use of decision support systems can 
improve quality of care by diminishing patient exposure to potentially 
harmful radiation caused by unnecessary over-utilization of advanced 
imaging services. The 2-year demonstration has recently completed its 
first year. The demonstration is a separate initiative and does not 
specifically address MPPR policy.
    Comment: Many commenters noted that administrative considerations 
prevented us from implementing this policy effective January 1, 2012. 
Commenters indicated that we have not provided a detailed explanation 
of how such administrative concerns were rectified.
    Response: Our administrative delay in implementing the policy did 
not involve the merits of the policy but the practicality of 
implementation. Medicare contractors were unable to make the necessary 
changes to their systems to effectively operationalize the policy for 
CY 2012. The necessary system changes have now been made in order for 
this policy to be operational beginning on January 1, 2013.
    Comment: Commenters expressed concern that using the NPI to define 
a group practice may be inaccurate. Commenters indicated that some 
diagnostic imaging practice members may belong to more than one NPI 
group; whereas other practitioners may be part of a smaller NPI group 
than their corporate structure would suggest. Commenters maintained 
that attempts to apply the MPPR to physicians in the same group 
practice using the NPI could lead to unfair application simply due to 
corporate governance issues. Additionally, commenters noted that 
radiologists in a group practice may also independently contract to 
furnish outside interpretations for other groups. Finally, commenters 
indicated that reliance on the NPI in these cases may lead to confusion 
and potential compliance concerns.
    Response: We have traditionally relied on the group NPI to identify

[[Page 68932]]

services furnished in the same group practice as a basis for group 
practice-level edits across the physician fee schedule. We plan to use 
the group NPI for applying the MPPR to advanced imaging services at the 
group practice level beginning in 2013. We appreciate commenter input 
on this issue and understand that physicians do not always furnish 
services within their group practice and that the group NPI may reflect 
several different organizational arrangements. Accordingly, we intend 
to further explore the issues the commenters raised regarding use of 
the group NPI to identify services furnished in the same group 
practice. For example, we could consider using a provider Tax 
Identification Number (TIN) as an alternative to the group NPI; 
however, we would need to determine whether this would create other 
operational problems. Medicare contractors would also require adequate 
time to make the necessary systems changes. We will consider these 
issues and make any changes in future rulemaking.
    Comment: Various commenters had the following concerns about the 
definition of a ``session'' and the use of modifier 59:
     Physicians use the 59 modifier appropriately to bypass the 
MPPR when multiple services are furnished to the same beneficiary in 
separate sessions on the same day. However, the 59 modifier is also 
used for the Correct Coding Initiative (CCI) edits, creating a conflict 
between the two different uses of the modifier. For example, if an MRA 
of the head and brain are furnished to the same beneficiary on the same 
day, it may be appropriate to report modifier 59 to bypass the CCI 
edit. However, the modifier 59 may also be interpreted to bypass the 
MPPR, which would not be appropriate if the services were furnished in 
the same session. They stated that this presents a quandary for both 
radiology practices and Medicare Administrative Contractors.
     CMS has provided no guidance on what constitutes a 
separate session for professional interpretation, other than ``scans 
interpreted at widely different times,'' leaving radiology practices 
vulnerable to differing interpretations by Medicare contractors, 
including Recovery Audit Contractors.
     Whether CMS' use of the word ``encounter'' is synonymous 
with ``session.''
     Multiple physicians furnishing the PC on different studies 
to the same beneficiary on the same day should constitute separate 
sessions by definition.
     Software programs in use for medical billing do not 
adequately capture interpretation times, and therefore, do not track 
whether the PC was performed in the same or different sessions and when 
the 59 modifier is appropriate. Commenters expressed concern that they 
will not be able to routinely identify when a Medicare beneficiary has 
had multiple imaging scans on the same day, especially if reports are 
generated in different locations, by different physicians, at different 
times of day. Radiology workflow systems triage studies to subspecialty 
radiologists who each separately interpret the studies and generate 
reports. Billing systems submit separate claims for each study. If two 
physicians read studies on the same beneficiary, coders and billing 
systems will have significant difficulty attaching the 59 modifier to 
the appropriate study, even if they are able to recognize that the 59 
modifier should be applied. Hospital-based radiologists rely on data 
feeds provided by their hospitals' information systems. These data-
feeds typically include beneficiary demographic information but not 
image interpretation times. Because they are unable to track the time 
of interpretation, coders and billers will be required to re-create the 
timing of interpretative sessions to determine whether or not the 
interpretation occurred in the same session.
     Radiologists in small practices, or rural hospitals and 
imaging facilities, are more likely to have only a few radiologists in 
the office. Frequently in small practices, there will be instances 
where beneficiaries have multiple advanced imaging services that are in 
clinically separate sessions, but interpreted by the individual members 
of the same small group of radiologists. It is not clear that there 
will be a way for coders, CMS contractors and auditors to understand 
and validate that these separate encounters constitute separate 
sessions.
     Contrary to CMS' claim, commenters expect there would be 
frequent circumstances requiring the use of the 59 modifier, that is, a 
distinct procedural service.
    Response: We are aware of the conflict between use of modifier 59 
for CCI edits and for purposes of bypassing the MPPR when multiple 
procedures are furnished. We are considering creating a new modifier 
for the MPPR to resolve this problem. In creating a new MPPR modifier, 
we would refine the definition of what constitutes a session. We 
believe that radiology imaging systems currently capture the time of 
each image and that image time can be provided to the interpreting 
radiologist(s). We also believe that radiology medical record systems 
currently capture the time of each professional comment or 
interpretation, and that the interpretation of the radiologist should 
contain any clinical information necessary to identify when a separate 
session has occurred. We believe that where billing systems currently 
do not capture this information in a readily usable form, that they 
will adapt to this policy and make this necessary billing information 
readily accessible to coders. Thus, we believe that coders will be able 
to determine when a separate session has occurred and will be able to 
append a 59 modifier (or new MPPR modifier for different session) to 
the claim line when such a modifier is justified.
    Alternatively, we may consider modifying the MPPR policy to apply 
to procedures furnished on the same day, rather than in the same 
session. This would resolve some of the operational difficulties with 
the use of ``session'' and conform to the policy for all other MPPRs. 
If we were to modify this MPPR to apply to procedures furnished on the 
same day rather than in the same session, we would do so through future 
rulemaking and subject to public comment.
    Comment: Commenters indicated that applying the MPPR for the PC of 
advanced imaging procedures to physicians in the same group practice 
would result in a payment reduction that would adversely affect both 
the quality of care and access to care.
    Response: We have no evidence to suggest any adverse impacts on 
either the quality of care or the access to care have resulted from the 
implementation of the MPPR to the TC of imaging in 2006 or the PC of 
imaging in 2012. We have no evidence that beneficiaries have been 
unable to obtain needed imaging, and we will continue to monitor access 
to care. MedPAC's analysis in its June 2011 report indicates there has 
been continued high annual growth in the use of imaging through 2009. 
Further, in the absence of any evidence of inadequate access or safety 
and quality concerns, declining growth in imaging services could be 
interpreted as a return to a more appropriate level of imaging 
utilization. Based on our experience with the MPPR on both the TC and 
PC of advanced diagnostic imaging services, we have no reason to 
believe that extending the imaging MPPR to physicians in the same group 
practice will have a negative impact on quality or access to care.

[[Page 68933]]

c. Proposed MPPR for the TC of Cardiovascular and Ophthalmology 
Services
    As noted above, we continue to examine whether it would be 
appropriate to apply MPPR policies to other categories of services that 
are frequently billed together, including the TC for diagnostic 
services other than advanced imaging services. For CY 2013, we examined 
other diagnostic services to determine whether there typically are 
efficiencies in the technical component when multiple diagnostic 
services are furnished together on the same day. We have conducted an 
analysis of the most frequently furnished code combinations for all 
diagnostic services using CY 2011 claims data. Of the several areas of 
diagnostic tests that we examined, we found that billing patterns and 
PE inputs indicated that multiple cardiovascular and ophthalmology 
diagnostic procedures, respectively, are frequently furnished together 
and that there is some duplication in PE inputs when this occurs. For 
cardiovascular diagnostic services, we reviewed the code pair/
combinations with the highest utilization in the CPT code ranges of 
75600 through 75893, 78414 through 78496, and 93000 through 93990. For 
ophthalmology diagnostic services, we reviewed the code pair/
combinations with the highest utilization in the CPT code ranges of 
76510 through 76529 and 92002 through 92371. The cardiovascular and 
ophthalmology diagnostic code combinations identified as most 
frequently billed together are listed in Tables 14 and 15.
    Under the resource-based PE methodology, specific PE inputs of 
clinical labor, supplies, and equipment are used to calculate PE RVUs 
for each individual service. When multiple diagnostic tests are 
furnished to the same beneficiary on the same day, most of the clinical 
labor activities and some supplies are not furnished twice. We have 
identified the following clinical labor activities that typically would 
not be duplicated for subsequent procedures:
     Greeting and gowning the patient.
     Preparing the room, equipment and supplies.
     Education and consent.
     Completing diagnostic forms.
     Preparing charts.
     Taking history.
     Taking vitals.
     Preparing and positioning the patient.
     Cleaning the room.
     Monitoring the patient.
     Downloading, filing, identifying and storing photos
     Developing film.
     Collating data.
     Quality Assurance documentation.
     Making phone calls.
     Reviewing prior X-rays, lab and echocardiograms.
    We analyzed the CY 2011 claims data for the most frequently billed 
cardiovascular and ophthalmology diagnostic code combinations to 
determine the level of duplication present when multiple services are 
furnished to the same beneficiary on the same day. Our MPPR 
determination excludes the clinical staff minutes associated with the 
activities that are not duplicated for subsequent procedures. For 
purposes of this analysis, we retained the higher number of minutes for 
each duplicated clinical activity, regardless of the code in the pair 
with which those clinical labor minutes were associated. For example, 
if code A and B had 6 and 3 minutes, respectively, of clinical labor 
for preparing and positioning the beneficiary, we removed 3 minutes. If 
code A and B had 2 and 4 minutes, respectively, of clinical labor for 
preparing room, equipment and supplies, we removed 2 minutes. The lower 
number of minutes was removed, regardless of the code. If one code had 
no minutes for a particular clinical labor activity, then no minutes 
were removed for that activity. Equipment time and indirect costs are 
allocated based on clinical labor time; therefore, these inputs were 
reduced accordingly. While we observed that some supplies are 
duplicated, we did not factor these into our calculations because they 
were low cost and had little impact on our estimate of the level of 
duplication for each code pair.
    When we removed the PE inputs for activities that are not 
duplicated, and adjusted the equipment time and indirect costs, we 
found support for payment reductions ranging from 8 to 57 percent for 
second and subsequent cardiovascular procedures (volume-adjusted 
average reduction across all code pairs of 25 percent); and payment 
reductions ranging from 9 to 62 percent for second and subsequent 
ophthalmology procedures (volume-adjusted average reduction across all 
code pairs of 32 percent). Because we found a relatively wide range of 
reductions by code pair, we believed that an across-the-board reduction 
of 25 percent for second and subsequent procedures (which is 
approximately the average reduction supported by our analysis) would be 
appropriate. In the CY 2013 proposed rule (77 FR 44748-44752), we 
proposed to apply an MPPR to TC-only services and to the TC portion of 
global services for the procedures listed in Tables 12 and 13. The MPPR 
would apply independently to second and subsequent cardiovascular 
services and to second and subsequent ophthalmology services. We 
proposed to make full payment for the TC of the highest priced 
procedure and to make payment at 75 percent (that is, a 25 percent 
reduction) of the TC for each additional procedure furnished by the 
same physician (or physicians in the same group practice, that is, the 
same group practice NPI) to the same beneficiary on the same day. We 
did not propose to apply an MPPR to the PC for cardiovascular and 
ophthalmology services at this time.
    We believe that the proposed MPPR percentage represents an 
appropriate reduction for the typical delivery of multiple 
cardiovascular and ophthalmology services on the same day. Because the 
reduction is based on discounting the specific PE inputs that are not 
duplicated for second and subsequent services, the proposal is 
consistent with our longstanding policies on surgical, nuclear medicine 
diagnostic procedures, and advanced imaging procedures, which apply a 
50 percent reduction to second and subsequent procedures, and our more 
recent policy on therapy services, which applies a 20 or 25 percent 
reduction depending on the setting.
    Furthermore, it is consistent with section 1848(c)(2)(K) of the 
Act, which specifies that the Secretary shall identify potentially 
misvalued codes by examining multiple codes that are frequently billed 
in conjunction with furnishing a single service, and review and make 
appropriate adjustments to their relative values.
    Finally, it is responsive to continued concerns about significant 
growth in spending on imaging and other diagnostic services, and to 
MedPAC (March 2010) and GAO (July 2009) recommendations regarding the 
expansion of MPPR policies under the PFS to account for additional 
efficiencies. Savings resulting from this proposal would be 
redistributed to other PFS services as required by the general 
statutory PFS BN provision.
    In summary, we proposed that for services furnished on or after 
January 1, 2013, we will apply the MPPR to nuclear medicine procedures 
to CPT code 78306 (Bone imaging; whole body) when followed by CPT code 
78320 (Bone imaging; SPECT). We will apply the MPPR to the PC and the 
TC of advanced imaging procedures when furnished by multiple physicians 
in the same group practice (same group NPI). Therefore, the MPPR will 
apply when

[[Page 68934]]

one or more physicians in the same group practice furnish services to 
the same beneficiary, in the same session, on the same day. Finally, we 
proposed to apply an MPPR to TC-only services and to the TC portion of 
global services for diagnostic cardiovascular and ophthalmology 
procedures. The reduction would apply independently to cardiovascular 
and ophthalmology services. We proposed to make full payment for the TC 
of the highest priced procedure and payment at 75 percent of the TC for 
each additional procedure furnished by the same physician (or 
physicians in the same group practice, that is, the same group practice 
NPI) to the same beneficiary on the same day.
    The following is a summary of the comments we received on this 
proposal to apply the MPPR to diagnostic cardiovascular and 
ophthalmology procedures:
    Comment: MedPAC supported the proposal to expand the MPPR to 
cardiovascular and ophthalmology diagnostic services. Furthermore, 
MedPAC encouraged CMS to examine whether there are efficiencies in 
physician work that occur when multiple tests are furnished in the same 
session that would justify applying the MPPR to the PC of these 
services. For example, when multiple tests are performed together, 
certain physician activities (such as reviewing the beneficiary's 
medical records and discussing the findings with the referring 
physician) are likely to occur only once.
    In the PFS proposed rule for CY 2012 (76 FR 42812-42813), CMS 
solicited comments on whether the MPPR should be applied to the TC of 
all diagnostic tests, rather than just imaging procedures. In response, 
MedPAC examined Part B claims data from 2010 to look for diagnostic 
tests that are frequently furnished more than once on the same day by 
the same physician for the same beneficiary. MedPAC found that several 
surgical pathology codes are frequently billed with more than one unit 
of service on the same date. For example, one-third of the claims for 
CPT code 88305 (Level IV, surgical pathology, gross and microscopic 
examination) contained more than one unit of service for that code. In 
addition, 57 percent of the claims for CPT code 88342 
(immunohistochemistry, each antibody) contained more than one unit of 
service for that code. In these cases, it appears that multiple 
specimens from the same beneficiary were examined at the same time by 
the same pathologist. MedPAC indicated that CMS should analyze whether 
there are efficiencies in practice expense or physician work that occur 
when multiple units of the same test are performed at the same time. If 
so, MedPAC suggested that CMS should consider applying the MPPR policy 
to these services or creating bundled codes that include multiple units 
of the same test. MedPAC noted that these services account for a 
substantial and growing amount of Medicare spending. In 2010, Medicare 
spent $1.3 billion on CPT code 88305 and $241 million on CPT code 
88342.
    MedPAC noted that it has recommended expanding the MPPR to both the 
TC and PC of all imaging services to account for efficiencies in 
practice expense and physician work that occur when multiple studies 
are furnished in the same session.
    A few additional commenters either agreed with the principle of 
applying the MPPR to cardiovascular and ophthalmology services or 
concurred with our findings that efficiencies exist when multiple 
diagnostic services are furnished on the same beneficiary on the same 
day. Those commenters agreed that the application of the MPPR to the 
additional cardiovascular and ophthalmic diagnostic procedures is an 
appropriate way to recognize such efficiencies.
    Response: We appreciate the support of MedPAC and other commenters 
for our proposal to apply the MPPR to cardiovascular and ophthalmology 
services. We agree that the MPPR is an appropriate mechanism to account 
for efficiencies when multiple procedures are furnished to the same 
beneficiary on the same day in order to ensure more accurate payments.
    Comment: Most commenters opposed applying the MPPR to the TC of 
diagnostic cardiovascular and ophthalmology services. Commenters 
maintained that the assumption that there is major duplication in 
clinical labor activities is false when two studies are done in the 
same session, and especially when these services are done in separate 
sessions on the same day. Commenters stated that CMS' methodology of 
eliminating the smaller number of minutes assigned to one code in the 
frequently performed together code pairs for clinical staff and 
equipment is not appropriate for pairs of services that are: (1) 
Furnished by different types of clinical staff, with different 
expertise and training (for example, radiology technologists and 
sonographers); (2) furnished in different types of rooms (for example, 
angiography suites and vascular ultrasound lab rooms); and (3) stocked 
with unique equipment. According to commenters, many of the clinical 
labor activities considered redundant are performed multiple times, at 
different times of day, and in different rooms.
    As examples, commenters referenced the sample payment reduction 
calculations in the proposed rule for cardiovascular and ophthalmology 
services. Concerning CPT code 93306 (transthoracic echocardiography) 
and CPT code 78452 (myocardial perfusion single-photon emission 
computed tomography (SPECT)), commenters noted that different 
physicians, each supported by separately specialized clinical staff 
perform the service in different rooms on two different types of 
equipment.
    Commenters indicated that clinical teams for each test 
independently greet and gown the patient, provide education, obtain 
consent, review previous exam results and studies and position the 
patient for the test. Commenters noted that the patient is positioned 
multiple times on different exam tables. According to commenters, two 
different clinical staff will independently review prior x-ray, 
laboratory, echocardiography studies, and other studies. Also, separate 
notes are made in the patient's records, different diagnostic forms are 
completed, and different quality assurance regulatory compliance 
information must be documented for each test. Commenters noted that two 
different rooms with different specialized equipment in two different 
parts of the facility are prepared and cleaned for the two unique and 
different services. Finally, two different machines are utilized by two 
differently credentialed support staff to acquire independent and 
unrelated clinical testing data.
    Concerning CPT code 92235 (Fluorescein Angiography) and CPT code 
92250 (Fundus Photography), commenters maintained that the proposal was 
based on an erroneous understanding of how services vary. Commenters 
noted that ophthalmic diagnostic tests are not equivalent to x-ray or 
fluoroscopic imaging, where the technician simply repositions the same 
device over a nearby area of the patient's body. Commenters noted that 
ophthalmic diagnostic tests range from imaging to psychophysical tests 
using a number of different technologies and instruments that require 
patient participation by responding to various stimuli to achieve an 
objective functional measurement of the anatomical structures within 
the eye. For such tests the patient must be taken to a second 
instrument and positioned, substantially reducing any redundancy in 
direct practice expenses.

[[Page 68935]]

    Another commenter indicated that visual field testing equipment, 
and other eye diagnostic equipment, do not share interfaces, space or 
patient information. The commenter noted that each machine requires 
independent input from the testing technician; including patient name, 
date, birth date, verification of the eye being tested, and there is no 
shared registration of data between the two services.
    According to the commenter, visual field testing requires a 
dedicated space and is typically not performed at the same time as 
other diagnostic tests. Patients need a quiet area away from other 
testing and patients to complete the test. Both eyes are tested, each 
with their own input and varying lenses that must be inserted into the 
equipment. The commenter maintained that these tests require 
substantial clinical staff time, patient instruction and interaction. 
Ophthalmology patients are typically elderly, often visually impaired 
and in need of mobility and positioning assistance in order to perform 
diagnostic eye testing. Finally, the commenter highlighted that the AMA 
RUC recently removed clinical staff time from some of the codes 
reviewed in our analysis.
    Commenters disagreed that diagnostic test resource utilization for 
multiple diagnostic tests is comparable to those required for multiple 
surgeries. Commenters noted that surgical procedures generally have a 
90-day global period where more than 50 percent of the payment is 
related to postoperative care. Commenters also noted that in large 
multi-specialty practice, technical resources are located in different 
physical locations.
    Commenters recommended that CMS conduct its study with a new 
methodology that takes into account both the frequency and the 
different types of clinical staff, and the different types of rooms 
involved in the services that are performed together on the same day.
    Finally, commenters noted that CMS' own analysis reveals payment 
reductions as low as 8 percent, indicating that a payment reduction of 
25 percent would be excessive for some of these services. A commenter 
expressed concern that taking this ``average'' approach would have the 
effect of discouraging cardiologists and ophthalmologists from 
performing certain low overhead diagnostic procedures as the payment 
will be far less than the practice costs. The commenter suggested that 
in previous cases the identified savings were closer to the mean on 
average and would not result in such dramatic effects. Other commenters 
recommended that the MPPR reduction percentage should be code-specific 
up to a maximum reduction of 25 percent.
    Response: We appreciate the many comments submitted on this 
proposal. However, we disagree with commenters' statements that there 
are minimal or no efficiencies in the TC of diagnostic cardiovascular 
and ophthalmology services.
    Concerning CPT code 93306 (transthoracic echocardiography) and CPT 
code 78452 (myocardial perfusion single-photon emission computed 
tomography (SPECT)) referenced by commenters, we agree that some 
cardiovascular centers might choose to employ two differently 
specialized technicians; that is, nuclear medicine and 
echocardiography; to allow two different clinical staff to 
independently perform the studies; and to locate the different 
specialized equipment in two different parts of the practice. However, 
we continue to believe that is not the typical cardiovascular center or 
practice. We believe that the typical cardiovascular center performing 
these diagnostic tests commonly cross-train technicians to perform both 
procedures and that a single cardiologist often performs both tests for 
a single patient. In addition, we continue to believe that much of the 
pre-service work such as greeting and gowning the patient and reviewing 
medical records and previous images is redundant. We believe that some 
of the equipment used in the top code pairs is portable and can be used 
in the treatment room or other diagnostic room. We also do not believe 
that multiple rooms dedicated to individual testing equipment is 
typical such that room preparation, greeting and gowning, and cleaning 
the room are never duplicated. Overall, commenters provided general 
descriptions of practices using multiple rooms and technicians to 
furnish these services, without sufficient information supporting a 
multiple room, dedicated clinical labor model as typical outside the 
facility setting. We would review generalizable, robust data 
demonstrating that an extensive practice model of multiple rooms 
dedicated to individual tests and distinct dedicated technicians 
trained is typical practice.
    Concerning CPT code 92235 (Fluorescein Angiography) and CPT code 
92250 (Fundus Photography), we acknowledge that these tests are not 
equivalent to other imaging procedures. However, we believe there are 
still efficiencies when furnished to the same patient due to some 
duplication of clinical labor. Concerning visual field testing, we 
agree that this is an interactive test, requiring the technician to 
teach the patient how to perform the test; however, the most intense 
instruction only occurs the first time a patient has visual field 
testing. Although not considered in our analysis, we also note that 
once a patient is diagnosed with glaucoma the patient usually undergo 
visual field testing for the rest of their life, and their familiarity 
with the test reduces the clinical labor associated with providing this 
service overtime. As for the other ophthalmology tests, we understand 
them to be mostly passive with minimal patient instruction.
    Commenters expressed concerns that there is wide variation in the 
potential efficiencies among different code pairs; that such 
variability precludes broad application of a single percentage 
reduction; and, that establishing new combined codes is the only 
mechanism for capturing accurate payment for multiple imaging services. 
In general, we believe that MPPR policies capture efficiencies when 
several services of the same type are furnished in the same session and 
that it is appropriate to apply a single percentage reduction to second 
and subsequent procedures to capture those efficiencies. Because of the 
myriad potential combinations of diagnostic services, establishing new 
combined codes for each combination of advanced imaging scans is 
unwieldy and impractical. An MPPR policy reflects efficiencies in the 
aggregate, such as common patient history, application of multiple 
tests to the same anatomical structures by the same clinical labor, 
frequently with the same modality, for the same patient.
    As previously noted, we found support for payment reductions 
ranging from 8 to 57 percent for second and subsequent cardiovascular 
procedures (volume-adjusted average reduction across all code pairs of 
25 percent); and payment reductions ranging from 9 to 62 percent for 
second and subsequent ophthalmology procedures (volume-adjusted average 
reduction across all code pairs of 32 percent). Based on this analysis, 
and because we found a relatively wide range of reductions by code 
pair, we believed that an across-the-board reduction of 25 percent for 
second and subsequent procedures, which is approximately the average 
reduction supported by our analysis, would be appropriate. Based on 
subsequent public comments, we have conducted additional analysis on 
ophthalmology code pairs discussed below. In response to comment that 
this MPPR application to ophthalmic and cardiovascular diagnostic 
testing is not the same as the MPPR for global surgery,

[[Page 68936]]

we agree. We have provided our analysis for why we proposed a 25 
percent reduction on second and subsequent diagnostic tests rather than 
a 50 percent reduction. We note that, as with many of our policies, we 
will continue to review this MPPR policy and refine it as needed in 
future years to ensure that we continue to provide accurate payments 
under the PFS.
    Comment: A commenter noted that several ophthalmology codes 
included in our analysis have been reviewed by the AMA RUC within the 
last year, which resulted in the recommended removal of several minutes 
of clinical staff time for activities that the AMA RUC determined are 
also included within an accompanying office visit code. The commenter 
indicated that CMS' acceptance of the AMA RUC recommendation, as well 
as applying the MPPR, would effectively double the practice expense 
reductions. The codes reviewed by the AMA RUC for CY 2013 were: CPT 
codes 92081-92083 (Visual field examinations), CPT code 92235 
(Fluorescein angiography) and CPT code 92286 (Internal eye 
photography). As discussed above, commenters noted that visual field 
testing equipment and other eye diagnostic equipment do not share 
interfaces, space or patient information, that there is no shared 
information with other tests, that the tests required separate staff 
time and clinical instruction, and that visual field testing happens in 
a dedicated space away from other testing.
    The commenter requested that any ophthalmic tests that had their 
time reduced because of duplication with an office visit should be 
removed from the list of codes subject to the MPPR. Specifically, the 
commenter requested that the three visual field tests CPT codes 92081, 
92082 and 92083 and CPT code 92235 (Fluorescein angiography) and CPT 
code 92286 (Internal eye photography) for which minutes were reduced 
that were not reflected in the CMS analysis should be removed from the 
list. Additionally, the commenter indicated that CPT codes 92133, 92134 
and 92285 all had their clinical staff labor times previously reduced 
during the AMA RUC consideration and should not be included in the 
MPPR.
    Commenters also expressed concern about CPT codes that have 
recently been reviewed or are in the process of being reviewed under 
the various misvalued services screens. Commenters noted that these 
codes have already been subjected to a process where duplicative 
minutes have been reduced. Therefore, they requested that any codes for 
procedures where the AMA RUC has reviewed the PE inputs in the last 2 
years be removed from this proposed list of services.
    Response: Our original proposed rule analysis for the subject 
ophthalmology codes was based on the latest AMA RUC PE worksheets 
available at that time. The PE worksheets are the basis for the direct 
practice expense inputs used in the PE methodology. They delineate 
minutes of the clinical staff time, equipment, and supplies for each 
clinical labor activity, for each CPT code. We subsequently reviewed 
the CY 2013 PE worksheets for the subject codes, which appeared in many 
of the ophthalmology code combinations reviewed. The AMA RUC did not 
reduce clinical labor minutes for CY 2013 for two of the reviewed code 
pairs (76514 with 92286 and 92081 with 92285). The most significant 
change in clinical labor activities for the other reviewed code pairs 
was the reduction of time for preparing and positioning the patient 
from either 7 or 10 minutes to 2 minutes. Because we never reduced this 
activity by more than 2 minutes, the AMA RUC changes to this clinical 
labor activity had no effect on our calculation. In all cases, the 
subject codes are the highest paid codes in the code combination. The 
payment reductions range from 9 to 62 percent for second and subsequent 
ophthalmology procedures, noted in the proposed rule, remains 
unchanged. However, the volume-adjusted average reduction across all 
code pairs, originally calculated at 32 percent is revised to 22 
percent.
    We disagree that recently reviewed codes should be exempt from the 
MPPR. However, we agree that the analysis establishing an MPPR should 
be based on the most current practice expense data available, and that 
the recent clinical labor reductions made to the subject codes should 
be taken into account. Therefore, based on our revised analysis, we are 
reducing the final MPPR on ophthalmology services from 25 percent to 20 
percent to more accurately reflect the new data.
    Comment: Commenters expressed concern about the lack of 
transparency in the methodology and data sets used to develop the 
proposed MPPR. Commenters noted that CMS did not post basic data files 
on its Web site until August 10, 2012, less than 30 calendar days from 
the comment deadline. Commenters also indicated that the posted data 
did not enable them to understand the cuts or replicate the data used 
to form the basis of the proposed MPPR. Commenters believed that this 
unfairly hampered their ability to fully analyze the proposal. 
Commenters urged us not to implement this proposed policy until full 
access to the data used to develop the policy is provided.
    Response: We have provided full access to the data that we used to 
develop the policy. We have listed every code pair reviewed and every 
clinical labor activity considered for duplication. In addition, we 
provided a description of how the analysis was conducted, the range of 
reductions found and the adjusted average reduction determined for 
cardiovascular and ophthalmology services. We acknowledge that the PE 
worksheets were not made available simultaneously with the publication 
of the proposed rule. Upon receiving requests from various specialty 
groups to supplement the information we provided in the proposed rule, 
we posted the PE worksheets used in the analysis on our Web site. We 
posted these data in August 2012, approximately one month before the 
comment period ended. We believe the information provided in the 
proposed rule would have been sufficient to permit full consideration 
of our proposed policy, but agreed to provide greater detail to assist 
commenters in further evaluating the proposal.
    Comment: Commenters indicated that we stated in the proposed rule 
that the code pairs published the MPPR analysis are frequently billed 
together. However, the AMA RUC determined that only four of the 
cardiology pairs (CPT codes 93320-93325, 93320-93351, 93965-93970 and 
78452TC-93017), and only one ophthalmology code pair (CPT codes 92235 
and 92250), are typically reported together on the same date of 
service. Commenters stated that the computerized ophthalmic diagnostic 
imaging codes (92133 and 923134) were created in 2011 and were not 
included in this analysis.
    Commenters further noted that every other code pair is reported 
together at or below 40 percent of the time, with over half below 20 
percent. They stated that not only are these services not commonly 
billed together, they are not performed on contiguous body parts and 
are not always performed on the same type of equipment or even in the 
same room. Further, the services would sometimes be performed by 
different physicians in the same group practice.
    In addition, commenters indicated that a broader analysis of the 
claims data for all the analyzed codes pairs for cardiovascular and 
ophthalmology suggest that only roughly four percent of the code 
combinations are typically performed together on the same date of 
service. Given that these services are rarely performed on the same day

[[Page 68937]]

together, it is unreasonable to assume there would be efficiencies 
gained when these services are performed together.
    Commenters maintained that efficiencies in practice expense are 
potentially created only when the two services are similar, use the 
same instrument, and are commonly performed together. Commenters 
indicated, however, that for more low-volume code pairs, the practice 
will not have the same level of familiarity, including the office 
equipment set up, to conduct these services. Commenters further noted 
that the differences between these services are such that even if all 
these services were commonly billed together, physician staff could not 
provide noticeable efficiencies.
    Response: In the CY 2013 proposed rule (77 FR 44748), we indicated 
that we analyzed the CY 2011 claims data for the most frequently billed 
cardiovascular and ophthalmology diagnostic code combinations to 
determine the level of duplication present when multiple services are 
furnished to the same patient on the same day. For cardiovascular 
diagnostic services, we reviewed the code pair/combinations with the 
highest utilization in code ranges 75600 through 75893, 78414 through 
78496, and 93000 through 93990. For ophthalmology diagnostic services, 
we reviewed the code pair/combinations with the highest utilization in 
code ranges 76510 through 76529 and 92002 through 92371.
    The frequency of code combinations reviewed for cardiovascular 
services ranged from 260 to 207,573 and for ophthalmology services from 
4,193 to 553,502. Although utilization was low for some code 
combinations reviewed, we examined the top highest frequency code 
combinations for each of the five code groups examined (three for 
cardiovascular and two for ophthalmology). The frequency with which a 
code combination is furnished does not diminish the potential 
efficiencies in clinical labor activities that will occur when that 
code combination is furnished. All MPPR policies (surgery, diagnostic 
imaging and therapy) apply to all code combinations of procedures 
subject to the policy, regardless of the frequency that the code 
combination was furnished. Therefore, we believe it is appropriate to 
apply the MPPR regardless of the frequency which the code combination 
is billed. Applying the MPPR to code combinations furnished 
infrequently will have a minimal effect on overall payments for imaging 
services. Finally, we based our final recommended percent reduction on 
the volume-adjusted average reduction observed in our code pair 
analysis, which ensures that when the MPPR is applied, the reduction 
adjustment is more likely to reflect the actual reduction for the code 
pair. MPPR policies have been consistently applied to all multiple 
procedures and are not restricted to those with the highest frequency 
of billings.
    Comment: Commenters noted that the MPPR is partly designed to 
address the growth in imaging and diagnostic services, as noted by 
MedPAC. Commenters further noted that in recent years the rate of 
imaging growth for both Medicare and private payor patients has slowed 
considerably, and concluded that additional payment reductions are 
unwarranted and unnecessary. Commenters cited an article in the August 
2012 issue of Health Affairs further confirming this trend, noting that 
the growth rate of advanced diagnostic imaging slowed to single digits 
beginning in 2006. The study concluded that the use of MRI in Medicare 
slowed to an average 2.6 percent annual growth rate from 2006-2009. In 
addition, commenters maintained that 2008 and 2009 data from MedPAC and 
the AMA demonstrate that the rate of volume growth for diagnostic 
imaging services overall is now generally lower than the rate of growth 
for all other physicians' services. Commenters further maintained that 
the volume of all physicians' services grew by 3.6 percent in 2008 and 
2009 while the volume of diagnostic imaging services rose by 3.3 
percent in 2008 and 2.2 percent in 2009.
    Another commenter noted that ultrasound services have never 
experienced rapid growth, but rather, have experienced only moderate 
growth. The commenter cited GAO's September 2008 report to Congress 
that found that after the implementation of DRA cap, which for vascular 
ultrasound services resulted in reductions of greater than 40 percent, 
the disparity in utilization between ultrasound and expensive, advanced 
imaging modalities continued to grow. The commenter noted that this is 
reflected by the Congressional Budget Office's (CBO) December 2008 
recommendations to Congress in which it excluded ultrasound and other 
inexpensive imaging modalities from its policy recommendations on 
advanced imaging services. Commenters concluded that imaging has 
absorbed numerous payment reductions and that it is illogical to target 
procedures for reduction that do not demonstrate a pattern of rapid 
growth.
    Response: MedPAC's analysis in its June 2011 report indicates there 
has been continued annual growth in the use of imaging. While overall 
growth may be lower than it was in the last decade, declining growth in 
imaging services could be interpreted as a return to a more appropriate 
level of imaging utilization without any accompanying evidence of 
inadequate access or safety and quality concerns. As indicated 
previously, MedPAC has expressed support for the MPPR on diagnostic 
cardiovascular and ophthalmology services.
    Comment: A commenter noted that many of the code pair combinations 
identified by CMS for the MPPR on cardiovascular services are not 
cardiovascular services, specifically, CPT 75600-75893, 78414-78496, 
and 93000-93990. The commenter further noted that it is highly unlikely 
that these codes would be furnished to the same patient on the same day 
by the same physician. For example, the AMA RUC database indicates CPT 
code 93980 for penile vascular study was provided by cardiologists less 
than 1 percent of the time to Medicare patients in 2011. The commenter 
did not recommend removing the codes from the MPPR list because their 
presence produces no impact. However, the commenter indicated that the 
inclusion of codes unrelated to cardiovascular creates doubts about the 
thoroughness and validity of the analysis underlying the proposal.
    Response: In reviewing the group of codes that we refer to as 
cardiovascular services, we looked at services involving the heart and 
vessels, regardless of the specialty that furnishes them. For example, 
penile vascular services are vascular services. Whereas we would not 
expect a urologist to perform trans-esophageal echoes, nor would we 
expect a cardiologist to perform penile studies, we would not be 
surprised to find some generalists, or even general vascular surgeons, 
evaluating the penile vasculature along with, for example, the 
vasculature of the lower extremities. And even if, as the commenter 
suggested, it would be unlikely for certain codes to be billed by the 
same physician on the same day, then the MPPR simply would not apply.
    Comment: Commenters questioned how the MPPR on cardiovascular 
services would apply to remote monitoring CPT codes 93279-93296. 
Specifically, they indicated that it is unclear whether the date of 
service is: (1) The day the patient transmits their data; (2) the day 
the data is received in the physician's office for technician review, 
technical support and

[[Page 68938]]

distribution of results; or (3) the day the physician reviews the data; 
all of which may represent different dates of service. The commenters 
indicated that because there is no specific identification of the date 
of service within the CPT description, applying the MPPR is likely to 
create confusion among physicians. Commenters recommended that we 
either remove these codes from the list subject to the MPPR or issue 
instructions that specifically indicate how dates of service within the 
90-day monitoring period should be addressed.
    Another commenter noted that CPT codes 93293 (Transtelephonic 
rhythm strip pacemaker evaluation(s) single, dual, or multiple lead 
pacemaker system, includes recording with and without magnet 
application with analysis, review and report(s) by a physician or other 
qualified health care professional, up to 90 days), 93296 
(Interrogation device evaluation(s) (remote), up to 90 days; single, 
dual, or multiple lead pacemaker system or implantable cardioverter-
defibrillator system, remote data acquisition(s), receipt of 
transmissions and technician review, technical support and distribution 
of results), and 93299 (Interrogation device evaluation(s), (remote) up 
to 30 days; implantable cardiovascular monitor system or implantable 
loop recorder system, remote data acquisition(s), receipt of 
transmissions and technician review, technical support and distribution 
of results) describe the TC for remote interrogation of the devices, 
meaning that the patient is not physically present when the service is 
furnished. The commenter questioned how it is possible for efficiencies 
to exist in the rare circumstance these services were furnished on the 
same date as a cardiovascular diagnostic service. The commenter 
indicated that the inclusion of these codes demonstrates a lack of 
understanding of how diagnostic services are furnished to 
beneficiaries.
    Response: The appropriate date of service used to bill codes 
subject to the MPPR is the same as required by Medicare billing 
instructions. We note that codes in the range of CPT codes 92293 
through 92299 should be consistently treated regarding application of 
the MPPR. Since we did not propose to include all codes in this range 
for the MPPR, we have removed remote monitoring codes CPT codes 93293 
and 93296 from the list of procedures subject to the MPPR. We note that 
CPT code 93299 was not on the proposed list.
    Comment: A commenter noted that diagnostic ultrasound offers a 
number of important advantages compared to CT and MRI, in terms of 
safety and effectiveness. For example, ultrasound is non-invasive and 
offers real-time imaging, allowing for examinations of structures at 
rest and in motion and does not use ionizing radiation. Although not 
always a good substitute for other advanced imaging modalities, 
ultrasound is an effective diagnostic tool in many cases.
    The commenter further noted that, due to the relatively low payment 
rates for ultrasound procedures, they are one of the most cost-
effective diagnostic imaging modalities. The commenter indicated that 
analyses performed by GAO in 2008 and others have shown that lower cost 
imaging modalities such as ultrasound have declined in use relative to 
more expensive imaging modalities, negatively impacting the quality and 
cost of their health care.
    The commenter concluded that payment reductions to ultrasound 
services have threatened the ability to furnish such services. 
Therefore, the commenter requested removal of all ultrasound procedures 
from the list of procedures subject to the MPPR on cardiovascular 
services.
    Another commenter noted that the June 2011 MedPAC report focused on 
advanced diagnostic imaging services and supported increasing, rather 
than decreasing, the payments for ultrasound services. The commenter 
indicated that the report suggests reforming the Medicare fee-for-
service system to encourage the use of high-value services and 
discourage the use of low-value services. In describing what is meant 
by low-valued services, MedPAC points to situations where two services 
may be equally safe and effective, yet one is more expensive than the 
other. The commenter indicates that this is the situation with 
ultrasound as compared to other, more expensive imaging services. 
Finally, the commenter noted that the report suggested that services 
that can potentially harm patients, for example, overexposure to 
radiation, should be considered low-value. The commenter indicates that 
ultrasound, which is non-ionizing, poses less risk to patients than 
other modalities.
    Response: The MPPR on diagnostic imaging procedures has included 
CT, MRI and ultrasound since 2006. MedPAC, as noted in its comment 
above, has supported our previous MPPR proposals and has not 
recommended excluding ultrasound from MPPR on diagnostic cardiovascular 
and ophthalmology services. MPPR policies are resource-based. MPPR 
policies for the TC reduce payment in situations where there is overlap 
in resources employed in the delivery of multiple services, with 
comparable practice expense inputs, when those resources are only 
employed once. We do not apply the MPPR to ultrasound used in place of 
other modalities, only when it is used in addition to, other modalities 
in the same session. We do not expect the MPPR to encourage 
radiologists to forego ultrasound imaging in favor of advanced imaging 
modalities.
    Comment: Commenters noted that the AMA RUC and the CPT Editorial 
Panels have been working to combine services frequently billed together 
into comprehensive codes and to remove overlapping physicians' services 
from the payment rates. Commenters indicated that the effort to combine 
codes and reduce payment for duplicate services has been accelerated by 
CMS after the threshold for analyzing services billed together was 
reduced from 95 percent to 75 percent overlap.
    Commenters urged CMS to be mindful of this work and to fully take 
into account the AMA RUC review of the code pairs. Commenters found it 
contradictory for CMS to utilize the AMA RUC process and accept the PE 
payment principle, only to disregard the methodology in applying an 
MPPR; and suggested that duplication of work in services performed on 
the same date of service should be addressed at the individual code 
level rather than through an MPPR.
    Another commenter recommended that CMS ask the AMA RUC to review 
the codes and make code-specific recommendations and claimed that 
implementing payment reductions that are not specific does a disservice 
to the entire AMA RUC process and all of the physicians who are paid 
under the PFS.
    Commenters disputed the assumption that an MPPR is a valid and 
accurate mechanism to value services when performed on the same date of 
service. Commenters indicated that, historically, the AMA RUC has 
recognized that efficiencies can be gained when services are commonly 
performed by the same physician on the same date of service, but only 
when explicit criteria are met. The commenters indicated that the 
proposal fails to meet these criteria because the services are not 
commonly billed together, are not analogous services performed on 
contiguous body parts, and applies to both individual physicians and 
physicians in the same group practice.
    Commenters maintained that the vague justification for selecting 
particular codes in the CY 2013 rule stands in stark contrast to the 
AMA RUC. According to commenters, the AMA RUC process set a clear and

[[Page 68939]]

distinct threshold for analyzing codes billed together, that is, 75 
percent of the time. In contrast, according to commenters, the proposal 
fails to define ``frequently billed'' thus creating a substantial 
barrier to a clear comprehension of the MPPR expansion.
    Response: As we have indicated previously (76 FR 73077-73078), the 
MPPR is not intended to supersede the AMA RUC process of developing 
recommended values for services described by CPT codes. We continue to 
appreciate the work done by the AMA RUC and encourage the AMA RUC to 
continue examining code pairs for duplication based upon the typical 
case, and appropriately valuing new comprehensive codes for bundled 
services that are established by the CPT Editorial Panel. We view the 
AMA RUC process and the MPPR policy as complimentary and equally 
reasonable means to the appropriate valuation and payment for services 
under the PFS. We note that as more code combinations are bundled into 
a single complete service reported by one CPT code, the MPPR policy 
would no longer apply to the combined services. At the same time, the 
adoption of the MPPR for the TC of diagnostic cardiovascular and 
ophthalmology services will address duplications in the PE to ensure 
that Medicare payment for multiple diagnostic services better reflects 
the resources involved in providing those services.
    As noted previously, although less precise than creating new 
comprehensive codes to capture each unique combination of diagnostic 
services that could be performed together, we believe that an MPPR 
policy appropriately addresses efficiencies present when multiple 
diagnostic services are furnished together. Moreover, we believe it 
would be unwieldy and impractical to develop unique codes and values 
for the myriad of procedure combinations that could be furnished 
together. In addition, we believe that the expansion of the MPPR policy 
to the TC of diagnostic cardiovascular and ophthalmology services is 
consistent with both the GAO and MedPAC recommendations. Finally, we 
already have discussed information on the determination of frequently 
billed services in response to comments on this rule concerning the 
most frequently billed cardiovascular and ophthalmology diagnostic code 
combinations used in our analysis.
    Comment: A commenter indicated that the statutory authority cited 
by CMS for the proposed MPPR expansion and new MPPR policy only grants 
CMS the authority to modify the reimbursement for ``codes'' and does 
not provide CMS with the authority to implement multiple service 
reductions. The commenter maintains that Congress bestowed CMS with 
specific and limited authority to implement multiple service reductions 
in another part of the Act and that this confirms that Congress did not 
intend to provide the authority that CMS claims under the 
``misevaluation'' clause. The commenter stated that the misvalued codes 
section of the Act that addresses multiple services frequently billed 
together as potentially misvalued does not give CMS the authority to 
implement either of its proposed MPPR policies. The commenter did not 
believe that the codes are ``misvalued'' within the meaning of the 
statutory provision CMS cites, and maintains that CMS has effectively 
conceded this point, as it continues to use the existing relative value 
units (RVUs) for single services. The commenter maintains that CMS is 
not contending that the activities and items described in the RVUs are 
not, in fact, part of the service; but rather, CMS is attempting to 
effectively reset the conversion factor based on its assumption that 
costs can be saved in multiple procedure scenarios, but the statute 
does not permit CMS to institute multiple conversion factors. Another 
commenter merely suggested that there was inadequate legal basis for 
the proposal.
    Another commenter noted that payment rates for x-rays under the 
OPPS are significantly higher than payment rates under the PFS. The 
commenter indicated that application of the MPPR in a non-hospital 
setting will cause procedures to shift to the hospital setting. The 
commenter recommended paying the lower of (1) full payment under the 
OPPS rate for procedure with the higher fee, and 50 percent of the OPPS 
rate for the second procedure, or (2) full payment for both procedures 
under the PFS.
    Response: We believe that the application of the MPPR to the PC of 
second and subsequent advanced imaging services furnished in the same 
session to the same patient is fully consistent with section 
1848(c)(2)(K) of the Act, especially given our authority to adopt 
ancillary policies under section 1848(c)(4). We also note that we have 
had several MPPR policies in place for many years before the enactment 
of section 1848(c)(2)(K) of the Act.
    As explained previously, section 1848(c)(2)(K)(i) of the Act 
requires the Secretary to identify services within several specific 
categories as being potentially misvalued and to make appropriate 
adjustments to their relative values. One of the specific categories 
listed under section 1834(c)(2)(K)(ii) of the Act is ``multiple codes 
that are frequently billed in conjunction with furnishing a single 
service.'' Although some code pair combinations will occur 
infrequently, the codes subject to the MPPR are frequently found in 
groups of multiple codes that are billed in conjunction with furnishing 
a single service. Section 1848(c)(2)(K)(ii) of the Act specifies that 
we should examine not only individual codes, but also families of 
codes. We believe the MPPR policy contributes to fulfilling our 
statutory obligations under section 1848(c) of the Act by more 
appropriately valuing combinations of imaging services furnished to 
patients and paid under the PFS.
    As previously noted, Medicare has a long-standing policy of 
applying an MPPR to surgical procedures. While the various MPPRs have 
been adopted through notice and comment rulemaking as administrative 
actions, the Congress has acknowledged our authority to adopt MPPRs by 
directly modifying several of them, and by exempting the payment 
changes relating to several others from budget neutrality adjustment 
under the PFS. For example, section 5102(a) of the DRA exempted from 
the PFS budget neutrality adjustment the changes in expenditures 
resulting from the MPPR on the TC of diagnostic imaging. Section 
3135(b) of the Affordable Care Act increased the MPPR reduction 
percentage on the TC of diagnostic imaging from 25 to 50 percent. 
Sections 3 and 4 of the PPATRA decreased the MPPR reduction percentage 
on the PE of therapy services from 25 to 20 percent for therapy 
services furnished in office settings, and exempted from budget 
neutrality the change in expenditures resulting from the MPPR on 
therapy services from budget neutrality.
    We appreciate the commenter's suggestions concerning alternate 
payment methodologies, that is, payments based on the OPPS rate, and we 
will consider them further for possible rulemaking in the future.
    Comment: A commenter noted that the proposed list of cardiovascular 
procedures subject to the MPPR did not include the global services that 
have different procedure codes than the corresponding technical 
services, which are on the list. The commenter specifically mentioned 
CPT codes 93005, 93016, 93040, and 93224, representing global services 
for electrocardiograms, cardiac stress tests, rhythm 
electrocardiograms, and Holter monitors, respectively. Lastly, the 
commenter noted that, because such codes were not proposed for 
inclusion

[[Page 68940]]

in the MPPR, it would violate the Administrative Procedure Act to 
subject them to the MPPR through this final rule.
    Response: The commenter is correct that we had not specifically 
identified global services that have different CPT codes than the 
corresponding TC on the proposed cardiovascular MPPR code list. 
However, we indicated in the proposed rule (77 FR 44749) that the MPPR 
applies to TC services and the TC of global services. As such, it is 
consistent with the proposed policy (which we are finalizing in this 
final rule with comment period as described here), and not inconsistent 
with the Administrative Procedure Act, to include these codes on the 
list of codes to which the MPPR will apply. In response to the comment, 
we have added the following global services to the cardiovascular MPPR 
list: CPT code 93000 (Electrocardiogram complete); CPT code 93015 
(Cardiovascular stress test); CPT code 93040 (Rhythm ECG with report); 
CPT code 93224 (Ecg monit/reprt up to 48 hrs); CPT code 93268 (ECG 
record/review); and CPT code 93784 (Ambulatory BP monitoring). The 
technical portion(s) of such codes will be subject to the MPPR. We note 
that CPT code 93005 (Electrocardiogram tracing) is a TC service already 
on the list, and CPT code 93016 (Cardiovascular stress test) is a PC 
service not subject to the MPPR.
    Comment: Several commenters noted that the following add-on codes 
were included on the list of procedures subject to the MPPR on 
cardiovascular procedures: CPT code 75774 (Artery x-ray each vessel); 
CPT code 78496 (Heart first pass add-on); CPT code 93320 (Doppler echo 
exam heart); CPT code 93321 (Doppler echo exam heart); and CPT code 
93325 (Doppler color flow add-on). Commenters indicated that such codes 
have already been valued to reflect efficiencies.
    Response: We agree that these codes should not be subject to the 
MMPR and have removed them from the list. While three of these codes 
were included in our analysis, their inclusion had no effect on the 
results. For example, CPT codes 93320 and 93325 contain none of the 
clinical labor activities that might be duplicated. While duplicated 
clinical labor was noted in the code combinations including CPT code 
77774, it affected neither the payment reduction range of 8 to 57 
percent for second and subsequent procedures, nor, due to the extremely 
low utilization, the volume-adjusted average reduction across all code 
pairs of 25 percent.
    Comment: Commenters noted that it was unclear exactly how we 
adjusted the equipment minutes in calculating the MPPR reduction and 
requested additional details.
    Response: In general, the minutes allocated to particular direct PE 
equipment items are based on the amount of time clinical labor would 
use the equipment for a typical service. When the clinical labor 
minutes were reduced in our analysis, and those minutes had been used 
to allocate minutes to the equipment, we made corresponding reductions 
to the equipment minutes so that the equipment minutes matched the 
adjusted clinical labor times.
    Comment: One commenter expressed concern that because pediatric 
cardiologists assess multiple aspects of a patient's cardiovascular 
status, the MPPR on cardiovascular services has an unjust impact on 
pediatric cardiology practices in the diagnosis and treatment of 
congenital heart diseases. The commenter noted that the functional and 
structural assessment of these multiple aspects requires the pediatric 
cardiologist to perform multiple procedures on the pediatric patient. 
It also requires special training and more time than a non-congenital 
adult assessment. According to the commenter, an echocardiogram 
performed to evaluate for congenital heart disease includes multiple 
types of different procedures/assessments which require a unique level 
of skill, training, and time when compared to the adult non-congenital 
assessment.
    The commenter urged us to exclude the following codes from the MPPR 
on cardiovascular services: CPT codes 93303 and 93304 (Congenital 
transthoracic echocardiography); CPT code 93308 (Limited non-congenital 
code used for follow-up studies); and CPT codes 93320, 93321 and 93325 
(Spectral and Color Doppler). The commenter maintained that excluding 
these codes would have no demonstrable effect on Medicare utilization 
of cardiology services since cardiologists treating adult patients 
rarely bill the congenital echocardiography codes to Medicare. The 
commenter noted that because most adult non-congenital transthoracic 
echocardiography studies that are billed to Medicare have been bundled 
into CPT code 93306 (including non-congenital echocardiography CPT 
codes 93307, 93320 and 93325), the significant decrease in payment for 
the subject codes would disproportionately impact pediatric 
cardiologists.
    The commenter further noted that state Medicaid agencies and 
private sector health insurance payors use Medicare guidelines and RVU 
valuations to establish their own payment protocols. Therefore, the 
repercussions of these reductions will extend across all payor sources 
for pediatric cardiology practices and have a materially significant 
impact on the financial viability of many practices. Finally, the 
commenter indicated that the inclusion of the subject codes in the 
proposed MPPR would exacerbate the current shortage of available 
fellowship positions that recruit medical residents into pediatric 
cardiology, and will impair their ability to provide patient access to 
this life-saving specialty care, especially to medically underserved 
areas.
    Response: We appreciate the commenter's concerns as to the impact 
of this policy on pediatricians. While we recognize that 
echocardiography training for congenital cardiovascular abnormalities 
may be different from that for adults, we are not convinced that the 
MPPR does is not equally applicable to pediatric and adult 
cardiologists. The purpose of the MPPR policy is to account for the 
efficiencies inherent when multiple procedures are furnished together. 
We do not believe that those efficiencies differ significantly from 
diagnostic testing on adults versus pediatric patients for these code 
pairs.
    We considered the specific scenarios presented by the commenter's 
in the context of MPPR methodology and identified the same or similar 
efficiencies regardless of whether the multiple diagnostic procedures 
were targeted at abnormal flow in response to congenital structural 
abnormalities or were targeted at functional abnormalities in response 
to primary vascular disease. We also noted that, whereas practitioners 
who perform more services that are reported separately will be impacted 
more by the MPPR, practitioners who report more services that have 
recently been bundled together will have a similar impact due to the 
efficiencies that were considered by CMS in the valuation of those new 
bundled codes. Finally, we note that the codes are not specific to 
pediatric patients so it is not possible to exclude them for pediatric 
cardiologists alone.
    In response to the commenters concerns that other insurers may 
adopt our policies, we do not modify Medicare payment policy based on 
the fact that Medicaid and other payors may adopt such policies. We 
understand that other payors have their own unique payment systems and 
consider the appropriateness of CMS valuations in their decisions to 
accept, modify or ignore our payments. We continue to believe that the 
MPPR policy that we are

[[Page 68941]]

adopting in this final rule with comment period is appropriate for 
Medicare. Therefore, we are not excluding these codes from the MPPR.
    Comment: Several commenters maintained that the policy could result 
in the following unintended consequences:
     Create a disincentive for specialists to provide 
efficient, high quality and continuous care to their patients. Penalize 
the use of the appropriate sub-specialist, resulting in generalist 
physicians conducting multiple reads, leading to a degradation of 
diagnostic interpretation quality.
     Have a negative impact on investment in new advanced 
imaging technology and stifle innovation. New equipment offers more 
precise images and the addition of highly-trained personnel to a 
medical practice is integral to high quality patient care. Inhibit 
staff training and the addition of staff in a state of uncertainty.
     Lead to a forced reduction in necessary services, 
compromising patient access to life-saving diagnostic imaging services 
in all settings, including independent practices, community hospitals, 
and large academic medical centers.
     Drive more services out of physicians' offices and into 
more expensive hospital settings, fragment care, and increase patient 
costs.
     Reduce the efficiency of patient care and inconvenience 
patients because many would be scheduled for multiple procedures over 
multiple days instead of just one day. This would particularly 
disadvantage patients with serious medical conditions, such as multiple 
traumas, heart attacks, strokes, and cancer, who require frequent and 
multiple imaging.
     Disproportionally affect radiologists in academic medical 
centers who are often part of large group practices and who furnish 
care to a more complex patient population. These patients are often 
suffering from acute trauma or undergoing treatment for cancer and are 
more likely to have multiple examinations on the same day.
     Contradict the goal to focus more on preventive care, as 
diagnostic tests enable the early detection of potentially serious 
conditions.
    Response: We have no reason to believe that appropriately valuing 
services for payment under the PFS by revising payment to reflect 
duplication in the TC of diagnostic cardiovascular and ophthalmology 
multiple services would negatively impact quality of care, be counter-
productive to the goal of promoting preventive care, or limit patients' 
access to medically reasonable and necessary imaging services, or 
disproportionally affect certain groups. We have no evidence to suggest 
any of the adverse impacts identified by the commenters have resulted 
from the implementation of the MPPR on the TC of imaging in 2006. In 
fact, to the contrary, the analysis in MedPAC's June 2011 report 
indicates there has been continued high annual growth in the use of 
imaging. Further, it is worth noting that, without any accompanying 
evidence of inadequate access or safety and quality concerns, declining 
growth in imaging services could be interpreted as a return to a more 
appropriate level of imaging utilization.
    For the ordering and scheduling of cardiovascular or ophthalmology 
services for Medicare beneficiaries, we require that Medicare-covered 
services be appropriate to beneficiary needs. We would not expect the 
adoption of an MPPR for the TC of diagnostic cardiovascular and 
ophthalmology services to result in services being furnished on 
separate days by one physician merely so that the physician may garner 
increased payment. We agree with the commenters who noted that such an 
unprofessional response on the part of practitioners would be 
inefficient and inappropriate care for the beneficiary. We will monitor 
access to care and patterns of delivery for cardiovascular and 
ophthalmology services to beneficiaries, with particular attention 
focused on identifying any clinically inappropriate changes in timing 
of the delivery of such services.
    In summary, after consideration of the public comments received, we 
are adopting our CY 2013 proposal to apply an MPPR to the TC of 
diagnostic cardiovascular and ophthalmology services, with a 
modification to apply a 20 percent reduction for diagnostic 
ophthalmology services rather than the 25 percent reduction we had 
proposed. The reduction percentage for diagnostic cardiovascular 
services remains at 25 percent, as proposed. We continue to believe 
that efficiencies exist in the TC of multiple diagnostic cardiovascular 
and ophthalmology services and we will continue to monitor code 
combinations for possible future adjustments to the reduction 
percentage applied through this MPPR policy.
    Specifically, beginning in CY 2013 we are adopting an MPPR that 
applies a 25 percent reduction to the TC of second and subsequent 
diagnostic cardiovascular, and a 20 percent reduction to the TC of 
second and subsequent diagnostic ophthalmology services, furnished by 
the same physician (or physicians in the same group practice) to the 
same beneficiary, on the same day. In Table 10, we provide examples 
illustrating the current and CY 2013 payment amounts:

                                                 Table 10--Illustration of Current and CY 2013 Payments
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                  Total current   Total CY 2013
                                                   Code 78452      Code 93306        payment         payment               Payment calculation
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Sample Cardiovascular Payment Reduction *
--------------------------------------------------------------------------------------------------------------------------------------------------------
PC.............................................          $77.00          $65.00         $142.00         $142.00  no reduction.
TC.............................................          427.00          148.00          575.00          538.00  $427 + (.75 x $148).
--------------------------------------------------------------------------------------------------------------------------------------------------------
Global.........................................          504.00          213.00          717.00          680.00  $142 + $427 + (.75 x $148).
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Code 92235      Code 92250   Total current   Total CY 2013  Payment calculation
                                                                                        payment         payment
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                        Sample Ophthalmology Payment Reduction *
--------------------------------------------------------------------------------------------------------------------------------------------------------
PC.............................................          $46.00          $23.00          $69.00          $69.00  no reduction.
TC.............................................           92.00           53.00          145.00          134.40  $92 + (.80 x $53).
Global.........................................          138.00           76.00          214.00          203.40  $69 + $92 + (.80 x $53).
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Dollar amounts are for illustrative purposes and do not reflect actual payment amounts.


[[Page 68942]]

    No changes have been made to the proposed list for diagnostic 
ophthalmology services. We have revised the proposed list for 
diagnostic cardiovascular services by removing codes deleted for CY 
2013, add-on codes, and remote monitoring codes, and adding global 
codes corresponding to technical-only codes already on the list:

 Table 11--Changes to the Proposed List of Procedures Subject to the MPPR on Diagnostic Cardiovascular Services
----------------------------------------------------------------------------------------------------------------
         Code                Descriptor              Added/deleted                         Reason
----------------------------------------------------------------------------------------------------------------
75650.................  Artery x-rays head   Deleted......................  Deleted for CY 2013.
                         & neck.
75660.................  Artery x-rays head   Deleted......................  Deleted for CY 2013.
                         & neck.
75662.................  Artery x-rays head   Deleted......................  Deleted for CY 2013.
                         & neck.
75665.................  Artery x-rays head   Deleted......................  Deleted for CY 2013.
                         & neck.
75671.................  Artery x-rays head   Deleted......................  Deleted for CY 2013.
                         & neck.
75676.................  Artery x-rays neck.  Deleted......................  Deleted for CY 2013.
75680.................  Artery x-rays neck.  Deleted......................  Deleted for CY 2013.
75685.................  Artery x-rays spine  Deleted......................  Deleted for CY 2013.
75774.................  Artery x-ray each    Deleted......................  Add-on Code.
                         vessel.
78496.................  Heart first pass     Deleted......................  Add-on Code.
                         add-on.
93000.................  Electrocardiogram    Added........................  Global Code.
                         complete.
93015.................  Cardiovascular       Added........................  Global Code.
                         stress test.
93040.................  Rhythm ECG with      Added........................  Global Code.
                         report.
93224.................  Ecg monit/reprt up   Added........................  Global Code.
                         to 48 hrs.
93268.................  ECG record/review..  Added........................  Global Code.
93293.................  Pm phone r-strip     Deleted......................  Remote monitoring code.
                         device eval.
93296.................  Pm/icd remote tech   Deleted......................  Remote monitoring code.
                         serv.
93320.................  Doppler echo exam    Deleted......................  Add-on Code.
                         heart.
93321.................  Doppler echo exam    Deleted......................  Add-on Code.
                         heart.
93325.................  Doppler color flow   Deleted......................  Add-on Code.
                         add-on.
93784.................  Ambulatory BP        Added........................  Global Code.
                         monitoring.
----------------------------------------------------------------------------------------------------------------

    The complete list of services subject to the MPPR for the TC of 
diagnostic cardiovascular and ophthalmology services is shown in 
Addendum X. The PFS budget neutrality provision is applicable to the 
new MPPR for the TC of diagnostic cardiovascular and ophthalmology 
services. Therefore, the estimated reduced expenditures for such 
services have been redistributed to increase payment for other PFS 
services. We refer readers to section VIII.C. of this final rule with 
comment period for further discussion of the impact of this policy.

  Table 12--Diagnostic Cardiovascular Services Subject to the Multiple
                       Procedure Payment Reduction
------------------------------------------------------------------------
                 Code                           Short descriptor
------------------------------------------------------------------------
75600................................  Contrast x-ray exam of aorta.
75605................................  Contrast x-ray exam of aorta.
75625................................  Contrast x-ray exam of aorta.
75630................................  X-ray aorta leg arteries.
75658................................  Artery x-rays arm.
75705................................  Artery x-rays spine.
75710................................  Artery x-rays arm/leg.
75716................................  Artery x-rays arms/legs.
75726................................  Artery x-rays abdomen.
75731................................  Artery x-rays adrenal gland.
75733................................  Artery x-rays adrenals.
75736................................  Artery x-rays pelvis.
75741................................  Artery x-rays lung.
75743................................  Artery x-rays lungs.
75746................................  Artery x-rays lung.
75756................................  Artery x-rays chest.
75791................................  Av dialysis shunt imaging.
75809................................  Nonvascular shunt x-ray.
75820................................  Vein x-ray arm/leg.
75822................................  Vein x-ray arms/legs.
75825................................  Vein x-ray trunk.
75827................................  Vein x-ray chest.
75831................................  Vein x-ray kidney.
75833................................  Vein x-ray kidneys.
75840................................  Vein x-ray adrenal gland.
75842................................  Vein x-ray adrenal glands.
75860................................  Vein x-ray neck.
75870................................  Vein x-ray skull.
75872................................  Vein x-ray skull.
75880................................  Vein x-ray eye socket.
75885................................  Vein x-ray liver.
75887................................  Vein x-ray liver.
75889................................  Vein x-ray liver.
75891................................  Vein x-ray liver.
75893................................  Venous sampling by catheter.
78428................................  Cardiac shunt imaging.
78445................................  Vascular flow imaging.
78451................................  Ht muscle image spect sing.
78452................................  Ht muscle image spect mult.
78453................................  Ht muscle image planar sing.
78454................................  Ht musc image planar mult.
78456................................  Acute venous thrombus image.
78457................................  Venous thrombosis imaging.
78458................................  Ven thrombosis images bilat.
78466................................  Heart infarct image.
78468................................  Heart infarct image (ef).
78469................................  Heart infarct image (3D).
78472................................  Gated heart planar single.
78473................................  Gated heart multiple.
78481................................  Heart first pass single.
78483................................  Heart first pass multiple.
78494................................  Heart image spect.
93000................................  Electrocardiogram complete.
93005................................  Electrocardiogram tracing.
93015................................  Cardiovascular stress test.
93017................................  Cardiovascular stress test.
93024................................  Cardiac drug stress test.
93025................................  Microvolt t-wave assess.
93040................................  Rhythm ECG with report.
93041................................  Rhythm ecg tracing.
93224................................  Ecg monit/reprt up to 48 hrs.
93225................................  Ecg monit/reprt up to 48 hrs.
93226................................  Ecg monit/reprt up to 48 hrs.
93229................................  Remote 30 day ecg tech supp.
93268................................  ECG record/review.
93270................................  Remote 30 day ecg rev/report.
93271................................  Ecg/monitoring and analysis.
93278................................  ECG/signal-averaged.
93279................................  Pm device progr eval sngl.
93280................................  Pm device progr eval dual.
93281................................  Pm device progr eval multi.
93282................................  Icd device prog eval 1 sngl.
93283................................  Icd device progr eval dual.
93284................................  Icd device progr eval mult.
93285................................  Ilr device eval progr.
93286................................  Pre-op pm device eval.

[[Page 68943]]

 
93287................................  Pre-op icd device eval.
93288................................  Pm device eval in person.
93289................................  Icd device interrogate.
93290................................  Icm device eval.
93291................................  Ilr device interrogate.
93292................................  Wcd device interrogate.
93303................................  Echo transthoracic.
93304................................  Echo transthoracic.
93306................................  Tte w/doppler complete.
93307................................  Tte w/o doppler complete.
93308................................  Tte f-up or lmtd.
93312................................  Echo transesophageal.
93314................................  Echo transesophageal.
93318................................  Echo transesophageal intraop.
93350................................  Stress tte only.
93351................................  Stress tte complete.
93701................................  Bioimpedance cv analysis.
93724................................  Analyze pacemaker system.
93784................................  Ambulatory BP monitoring.
93786................................  Ambulatory BP recording.
93788................................  Ambulatory BP analysis.
93880................................  Extracranial study.
93882................................  Extracranial study.
93886................................  Intracranial study.
93888................................  Intracranial study.
93890................................  Tcd vasoreactivity study.
93892................................  Tcd emboli detect w/o inj.
93893................................  Tcd emboli detect w/inj.
93922................................  Upr/l xtremity art 2 levels.
93923................................  Upr/lxtr art stdy 3+ lvls.
93924................................  Lwr xtr vasc stdy bilat.
93925................................  Lower extremity study.
93926................................  Lower extremity study.
93930................................  Upper extremity study.
93931................................  Upper extremity study.
93965................................  Extremity study.
93970................................  Extremity study.
93971................................  Extremity study.
93975................................  Vascular study.
93976................................  Vascular study.
93978................................  Vascular study.
93979................................  Vascular study.
93980................................  Penile vascular study.
93981................................  Penile vascular study.
93990................................  Doppler flow testing.
------------------------------------------------------------------------


   Table 13--Diagnostic Ophthalmology Services Subject to the Multiple
                       Procedure Payment Reduction
------------------------------------------------------------------------
                 Code                              Descriptor
------------------------------------------------------------------------
76510................................  Ophth us b & quant a.
76511................................  Ophth us quant a only.
76512................................  Ophth us b w/non-quant a.
76513................................  Echo exam of eye water bath.
76514................................  Echo exam of eye thickness.
76516................................  Echo exam of eye.
76519................................  Echo exam of eye.
92025................................  Corneal topography.
92060................................  Special eye evaluation.
92081................................  Visual field examination(s).
92082................................  Visual field examination(s).
92083................................  Visual field examination(s).
92132................................  Cmptr ophth dx img ant segmt.
92133................................  Cmptr ophth img optic nerve.
92134................................  Cptr ophth dx img post segmt.
92136................................  Ophthalmic biometry.
92228................................  Remote retinal imaging mgmt.
92235................................  Eye exam with photos.
92240................................  Icg angiography.
92250................................  Eye exam with photos.
92265................................  Eye muscle evaluation.
92270................................  Electro-oculography.
92275................................  Electroretinography.
92283................................  Color vision examination.
92284................................  Dark adaptation eye exam.
92285................................  Eye photography.
92286................................  Internal eye photography.
------------------------------------------------------------------------


                                           Table 14--Frequently Billed Diagnostic Cardiovascular Combinations
--------------------------------------------------------------------------------------------------------------------------------------------------------
           Code                  Descriptor           Code          Descriptor           Code          Descriptor          Code          Descriptor
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                 Code Range 75600-75893
--------------------------------------------------------------------------------------------------------------------------------------------------------
75710....................  Artery x-rays arm/leg.      75791  Av dialysis shunt
                                                               imaging.
75625....................  Contrast x-ray exam of      75716  Artery x-rays arms/
                            aorta.                             legs.
75625....................  Contrast x-ray exam of      75716  Artery x-rays arms/         75774  Artery x-ray each
                            aorta.                             legs.                              vessel.
75820....................  Vein x-ray arm/leg....      75827  Vein x-ray chest......
75625....................  Contrast x-ray exam of      75710  Artery x-rays arm/leg.
                            aorta.
75791....................  Av dialysis shunt           75827  Vein x-ray chest......
                            imaging.
75658....................  Artery x-rays arm.....      75791  Av dialysis shunt           75820  Vein x-ray arm/leg...      75827  Vein x-ray chest.
                                                               imaging.
75710....................  Artery x-rays arm/leg.      75774  Artery x-ray each
                                                               vessel.
75820....................  Vein x-ray arm/leg....      93931  Upper extremity study.
75791....................  Av dialysis shunt           75820  Vein x-ray arm/leg....
                            imaging.
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                 Code Range 78414-78496
--------------------------------------------------------------------------------------------------------------------------------------------------------
78452....................  Ht muscle image spect       93306  Tte w/doppler complete
                            mult.
78452....................  Ht muscle image spect       93017  Cardiovascular stress
                            mult.                              test.
78452....................  Ht muscle image spect       93306  Tte w/doppler complete      93880  Extracranial study...
                            mult.
78452TC..................  Ht muscle image spect       93017  Cardiovascular stress
                            mult.                              test.
78452....................  Ht muscle image spect       93880  Extracranial study....
                            mult.

[[Page 68944]]

 
78452TC..................  Ht muscle image spect       93306  Tte w/doppler complete
                            mult.
78452....................  Ht muscle image spect       93017  Cardiovascular stress       93306  Tte w/doppler
                            mult.                              test.                              complete.
78451....................  Ht muscle image spect       93306  Tte w/doppler complete
                            sing.
78452TC..................  Ht muscle image spect     93306TC  Tte w/doppler complete
                            mult.
78452....................  Ht muscle image spect       93306  Tte w/doppler complete      93880  Extracranial study...      93978  Vascular study.
                            mult.
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                 Code Range 93000-93990
--------------------------------------------------------------------------------------------------------------------------------------------------------
93306....................  Tte w/doppler complete      93880  Extracranial study....
93320....................  Doppler echo exam           93325  Lower extremity study.      93351  Stress tte complete..
                            heart.
93922....................  Upr/l xtremity art 2        93925  Lower extremity study.
                            levels.
93923....................  Upr/lxtr art stdy 3+        93925  Lower extremity study.
                            lvls.
93306TC..................  Tte w/doppler complete    93880TC  Extracranial study....
93880....................  Extracranial study....      93978  Vascular study........
93284....................  Icd device progr eval       93290  Icm device eval.......
                            mult.
93922....................  Upr/l xtremity art 2        93926  Lower extremity study.
                            levels.
93965....................  Extremity study.......      93970  Extremity study.......
93925....................  Lower extremity study.      93970  Extremity study.......
--------------------------------------------------------------------------------------------------------------------------------------------------------


                        Table 15--Frequently Billed Diagnostic Ophthalmology Combinations
----------------------------------------------------------------------------------------------------------------
          Code                 Descriptor          Code         Descriptor          Code         Descriptor
----------------------------------------------------------------------------------------------------------------
                                             Code Range 76510-76529
----------------------------------------------------------------------------------------------------------------
76514...................  Echo exam of eye          92133  Cmptr ophth img
                           thickness.                       optic nerve.
76514...................  Echo exam of eye          92083  Visual field              92133  Cmptr ophth img
                           thickness.                       examination(s).                  optic nerve.
76514...................  Echo exam of eye          92083  Visual field
                           thickness.                       examination(s).
76514...................  Echo exam of eye          92250  Eye exam with photos
                           thickness.
76514...................  Echo exam of eye          92083  Visual field              92250  Eye exam with
                           thickness.                       examination(s).                  photos.
76512...................  Ophth us b w/non-         92134  Cptr ophth dx img
                           quant a.                         post segmt.
76512...................  Ophth us b w/non-         92250  Eye exam with photos
                           quant a.
76514...................  Echo exam of eye          92286  Internal eye
                           thickness.                       photography.
76514...................  Echo exam of eye          92134  Cptr ophth dx img
                           thickness.                       post segmt.
76512...................  Ophth us b w/non-         92235  Eye exam with photos      92250  Eye exam with
                           quant a.                                                          photos.
----------------------------------------------------------------------------------------------------------------
                                             Code Range 92002-92371
----------------------------------------------------------------------------------------------------------------
92083...................  Visual field              92133  Cmptr ophth img
                           examination(s).                  optic nerve.
92235...................  Eye exam with photos      92250  Eye exam with photos
92083...................  Visual field              92250  Eye exam with photos
                           examination(s).
92083...................  Visual field              92134  Cptr ophth dx img
                           examination(s).                  post segmt.
92134...................  Cptr ophth dx img         92235  Eye exam with photos
                           post segmt.
92134...................  Cptr ophth dx img         92250  Eye exam with photos
                           post segmt.
92134...................  Cptr ophth dx img         92235  Eye exam with photos      92250  Eye exam with
                           post segmt.                                                       photos.
92250...................  Eye exam with photos      92285  Eye photography.....
92082...................  Visual field              92250  Eye exam with photos
                           examination(s).
92081...................  Visual field              92285  Eye photography.....
                           examination(s).
----------------------------------------------------------------------------------------------------------------

d. Procedures Subject to the OPPS Cap
    We are proposing to add the new codes in Table 16 to the list of 
procedures subject to the OPPS cap, effective January 1, 2013. Some of 
these codes are replacement codes for codes deleted for CY 2013. These 
procedures meet the definition of imaging under section 5102(b) of the 
DRA. These codes are being added on an interim final basis and their 
addition as procedures subject to the OPPS cap is open to public 
comment in this final rule with comment period.

[[Page 68945]]



     Table 16--Additions and Deletions to the List of Procedure Subject to the OPPS CAP on Imaging Services
----------------------------------------------------------------------------------------------------------------
                       Additions                                                Deletions
----------------------------------------------------------------------------------------------------------------
             Code                     Descriptor                      Code                     Descriptor
----------------------------------------------------------------------------------------------------------------
31620........................  Endobronchial us add-on.  71040........................  Contrast x-ray of
                                                                                         bronchi.
36221........................  Place cath thoracic       71060........................  Contrast x-ray of
                                aorta.                                                   bronchi.
36222........................  Place cath carotd/inom    75650........................  Artery x-rays head &
                                art.                                                     neck.
36223........................  Place cath carotd/inom    75660........................  Artery x-rays head &
                                art.                                                     neck.
36224........................  Place cath carotd art...  75662........................  Artery x-rays head &
                                                                                         neck.
36225........................  Place cath subclavian     75665........................  Artery x-rays head &
                                art.                                                     neck.
36226........................  Place cath vertebral art  75671........................  Artery x-rays head &
                                                                                         neck.
36227........................  Place cath xtrnl carotid  75676........................  Artery x-rays neck.
36228........................  Place cath intracranial   75680........................  Artery x-rays neck.
                                art.
43206........................  Esoph optical             75685........................  Artery x-rays spine.
                                endomicroscopy.
43252........................  Upper GI optical          75900........................  Intravascular cath
                                endomicroscopy.                                          exchange.
77080........................  DXA bone density axial..  75961........................  Retrieval broken
                                                                                         catheter.
77082........................  DXA bone density vert fx  77424........................  Intraoperative radiation
                                                                                         delivery.
78013........................  Thyroid imaging w/blood   78006........................  Thyroid imaging with
                                flow.                                                    uptake.
78014........................  Thyroid imaging w/blood   78007........................  Thyroid image mult
                                flow.                                                    uptakes.
78070........................  Parathyroid planar        78010........................  Thyroid imaging.
                                imaging.
78071........................  Parathyroid planar        78011........................  Thyroid imaging with
                                imaging w/o subtrj.                                      flow.
78072........................  Parathyroid imaging w/
                                spect & ct.
88375........................  Optical endomicroscopy
                                interp.
91110........................  GI tract capsule
                                endoscopy.
91111........................  Esophageal capsule
                                endoscopy.
92287........................  Internal eye photography
----------------------------------------------------------------------------------------------------------------

C. Overview of the Methodology for the Calculation of Malpractice RVUs

    Section 1848(c) of the Act requires that each service paid under 
the PFS be comprised of three components: work, PE, and malpractice. 
From 1992 to 1999, malpractice RVUs were charge-based, using weighted 
specialty-specific malpractice expense percentages and 1991 average 
allowed charges. Malpractice RVUs for new codes after 1991 were 
extrapolated from similar existing codes or as a percentage of the 
corresponding work RVU. Section 4505(f) of the BBA, which amended 
section 1848(c) of the Act, required us to implement resource-based 
malpractice RVUs for services furnished beginning in 2000. Therefore, 
initial implementation of resource-based malpractice RVUs occurred in 
2000.
    The statute also requires that we review and, if necessary, adjust 
RVUs no less often than every 5 years. The first review and update of 
resource-based malpractice RVUs was addressed in the CY 2005 PFS final 
rule with comment period (69 FR 66263). Minor modifications to the 
methodology were addressed in the CY 2006 PFS final rule with comment 
period (70 FR 70153). In the CY 2010 PFS final rule with comment 
period, we implemented the second review and update of malpractice 
RVUs. For a discussion of the second review and update of malpractice 
RVUs, see the CY 2010 PFS proposed rule (74 FR 33537) and final rule 
with comment period (74 FR 61758).
    As explained in the CY 2011 PFS final rule with comment period (75 
FR 73208), malpractice RVUs for new and revised codes effective before 
the next Five-Year Review of Malpractice (for example, effective CY 
2011 through CY 2014, assuming that the next review of malpractice RVUs 
occurs for CY 2015) are determined either by a direct crosswalk to a 
similar source code or by a modified crosswalk to account for 
differences in work RVUs between the new/revised code and the source 
code. For the modified crosswalk approach, we adjust (or ``scale'') the 
malpractice RVU for the new/revised code to reflect the difference in 
work RVU between the source code and the new/revised work value (or, if 
greater, the clinical labor portion of the fully implemented PE RVU) 
for the new code. For example, if the proposed work RVU for a revised 
code is 10 percent higher than the work RVU for its source code, the 
malpractice RVU for the revised code would be increased by 10 percent 
over the source code malpractice RVU. This approach presumes the same 
risk factor for the new/revised code and source code but uses the work 
RVU for the new/revised code to adjust for risk-of-service.
    As we indicated in the CY 2013 PFS proposed rule, we will continue 
our current approach for determining malpractice RVUs for new/revised 
codes. In section II.M.2. of this final rule with comment period, we 
have published a list of new/revised codes and the malpractice 
crosswalk(s) used for determining their malpractice RVUs. These 
malpractice RVUs for new/revised codes will be implemented for CY 2013 
on an interim final basis and the malpractice crosswalks are subject to 
public comment. We will respond to comments and finalize the 
malpractice crosswalks for the majority of these codes in the CY 2014 
PFS final rule with comment period.

D. Geographic Practice Cost Indices (GPCIs)

1. Background
    Section 1848(e)(1)(A) of the Act requires us to develop separate 
Geographic Practice Cost Indices (GPCIs) to measure resource cost 
differences among localities compared to the national average for each 
of the three fee schedule components (that is, work, practice expense 
(PE), and malpractice). While requiring that the PE and MP GPCIs 
reflect the full relative cost differences, section 1848(e)(1)(A)(iii) 
of the Act requires that the work GPCIs reflect only one-quarter of the 
relative cost differences compared to the national average. In 
addition, section 1848(e)(1)(G) of the Act sets a permanent 1.5 work 
GPCI floor for services furnished in Alaska beginning January 1, 2009, 
and section 1848(e)(1)(I) of the Act sets a permanent 1.0 PE GPCI floor 
for services furnished in frontier states beginning January 1, 2011.
    Section 1848 (e)(1)(E) of the Act provides for a 1.0 floor for the 
work GPCIs, which was set to expire at the end of 2011. The statute was 
amended by section 303 of the Temporary Payroll

[[Page 68946]]

Tax Cut Continuation Act of 2011 (TPTCCA) (Pub. L. 112-78) to extend 
the 1.0 floor for the work GPCIs through February 29, 2012. The statute 
was again amended by section 3004 of the Middle Class Tax Relief and 
Job Creation Act of 2012 (MCTRJCA) (P.L. 112-399) to extend the 1.0 
work floor for GPCIs throughout the remainder of CY 2012 (that is, for 
services furnished no later than December 31, 2012). During the 
development of the CY 2012 PFS final rule with comment period, neither 
TPTCCA nor MCTRJCA had been enacted and, because the work GPCI floor 
was set to expire at the end of 2011, the GPCIs published in Addendum E 
of the CY 2012 PFS final rule with comment period did not reflect the 
1.0 work floor. Following the enactment of the legislation, appropriate 
changes to the CY 2012 GPCIs to reflect the 1.0 work floor required by 
section 303 of the TPTCCA and section 3004 of the MCTRJCA.
    Since the 1.0 work GPCI floor provided in section 1848 (e)(1)(E) of 
the Act is set to expire prior to the implementation of the CY 2013 
updates to the PFS, the proposed CY 2013 work GPCIs and summarized 
geographic adjustment factors (GAFs) published in addendums D and E of 
this CY 2013 PFS proposed rule do not reflect the 1.0 work GPCI floor 
for CY 2013. As required by section 1848 (e)(1)(G) and section1848 
(e)(1)(I) of the Act, the 1.5 work GPCI floor for Alaska and the 1.0 PE 
GPCI floor for frontier states are applicable in CY 2013 and are 
reflected in addendums D and E.
    In the CY 2012 PFS final rule with comment period, we made several 
refinements to the GPCIs (76 FR 73081 through 73092), including 
revising the sixth GPCI update to reflect the most recent data, with 
modifications. Specifically, we finalized our proposal to change the 
GPCI cost share weights for CY 2012 to reflect the most recent rebased 
and revised Medicare Economic Index (MEI). As a result, the cost share 
weight for the work GPCI (as a percentage of the total) was changed 
from 52.466 percent to 48.266 percent, and the cost share weight for 
the PE GPCI was revised from 43.669 percent to 47.439 percent with a 
change in the employee compensation component from 18.654 to 19.153 
percentage points. The cost share weight for the office rent component 
of the PE GPCI was changed from 12.209 percent to 10.223 percentage 
points (fixed capital with utilities), and the medical equipment, 
supplies, and other miscellaneous expenses component was changed from 
12.806 percent to 9.968 percentage points. In addition, we finalized 
the weight for purchased services at 8.095 percentage points, of which 
5.011 percentage points are adjusted for geographic cost differences. 
Lastly, the cost share weight for the malpractice GPCI was revised from 
3.865 percent to 4.295 percent. Table 17 displays the cost share 
weights that were finalized in the CY 2012 final rule with comment 
period. Note that the employee compensation; office rent; purchased 
services; and equipment supplies and other cost share weights sum to 
the total PE GPCI cost share weights of 47.439 percent.

      Table 17--Cost Share Weights Finalized in CY 2012 GPCI Update
------------------------------------------------------------------------
                                                            Cost share
                    Expense category                         weights %
------------------------------------------------------------------------
Work....................................................          48.266
Practice Expense........................................          47.439
  Employee Compensation.................................          19.153
  Office Rent...........................................          10.223
  Purchased Services....................................           8.095
  Equipment, Supplies, and Other........................           9.968
Malpractice Insurance...................................           4.295
------------------------------------------------------------------------

    We also finalized several other policies in the CY 2012 final rule 
with comment period including the use of 2006 through 2008 American 
Community Survey (ACS) two-bedroom rental data as a proxy for the 
relative cost difference in physician office rent. In addition, we 
created a purchased services index to account for labor-related 
services within the ``all other services'' and ``other professional 
expenses'' MEI components. In response to public commenters who 
recommended that we use Bureau of Labor Statistics (BLS) Occupational 
Employment Statistics (OES) data to capture the ``full range'' of 
occupations included in the offices of physician industry to calculate 
the nonphysician employee wage component (also referred to as the 
employee wage index) of the PE GPCI, we finalized a policy of using 100 
percent of the total wage share of nonphysician occupations in the 
offices of physicians' industry to calculate the nonphysician employee 
wage component of the PE GPCI.
2. Recommendations From the Institute of Medicine
    Concurrent with our CY 2012 rulemaking cycle, the Institute of 
Medicine released the final version of its first of two anticipated 
reports entitled ``Geographic Adjustment in Medicare Payment: Phase I: 
Improving Accuracy, Second Edition'' on September 28, 2011. This report 
included an evaluation of the accuracy of GAFs for the hospital wage 
index and the GPCIs, as well as the methodology and data used to 
calculate them. Several of the policies that we finalized in CY 2012 
rulemaking addressed recommendations contained in the Institute of 
Medicine's first report. Because we did not have adequate time to 
completely address the Institute of Medicine's Phase I report 
recommendations during CY 2012 rulemaking, we included a discussion in 
the CY 2013 proposed rule (77 FR 44756) about the recommendations that 
were not implemented or discussed in the CY 2012 final rule with 
comment period.
    As we anticipated in the CY 2013 proposed rule, the Institute of 
Medicine's second report, entitled ``Geographic Adjustment in Medicare 
Payment--Phase II: Implications for Access, Quality, and Efficiency,'' 
was released July 17, 2012. The Phase II report evaluates the effects 
of GAFs (hospital wage index and GPCIs) on the distribution of the 
healthcare workforce, quality of care, population health, and the 
ability to provide efficient, high value care. Once we have had an 
opportunity to fully evaluate the report and its recommendations we 
will respond to its recommendations in subsequent rulemaking.
3. GPCI Discussion for CY 2013
    CY 2013 is the final year of the sixth GPCI update and, because we 
will propose updates next year, we did not include any proposals 
related to the GPCIs for the CY 2013 PFS. In response to public 
inquiries about exceptions to the calculated GPCIs, we provided a brief 
discussion about the permanent 1.0 PE floor for frontier states, the 
1.5 work floor for Alaska, the GPCIs for the Puerto Rico payment 
locality, and the expiration of the GPCI 1.0 work floor required under 
section 1848 (e)(1)(E) of the Act. We also discussed recommendations 
from the first Institute of Medicine report that were not addressed 
during CY 2012 rulemaking in the CY 2013 proposed rule. We have 
included this discussion below.
a. Alaska Work Floor and PE GPCI Floor for Frontier States
    Section 1848(e)(1)(G) of the Act sets a permanent 1.5 work GPCI 
floor for services furnished in Alaska beginning January 1, 2009. 
Therefore, the 1.5 work floor for Alaska will remain in effect in CY 
2013. In addition, section 1848(e) (1)(I) of the Act establishes a 1.0 
PE GPCI floor for physicians' services furnished in frontier states 
effective January 1, 2011. In accordance with section 1848(e)(1)(I) of 
the Act,

[[Page 68947]]

beginning in CY 2011, we applied a 1.0 PE GPCI floor for physicians' 
services furnished in states determined to be frontier states. The 
following states met the statutory criteria to be considered frontier 
states for CY 2012: Montana, North Dakota, Nevada, South Dakota, and 
Wyoming. There are no changes to those states identified as frontier 
states for CY 2013.
b. GPCI Assignments for the Puerto Rico Payment Locality
    As noted in the CY 2013 proposed rule, we have received inquiries 
from representatives of the Puerto Rico medical community regarding our 
policies for determining the GPCIs for the Puerto Rico payment 
locality. While we did not make any proposals related to the GPCIs for 
Puerto Rico, in response to those inquiries, we provided the following 
discussion regarding the GPCIs assigned to the Puerto Rico payment 
locality. We anticipate recalculating all the GPCIs in the seventh GPCI 
update, currently anticipated to be implemented for CY 2014.
    As noted above, we are required by section 1848(e)(1)(A) of the Act 
to develop separate GPCIs to measure relative resource cost differences 
among localities compared to the national average for each of the three 
fee schedule components: Work, PE and malpractice expense. To calculate 
these GPCI values, we rely on three primary data sources. We currently 
use the 2006-2008 BLS OES data to calculate the work GPCI, the 
nonphysician employee wage component of PE GPCI, and the labor costs 
associated with the purchased services component of PE GPCI. We use 
2006-2008 ACS data to calculate the office rent component of the PE 
GPCI. Finally, we use 2006-2007 malpractice premium data to calculate 
the malpractice GPCI. For all localities, including Puerto Rico, we 
assume equipment, supplies, and other expenses are purchased in a 
national market and that the costs do not vary by geographic location. 
Therefore, we do not use data on the price of equipment, supplies, and 
expenses across localities in calculating PE GPCIs. With the exception 
of the malpractice GPCI, we have current data from the applicable 
sources allowing us to calculate the work and PE GPCIs for the Puerto 
Rico payment locality. The 2006-2008 BLS OES data and rental values 
derived from the 2006-2008 ACS indicate that the costs associated with 
operating a physician practice in Puerto Rico are the lowest among all 
payment localities.
    To calculate the malpractice GPCI for the various Medicare PFS 
localities, we collect malpractice insurance market share and premium 
data from state departments of insurance and from state rate filings. 
As discussed in our contractor's report (Final Report on the Sixth 
Update of the Geographic Practice Cost Index for the Medicare Physician 
Fee Schedule page. 41), for the fourth, fifth, and sixth GPCI updates 
we were not able to collect this data for the Puerto Rico payment 
locality. Therefore, we carried over the malpractice GPCI value of 
0.249 from previous GPCI updates when malpractice premium data were 
last available. It is important to note that we have a source for more 
current malpractice premium data for Puerto Rico for use in the 
upcoming seventh GPCI update. We are working with the relevant 
officials in Puerto Rico to acquire these data for use in future 
rulemaking.
    For a detailed discussion regarding the methodology used to 
calculate the various components of the Puerto Rico GPCIs, we referred 
readers to our contractor's report from November of 2010 entitled 
``Final Report on the Sixth Update of the Geographic Practice Cost 
Index for the Medicare Physician Fee Schedule'' available on our Web 
site at www.cms.gov/PhysicianFeeSched/downloads/GPCI_Report.pdf.
    In the CY 2013 proposed rule, we also encouraged comments from 
stakeholders regarding potential data sources that may be available for 
calculating the Puerto Rico malpractice GPCI.
    Comment: In response to our inquiry regarding potential sources for 
data that could be used in calculating a malpractice GPCI for Puerto 
Rico, we received numerous comments about the costs of practicing 
medicine in Puerto Rico. The commenters primarily expressed concern 
about the PE GPCI (with emphases on the rent component) and the 
malpractice GPCI. The commenters stated that the current GPCI values 
for Puerto Rico are low in comparison to other PFS localities and that 
this disparity may create incentives for doctors to move their 
practices to the continental United States. As a result, the commenters 
explained that access to both primary and specialty care for Medicare 
beneficiaries residing in Puerto Rico could be compromised. Several 
stakeholders provided a report on a comprehensive study entitled ``Cost 
of Medical Services in Puerto Rico.'' The report included results from 
a physician survey on the costs of operating a medical practice in 
Puerto Rico, including the cost for obtaining malpractice insurance. 
For example, the report included information about the leading 
malpractice insurers in Puerto Rico, the amount of malpractice 
insurance coverage typically purchased by physicians, and the cost of 
malpractice insurance by primary and specialty care providers. In 
addition to malpractice insurance costs, the report also included 
information on the cost of employees, contracted services, rent and 
utilities, medical equipment and supplies in Puerto Rico as well as 
information on the major concerns, demographics, and work patterns of 
the doctors currently practicing medicine in Puerto Rico and the 
doctors that have moved from Puerto Rico now practicing in the United 
States.
    Response: As noted in the proposed rule, we will be adjusting the 
GPCIs for CY 2014. Given that we did not make any proposals to modify 
the malpractice GPCI calculation methodology or values for CY 2013, it 
would not be appropriate to make changes to the GPCIs in this final 
rule. We appreciate the physician survey information on the cost of 
malpractice insurance. We will review the information submitted on the 
cost of obtaining malpractice insurance in Puerto Rico as we prepare 
for the seventh GPCI update. We would note that the GPCIs are based 
upon changes in the relative costs of obtaining malpractice insurance 
so any changes in the GPCI for Puerto Rico will be based not only on 
data reflecting the costs on Puerto Rico, but also those in other 
localities.
c. Expiration of GPCI Work Floor
    The work GPCIs are designed to capture the relative costs of 
physician labor by Medicare PFS locality. Previously, the work GPCIs 
were developed using the median hourly earnings from the 2000 Census of 
workers in seven professional specialty occupation categories that we 
used as a proxy for physicians' wages. Physicians' wages are not 
included in the occupation categories because Medicare payments are a 
key determinant of physicians' earnings. That is, including physicians' 
wages in the work GPCIs would effectively make the indices dependent 
upon Medicare payments. As required by law, the work GPCIs reflect one 
quarter of the relative wage differences for each locality compared to 
the national average. The work GPCI updates in CYs 2001, 2003, 2005, 
and 2008 were based on professional earnings data from the 2000 Census. 
For the sixth GPCI update in CY 2011, we used the 2006 through 2008 BLS 
OES data as a replacement for the 2000 Census data.
    Although we did not propose any changes to the data or methodology 
used to calculate the work GPCI for CY

[[Page 68948]]

2013, we note that addenda D and E will reflect the expiration of the 
statutory 1.0 work GPCI floor which as noted above, is set to expire on 
December 31, 2012 in accordance with section 1848 (e)(1)(E) of the Act.
    Comment: A few commenters requested an extension of the 1.0 work 
GPCI floor stating that the statutorily-mandated work GPCI floor will 
expire on December 31, 2012.
    Response: As discussed above (and noted by the commenters) the 1.0 
work GPCI floor is set to expire on December 31, 2012 and we do not 
have authority to extend the 1.0 work GPCI floor beyond December 31, 
2012.
4. Institute of Medicine Phase I Report
a. Background
    At our request, the Institute of Medicine conducted a study of the 
geographic adjustment factors in Medicare payment. It is a 
comprehensive empirical study of the geographic adjustment factors 
established under sections 1848(e) (GPCI) and 1886(d)(3)(E) (hospital 
wage index) of the Act. These adjustments are designed to ensure 
Medicare payments reflect differences in input costs across geographic 
areas. The factors the Institute of Medicine evaluated include the 
following:
     Accuracy of the adjustment factors;
     Methodology used to determine the adjustment factors; and
     Sources of data and the degree to which such data are 
representative.
    Within the context of the U.S. healthcare marketplace, the 
Institute of Medicine also evaluated and considered the--
     Effect of the adjustment factors on the level and 
distribution of the health care workforce and resources, including--
    ++ Recruitment and retention taking into account mobility between 
urban and rural areas;
    ++ Ability of hospitals and other facilities to maintain an 
adequate and skilled workforce; and
    ++ Patient access to providers and needed medical technologies;
     Effect of adjustment factors on population health and 
quality of care; and
     Effect of the adjustment factors on the ability of 
providers to furnish efficient, high value care.
    The Institute of Medicine's first report entitled ``Geographic 
Adjustment in Medicare Payment, Phase I: Improving Accuracy'' evaluated 
the accuracy of geographic adjustment factors and the methodology and 
data used to calculate them. The recommendations included in the 
Institute of Medicine's Phase I report that relate to or would have an 
effect on the methodologies used to calculate the GPCIs and the 
configuration of Medicare PFS payment locality structure are summarized 
as follows:
     Recommendation 2-1: The same labor market definition 
should be used for both the hospital wage index and the physician 
geographic adjustment factor. Metropolitan statistical areas and 
statewide non-metropolitan statistical areas should serve as the basis 
for defining these labor markets.
     Recommendation 2-2: The data used to construct the 
hospital wage index and the physician geographic adjustment factor 
should come from all health care employers.
     Recommendation 5-1: The GPCI cost share weights for 
adjusting fee-for-service payments to practitioners should continue to 
be national, including the three GPCIs (work, PE, and liability 
insurance) and the categories within the PE (office rent and 
personnel).
     Recommendation 5-2: Proxies should continue to be used to 
measure geographic variation in the physician work adjustment, but CMS 
should determine whether the seven proxies currently in use should be 
modified.
     Recommendation 5-3: CMS should consider an alternative 
method for setting the percentage of the work adjustment based on a 
systematic empirical process.
     Recommendation 5-4: The PE GPCI should be constructed with 
the full range of occupations employed in physicians' offices, each 
with a fixed national weight based on the hours of each occupation 
employed in physicians' offices nationwide.
     Recommendation 5-5: CMS and the Bureau of Labor Statistics 
should develop an agreement allowing the Bureau of Labor Statistics to 
analyze confidential data for CMS.
     Recommendation 5-6: A new source of information should be 
developed to determine the variation in the price of commercial office 
rent per square foot.
     Recommendation 5-7: Nonclinical labor-related expenses 
currently included under PE office expenses should be geographically 
adjusted as part of the wage component of the PE. This report can be 
accessed on the Institute of Medicine 's Web site at www.iom.edu/Reports/2011/Geographic-Adjustment-in-Medicare-Payment-Phase-I-Improving-Accuracy.aspx.
    As previously noted in this section, the Institute of Medicine also 
considered the role of Medicare payments on matters such as the 
distribution of the healthcare workforce, population health, and the 
ability of providers to produce high-value, high-quality health care in 
its final report July 17, 2012. We were not able to evaluate the 
recommendations contained in the Institute of Medicine's Phase II 
report, in time for discussion in the proposed rule. The Phase II 
report can be accessed on the Institute of Medicine's Web site at 
www.iom.edu/Reports/2012/Geographic-Adjustment-in-Medicare-Payment-Phase-II.aspx.
b. Institute of Medicine Recommendations Implemented in CY 2012
    In the CY 2012 PFS final rule with comment period, we addressed 
three of the recommendations offered by the Institute of Medicine in 
its Phase I report. Specifically, the final CY 2012 GPCIs utilized the 
full range of nonphysician occupations in the employee wage calculation 
consistent with Institute of Medicine recommendation 5-4. Additionally, 
we created a new purchased service index to account for nonclinical 
labor related expenses similar to Institute of Medicine recommendation 
5-7. Lastly, we have consistently used national cost share weights to 
determine the appropriate weight attributed to each GPCI component, 
which is supported by Institute of Medicine recommendation 5-1 (76 FR 
73081 through 73092). In order to facilitate a public discussion 
regarding the Institute of Medicine's remaining Phase I 
recommendations, we provided a summary analysis of these 
recommendations in the CY 2013 proposed rule, which has also been 
included in this final rule with comment period below. We provided our 
technical analyses of the remaining Institute of Medicine Phase I 
recommendations in a report released on the PFS Web site at 
www.cms.gov/PhysicianFeeSched. Since we have not yet had an opportunity 
to review the recommendations in the Institute of Medicine's Phase II 
report, these analyses focus exclusively on the recommendations as 
presented in the Institute of Medicine's Phase I report.
c. Discussion of Remaining Institute of Medicine's Phase I 
Recommendations
(1) Institute of Medicine Recommendation Summaries
    (A) Institute of Medicine recommendation 2-1: The same labor market 
definition should be used for both the hospital wage index and the 
physician geographic adjustment factor. Metropolitan statistical areas 
and

[[Page 68949]]

statewide non-metropolitan statistical areas should serve as the basis 
for defining these labor markets. (Geographic Adjustment in Medicare 
Payment, Phase I: Improving Accuracy pages 2-1 thru 2-29)
(i) Locality Background
    The current PFS locality structure was developed and implemented in 
1997. There are currently 89 total PFS localities; 34 localities are 
statewide areas (that is, only one locality for the entire state). 
There are 52 localities in the other 16 states, with 10 states having 2 
localities, 2 states having 3 localities, 1 state having 4 localities, 
and 3 states having 5 or more localities. The District of Columbia, 
Maryland, and Virginia suburbs, Puerto Rico, and the Virgin Islands are 
additional localities that make up the remainder of the total of 89 
localities. The development of the current locality structure is 
described in detail in the CY 1997 PFS proposed rule (61 FR 34615) and 
the subsequent final rule with comment period (61 FR 59494).
    Prior to 1992, Medicare payments for physicians' services were made 
under the reasonable charge system. Payments were based on the charging 
patterns of physicians. This resulted in large differences among types 
of services, geographic payment areas, and physician specialties. 
Recognizing this, the Congress replaced the reasonable charge system 
with the Medicare PFS in the Omnibus Budget Reconciliation Act (OBRA) 
of 1989, effective January 1, 1992. Payments under the fee schedule are 
based on the relative resources used in furnishing services and vary 
among areas as resource costs vary geographically as measured by the 
GPCIs.
    Payment localities were established under the reasonable charge 
system by local Medicare carriers based on their knowledge of local 
physician charging patterns and economic conditions. These localities 
changed little between the inception of Medicare in 1967 and the 
beginning of the PFS in 1992. As a result, a study was begun in 1994 
that resulted in a comprehensive locality revision, which was 
implemented in 1997 (61 FR 59494).
    The revised locality structure reduced the number of localities 
from 210 to the current 89 and the number of statewide localities 
increased from 22 to 34. The revised localities were based on locality 
resource cost differences as reflected by the GPCIs. A full discussion 
of the methodology can be found in the CY 1997 PFS final rule with 
comment period (61 FR 59494). The current 89 fee schedule areas are 
defined alternatively by state boundaries (for example, Wisconsin), 
metropolitan areas (for example, Metropolitan St. Louis, MO), portions 
of a metropolitan area (for example, Manhattan), or rest-of-state areas 
that exclude metropolitan areas (for example, Rest of Missouri). This 
locality configuration is used to calculate the GPCIs that are in turn 
used to calculate payments for physicians' services under the PFS.
    As was stated in the CY 2011 final rule with comment period (75 FR 
73261), we require that changes to the PFS locality structure be done 
in a budget neutral manner within a state. For many years, we have 
sought consensus for any locality changes among the professionals whose 
payments would be affected. We have also considered more comprehensive 
changes to locality configurations. In 2008, we issued a draft 
comprehensive report detailing four different locality configuration 
options (www.cms.gov/physicianfeesched/downloads/ReviewOfAltGPCIs.pdf). 
The alternative locality configurations in the report are described 
below.
     Option 1: CMS Core-Based Statistical Area (CBSA) Payment 
Locality Configuration: CBSAs are a combination of Office of Management 
and Budget (OMB's) Metropolitan Statistical Areas (MSAs) and their 
Micropolitan Statistical Areas. Under this option, MSAs would be 
considered as urban CBSAs. Micropolitan Statistical Areas (as defined 
by OMB) and rural areas would be considered as non-urban (rest of 
state) CBSAs. This approach would be consistent with the areas used in 
the Inpatient Prospective Payment System (IPPS) pre-reclassification 
wage index, which is the hospital wage index for a geographic area 
(CBSA or non-CBSA) calculated from submitted hospital cost report data 
before statutory adjustments reconfigure, or ``reclassify'' a hospital 
to an area other than its geographic location, to adjust payments for 
difference in local resource costs in other Medicare payment systems. 
Based on data used in the 2008 locality report, this option would 
increase the number of PFS localities from 89 to 439.
     Option 2: Separate High-Cost Counties from Existing 
Localities (Separate Counties): Under this approach, higher cost 
counties are removed from their existing locality structure, and they 
would each be placed into their own locality. This option would 
increase the number of PFS localities from 89 to 214, using a 5 percent 
GAF differential to separate high-cost counties.
     Option 3: Separate MSAs from Statewide Localities 
(Separate MSAs): This option begins with statewide localities and 
creates separate localities for higher cost MSAs (rather than removing 
higher cost counties from their existing locality as described in 
Option 2). This option would increase the number of PFS localities from 
89 to 130, using a 5 percent GAF differential to separate high-cost 
MSAs.
     Option 4: Group Counties Within a State Into Locality 
Tiers Based on Costs (Statewide Tiers): This option creates tiers of 
counties (within each state) that may or may not be contiguous but 
share similar practice costs. This option would increase the number of 
PFS localities from 89 to 140, using a 5 percent GAF differential to 
group similar counties into statewide tiers.
    For a detailed discussion of the public comments on the 
contractor's 2008 draft report detailing four different locality 
configurations, we refer readers to the CY 2010 PFS proposed rule (74 
FR 33534) and subsequent final rule with comment period (74 FR 61757). 
There was no public consensus on the options, although a number of 
commenters expressed support for Option 3 (separate MSAs from statewide 
localities) because the commenters believed this alternative would 
improve payment accuracy and could mitigate potential reductions to 
rural areas compared to Option 1 (CMS CBSAs).
    In response to some public comments regarding the third of the four 
locality options, we had our contractor conduct an analysis of the 
impacts that would result from the application of Option 3. Those 
results were displayed in the final locality report released in 2011. 
The final report, entitled ``Review of Alternative GPCI Payment 
Locality Structures--Final Report,'' may be accessed directly from the 
CMS Web site at www.cms.gov/PhysicianFeeSched/downloads/Alt_GPCI_Payment_Locality_Structures_Review.pdf.
(ii) Institute of Medicine Recommendations on PFS Locality Structure 
Discussion
    The Institute of Medicine recommends altering the current locality 
structure that was originally based on areas set by local contractors 
and, in 1996, reduced from 210 to current 89 using a systematic 
iterative methodology. Rather than using the current uniform fee 
schedule areas in adjusting for relative cost differences as compared 
to the national average, the Institute of Medicine recommends a three-
tiered system for defining fee schedule areas. In the first tier, the

[[Page 68950]]

Institute of Medicine proposes applying county-based fee schedule areas 
to calculate the employee wage component of the PE GPCI. Although the 
Institute of Medicine's report states that it recommends that 
``Metropolitan statistical areas and statewide non-metropolitan 
statistical areas should serve as the basis for defining these labor 
markets,'' the Institute of Medicine also recommends applying an out-
commuting adjustment, which would permit employee wage index values to 
vary by county. Since the employee wage index is one component of the 
PE GPCI, these values also would vary by county under the Institute of 
Medicine's proposal.
    To understand why the employee wage index would vary by county 
under the Institute of Medicine's recommendation, consider the three 
steps that would be required to calculate the employee wage index. The 
first step calculates the average hourly wage (AHW) for workers 
employed in each MSA or residual (rest of state) area. The wages of 
workers in each occupation are weighted by the number of workers 
employed in physicians' offices nationally. The second step applies a 
commuting-based smoothing adjustment to create area index wages for 
each county. The commuting-adjusted county index wages are equal to a 
weighted average of the AHW values calculated in the first step, where 
the weights are county-to-MSA out-commuting patterns. The Institute of 
Medicine's out-commuting-based weights equal the share of health care 
workers that live in a county where a physician's office is located who 
commute out of the county to work in a physician's office in each MSA. 
The third step sets each physician's employee index wage equal to the 
estimated area index wage (calculated in Step 2) of the county in which 
the physician's office is located. Because the out-commuting adjustment 
envisioned by the Institute of Medicine in the second step varies by 
county, the employee wage index value--and thus the PE GPCI as a 
whole--would also potentially vary by county depending on the smoothing 
option chosen. If implemented, the number of employee wage index 
payment areas could potentially increase from 89 to over 3,000.
    The Institute of Medicine's second tier of fee schedule areas would 
use an MSA-based approach. The Institute of Medicine proposes using the 
MSA-based system for the work GPCI, the office rent index and the 
purchased services index of the PE GPCI, and the MP GPCI. An MSA is 
made up of one or more counties, including the counties that contain 
the core urban area with a population of 50,000 or more, as well as 
surrounding counties that exhibit a high degree of social and economic 
integration (as measured by commuting patterns) with the urban core. 
MSAs are designed to be socially and economically integrated units 
based on the share of workers who commute to work within the urban core 
of each MSA. Implementing an MSA-based locality structure would expand 
the number of fee schedule areas from 89 to upwards of 400 plus 
additional MSAs for U.S. territories (for example, Virgin Islands, 
American Samoa, Guam, Northern Marianna Islands).
    In its third payment area tier, the Institute of Medicine proposes 
creating a national payment area for the ``equipment, supplies and 
other'' index. We currently do not adjust PEs associated with supplies 
and equipment since we believe they are typically purchased in a 
national market. Thus, this approach is equivalent to using a national 
fee schedule area to define this index. The Institute of Medicine 
proposes no change to the fee schedule area used to compute the 
``equipment, supplies and other'' index.
    Based on our contractor's analysis, there would be significant 
redistributive impacts if we were to implement a policy that would 
reconfigure the PFS localities based on the Institute of Medicine's 
three-tiered recommendation. Many rural areas would see substantial 
decreases in their corresponding GAF and GPCI values as higher cost 
counties are removed from current ``rest of state'' payment areas. 
Conversely, many urban areas, especially those areas that are currently 
designated as ``rest of state'' but reside within higher cost MSAs, 
would experience increases in their applicable GPCIs and GAFs.
    The localities used to calculate the GPCIs have been a subject of 
substantial discussion and debate since the implementation of the PFS. 
The intensity of those discussions has increased since the last 
comprehensive update to the locality structure in 1997. Physicians and 
other suppliers in areas such as Santa Cruz County, California and 
Prince William County, Virginia have expressed concern that the current 
locality structure does not appropriately capture economic and 
demographic shifts that have taken place since the last PFS locality 
update. On the other hand, rural practitioners have argued that 
revisions to the current PFS payment localities will reduce their 
payments and exacerbate the problems of attracting physicians and other 
practitioners to rural areas. In the past, we have also heard concerns 
from representatives of some statewide localities regarding the 
potential implications of adopting an alternative locality structure 
that would change their current statewide payment area (74 FR 33536).
    The Institute of Medicine stated in its Phase I report regarding 
its locality recommendation that, ``While the payment areas would stay 
the same for the HWI (hospital wage index), implementing this 
recommendation would mean that the GPCI payment areas would expand from 
89 to 441 areas, which would be a significant change. The impact of the 
change in payment areas will be assessed in the Phase II report.'' 
(``Geographic Adjustment in Medicare Payment: Phase I: Improving 
Accuracy, Second Edition'' on September 28, 2011 page 5-6.) Moreover, 
the Institute of Medicine's Phase II report will evaluate the effects 
of geographic adjustment factors on the distribution of the healthcare 
workforce, quality of care, population health, and the ability to 
provide efficient, high value care. Over the years, commenters that 
have opposed revisions to localities have claimed that changes to the 
PFS areas could have a significant impact on the ability of rural areas 
to attract physicians. Certainly, one of our major goals when we last 
comprehensively revised the Medicare PFS localities in 1996 was to 
avoid excessively large urban/rural payment differences (61 FR 59494). 
In 1996, we were hopeful that the revisions would improve access to 
care for rural areas (61 FR 59494). Some areas may have experienced 
both economic and demographic shifts since the last comprehensive 
locality update. Before moving forward with the Institute of Medicine's 
three-tiered locality recommendation, or any other potential locality 
revision, we would need to assess, and prepare to inform the public of, 
the impact of any change for all Medicare stakeholders. The Institute 
of Medicine's Phase II report, released July 17, 2012, contains an 
evaluation of many of these important factors including:
     The effect of the adjustment factors on the level and 
distribution of the health care workforce and resources, including--
    ++ Recruitment and retention taking into account mobility between 
urban and rural areas;
    ++ Ability for hospitals and other facilities to maintain an 
adequate and skilled workforce;
    ++ Patient access to providers and needed medical technologies;

[[Page 68951]]

    ++ Effect of adjustment factors on population health and quality of 
care; and
    ++ Effect of adjustment factors on the ability of providers to 
furnish efficient, high value care.
    To fully assess the broader public policy implications associated 
with the Institute of Medicine's locality recommendation, we must first 
fully assess and analyze the recommendations contained in the Institute 
of Medicine's Phase II report. Accordingly, we believe that it would be 
premature to make any statements about potential changes we would 
consider making to the PFS localities at this time. Any changes to PFS 
fee schedule areas would be made through future notice and comment 
rulemaking.
    In the event that we develop a specific proposal for changing the 
locality configuration during future rulemaking, we would provide 
detailed analysis on the impact of the changes for physicians in each 
county. We would also provide opportunities for public input (for 
example, Town Hall meetings or Open Door Forums), as well as 
opportunities for public comments afforded by the rulemaking process.
    While we did not propose to change the current locality 
configuration for CY 2013, we requested public comments regarding the 
Institute of Medicine's recommended three-tiered PFS payment locality 
definition. In addition, as stated above we, made our technical 
analyses of the Institute of Medicine locality recommendations, 
specific to the Phase I report, available on the CMS Web site at 
www.cms.gov/PhysicianFeeSched/.
    The following is a summary of the comments we received regarding 
the Institute of Medicine's recommended three-tiered PFS payment 
locality definition.
    Comment: We received several comments on the Institute of 
Medicine's recommendation for a three-tiered PFS payment locality 
definition. Commenters from rural areas opposed increasing the number 
of payment localities, as would happen under an MSA-based PFS locality 
structure, because it would redistribute payments from rural to urban 
areas. Additionally, commenters who opposed the Institute of Medicine's 
three-tiered locality approach argued that increasing the number of PFS 
payment localities would reduce their payment amounts and exacerbate 
problems of attracting physicians and other practitioners to rural 
areas.
    A few commenters supported the Institute of Medicine's 
recommendation to move toward an MSA-based locality configuration and 
urged us to make updating the PFS locality configuration a priority in 
CY 2013. Commenters supporting an MSA-based locality configuration 
contend that significant economic and demographic shifts have occurred 
since the last reconfiguration, making the current locality assignments 
outdated. One state medical association expressed disappointment that 
we did not propose an MSA-based locality structure for CY 2013. The 
commenter urged us ``to adopt a transition plan to update the PFS 
localities'' and stressed that the ``transition plan must take into 
account the negative impact on physicians practicing in rural areas and 
work to mitigate the reductions in these regions.''
    Response: We appreciate the comments received on the Institute of 
Medicine's recommendation to adopt an MSA-based approach for defining 
PFS localities. We will continue to evaluate the comments received on 
the Institute of Medicine's recommendations for revising the PFS 
locality structure, along with the impacts of such recommendations as 
discussed in the Phase II report.
    (B) Institute of Medicine Recommendation 2-2: Employee Wage Index 
of the PE GPCI. The data used to construct the hospital wage index and 
the physician geographic adjustment factor should come from all 
healthcare employers (Geographic Adjustment in Medicare Payment, Phase 
I: Improving Accuracy pages 2-1 thru 2-29) and Recommendation 5-5: CMS 
and the Bureau of Labor Statistics should develop an agreement allowing 
the Bureau of Labor Statistics to analyze confidential data for the 
Centers for Medicare and Medicaid Services. (Geographic Adjustment in 
Medicare Payment, Phase I: Improving Accuracy page 5-38.)
    The Institute of Medicine recommends altering the data used to 
calculate the employee wage index. Specifically, Institute of Medicine 
recommends using wage data for workers in the healthcare industry 
rather than wage data for workers across all-industries. Although all-
industry wage data has the largest sample size, the Institute of 
Medicine ``* * * is concerned that the [all-industry] sample does not 
represent physician offices.'' BLS OES occupation wage data by MSA, 
however, are not publicly available for the healthcare industry. Using 
healthcare-industry wages would require the use of confidential BLS OES 
data. While CMS could potentially secure access to the confidential BLS 
OES data, the general public may not be able to. Although the Institute 
of Medicine recommends that CMS secure an agreement with BLS to use the 
confidential wage data, the current employee wage index relies on 
publicly-available all-industry wage data.
    In the CY 2013 proposed rule we requested comments on the use of 
confidential employee wage index data rather than the publicly 
available all-industry wage data. However, we did not receive specific 
comments as to whether we should pursue the acquisition of confidential 
employee wage index data (as a replacement for the publically available 
all-industry wage data) for purposes of determining the employee wage 
index component of the PE GPCI.
    Regardless of whether healthcare-industry or all-industry wage data 
is used, the Institute of Medicine recommends following the current 
approach adopted by CMS in CY 2012 for calculating the employee wage 
index. This approach constructs the employee wage index as a weighted 
average of occupation wages for the full-range of occupations employed 
in physicians' offices, where the weights are equal to the fixed 
national weight based on the hours of each occupation employed in 
physicians' offices nationwide. We adopted this approach for 
calculating the GPCI employee wage index in the CY 2012 PFS final rule 
with comment period (76 FR 73088).
(C) Institute of Medicine Recommendation 5-2: Work GPCI Methodology
    Proxies should continue to be used to measure geographic variation 
in the physician work adjustment, but CMS should determine whether the 
seven proxies currently in use should be modified (Geographic 
Adjustment in Medicare Payment, Phase I: Improving Accuracy page 5-36) 
and; Recommendation 5-3: CMS should consider an alternative method for 
setting the percentage of the work adjustment based on a systematic 
empirical process. (Geographic Adjustment in Medicare Payment, Phase I: 
Improving Accuracy pages 5-36 thru 5-37)
    The Institute of Medicine recommends replacing the current work 
GPCI methodology with a regression-based approach. We currently use 
three steps to calculate the work GPCI. These steps include:
    (1) Selecting the proxy occupations and calculating an occupation-
specific index for each proxy;
    (2) Assigning weights to each proxy-occupation index based on each 
occupation's share of total national wages to create an aggregate 
proxy-occupation index; and

[[Page 68952]]

    (3) Adjusting the aggregate proxy-occupation index by a physician 
inclusion factor to calculate the final work GPCI.
    By using this approach, the current methodology reduces the 
circularity problem that occurs when work GPCI values are based on 
direct measurements of physician earnings. Because physician earnings 
are made up of both wages and a return on investment from ownership of 
the physician practice, calculating the work GPCI using physician 
earnings information would assign areas where physician practices are 
more profitable higher work GPCI values. Although the Institute of 
Medicine recommends that we continue to use proxy occupations in the 
work GPCI methodology, its regression-based approach alters each of the 
three steps described above.
    To modify the first step, the Institute of Medicine recommends that 
we empirically evaluate the validity of seven proxy occupations we 
currently use. The current proxy occupations in the work GPCI are 
intended to represent highly educated, professional employee 
categories. Although the Institute of Medicine recommends re-evaluating 
the proxy occupations used in the work GPCI, it does not define 
specific criteria to use for this purpose.
    To modify the second step, the Institute of Medicine recommends 
using a regression-based approach to weight the selected proxy 
occupation indices based on their correlation with physician earnings. 
This Institute of Medicine proposal would replace the current approach 
where occupations are weighted by the size of their share of total 
national wages. Such an approach presumes that wages for proxy 
occupations are not related to physician profits.
    Finally, the Institute of Medicine proposes an empirically-based 
approach to determine the inclusion factor for work. The inclusion 
factor for work refers to section 1848(e)(1)(A)(iii) of the Act 
requiring that the work GPCI reflect only 25 percent of the difference 
between the relative value of physicians' work effort in each locality 
and the national average of such work effort. Therefore, under current 
law, only one quarter of the measured regional variation in physician 
wages is incorporated into the work GPCI. The Institute of Medicine 
recommends calculating an inclusion factor based on the predicted 
values of the regression described above. Under the Institute of 
Medicine's approach, the inclusion factor is larger when the proxy 
occupations have a higher correlation with physicians' earnings and 
smaller when the proxy occupations have a lower correlation with 
physicians' earnings. We note that using such an empirical approach to 
weight the proxy occupation indices and to estimate the inclusion 
factor requires the identification of a viable source of physician wage 
information in addition to the wage information of proxy occupations to 
accurately measure regional variation in physician wages.
    We requested comments on the Institute of Medicine's 
recommendations to revise the work GPCI methodology.
    The following is a summary of the comments we received regarding 
the Institute of Medicine's recommendations to revise the work GPCI 
methodology.
    Comment: A few commenters stated that the physician work GPCI 
should not be adjusted at all for geographic cost differences. However, 
the same commenters stated that if geographic payments adjustments must 
be applied under the PFS, the current proxy occupations used for 
calculating the work GPCI should be replaced with actual physician 
salary survey data to determine the true cost (market price) of 
physician labor. To that end, the commenters suggested that third 
parties who hire physicians, for example hospitals, would be a good 
source for obtaining ``market based'' physician salary data. 
Additionally, one commenter encouraged us to work with the AMA and the 
Medical Group Management Association (MGMA) to evaluate the validity of 
the current proxy occupational data sources and to determine methods 
for gathering reliable physician cost data.
    Response: We appreciate the comments received on the Institute of 
Medicine's recommendations to revise the work GPCI methodology. We will 
continue to evaluate the comments received on the methodology used for 
determining the physician work GPCI in preparation for the seventh 
update to the GPCIs, which is scheduled to be implemented in CY 2014. 
We also look forward to the MedPAC study on this issue, which is 
required under section 3004 of the MCTRJCA. This study will assess 
whether any geographic adjustment to physician work is appropriate and, 
if so, what the level should be and where it should be applied.
    (D) Institute of Medicine Recommendation 5-6: Office Rent Component 
of PE GPCI. A new source of information should be developed to 
determine the variation in the price of commercial office rent per 
square foot. (Geographic Adjustment in Medicare Payment, Phase I: 
Improving Accuracy pages 5-38 thru 5-39)
    The Institute of Medicine recommends the development of a new 
source of data to determine the variation in the price of commercial 
office rent per square foot. However, the Institute of Medicine does 
not explicitly recommend where the data should come from or how it 
should be collected. Before coming to this recommendation, the 
Institute of Medicine identified and evaluated several public and 
commercially available sources of data to determine whether an accurate 
alternative is available to replace the residential rent data currently 
used as a proxy to measure regional variation in physicians' cost to 
rent office space in the PE GPCI; these sources include rental data 
from the U.S. Department of Housing and Urban Development, American 
Housing Survey, General Services Administration, Basic Allowance for 
Housing (U.S. Department of Defense), U.S. Postal Service, MGMA (MGMA), 
and REIS, Inc. The Institute of Medicine concluded that these sources 
had substantial limitations, including lack of representativeness of 
the market in which physicians rent space, small sample size, low 
response rates, and sample biases. Although we agree that a suitable 
source for commercial office rent data would be preferable to the use 
of residential rent data in our PE office rent methodology, we have 
still been unable to identify an adequate commercial rent source that 
sufficiently covers rural and urban areas.
    We will continue to evaluate possible commercial rent data sources 
for potential use in the office rent calculation. To that end, we 
encouraged public commenters to notify us of any publicly available 
commercial rent data sources, with adequate data representation of 
urban and rural areas that could potentially be used in the calculation 
of the office rent component of PE. However, we did not receive 
comments on specific data sources for commercial rent for purposes of 
determining the office rent component of the PE GPCI.
    Comment: We received several comments that were not within the 
scope of the CY 2013 proposed rule. For example, a few commenters 
expressed concerns about the methodology used for determining the CY 
2012 GPCI values and the impact of the current PFS locality 
configuration on specific PFS localities.
    Response: We appreciate the comments regarding the methodology used 
for determining the CY 2012 GPCI values and the impact they have on

[[Page 68953]]

specific PFS localities. As discussed above, we did not make any 
proposed changes to the GPCI calculation methodology or values for CY 
2013. Therefore, it would not be appropriate to consider making new 
adjustments to the GPCI values for a specific locality without 
providing the public an opportunity to comment. We will consider the 
commenters' suggestions as we implement the seventh GPCI update 
anticipated in CY 2014.
Result of Evaluation of Comments
    We appreciate the comments received on the Institute of Medicine's 
recommendations regarding the PFS locality structure and the data 
sources and methodology used to calculate GPCI values. We will consider 
the commenters' suggestions as we continue to evaluate options for 
reconfiguring the PFS locality structure and as we implement the 
seventh update to the GPCIs scheduled for CY 2014. We also look forward 
to conducting a full review and assessment of the Institute of 
Medicine's additional PFS locality recommendations (as discussed in 
their Phase II report), as well as the MedPAC study on the physician 
work GPCI under the PFS that is required by section 3004 of the 
MCTRJCA.

E. Medicare Telehealth Services for the Physician Fee Schedule

1. Billing and Payment for Telehealth Services
a. History
    Prior to January 1, 1999, Medicare coverage for services delivered 
via a telecommunications system was limited to services that did not 
require a face-to-face encounter under the traditional model of medical 
care. Examples of these services included interpretation of an x-ray, 
or electrocardiogram, or electroencephalogram tracing, and cardiac 
pacemaker analysis.
    Section 4206 of the BBA provided for coverage of, and payment for, 
consultation services delivered via a telecommunications system to 
Medicare beneficiaries residing in rural health professional shortage 
areas (HPSAs) as defined by the Public Health Service Act. 
Additionally, the BBA required that a Medicare practitioner 
(telepresenter) be with the patient at the time of a teleconsultation. 
Further, the BBA specified that payment for a teleconsultation had to 
be shared between the consulting practitioner and the referring 
practitioner and could not exceed the fee schedule payment which would 
have been made to the consultant for the service furnished. The BBA 
prohibited payment for any telephone line charges or facility fees 
associated with the teleconsultation. We implemented this provision in 
the CY 1999 PFS final rule with comment period (63 FR 58814).
    Effective October 1, 2001, section 223 of the Medicare, Medicaid 
and SCHIP Benefits Improvement Protection Act of 2000 (Pub. L. 106-554) 
(BIPA) added a new section, 1834(m), to the Act which significantly 
expanded Medicare telehealth services. Section 1834(m)(4)(F)(i) of the 
Act defines Medicare telehealth services to include consultations, 
office visits, office psychiatry services, and any additional service 
specified by the Secretary, when delivered via a telecommunications 
system. We first implemented this provision in the CY 2002 PFS final 
rule with comment period (66 FR 55246). Section 1834(m)(4)(F)(ii) of 
the Act required the Secretary to establish a process that provides for 
annual updates to the list of Medicare telehealth services. We 
established this process in the CY 2003 PFS final rule with comment 
period (67 FR 79988).
    As specified in regulations at Sec.  410.78(b), we generally 
require that a telehealth service be furnished via an interactive 
telecommunications system. Under Sec.  410.78(a)(3), an interactive 
telecommunications system is defined as multimedia communications 
equipment that includes, at a minimum, audio and video equipment 
permitting two-way, real time interactive communication between the 
patient and the practitioner at the distant site. Telephones, facsimile 
machines, and electronic mail systems do not meet the definition of an 
interactive telecommunications system. An interactive 
telecommunications system is generally required as a condition of 
payment; however, section 1834(m)(1) of the Act does allow the use of 
asynchronous ``store-and-forward'' technology in delivering these 
services when the originating site is a federal telemedicine 
demonstration program in Alaska or Hawaii. As specified in regulations 
at Sec.  410.78(a)(1), store and forward means the asynchronous 
transmission of medical information from an originating site to be 
reviewed at a later time by the practitioner at the distant site.
    Medicare telehealth services may be furnished to an eligible 
telehealth individual notwithstanding the fact that the individual 
practitioner furnishing the telehealth service is not at the same 
location as the beneficiary. An eligible telehealth individual means an 
individual enrolled under Part B who receives a telehealth service 
furnished at an originating site. Under the BIPA, originating sites 
were limited under section 1834(m)(3)(C) of the Act to specified 
medical facilities located in specific geographic areas. The initial 
list of telehealth originating sites included the office of a 
practitioner, a critical access hospital (CAH), a rural health clinic 
(RHC), a federally qualified health center (FQHC) and a hospital (as 
defined in Section 1861(e) of the Act). More recently, section 149 of 
the Medicare Improvements for Patients and Providers Act of 2008 (Pub. 
L. 110-275) (MIPPA) expanded the list of telehealth originating sites 
to include hospital-based renal dialysis centers, skilled nursing 
facilities (SNFs), and community mental health centers (CMHCs). In 
order to serve as a telehealth originating site, these sites must be 
located in an area designated as a rural health professional shortage 
area (HPSA), in a county that is not in a metropolitan statistical area 
(MSA), or must be an entity that participates in a federal telemedicine 
demonstration project that has been approved by (or receives funding 
from) the Secretary of Health and Human Services as of December 31, 
2000. Finally, section 1834(m) of the Act does not require the eligible 
telehealth individual to be presented by a practitioner at the 
originating site.
b. Current Telehealth Billing and Payment Policies
    As noted previously, Medicare telehealth services can only be 
furnished to an eligible telehealth beneficiary in an originating site. 
An originating site is defined as one of the specified sites where an 
eligible telehealth individual is located at the time the service is 
being furnished via a telecommunications system. In general, 
originating sites must be located in a rural HPSA or in a county 
outside of an MSA. The originating sites authorized by the statute are 
as follows:
     Offices of a physician or practitioner;
     Hospitals;
     CAHs;
     RHCs;
     FQHCs;
     Hospital-Based or Critical Access Hospital-Based Renal 
Dialysis Centers (including Satellites);
     SNFs;
     CMHCs.

Currently approved Medicare telehealth services include the following:

     Initial inpatient consultations;
     Follow-up inpatient consultations;
     Office or other outpatient visits;
     Individual psychotherapy;
     Pharmacologic management;

[[Page 68954]]

     Psychiatric diagnostic interview examination;
     End-stage renal disease (ESRD) related services;
     Individual and group medical nutrition therapy (MNT);
     Neurobehavioral status exam;
     Individual and group health and behavior assessment and 
intervention (HBAI);
     Subsequent hospital care;
     Subsequent nursing facility care;
     Individual and group kidney disease education (KDE);
     Individual and group diabetes self-management training 
(DSMT); and
     Smoking cessation services.
    In general, the practitioner at the distant site may be any of the 
following, provided that the practitioner is licensed under state law 
to furnish the service via a telecommunications system:
     Physician;
     Physician assistant (PA);
     Nurse practitioner (NP);
     Clinical nurse specialist (CNS);
     Nurse-midwife;
     Clinical psychologist;
     Clinical social worker;
     Registered dietitian or nutrition professional.
    Practitioners furnishing Medicare telehealth services submit claims 
for telehealth services to the Medicare contractors that process claims 
for the service area where their distant site is located. Section 
1834(m)(2)(A) of the Act requires that a practitioner who furnishes a 
telehealth service to an eligible telehealth individual be paid an 
amount equal to the amount that the practitioner would have been paid 
if the service had been furnished without the use of a 
telecommunications system. Distant site practitioners must submit the 
appropriate HCPCS procedure code for a covered professional telehealth 
service, appended with the -GT (Via interactive audio and video 
telecommunications system) or -GQ (Via asynchronous telecommunications 
system) modifier. By reporting the -GT or -GQ modifier with a covered 
telehealth procedure code, the distant site practitioner certifies that 
the beneficiary was present at a telehealth originating site when the 
telehealth service was furnished. The usual Medicare deductible and 
coinsurance policies apply to the telehealth services reported by 
distant site practitioners.
    Section 1834(m)(2)(B) of the Act provides for payment of a facility 
fee to the originating site. To be paid the originating site facility 
fee, the provider or supplier where the eligible telehealth individual 
is located must submit a claim with HCPCS code Q3014 (Telehealth 
originating site facility fee), and the provider or supplier is paid 
according to the applicable payment methodology for that facility or 
location. The usual Medicare deductible and coinsurance policies apply 
to HCPCS code Q3014. By submitting HCPCS code Q3014, the originating 
site certifies that it is located in either a rural HPSA or non-MSA 
county or is an entity that participates in a federal telemedicine 
demonstration project that has been approved by (or receives funding 
from) the Secretary of Health and Human Services as of December 31, 
2000 as specified in section 1834(m)(4)(C)(i)(III) of the Act.
    As previously described, certain professional services that are 
commonly furnished remotely using telecommunications technology, but 
that do not require the patient to be present in-person with the 
practitioner when they are furnished, are covered and paid in the same 
way as services delivered without the use of telecommunications 
technology when the practitioner is in-person at the medical facility 
furnishing care to the patient. Such services typically involve 
circumstances where a practitioner is able to visualize some aspect of 
the patient's condition without the patient being present and without 
the interposition of a third person's judgment. Visualization by the 
practitioner can be possible by means of x-rays, electrocardiogram or 
electroencephalogram tracings, tissue samples, etc. For example, the 
interpretation by a physician of an actual electrocardiogram or 
electroencephalogram tracing that has been transmitted via telephone 
(that is, electronically, rather than by means of a verbal description) 
is a covered physician's service. These remote services are not 
Medicare telehealth services as defined under section 1834(m) of the 
Act. Rather, these remote services that utilize telecommunications 
technology are considered physicians' services in the same way as 
services that are furnished in-person without the use of 
telecommunications technology; they are paid under the same conditions 
as in-person physicians' services (with no requirements regarding 
permissible originating sites), and should be reported in the same way 
(that is, without the -GT or -GQ modifier appended).
2. Requests for Adding Services to the List of Medicare Telehealth 
Services
    As noted previously, in the December 31, 2002 Federal Register (67 
FR 79988), we established a process for adding services to or deleting 
services from the list of Medicare telehealth services. This process 
provides the public with an ongoing opportunity to submit requests for 
adding services. We assign any request to make additions to the list of 
telehealth services to one of two categories. In the November 28, 2011 
Federal Register (76 FR 73102), we finalized revisions to criteria that 
we use to review requests in the second category. The two categories 
are:
     Category 1: Services that are similar to professional 
consultations, office visits, and office psychiatry services that are 
currently on the list of telehealth services. In reviewing these 
requests, we look for similarities between the requested and existing 
telehealth services for the roles of, and interactions among, the 
beneficiary, the physician (or other practitioner) at the distant site 
and, if necessary, the telepresenter. We also look for similarities in 
the telecommunications system used to deliver the proposed service, for 
example, the use of interactive audio and video equipment.
     Category 2: Services that are not similar to the current 
list of telehealth services. Our review of these requests includes an 
assessment of whether the service is accurately described by the 
corresponding code when delivered via telehealth and whether the use of 
a telecommunications system to deliver the service produces 
demonstrated clinical benefit to the patient. In reviewing these 
requests, we look for evidence indicating that the use of a 
telecommunications system in delivering the candidate telehealth 
service produces clinical benefit to the patient. Submitted evidence 
should include both a description of relevant clinical studies that 
demonstrate the service furnished by telehealth to a Medicare 
beneficiary improves the diagnosis or treatment of an illness or injury 
or improves the functioning of a malformed body part, including dates 
and findings, and a list and copies of published peer reviewed articles 
relevant to the service when furnished via telehealth. Our evidentiary 
standard of clinical benefit does not include minor or incidental 
benefits.
    Some examples of clinical benefit include the following:
     Ability to diagnose a medical condition in a patient 
population without access to clinically appropriate in person 
diagnostic services.
     Treatment option for a patient population without access 
to clinically appropriate in-person treatment options.
     Reduced rate of complications.
     Decreased rate of subsequent diagnostic or therapeutic 
interventions

[[Page 68955]]

(for example, due to reduced rate of recurrence of the disease 
process).
     Decreased number of future hospitalizations or physician 
visits.
     More rapid beneficial resolution of the disease process 
treatment.
     Decreased pain, bleeding, or other quantifiable symptom.
     Reduced recovery time.
    Since establishing the process to add or remove services from the 
list of approved telehealth services, we have added the following to 
the list of Medicare telehealth services: individual and group HBAI 
services; psychiatric diagnostic interview examination; ESRD services 
with 2 to 3 visits per month and 4 or more visits per month (although 
we require at least 1 visit a month to be furnished in-person by a 
physician, CNS, NP, or PA in order to examine the vascular access 
site); individual and group MNT; neurobehavioral status exam; initial 
and follow-up inpatient telehealth consultations for beneficiaries in 
hospitals and skilled nursing facilities (SNFs); subsequent hospital 
care (with the limitation of one telehealth visit every 3 days); 
subsequent nursing facility care (with the limitation of one telehealth 
visit every 30 days); individual and group KDE; and individual and 
group DSMT (with a minimum of 1 hour of in-person instruction to ensure 
effective injection training), and smoking cessation services.
    Requests to add services to the list of Medicare telehealth 
services must be submitted and received no later than December 31 of 
each calendar year to be considered for the next rulemaking cycle. For 
example, requests submitted before the end of CY 2012 will be 
considered for the CY 2014 proposed rule. Each request for adding a 
service to the list of Medicare telehealth services must include any 
supporting documentation the requester wishes us to consider as we 
review the request. Because we use the annual PFS rulemaking process as 
a vehicle for making changes to the list of Medicare telehealth 
services, requestors should be advised that any information submitted 
is subject to public disclosure for this purpose. For more information 
on submitting a request for an addition to the list of Medicare 
telehealth services, including where to mail these requests, we refer 
readers to the CMS Web site at www.cms.gov/telehealth/.
3. Submitted Request and Other Additions to the List of Telehealth 
Services for CY 2013
    We received a request in CY 2011 to add alcohol and/or substance 
abuse and brief intervention services as Medicare telehealth services 
effective for CY 2013. The following presents a discussion of this 
request, and our proposals for additions to the CY 2013 telehealth 
list.
a. Alcohol and/or Substance Abuse and Brief Intervention Services
    The American Telemedicine Association submitted a request to add 
alcohol and/or substance abuse and brief intervention services, 
reported by CPT codes 99408 (Alcohol and/or substance (other than 
tobacco) abuse structured screening (for example, AUDIT, DAST), and 
brief intervention (SBI) services; 15 to 30 minutes) and 99409 (Alcohol 
and/or substance (other than tobacco) abuse structured screening (for 
example, AUDIT, DAST), and brief intervention (SBI) services; greater 
than 30 minutes) to the list of approved telehealth services for CY 
2013 on a category 1 basis.
    We note that we assigned a status indicator of ``N'' (Noncovered) 
to CPT codes 99408 and 99409 as explained in the CY 2008 PFS final rule 
with comment period (72 FR 66371). At the time, we stated that because 
Medicare only provides payment for certain screening services with an 
explicit benefit category, and these CPT codes incorporate screening 
services along with intervention services, we believed that these codes 
were ineligible for payment under the PFS. We continue to believe that 
these codes are ineligible for payment under PFS and, additionally, 
under the telehealth benefit. We do not believe it would be appropriate 
to make payment for claims using these CPT codes for the services 
furnished via telehealth, but not when furnished in person. Because CPT 
codes 99408 and 99409 are currently assigned a noncovered status 
indicator, and because we continue to believe this assignment is 
appropriate, we did not propose adding these CPT codes to the list of 
Medicare Telehealth Services for CY 2013.
    However, we created two parallel G-codes for 2008 that allow for 
appropriate Medicare reporting and payment for alcohol and substance 
abuse assessment and intervention services that are not furnished as 
screening services, but that are furnished in the context of the 
diagnosis or treatment of illness or injury. The codes are HCPCS code 
G0396 (Alcohol and/or substance (other than tobacco) abuse structured 
assessment (for example, AUDIT, DAST) and brief intervention, 15 to 30 
minutes) and HCPCS code G0397, (Alcohol and/or substance (other than 
tobacco) abuse structured assessment (for example, AUDIT, DAST) and 
intervention greater than 30 minutes). Since these codes are used to 
report comparable alcohol and substance abuse services under certain 
conditions, we believed that it would be appropriate to consider the 
ATA's request as it applies to these services when appropriately 
reported by the G-codes. The ATA asked that CMS consider this request 
as a category 1 addition based on the similarities between these 
services and CPT codes 99406 (Smoking and tobacco use cessation 
counseling visit; intermediate, greater than 3 minutes up to 10 
minutes) and 99407 (Smoking and tobacco use cessation counseling visit; 
intensive, greater than 10 minutes). We agree that the interaction 
between a practitioner and a beneficiary receiving alcohol and 
substance abuse assessment and intervention services is similar to 
their interaction in smoking cessation services. We also believe that 
the interaction between a practitioner and a beneficiary receiving 
alcohol and substance abuse assessment and intervention services is 
similar to the assessment and intervention elements of CPT code 96152 
(health and behavior intervention, each 15 minutes, face-to-face; 
individual), which also is currently on the telehealth list.
    Therefore, we proposed to add HCPCS codes G0396 and G0397 to the 
list of telehealth services for CY 2013 on a category 1 basis. 
Consistent with this proposal, we also proposed to revise our 
regulations at Sec.  410.78(b) and Sec.  414.65(a)(1) to include 
alcohol and substance abuse assessment and intervention services as 
Medicare telehealth services.
b. Preventive Services
    Under our existing policy, we add services to the telehealth list 
on a category 1 basis when we determine that they are similar to 
services on the existing telehealth list with respect to the roles of, 
and interactions among, the beneficiary, physician (or other 
practitioner) at the distant site and, if necessary, the telepresenter. 
As we stated in the CY 2012 proposed rule (76 FR 42826), we believe 
that the category 1 criteria not only streamline our review process for 
publically requested services that fall into this category, the 
criteria also expedite our ability to identify codes for the telehealth 
list that resemble those services already on this list.
    During CY 2012, CMS added coverage for several preventive services 
through the national coverage determination (NCD) process as authorized 
by section 1861(ddd) of the Act. These services add to Medicare's 
existing portfolio of preventive services that are now

[[Page 68956]]

available without cost sharing under the Affordable Care Act. We 
believe that for several of these services, the interactions between 
the furnishing practitioner and the beneficiary are similar to services 
currently on the list of Medicare telehealth services. Specifically, we 
believe that the assessment, education, and counseling elements of the 
following services are similar to existing telehealth services:
     Screening and behavioral counseling interventions in 
primary care to reduce alcohol misuse, reported by HCPCS codes G0442 
(Annual alcohol misuse screening, 15 minutes) and G0443 (Brief face-to-
face behavioral counseling for alcohol misuse, 15 minutes).
     Screening for depression in adults, reported by HCPCS code 
G0444 (Annual Depression Screening, 15 minutes).
     Screening for sexually transmitted infections (STIs) and 
high-intensity behavioral counseling (HIBC) to prevent STIs, reported 
by HCPCS code G0445 (High-intensity behavioral counseling to prevent 
sexually transmitted infections, face-to-face, individual, includes: 
education, skills training, and guidance on how to change sexual 
behavior, performed semi-annually, 30 minutes).
     Intensive behavioral therapy for cardiovascular disease, 
reported by HCPCS code G0446 (Annual, face-to-face intensive behavioral 
therapy for cardiovascular disease, individual, 15 minutes).
     Intensive behavioral therapy for obesity, reported by 
HCPCS code G0447 (Face-to-face behavioral counseling for obesity, 15 
minutes).
    We believe that the interactions between practitioners and 
beneficiaries receiving these services are similar to individual KDE 
services reported by HCPCS code G0420 (Face-to-face educational 
services related to the care of chronic kidney disease; individual, per 
session, per one hour), individual MNT reported by HCPCS code G0270 
(Medical nutrition therapy; reassessment and subsequent intervention(s) 
following second referral in the same year for change in diagnosis, 
medical condition or treatment regimen (including additional hours 
needed for renal disease), individual, face-to-face with the patient, 
each 15 minutes); CPT code 97802 (Medical nutrition therapy; initial 
assessment and intervention, individual, face-to-face with the patient, 
each 15 minutes); and CPT code 97803 (Medical nutrition therapy; re-
assessment and intervention, individual, face-to-face with the patient, 
each 15 minutes), and HBAI reported by CPT code 96150 (Health and 
behavior assessment (for example, health-focused clinical interview, 
behavioral observations, psychophysiological monitoring, health-
oriented questionnaires), each 15 minutes face-to-face with the 
patient; initial assessment); CPT code 96151 (Health and behavior 
assessment (for example, health-focused clinical interview, behavioral 
observations, psychophysiological monitoring, health-oriented 
questionnaires), each 15 minutes face-to-face with the patient re-
assessment); CPT code 96152 (Health and behavior intervention, each 15 
minutes, face-to-face; Individual); CPT code 96153 (Health and behavior 
intervention, each 15 minutes, face-to-face; Group (2 or more 
patients)); CPT code 96154 (Health and behavior intervention, each 15 
minutes, face-to-face; family (with the patient present)), all services 
that are currently on the telehealth list.
    Therefore, we proposed to add HCPCS codes G0442, G0443, G0444, 
G0445, G0446, and G0447 to the list of telehealth services for CY 2013 
on a category 1 basis. We note that all coverage guidelines specific to 
the services would continue to apply when these services are furnished 
via telehealth. For example, when the national coverage determination 
requires that the service be furnished to beneficiaries in a primary 
care setting, the qualifying originating telehealth site must also 
qualify as a primary care setting. Similarly, when the national 
coverage determination requires that the service be furnished by a 
primary care practitioner, the qualifying primary distant site 
practitioner must also qualify as primary care practitioner. For more 
detailed information on coverage requirements for these services, we 
refer readers to the Medicare National Coverage Determinations Manual, 
Pub. 100-03, Chapter 1, Section 210, available at http://www.cms.gov/manuals/downloads/ncd103c1_Part4.pdf. Consistent with this proposal, 
we also proposed to revise our regulations at Sec.  410.78(b) and Sec.  
414.65(a)(1) to include these preventive services as Medicare 
telehealth services.
    Comment: All commenters expressed support for CMS' proposals to add 
alcohol and/or substance abuse structured assessment and brief 
intervention services and the several preventive services established 
through the national coverage determination (NCD) process to the list 
of Medicare telehealth services for CY 2013. One commenter stated 
particular support for CMS' approach to ensure that coverage guidelines 
continue to apply when these services are furnished via telehealth and 
expressed the intention to support CMS' efforts to help educate 
practitioners about these preventive telehealth services newly 
available in 2013. Another commenter stated that the proposal to add 
these services to this list was an integral step forward for 
telehealth, but that the current breadth and level of services covered 
under the telehealth benefit is inadequate to support more robust 
telehealth capabilities sought by some practitioners.
    Response: We appreciate the broad support for the proposed 
additions to the list of Medicare telehealth services and the efforts 
of stakeholders to ensure that practitioners are educated about the 
addition of these services to the list of Medicare telehealth services. 
We believe that the delivery of services via telehealth can help reduce 
barriers to health care access faced by some beneficiaries, and we 
remind all interested stakeholders that we are currently soliciting 
public requests to add services to the list of Medicare telehealth 
services. To be considered during PFS rulemaking for CY 2014, these 
requests must be submitted and received by December 31, 2012 or the 
close of the comment period for this final rule with comment period. 
Each request to add a service to the list of Medicare telehealth 
services must include any supporting documentation the requester wishes 
us to consider as we review the request. For more information on 
submitting a request for an addition to the list of Medicare telehealth 
services, including where to mail these requests, we refer readers to 
the CMS Web site at www.cms.gov/telehealth/.
    After consideration of the public comments received, we are 
finalizing our CY 2013 proposal to add HCPCS codes G0396, G0397, G0442, 
G0443, G0444, G0445, G0446, and G0447 to the list of telehealth 
services for CY 2013 on a category 1 basis. We note that all coverage 
guidelines specific to the services will continue to apply when these 
services are furnished via telehealth. For example, when the national 
coverage determination requires that the service be furnished to 
beneficiaries in a primary care setting, the telehealth originating 
site must also qualify as a primary care setting under the terms of the 
national coverage determination. Similarly, when the national coverage 
determination requires that the service be furnished by a primary care 
practitioner, the distant site practitioner who furnishes the 
telehealth service must also qualify as primary care practitioner under 
the terms of the national coverage

[[Page 68957]]

determination. For more detailed information on coverage requirements 
for these services, we refer readers to the Medicare National Coverage 
Determinations Manual, Pub. 100-03, Chapter 1, Section 210, available 
at www.cms.gov/manuals/downloads/ncd103c1_Part4.pdf. Consistent with 
this proposal, we are also revising our regulations at Sec.  410.78(b) 
and Sec.  414.65(a)(1) to include alcohol and/or substance abuse 
structured assessment and intervention services and the preventive 
services as Medicare telehealth services.
4. Technical Correction To Include Emergency Department Telehealth 
Consultations in Regulation
    In the CY 2012 PFS final rule with comment period (76 FR 73103), we 
finalized our proposal to change the code descriptors for initial 
inpatient telehealth consultation G-codes to reflect telehealth 
consultations furnished to emergency department patients in addition to 
inpatient telehealth consultations effective January 1, 2012. However, 
we did not amend the description of the services within the regulation 
at Sec.  414.65(a)(1)(i). Therefore, we proposed to make a technical 
revision to our regulation at Sec.  414.65(a)(1)(i) to reflect 
telehealth consultations furnished to emergency department patients in 
addition to hospital and SNF inpatients.
    We received no comments regarding our proposal to make this 
technical revision. Therefore, we are finalizing our proposal to make a 
technical revision to our regulation at Sec.  414.65(a)(1)(i) to 
reflect telehealth consultations furnished to emergency department 
patients in addition to hospital and SNF inpatients.
5. Telehealth Originating Site Facility Fee Payment Amount Update
    Section 1834(m)(2)(B) of the Act establishes the payment amount for 
the Medicare telehealth originating site facility fee for telehealth 
services provided from October 1, 2001, through December 31, 2002, at 
$20. For telehealth services provided on or after January 1 of each 
subsequent calendar year, the telehealth originating site facility fee 
is increased by the percentage increase in the MEI as defined in 
section 1842(i)(3) of the Act. The MEI increase for 2013 is 0.8 
percent. Therefore, for CY 2013, the payment amount for HCPCS code 
Q3014 (Telehealth originating site facility fee) is 80 percent of the 
lesser of the actual charge or $24.43. The Medicare telehealth 
originating site facility fee and MEI increase by the applicable time 
period is shown in Table 18.

 Table 18--The Medicare Telehealth Originating Site Facility Fee and MEI
                 Increase by the Applicable Time Period
------------------------------------------------------------------------
                                   MEI
         Facility  fee          increase              Period
------------------------------------------------------------------------
$20.00........................       N/A  10/01/2001-12/31/2002
$20.60........................      3.0%  01/01/2003-12/31/2003
$21.20........................      2.9%  01/01/2004-12/31/2004
$21.86........................      3.1%  01/01/2005-12/31/2005
$22.47........................      2.8%  01/01/2006-12/31/2006
$22.94........................      2.1%  01/01/2007-12/31/2007
$23.35........................      1.8%  01/01/2008-12/31/2008
$23.72........................      1.6%  01/01/2009-12/31/2009
$24.00........................      1.2%  01/01/2010-12/31/2010
$24.10........................      0.4%  01/01/2011-12/31/2011
$24.24........................      0.6%  01/01/2012-12/31/2012
$24.43........................      0.8%  01/01/2013-12/31/2013
------------------------------------------------------------------------

F. Extension of Payment for Technical Component of Certain Physician 
Pathology Services

1. Background and Statutory Authority
    Section 542(c) of the Medicare, Medicaid, and SCHIP Benefits 
Improvement and Protection Act of 2000 (BIPA) (Pub. L. 106-554) 
provided payment to independent laboratories furnishing the technical 
component (TC) of physician pathology services to fee-for-service 
Medicare beneficiaries who are inpatients or outpatients of a covered 
hospital for a 2-year period beginning on January 1, 2000. This section 
was subsequently amended by section 732 of the Medicare Prescription 
Drug, Improvement, and Modernization Act of 2003 (MMA) (Pub. L. 108-
173), section 104 of division B of the Tax Relief and Health Care Act 
of 2006 (MIEA-TRHCA) (Pub. L. 109-432), section 104 of the Medicare, 
Medicaid, and SCHIP Extension Act of 2007 (MMSEA) (Pub. L. 110-173), 
section 136 of the Medicare Improvements for Patients and Providers Act 
of 2008 (MIPPA) (Pub. L. 110-275), section 3104 of the Affordable Care 
Act (Pub. L. 111-148), section 105 of the Medicare and Medicaid 
Extenders Act of 2010 (MMEA) (Pub. L. 111-309), section 305 of the 
Temporary Payroll Tax Cut Continuation Act of 2011 (Pub. L. 112-78) and 
section 3006 of the Middle Class Tax Relief and Job Creation Act of 
2012 (Pub. L. 112-96) to continue payment to independent laboratories 
furnishing the technical component (TC) of physician pathology services 
to fee-for-service Medicare beneficiaries who are inpatients or 
outpatients of a covered hospital for various time periods. As 
discussed in detail below, Congress most recently acted to continue 
this payment through June 30, 2012. The TC of physician pathology 
services refers to the preparation of the slide involving tissue or 
cells that a pathologist interprets. The professional component (PC) of 
physician pathology services refers to the pathologist's interpretation 
of the slide.
    When the hospital pathologist furnishes the PC service for a 
hospital patient, the PC service is separately billable by the 
pathologist. When an independent laboratory's pathologist furnishes the 
PC service, the PC service is usually billed with the TC service as a 
combined or global service.
    Historically, any independent laboratory could bill the Medicare 
contractor under the PFS for the TC of physician pathology services for 
hospital patients even though the payment for the costs of furnishing 
the pathology service (but not its interpretation) was already included 
in the bundled inpatient stay payment to the hospital. In the CY 2000 
PFS final rule with comment period (64 FR 59408 and 59409), we stated 
that this policy has contributed to the Medicare program paying twice 
for the TC service: (1) To the hospital, through the inpatient 
prospective payment rate, when the patient is an inpatient; and (2) To 
the independent laboratory that bills the Medicare contractor, instead 
of the hospital, for the TC service. While the policy also permits the 
independent laboratory to bill for the TC of physician pathology 
services for hospital outpatients, in this case, there generally would 
not be duplicate payment because we would expect the hospital to not 
also bill for the pathology service, which would be paid separately to 
the hospital only if the hospital were to specifically bill for it. We 
further indicated that we would implement a policy to pay only the 
hospital for the TC of physician pathology services furnished to its 
inpatients.
    Therefore, in the CY 2000 PFS final rule with comment period, we 
revised Sec.  415.130(c) to state that for physician pathology services 
furnished on or after January 1, 2001 by an independent laboratory, 
payment is made only to the hospital for the TC of physician pathology 
services furnished to a hospital inpatient. Ordinarily, the provisions 
in the PFS final rule with comment period are implemented in the 
following year. However, the change to Sec.  415.130 was delayed 1-year 
(until January 1, 2001), at the request of the industry, to allow 
independent laboratories and hospitals sufficient time to negotiate 
arrangements.
    Full implementation of Sec.  415.130 was further delayed by section 
542 of the

[[Page 68958]]

BIPA and section 732 of the MMA, which directed us to continue payment 
to independent laboratories for the TC of physician pathology services 
for hospital patients for a 2-year period beginning on January 1, 2001 
and for CYs 2005 and 2006, respectively. In the CY 2007 PFS final rule 
with comment period (71 FR 69788), we amended Sec.  415.130 to provide 
that, for services furnished after December 31, 2006, an independent 
laboratory may not bill the carrier for the TC of physician pathology 
services furnished to a hospital inpatient or outpatient. However, 
section 104 of the MIEA-TRHCA continued payment to independent 
laboratories for the TC of physician pathology services for hospital 
patients through CY 2007, and section 104 of the MMSEA further extended 
such payment through the first 6 months of CY 2008.
    Section 136 of the MIPPA extended the payment through CY 2009. 
Section 3104 of the Affordable Care Act amended the prior legislation 
to extend the payment through CY 2010. Section 105 of the MMEA extended 
the payment through CY 2011. Subsequent to the publication of the CY 
2012 PFS final rule with comment period, section 305 of the Temporary 
Payroll Tax Cut Continuation Act of 2011 extended the payment through 
February 29, 2012 and section 3006 of the Middle Class Tax Relief and 
Job Creation Act of 2012 extended the payment through June 30, 2012.
2. Revisions to Payment for TC of Certain Physician Pathology Services
    In the CY 2012 PFS final rule with comment period, we finalized our 
policy that an independent laboratory may not bill the Medicare 
contractor for the TC of physician pathology services furnished after 
December 31, 2011, to a hospital inpatient or outpatient (76 FR 73278 
through 73279, 73473). As discussed above, subsequent to publication of 
that final rule with comment period, Congress acted to continue payment 
to independent laboratories through June 30, 2012. Therefore, the 
policy that we finalized in the CY 2012 PFS final rule with comment 
period was superseded by statute for 6 months. To be consistent with 
the statutory changes and our current policy, we proposed conforming 
changes to Sec.  415.130(d) such that we continued payment under the 
PFS to independent laboratories furnishing the TC of physician 
pathology services to fee-for-service Medicare beneficiaries who are 
inpatients or outpatients of a covered hospital on or before June 30, 
2012 (77 FR 44763). Independent laboratories may not bill the Medicare 
contractor for the TC of physician pathology services furnished after 
June 30, 2012, to a hospital inpatient or outpatient. We received no 
public comments on the proposed conforming changes so we are finalizing 
the revisions to Sec.  415.130(d) without modification.

G. Therapy Services

1. Outpatient Therapy Caps for CY 2013
    Section 1833(g) of the Act applies annual, per beneficiary, 
limitations (therapy caps) on expenses considered incurred for 
outpatient therapy services under Medicare Part B. There is one therapy 
cap for outpatient occupational therapy (OT) services and another 
separate therapy cap for physical therapy (PT) and speech-language 
pathology (SLP) services combined. Although therapy services furnished 
in an outpatient hospital setting have been exempt from the application 
of the therapy caps, section 3005(b) of the MCTRJCA amended section 
1833(g) of the Act to include therapy services furnished in an 
outpatient hospital setting in the therapy caps. This provision is in 
effect from October 1, 2012 through December 31, 2012.
    The therapy cap amounts are updated each year based on the Medicare 
Economic Index (MEI). The annual change in the therapy cap amount for 
CY 2013 is computed by multiplying the cap amount for CY 2012 by the 
MEI for CY 2013 and rounding to the nearest $10. This amount is added 
to the CY 2012 cap, which is $1,880, to obtain the CY 2013 cap amount. 
The MEI for CY 2013 is 0.8 percent, resulting in a therapy cap amount 
for CY 2013 of $1,900.
    An exceptions process to the therapy caps has been in effect since 
January 1, 2006. Since originally authorized by section 5107 of the 
Deficit Reduction Act (DRA), which amended section 1833(g)(5) of the 
Act, the exceptions process for the therapy caps has been extended 
through subsequent legislation (MIEA-TRHCA, MMSEA, MIPPA, the 
Affordable Care Act, MMEA, and TPTCCA). Last amended by section 3005 of 
the MCTRJCA, the Agency's authority to provide for an exception process 
to therapy caps expires on December 31, 2012. To request an exception 
to the therapy caps, therapy suppliers and providers use the KX 
modifier on claims for services after the beneficiary's services for 
the year have exceeded the therapy cap. Use of the KX modifier 
indicates that the services are reasonable and necessary and that there 
is documentation of medical necessity in the beneficiary's medical 
record.
    Section 3005 of the MCTRJCA also required two additional changes to 
Medicare policies for outpatient therapy services. Effective for 
services furnished from October 1 through December 31, 2012, after a 
beneficiary's incurred expenses for PT and SLP services combined exceed 
the threshold of $3,700 during the calendar year, section 1833(g)(5)(C) 
of the Act, as amended by 3005(a)(5) of the MCTRJCA, requires that we 
apply a manual medical review process as part of the therapy caps 
exceptions process. Similar to the therapy caps, there is a separate 
$3,700 threshold for OT services. All requests for exceptions to the 
therapy caps for services after the $3,700 threshold is reached are 
subject to manual medical review. The manual medical review process is 
being phased in over a 3-month period. Unlike the therapy caps, 
exceptions are not automatically granted for therapy services above the 
$3,700 threshold based upon the therapist's determination that they 
services are reasonable and necessary. To request an exception to the 
therapy caps for services after the threshold is reached, the provider 
sends a request for an exception to the Medicare contractor. The 
contractor then uses the coverage and payment requirements contained 
within Pub. 100-02, Medicare Benefit Policy Manual, section 220 and 
applicable medical review guidelines, and any relevant local coverage 
determinations to make decisions as to whether an exception is approved 
for the services. For more information on the manual medical review 
process, go to www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/Medical-Review/TherapyCap.html.
2. Claims-Based Data Collection Strategy for Therapy Services
a. Introduction
    Section 3005(g) of the MCTRJCA requires CMS to implement, beginning 
on January 1, 2013, ``* * * a claims-based data collection strategy 
that is designed to assist in reforming the Medicare payment system for 
outpatient therapy services subject to the limitations of section 
1833(g) of the Act. Such strategy shall be designed to provide for the 
collection of data on patient function during the course of therapy 
services in order to better understand patient condition and 
outcomes.''
b. History/Background
    In 2011, more than 8 million Medicare beneficiaries received 
outpatient therapy services, including

[[Page 68959]]

physical therapy (PT), occupational therapy (OT), and speech-language-
pathology (SLP). Medicare payments for these services exceeded $5.8 
billion. Between 1998-2008, Medicare expenditures for outpatient 
therapy services increased at a rate of 10.1 percent per year while the 
number of Medicare beneficiaries receiving therapy services only 
increased by 2.9 percent per year. Although a significant number of 
Medicare beneficiaries benefit from therapy services, the rapid growth 
in Medicare expenditures for these services has long been of concern to 
the Congress and the Agency. To address this concern, efforts have been 
focused on developing Medicare payment incentives that encourage 
delivery of reasonable and necessary care while discouraging 
overutilization of therapy services and the provision of medically 
unnecessary care. A brief review of these efforts is useful in 
understanding our policy for CY 2013.
(1) Therapy Caps
    Section 4541 of the Balanced Budget Act of 1997 (Pub. L. 105-33) 
(BBA) amended section 1833(g) of the Act to impose financial 
limitations on outpatient therapy services (the ``therapy caps'' 
discussed above) in an attempt to limit Medicare expenditures for 
therapy services. Prior to the BBA amendment, these caps had applied to 
services furnished by therapists in private practice, but the BBA 
expanded the caps effective January 1, 1999, to include all outpatient 
therapy services except those furnished in hospital outpatient 
departments. Since that time, the Congress has amended the statute 
several times to impose a moratorium on the application of the caps or 
has required us to implement an exceptions process for the caps. The 
therapy caps have only been in effect without a moratorium or an 
exceptions process for less than 2 years. (See the discussion about the 
therapy cap exceptions process above.) Almost from the inception of the 
therapy caps, Congress and the Agency have been exploring potential 
alternatives to the therapy caps.
(2) Multiple Procedure Payment Reduction (MPPR)
    In the CY 2011 PFS final rule with comment period (75 FR 73232-
73242), we adopted a MPPR of 25 percent applicable to the practice 
expense (PE) component of the second and subsequent therapy services 
furnished to a beneficiary when more than one of these services is 
furnished in a single session. This reduction applies to nearly 40 
therapy service codes. (For a list of therapy service codes to which 
this policy applies, see Addendum H.) The Physician Payment and Therapy 
Relief Act of 2010 (PPATRA) subsequently revised the reduction to 20 
percent for the second and subsequent therapy services furnished to a 
beneficiary in an office setting, leaving the 25 percent reduction in 
place for therapy services furnished to a beneficiary in institutional 
settings. We adopted this MPPR as part of our directive under section 
1848(c)(2)(K) of the statute, as added by section 3134(a) of the 
Affordable Care Act, to identify and evaluate potentially misvalued 
codes. By taking into consideration the expected efficiencies in direct 
PE resources that occur when services are furnished together, this 
policy results in more appropriate payment for therapy services. 
Although we did not adopt this MPPR policy specifically as an 
alternative to the therapy caps, paying more appropriately for 
combinations of therapy services that are commonly furnished in a 
single session reduces the number of beneficiaries impacted by the 
therapy caps in a given year. For more details on the MPPR policy, see 
section II.B.4. of this final rule with comment period.
(3) Studies Performed
    The therapy cap is a uniform dollar amount that sets a limit on the 
total value of services furnished unrelated to the specific services 
furnished or the beneficiary's condition or needs. A uniform cap does 
not deter unnecessary care or encourage efficient practice for low 
complexity beneficiaries. In fact, it may even encourage the provision 
of services up to the level of the cap. Conversely, a uniform cap 
without an exceptions process restricts necessary and appropriate care 
for certain high complexity beneficiaries. Recognizing these 
limitations in a uniform dollar value cap, we have been studying 
therapy practice patterns and exploring ways to refine payment for 
these services as an alternative to therapy caps.
    On November 9, 2004, the Secretary delivered the Report to 
Congress, as required by the BBA as amended by the BBRA, ``Medicare 
Financial Limitations on Outpatient Therapy Services.'' This report 
included two utilization analyses. Although these analyses provided 
details on utilization, neither specifically identified ways to improve 
therapy payment. In the report, we indicated that further study was 
underway to assess alternatives to the therapy caps. The report and the 
analyses are available on the CMS Web site at www.cms.gov/TherapyServices/.
    Since 2004, we have periodically updated the utilization analyses 
and posted other reports on the CMS Web site. These reports highlighted 
the expected effects of limiting services in various ways and presented 
plans to collect data about beneficiary condition, including functional 
limitations, using available tools. Through these efforts, we have made 
progress in identifying the types of outpatient therapy services that 
are billed to Medicare, the demographics of the beneficiaries who 
utilize these services, the HCPCS codes used to bill the services, the 
allowed and paid amounts of the services, the providers of these 
services, the therapy utilization patterns among states in which the 
services are furnished, and the type of practitioner furnishing 
services.
    From these and other analyses in our ongoing research effort, we 
have concluded that without the ability to define the services that are 
typically needed to address specific clinical cohorts of beneficiaries 
(those with similar risk-adjusted conditions), it is not possible to 
develop payment policies that encourage the delivery of reasonable and 
necessary services while discouraging the provision of services that do 
not produce a clinical benefit. Although there is widespread agreement 
that beneficiary condition and functional limitations are critical to 
developing and evaluating an alternative payment system for therapy 
services, a system for collecting such data uniformly does not exist. 
Currently diagnosis information is available from Medicare claims. 
However, we believe that the diagnosis on the claim is a poor predictor 
for the type and duration of therapy services required. Additional work 
is needed to develop an appropriate system for classifying clinical 
cohorts to determine therapy needs.
    A 5-year CMS project titled ``Development of Outpatient Therapy 
Payment Alternatives'' (DOTPA) is expected to provide some of this 
information. The purpose of the DOTPA project is to identify a set of 
measures that we could collect routinely and reliably to support the 
development of payment alternatives to the therapy caps. Specifically, 
the measures being collected are assessed for administrative 
feasibility and usefulness in identifying beneficiary need for 
outpatient therapy services and the outcomes of those services. The 
data collection processes have just been completed and a final DOTPA 
report is expected in late CY 2013. In addition to developing 
alternatives to the therapy caps, the DOTPA project reflects our 
interest in

[[Page 68960]]

value-based purchasing by identifying components of value, namely, the 
beneficiary need and the effectiveness of therapy services. Although we 
expect DOTPA to provide meaningful data and practical information to 
assist in developing improved methods of paying for appropriate therapy 
services, it is unlikely that this one project alone will provide 
adequate information to implement a new payment system for therapy. 
This study combined with data from a wider group of Medicare 
beneficiaries would enhance our ability to develop alternative payment 
policy for outpatient therapy services.
(c) System Description and Requirements
(1) Overview
    Section 3005(g) of MCTRJCA requires CMS to implement a claims-based 
data collection strategy on January 1, 2013 to gather information on 
beneficiary function and condition, therapy services furnished, and 
outcomes achieved. This information will be used in assisting us in 
reforming the Medicare payment system for outpatient therapy services. 
By collecting data on beneficiary function over an episode of therapy 
services, we hope to better understand the Medicare beneficiary 
population who uses therapy services, how their functional limitations 
change as a result of therapy services, and the relationship between 
beneficiary functional limitations and furnished therapy.
    The long-term goal is to develop an improved payment system for 
Medicare therapy services. The desired payment system would pay 
appropriately and similarly for efficient and effective services 
furnished to beneficiaries with similar conditions and functional 
limitations that have potential to benefit from the services furnished. 
Importantly, such a system would not encourage the furnishing of 
medically unnecessary or excessive services. At this time, the data on 
Medicare beneficiaries' use and outcomes from therapy services from 
which to develop an improved system does not exist. This data 
collection effort is the first step towards collecting the data needed 
for this type of payment reform. Once the initial data have been 
collected and analyzed, we expect to identify gaps in information and 
determine what additional data would be needed to develop a new payment 
policy. Without a better understanding of the diversity of 
beneficiaries receiving therapy services and the variations in type and 
volume of treatments provided, we lack the information to develop a 
comprehensive strategy to map the way to an improved payment policy. 
While this claims-based data collection is only the first step in a 
long-term effort, it is an essential step.
    In the CY 2013 proposed rule, we proposed to implement section 
3005(g) of MCTRJCA by requiring that claims for therapy services 
include nonpayable G-codes and modifiers. Through the use of these 
codes and modifiers, we proposed to capture data on the beneficiary's 
functional limitations (a) At the outset of the therapy episode, (b) at 
specified points during treatment and (c) at discharge from the 
outpatient therapy episode of care. In addition, the therapist's 
projected goal for functional status at the end of treatment would be 
reported on the first claim for services and periodically throughout an 
episode of care.
    Specifically, as proposed, G-codes would be used to identify what 
type of functional limitation is being reported and whether the report 
is on the current status, projected goal status or discharge status. 
Modifiers would indicate the severity/complexity of the functional 
limitation being tracked. The difference between the reported 
functional status at the start of therapy and projected goal status 
represents any progress the therapist anticipates the beneficiary would 
make during the course of treatment/episode of care. We proposed that 
these reporting requirements would apply to all therapy claims, 
including those for services above the therapy caps and those that 
include the KX modifier (described above).
    By tracking any changes in functional limitations throughout the 
therapy episode of care and at discharge, we would have information 
about the therapy services furnished and the outcomes of such services. 
The ICD-9 diagnosis codes reported on the claim form would provide some 
information on the beneficiary's condition.
    We proposed that these claims-based data collection requirements 
would apply to services furnished under the Medicare Part B outpatient 
therapy benefit and PT, OT, and SLP services under the Comprehensive 
Outpatient Rehabilitation Facilities (CORF) benefit. We also proposed 
to include therapy services furnished personally and ``incident to'' 
the services of physicians or nonphysician practitioners (NPPs). As we 
explained in the proposed rule, this broad applicability would include 
therapy services furnished in hospitals, critical access hospitals 
(CAHs), skilled nursing facilities (SNFs), CORFs, rehabilitation 
agencies, home health agencies (when the beneficiary is not under a 
home health plan of care), and in private offices of therapists, 
physicians and NPPs.
    When used in this section ``therapists'' means all practitioners 
who furnish outpatient therapy services, including physical therapists, 
occupational therapists, and speech-language pathologists in private 
practice and those therapists who furnish services in the institutional 
settings, physicians and NPPs (including, physician assistants (PAs), 
nurse practitioners (NPs), clinical nurse specialists (CNSs), as 
applicable.) The term ``functional limitation'' generally encompasses 
both the terms ``activity limitations'' and ``participation 
restrictions'' as described by the International Classification of 
Functioning, Disability and Health (ICF). (For information on ICF, see 
www.who.int/classifications/icf/en/ and for specific ICF nomenclature 
(including activity limitations and participation restrictions), see 
http://apps.who.int/classifications/icfbrowser/.
    The CY 2013 proposal was based upon an option for claims-based data 
collection that was developed as part of the Short Term Alternatives 
for Therapy Services (STATS) project under a contract with CMS, which 
provided three options for alternatives to the therapy caps that could 
be considered in the short-term before completion of the DOTPA project. 
In developing options, the STATS project drew upon the analytical 
expertise of CMS contractors and the clinical expertise of various 
outpatient therapy stakeholders to consider policies and available 
claims data. The options developed were:
     Capturing additional clinical information regarding the 
severity and complexity of beneficiary functional impairments on 
therapy claims in order to facilitate medical review and at the same 
time gather data that would be useful in the long term to develop a 
better payment mechanism;
     Introducing additional claims edits regarding medical 
necessity to reduce overutilization; and
     Adopting a per-session bundled payment, the amount of 
which would vary based on beneficiary characteristics and the 
complexity of evaluation and treatment services furnished in a therapy 
session.
    Although we did not propose to adopt any of these alternatives at 
that time, we discussed and solicited public comments on all aspects of 
these options during the CY 2011 rulemaking. (See 75 FR 40096 through 
40100 and 73284 through 73293.) In developing the CY 2013 claims-based 
data collection proposal, we used the feedback received from the CY 
2011 rulemaking.

[[Page 68961]]

    We noted in the proposal that the proposed claims-based data 
collection system using G-codes and severity modifiers builds upon 
current Medicare requirements for therapy services. Section 410.61 
requires that a therapy plan of care (POC) be established for every 
beneficiary receiving outpatient therapy services. This POC must 
include: the type, amount, frequency, and duration of services to be 
furnished to each beneficiary, the diagnosis and the anticipated goals. 
Section 410.105(c) contains similar requirements for services furnished 
in the CORF setting. We have long encouraged therapists, through our 
manual provisions, to express the POC-required goals for each 
beneficiary in functional terms and require that goals be based on 
measureable assessments or objective data and relate to identified 
functional impairments. See Pub 100-02, Chapter 15, Section 220.1.2. We 
also noted that the evaluation and the goals developed as part of the 
POC would be the foundation for the initial reporting under the 
proposed system.
    The following is a summary of the comments we received regarding 
the general approach proposed in the CY 2013 PFS proposed rule to 
require nonpayable G-codes and modifiers on therapy claims to implement 
the new statutory requirement.
    Comment: Most commenters supported a new payment system for therapy 
services and recognized that data would be a critical factor in the 
development of such a system. Others recognized that the statute 
required CMS to implement a claims-based data collection system and 
therefore addressed comments to the specific elements rather than the 
overall requirement. Many commenters expressed concerns that the data 
we would be collecting under the proposed system would not provide 
adequate data for us to develop a new payment system. Many commenters 
also expressed concern that the system would not provide the means for 
therapists to adequately convey why some beneficiaries needed more 
treatment. Toward this end, commenters suggested that we include a way 
to risk adjust the data or collect more beneficiary information. Some 
commenters suggested that we establish additional G-codes to report the 
beneficiary's complexity, such as whether their condition is of low, 
moderate, or high complexity. These G-codes would represent the 
multiple variables that affect a beneficiary's condition and response 
to therapy, such as age, comorbidities, prognosis, patient safety 
considerations, and current clinical presentation. One association 
indicated that it is working on an alternative payment system that will 
define and use three levels of complexity. Many commenters pointed out 
that the data we proposed to collect could only provide information on 
the progress an individual beneficiary made and was not valid for 
analyzing payment alternatives.
    Response: We agree with commenters that the data collected under 
this system will not alone provide all the information that CMS needs 
to develop, analyze and implement an alternative payment system. We 
agree with the commenters that factors such as the patient's overall 
condition, including age, comorbidities, etc. are likely to affect the 
response to therapy; and we further agree that being able to analyze 
the data collected on such variables would enhance the usefulness of 
our data. Although we agree with the commenters' that it could be 
beneficial to include additional data elements to reflect the patient's 
condition and the complexity of the case, a meaningful system to use in 
classifying a beneficiary's complexity does not currently exist. As 
experience is gained with this new system, we expect that through 
future notice and comment rulemaking we will be able to enhance the 
system.
    Comment: Many commenters commented on the administrative burden 
that therapists would incur if the proposed system was implemented. 
Some commented that the administrative burden would be particularly 
significant for physical therapists in private practice who often 
submit claims after each therapy visit. Commenters labeled the proposal 
``improper,'' ``unreasonable,'' and ``overly burdensome.'' Other 
commenters indicated that the proposed process would not be burdensome 
stating that the functional assessment tools they use were ``perfectly 
suited to comply with CMS rule for data collection points, so we 
anticipate little or no burden in complying with the collection of 
function at intake, predicting discharge function at intake, during 
care and at discharge from care.'' In addition to the many commenters 
who noted the additional work that would be required to comply with 
this system, one commenter suggested that we also add a billable G-code 
to pay therapists for the additional work that this proposal would 
require.
    Response: While we recognize that complying with these new 
reporting requirements will impose an additional burden on therapists, 
we believe that having available additional data on the therapy 
services furnished and the beneficiaries who receive them is critical 
to development of an alternative payment system for therapy services. 
Although we acknowledge that there would be work and some additional 
effort in complying with these reporting requirements, we believe that 
the additional burden is minimal. We designed our proposal to mesh 
closely with information that therapists already include in the medical 
record. The proposal would merely require that the information be 
translated into the new G-codes and modifiers, and included in 
additional lines on the same claims that would otherwise be submitted. 
We do not believe this reporting requirement would significantly 
increase the resources required to furnish therapy services.
    Comment: A couple of commenters suggested that we abandon our G-
code/modifier proposal and use diagnosis codes in its place. One 
recognized that CMS's assertion that diagnosis codes on the claims do 
not provide the data that we need was valid when only the principal 
diagnosis is used, but stated that if we relied upon principal and 
secondary diagnosis we could obtain the additional information 
regarding the patient's clinical condition and functional limitations. 
The commenter provided the example of when hemiparesis was coded as the 
secondary diagnosis. Some suggested that when the ICD-10 system is 
implemented the diagnosis codes would provide better information.
    Response: We continue to believe that diagnosis codes, even when 
secondary diagnoses are included, do not provide the information on 
functional limitations that the statute requires us to collect. In the 
example the commenter provided, use of the diagnosis code 
``hemiparesis,'' would only tell us that the beneficiary needs therapy 
due to a paralysis or weakness on one side of his or her body caused by 
a stroke or other brain trauma, but not the extent of the beneficiary's 
functional limitation. With regard to use of ICD-10, the statute 
requires us to implement a functional reporting system by January 1, 
2013 so we cannot wait for ICD-10 system to implement the reporting 
requirements.
    Comment: One commenter requested to be exempted from these 
reporting requirements because the organization furnishes such a small 
amount of Part B outpatient therapy services. Another noted that 
``Given that this policy may affect HOPDs only for 3 months, CMS should 
consider ways to impose minimal administrative burden on HOPDs to 
implement this policy.'' One commenter sought assurance that CAHs

[[Page 68962]]

were included in this data collection effort.
    Response: As we indicated in the proposed rule, our goal is to have 
data on the complete range of therapy services for which payment is 
made based on the PFS for use in assessing and developing potential 
alternative payment systems for those services. This is important since 
any new payment system would likely apply to all those therapy services 
that are currently paid at rates under the PFS. To meet this goal, we 
proposed that the reporting requirements apply to all providers and 
suppliers of outpatient therapy services and CORFs. We note that the 
proposed policy would apply to hospital outpatient department services, 
even if such services are not subject to the therapy caps after 
December 31, 2012, and to services furnished in CAHs. We are finalizing 
without change the proposed policy to apply the reporting requirements 
to hospitals, SNFs, rehabilitation agencies, CORFs, home health 
agencies (when the beneficiary is not under a home health plan of care) 
and private offices.
    Comment: Several commenters raised concerns about a new payment 
system based upon the data collected without a standardized tool, 
stating that such data would not provide reliable information on which 
to develop an alternative payment system. Additionally, some commenters 
believed the invalid data would be used to create a payment system 
based upon functional limitations.
    Response: At this time we are not making any changes in the 
existing payment methodology for therapy services, except that 
therapists will have to comply with the reporting requirements to 
receive payment for furnished therapy services. Therapists will 
continue to be paid in CY 2013 under the existing payment methodology, 
which includes the therapy caps. We will closely monitor and implement 
any enacted legislation that would amend the current statutory 
provisions, including any amendment to extend the therapy cap 
exceptions process. At this time we are broadly considering options for 
a revised payment system for therapy services and do not have any 
preconceived ideas as to what such a system would like or what it would 
be based upon. The purpose of the data collection proposal described in 
the CY 2013 PFS proposed rule is to meet the statutory requirement and 
begin to gather data that will be used, along with other data and 
information that we have, to develop and analyze potential alternative 
payment systems. It is likely that changes will be made in the data 
collected as we gain experience with this system. Therapists and others 
concerned with Medicare payment for therapy services should not draw 
conclusions about any future payment system for therapy services based 
upon the claims-based data that we proposed to collect. The claims-
based data is only one set of information that will be used and it is 
only a beginning step in gathering the information that we would need 
to consider in developing a revised payment system for therapy 
services.
    Comment: Some commenters suggested that the ``preamble language 
implies that improvement is a requirement for ongoing Medicare 
coverage.'' One commenter suggested that the preamble language 
``implies that a measurable improvement in a beneficiary's functional 
limitation is required during an episode of therapy services.'' Others 
expressed concern that some beneficiaries, such as those with spinal 
cord injuries, will be denied coverage because they improve too slowly.
    Response: We did not intend for the preamble language to raise 
concern about changing coverage conditions for beneficiaries who need 
therapy services. As noted above, the purpose of the claims-based data 
collection system is simply to gather data, and we did not propose, nor 
are we implementing, any changes to coverage or payment policy for 
therapy services other than to require that therapists comply with the 
reporting requirements to receive payment for therapy services they 
furnish. Under existing IOM requirements, therapists have to establish 
a long-term goal for beneficiaries receiving therapy. What is new under 
this system is that at the outset of treatment, the therapist will need 
to report on the claim the projected goal for treatment using modifiers 
that describe the percentage of impairment. For beneficiaries who are 
not expected to improve, such as those receiving maintenance therapy, 
the same modifier would be used for current status and for projected 
goal status. It is possible for some beneficiaries that while 
improvement is expected, it is expected to be limited, and thus it will 
also be reported using the same modifiers. To emphasize, the collection 
of these data elements will not affect a beneficiary's coverage of 
therapy services.
    Comment: Some commenters expressed concerns about how this proposal 
would affect individuals suffering from lymphedema. Commenters stated 
that some clients experience both pain and swelling while others seem 
to have only swelling of a limb. Successful management of a beneficiary 
with lymphedema involves bandaging, compression and skin care 
instruction, manual lymph drainage, decongestive therapy, manual lymph 
drainage instruction, and exercise. These services take lots of 
valuable practitioner time to perform correctly as does instructing 
caregivers. While lymphedema impacts function to a point of mild to 
severe disability, many commenters told us that lymphedema severity/
complexity is very difficult to quantify and show significant 
functional improvements in the lymphatic system when many of these 
improvements are in skin integrity, cellular health and lymphatic flow. 
Other commenters stated that the patient's functional limitations due 
to lymphedema (restricted motion and/or mobility) can range from 
profound to minimal. But all lymphedema patients, including those 
proficient in self-care who have minimal functional limitations, are at 
great risk for developing cellulitis or other major medical 
complications from sustained tissue congestion of the lymphatic system. 
With ongoing or periodic management, as appropriate, therapy services 
can successfully prevent these medical crises. Many commenters 
expressed concern that coverage for therapy services relating to 
lymphedema would be denied as a result of this proposal. Others 
questioned which functional limitation to use for lymphedema patients.
    Response: As noted earlier, we did not propose to change coverage 
policy or to use the claims-based data reporting system to determine 
which beneficiaries are entitled to therapy services. Instead, our 
proposal would require those furnishing care to provide certain 
information about the beneficiary and his or her expected response to 
therapy. We are reiterating in this final rule with comment period that 
the proposed claims-based data collection system makes no changes in 
our therapy coverage policies.
    With regard to how those treating beneficiaries should comply with 
the data collection system, we expect therapists to report the G-code 
for the functional limitation that most closely relates to the 
functional limitation being treated. As a result of comments on the 
proposed rule, we are clarifying in this final rule with comment period 
that if the therapy services being furnished are not intended to treat 
a functional limitation, the therapist should use the G-code for 
``other'' and the modifier representing zero.
    Comment: Several commenters suggested that significant education 
will

[[Page 68963]]

be required for therapists to comply with this required reporting.
    Response: We are publishing in this final rule with comment period 
the claims-based reporting requirements that must be met in order to 
receive payment for therapy services. We will also use our usual 
methods for providing additional information, including revising 
relevant sections of the IOM, publishing Medicare Learning Network 
(MLN) Matters articles; presentations on Open Door Forums, and 
conducting National Provider Calls on the new requirements. We urge 
therapist to use these tools to assure that they have the information 
they need to comply with these new requirements.
(2) Nonpayable G-Codes on Beneficiary Functional Status
    We proposed that therapists would report G-codes and modifiers on 
Medicare claims for outpatient therapy services. We discussed and 
sought comment on two types of G-codes in the proposed rule--generic 
and categorical. Table 19 shows the proposed generic G-codes and Table 
20 shows the categorical codes discussed in the proposed rule.

     Table 19--Proposed Nonpayable G-Codes for Reporting Functional
                               Limitations
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Functional limitation for primary functional limitation:
    Primary Functional limitation, Current status at initial       GXXX1
     treatment/episode outset and at reporting intervals.....
    Primary Functional limitation, Projected goal status.....      GXXX2
    Primary Functional limitation, Status at therapy               GXXX3
     discharge or end of reporting...........................
Functional limitation for a secondary functional limitation
 if one exists:
    Secondary Functional limitation, Current status at             GXXX4
     initial treatment/outset of therapy and at reporting
     intervals...............................................
    Secondary Functional limitation, Projected goal status...      GXXX5
    Secondary Functional limitation, Status at therapy             GXXX6
     discharge or end of reporting...........................
Provider attestation that functional reporting not required:
    Provider confirms functional reporting not required......      GXXX7
------------------------------------------------------------------------

    The proposed G-codes differ from the three separate pairs of G-
codes discussed in the CY 2011 PFS rulemaking. The CY 2011 discussion 
included these three pairs of G-codes, all of which reflect specific 
ICF terminology:
     Impairments of Body Functions and/or Impairments of Body 
Structures;
     Activity Limitations and Participation Restrictions; and
     Environmental Factors Barriers.

Each pair contained a G-code to represent the beneficiary's current 
functional status and another G-code to represent the beneficiary's 
projected goal status. Each claim would have required all three sets of 
G-codes. Like the G-codes we proposed for CY 2013, the G-codes 
discussed in the CY 2011 PFS rulemaking would have been used with 
modifiers to reflect the severity/complexity of each element.
    In the CY 2013 PFS proposed rule, we indicated that we were not 
proposing to use these specific G-codes because we found them to be 
potentially redundant and confusing. Instead we chose to use G-codes to 
define ``functional limitations'' synonymously with the ICF terminology 
``activity limitations and participation restrictions.'' We noted that 
requiring separate reporting on three elements would have imposed a 
greater burden on therapists without providing a meaningful benefit in 
the value of the data provided. We added that because environmental 
barriers as discussed in CY 2011 are contextual, we did not believe 
collecting information on them would contribute to developing an 
improved payment system.
    To create the select categories of G-codes discussed in the 
proposed rule (See Table 20) we used the two most frequently reported 
functional limitations in the DOTPA project by each of the three 
therapy disciplines. We noted that should we decide to use a system 
with category-specific reporting, we would expect to develop specific 
nonpayable G-codes for select categories of functional limitations in 
the final rule. We explained that if one of the select categories of 
functional limitations describes the functional limitation being 
reported, that G-code set would be used to report the current, 
projected goal, and discharge status of the beneficiary. When reporting 
a functional limitation not described by one of categorical G-codes, 
one of the generic G-codes previously described would be used.

    Table 20--Select Categories of G-Codes Discussed in Proposed Rule
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Walking & Moving Around
    Walking & moving around functional limitation, current         GXXX8
     status at time of initial therapy treatment/episode
     outset and reporting intervals..........................
    Walking & moving around functional limitation, projected       GXXX9
     goal status, at initial therapy treatment/outset and at
     discharge from therapy..................................
    Walking & moving around functional limitation, discharge       GXX10
     status, at discharge from therapy/end of reporting on
     limitation..............................................
Changing & Maintaining Body Position
    Changing & maintaining body position functional                GXX11
     limitation, current status at time of initial therapy
     treatment/episode outset and reporting intervals........
    Changing & maintaining body position functional                GXX12
     limitation, projected goal status at initial therapy
     treatment/outset and at discharge from therapy..........
    Changing & maintaining body position functional                GXX13
     limitation, discharge status at discharge from therapy/
     end of reporting on limitation..........................
Carrying, Moving & Handling Objects
    Carrying, moving & handling objects functional                 GXX14
     limitation, current status at time of initial therapy
     treatment/episode outset and reporting intervals........
    Carrying, moving & handling objects functional                 GXX15
     limitation, projected goal status at initial therapy
     treatment/outset and at discharge from therapy..........

[[Page 68964]]

 
    Carrying, moving & handling objects functional                 GXX16
     limitation, discharge status at discharge from therapy/
     end of reporting on limitation..........................
Self Care (washing oneself, toileting, dressing, eating,
 drinking)
    Self care functional limitation, current status at time        GXX17
     of initial therapy treatment/episode outset and
     reporting intervals.....................................
    Self care functional limitation, projected goal status at      GXX18
     initial therapy treatment/outset and at discharge from
     therapy.................................................
    Self care functional limitation, discharge status at           GXX19
     discharge from therapy/end of reporting on limitation...
Communication: Reception (spoken, nonverbal, sign language,
 written)
    Communication: Reception functional limitation, current        GXX20
     status at time of initial therapy treatment/episode
     outset and reporting intervals..........................
    Communication: Reception functional limitation, projected      GXX21
     goal status at initial therapy treatment/outset and at
     discharge from therapy..................................
    Communication: Reception functional limitation, discharge      GXX22
     status at discharge from therapy/end of reporting on
     limitation..............................................
Communication: Expression (speaking, nonverbal, sign
 language, writing)
    Communication: Expression functional limitation, current       GXX23
     status at time of initial therapy treatment/episode
     outset and reporting intervals..........................
    Communication: Expression functional limitation,               GXX24
     projected goal status at initial therapy treatment/
     outset and at discharge from therapy....................
    Communication: Expression functional limitation,               GXX25
     discharge status at discharge from therapy/end of
     reporting on limitation.................................
------------------------------------------------------------------------

    We sought input from therapists on categories of functional 
limitations, such as those described in this section. We specifically 
requested comments regarding the following questions: Would data 
collected on categories of functional limitations provide more 
meaningful data on therapy services than that collected through use of 
the generic G-codes in our proposal? Should we choose to implement a 
system that is based on at least some select categories of functional 
limitation, which functional limitations should we collect data on in 
2013? Is it more, less or the same burden to report on categories of 
functional limitations or generic ones? The categories of functional 
limitations described above are based on the ICF categories, but these 
ICF categories also have subcategories. Should we use subcategories for 
reporting? Are there specific conditions not covered by these ICF 
categories? Would we need to have G-codes for the same categories of 
secondary limitations? We sought public comment on whether these 
proposed G-codes allow adequate reporting on beneficiary's functional 
limitations. We also noted that we would particularly appreciate 
receiving specific suggestions for any missing elements.
    The following is a summary of the comments we received on the G-
codes, generic and categorical, whether these proposed G-codes allow 
adequate reporting on beneficiary's functional limitations, and 
specific suggestions for any missing elements.
    Comment: Two commenters disagreed with our proposal to develop new 
G-codes and instead encouraged us to use the three pairs of G-codes 
(activities and participation restrictions, impairments to body 
functions/structures and environmental barriers) from the STATs project 
to report functional limitations. These commenters agreed that adding 
these domains might be more burdensome, but one commenter suggested 
that without these data elements we would likely miss integral 
beneficiary data in relation to health and wellness benefits, such as 
increased muscle function, improved quality of life, decreased 
depression, improved bowel/bladder function, improved respiratory 
function, improved autonomic function and improved circulation. Another 
commenter specifically agreed with our decision to use only the one 
ICF-defined G-code from the STATS for activity impairments and 
participation restrictions. They noted that it would be potentially 
redundant and confusing to adopt the two additional G-codes for body 
functions/structures and environmental barriers and noted that these 
other two categories would ``provide the agency with little meaningful 
data.'' One commenter suggested that if we adopted this additional 
reporting we could minimize the additional burden by eliminating goal 
reporting.
    Response: We appreciate the views of these commenters about which 
ICF categories to capture in our G-code data collection. We continue to 
believe that the reporting of functional limitations will be less 
confusing and more defined with the G-codes as described in our 
proposal for activity impairments/participation restrictions. As we 
move forward with functional reporting in following years, we may 
revisit the addition of other categories.
    Comment: Commenters had divergent views on the categorical and 
generic G-codes. Many found the proposed system complicated, burdensome 
and stated that it would not provide the data we sought. Some 
criticized the categorical codes as being too broadly defined and 
stated that this will lead to confusion as to what areas of impairment 
are being reported. For example, one commenter stated, ``The suggested 
categories are very broad and, in our view, will lead to confusion 
regarding which areas of impairment would be reported for certain 
therapy activities.'' One commenter opposed the use of generic G-codes 
saying that data from these codes would be ``useless.'' On the other 
hand, we received much support for the proposed G-codes. Many 
commenters supported the use of categorical G-codes codes saying their 
use will provide more useful information than the generic ones. One 
commenter stated, ``We believe having therapists report on these 
categories will provide CMS with more useful information than generic 
reporting on a functional limitation.'' Many favored use of the 
categorical G-codes in addition to using ``generic'' or ``other'' codes 
only for functional limitations that did not fit in one of the 
categorical ones. Several commenters gave us specific guidance, 
recommending that instead of the generic G-codes, we add an ``other'' 
G-code to the categorical codes for functional limitations that don't 
fit into one of the defined categories.
    Response: Based upon the comments we received suggesting that we 
use the categorical codes, but include an ``other'' category to use 
when one of the categorical codes does not apply, we are modifying our 
proposal to adopt categorical G-codes to define functional limitations 
and including within the categorical G-codes ``other'' G-codes to use 
when one of the more specific categorical codes does not apply. In 
addition to this change, as discussed below, we are replacing the two 
SLP categorical codes with eight new ones to better reflect the 
diversity of services

[[Page 68965]]

furnished. Table 21 provides a complete list of the codes that will be 
available for reporting functional limitations. With regard to the 
commenters' concern that the categories are too broad and this will 
lead to confusion as to what is being reported, we acknowledge that the 
categories are broad, but disagree that the use of broad categories 
will result in confusion. Instead, we believe that the result will be 
the collection of data that includes information on broadly defined 
functional limitations. Without more specific input and greater support 
from the commenters, we do not believe we should create these in this 
final rule with comment period. Moreover, we believe it is important to 
gain experience with a limited number of codes in this new reporting 
system before we vastly expand the number of codes that are used. We 
sought comment on ways to better define the categories and where we 
received specific suggestions for additional G-codes that were 
sufficiently developed, such as those for SLP (explained below), we 
included them in our final set of G-codes. We anticipate that we will 
continue to refine the categories through future notice and comment 
rulemaking as we get more information and experience with this system.
    Comment: Several commenters pointed out that there were many 
functional limitations for which there was not a categorical G-code. 
The American Speech-Language and Hearing Association pointed out the 
lack of appropriate SLP categories and suggested that we take advantage 
of the experience that has been gained through the use of its system 
for collecting data on functional limitations in this area. 
Specifically, they urged us to assign G-codes to the top seven reported 
functional communication measures used in National Outcomes Measurement 
System (NOMS). This commenter stated that, using this system, we would 
be able to collect ``consistent'' and ``meaningful'' ratings across all 
settings nationally.
    Others told us that there were many conditions and situations that 
our system did not address and that some of these beneficiaries did not 
exhibit functional limitations that could be easily measured or 
reported. They cited, as examples, beneficiaries seen for lymphedema 
management, wound care, wheelchair assessment/fitting, cognitive 
impairments, and incontinence training.
    Response: We agree with commenters that the G-codes discussed in 
the proposed rule did not go far enough in addressing SLP functional 
limitations. After consideration of the comments, we also agree that 
adoption of the most frequently used NOMS measures would be the best 
way to address this issue and would significantly improve our system in 
several ways. By using a system familiar to many speech-language 
pathologists, the quality of our data collection will be enhanced and 
the burden on those reporting will be less. We agree that it is 
reasonable to incorporate categories that are more specific, when 
appropriate, and note that this is an opportunity to align with 
existing measurement systems.
    Accordingly, we are replacing the two of the categorical codes 
relating to SLP with seven categorical codes and one ``other'' code for 
SLP. (See Table 21.) The seven categorical codes mirror the seven most 
frequently reported NOMS categories and should be used when 
appropriate. For all other SLP treatments, the ``SLP Other'' category 
should be used.
    For functional limitations not defined by the specific categorical 
codes and for therapy services that are not addressing a particular 
functional limitation; the ``other'' G-codes should be used. As we 
begin collecting data in this initial year, we will continue to assess 
the need for additional G-codes, refinement of existing ones, and 
examine ways to address those situations for which beneficiaries do not 
have functional limitations.
    We have addressed in this final rule with comment period those 
areas for which we have adequate information to do so at this time and 
for which an additional burden will not be created. We will continue to 
refine this system through further notice and comment rulemaking in 
future years.
    Comment: We received mixed feedback in response to our request for 
comment regarding the use of the ICF subcategories. Some commenters 
noted that adding more subcategories would result in too many codes and 
only add to the confusion. At least one other commenter supported 
subcategory reporting, but did not suggest which subcategories we 
should use.
    Response: Given the comments received, we will not be implementing 
reporting by subcategories at this time. Once the system is 
operational, we will reassess whether subcategory reporting is 
necessary to provide the data that we need.
    Comment: Some commenters interpreted our proposal to limit each 
therapy discipline to using only the two codes that represented the top 
two reported functional limitations for that discipline and suggested 
that we allow therapists to use any appropriate functional limitation.
    Response: We agree with commenters that therapists should be able 
to use any appropriate functional limitation. In the proposed rule, we 
indicated that we developed the 6 categorical codes to correspond with 
the two most commonly reported functional limitations for each of the 
three therapy disciplines. However, this was only a way of identifying 
the functional limitations for which we needed codes. To be clear, 
therapists are to use the most appropriate categorical G-code that 
describes the functional limitation that is the primary reason for 
treatment without restriction by discipline.
    Comment: A few commenters urged us to clarify that therapists using 
Patient Inquiry by Focus on Therapeutic Outcomes, Inc (FOTO), or 
another measurement system that provides a composite functional status 
score, did not need to report on secondary limitations.
    Response: In assessing this comment, we recognized the need to 
clarify how composite functional scores should be reported. We are 
clarifying that a composite score should be reported using G8990 (Other 
physical or occupational primary functional limitation, current status, 
at therapy episode outset and at reporting intervals), G8991(Other 
physical or occupational primary functional limitation, projected goal 
status, at therapy episode outset, at reporting intervals, and at 
discharge or to end reporting) and G8992 (Other physical or 
occupational primary functional limitation, discharge status, at 
discharge from therapy or to end reporting). Should there be the 
occasion to report on a second condition after the reporting on the 
first had ended, the therapist would use the G-code set for ``other 
subsequent'' functional limitation, G8993-G8896.
(3) Number of Functional Limitations on Which Reporting Occurs
    We proposed that, using a set of G-codes with appropriate 
modifiers, the therapist would report the beneficiary's primary 
functional limitation defined as the most clinically relevant 
functional limitation at the time of the initial therapy evaluation and 
the establishment of the POC. The projected goal would also be reported 
at this time. At specified intervals during treatment, claims would 
also include the current functional status and the goal functional 
status, which would not typically change during therapy, except as 
described below. On the final claim for an episode of care, the 
therapist would report the status at this time for this functional 
limitation and the goal status.

[[Page 68966]]

    Early results from the DOTPA project suggest that most 
beneficiaries have more than one functional limitation at treatment 
outset. In fact, only 21 percent of the DOTPA assessments reported just 
one functional limitation. Slightly more than half (54 percent) 
reported two, three or four functional limitations.
    To the extent that the DOTPA finding is typical, the therapist may 
need to make a determination as to which functional limitation is 
primary for reporting purposes. In cases where this is unclear, the 
therapist may choose the functional limitation that is most clinically 
relevant to a successful outcome for the beneficiary, the one that 
would yield the quickest and/or greatest mobility, or the one that is 
the greatest priority for the beneficiary. In all cases, this primary 
functional limitation should reflect the predominant limitation that 
the furnished therapy services are intended to address.
    We sought comment on specific issues regarding reporting data on a 
secondary limitation. Specifically, we requested comments regarding 
whether reporting on secondary functional limitations should be 
required or optional.
    The following is a summary of the comments we received on the 
percentage of Medicare therapy beneficiaries with more than one 
functional limitation at the outset of therapy and whether reporting on 
secondary functional limitations should be required or optional.
    Comment: The responses on the number of functional limitations 
being treated showed a wide variation. One commenter treating 
beneficiaries with spinal cord injuries indicated that 100 percent had 
more than one functional limitation, with an average of 10 functional 
limitations. Another respondent told us that 50 percent of SLP patients 
have two or more functional limitations. Another respondent indicated 
that nearly 98 percent of patients seen by therapists using FOTO were 
surveyed for only one condition. Most commenters recommended that 
therapists be required to report only one functional limitation, 
especially as we are just beginning to require functional reporting. 
The commenters stated that it would be burdensome and would pose 
clinical challenges to require reporting both a primary and secondary 
functional limitation. Others suggested that it would be costly, time 
intensive and burdensome to report numerous secondary functional 
limitations. Some stated that reporting on only one functional 
limitation would not capture sufficient information since treatment of 
multiple functional limitations is interrelated and treatment for these 
occurs simultaneously, not sequentially. Some commenters suggested 
allowing the optional reporting of a second or third functional 
limitation. Some commenters questioned how functional reporting would 
be handled when the beneficiary was being treated by more than one 
discipline or when a substitute therapist treats a beneficiary.
    Response: In response to comments, we have decided to limit 
reporting to one functional limitation at this time. Recognizing that 
therapists treat the patient as a whole and work on more than one 
functional limitation at a time, we believe that limiting reporting in 
this way will make it less burdensome in the situations involving more 
than one functional limitation. Although many commenters favored the 
option of reporting on additional functional limitations when 
appropriate, we believe that allowing additional optional reporting 
would not produce consistent or useful data on beneficiaries who have 
more than one functional limitation that is being treated, and could 
potentially complicate the use of the data we collect for the 
development of future therapy payment policy. As we seek to improve 
reporting in future years, we may reconsider whether to permit or 
require reporting on additional functional limitations. We note that 
this is a new reporting system designed to gather data on the changes 
in beneficiary function throughout an episode of care. We are not 
expecting therapists to change the way they treat patients because of 
our reporting requirements.
    We also explained that in situations where treatment continues 
after the treatment goal is achieved and reporting ended on the primary 
functional limitation, reporting will be required for another 
functional limitation. Thus, reporting on more than one functional 
limitation may be required for some patients, but not simultaneously. 
Instead, once reporting on the primary functional limitation is 
complete, the therapist will begin reporting on a subsequent functional 
limitation using another set of G-codes. If this additional functional 
limitation is not described by one of the specific categorical codes, 
one of the three ``other'' codes should be used depending on the 
circumstances.
    In response to the comments, we are making several modifications in 
the G-codes that we proposed, as noted in the responses to comments 
above. To summarize, the G-codes, and their long descriptors, that will 
be used for reporting functional limitations of beneficiaries are 
listed in Table 21. There are 11 G-codes that describe categorical 
functional limitation, including seven for SLP services, and three more 
general G-codes for functional limitations that do not fit within one 
of the 11 categories. The general categorical codes would be used when 
none of the specific categories apply or when an assessment tool is 
used that yields a composite score that combines several or many 
functional measures, such as is done with the FOTO Patient Inquiry 
tool, for example. Two of these general G-code sets are to be used for 
``other'' PT and OT services and one for ``other'' SLP services. In 
addition, we deleted the requirement to report a G-code to signal that 
no reporting was required and thus deleted the G-code that would have 
been used for this. (For discussion about the comments on this G-code 
and our decision to remove this reporting requirement, see section 
II.F.2.(b).(6).) Therapists would use the code that best describes the 
functional limitation that is primary to the therapy plan of care.

   Table 21--G-Codes for Claims-Based Functional Reporting for CY 2013
------------------------------------------------------------------------
 
------------------------------------------------------------------------
                    Mobility: Walking & Moving Around
------------------------------------------------------------------------
G8978....................  Mobility: walking & moving around functional
                            limitation, current status, at therapy
                            episode outset and at reporting intervals.
G8979....................  Mobility: walking & moving around functional
                            limitation, projected goal status, at
                            therapy episode outset, at reporting
                            intervals, and at discharge or to end
                            reporting.
G8980....................  Mobility: walking & moving around functional
                            limitation, discharge status, at discharge
                            from therapy or to end reporting.
------------------------------------------------------------------------
                  Changing & Maintaining Body Position
------------------------------------------------------------------------
G8981....................  Changing & maintaining body position
                            functional limitation, current status, at
                            therapy episode outset and at reporting
                            intervals.

[[Page 68967]]

 
G8982....................  Changing & maintaining body position
                            functional limitation, projected goal
                            status, at therapy episode outset, at
                            reporting intervals, and at discharge or to
                            end reporting.
G8983....................  Changing & maintaining body position
                            functional limitation, discharge status, at
                            discharge from therapy or to end reporting.
------------------------------------------------------------------------
                   Carrying, Moving & Handling Objects
------------------------------------------------------------------------
G8984....................  Carrying, moving & handling objects
                            functional limitation, current status, at
                            therapy episode outset and at reporting
                            intervals.
G8985....................  Carrying, moving & handling objects
                            functional limitation, projected goal
                            status, at therapy episode outset, at
                            reporting intervals, and at discharge or to
                            end reporting.
G8986....................  Carrying, moving & handling objects
                            functional limitation, discharge status, at
                            discharge from therapy or to end reporting.
------------------------------------------------------------------------
                                Self Care
------------------------------------------------------------------------
G8987....................  Self care functional limitation, current
                            status, at therapy episode outset and at
                            reporting intervals.
G8988....................  Self care functional limitation, projected
                            goal status, at therapy episode outset, at
                            reporting intervals, and at discharge or to
                            end reporting.
G8989....................  Self care functional limitation, discharge
                            status, at discharge from therapy or to end
                            reporting.
------------------------------------------------------------------------
                Other PT/OT Primary Functional Limitation
------------------------------------------------------------------------
G8990....................  Other physical or occupational primary
                            functional limitation, current status, at
                            therapy episode outset and at reporting
                            intervals.
G8991....................  Other physical or occupational primary
                            functional limitation, projected goal
                            status, at therapy episode outset, at
                            reporting intervals, and at discharge or to
                            end reporting.
G8992....................  Other physical or occupational primary
                            functional limitation, discharge status, at
                            discharge from therapy or to end reporting.
------------------------------------------------------------------------
              Other PT/OT Subsequent Functional Limitation
------------------------------------------------------------------------
G8993....................  Other physical or occupational subsequent
                            functional limitation, current status, at
                            therapy episode outset and at reporting
                            intervals.
G8994....................  Other physical or occupational subsequent
                            functional limitation, projected goal
                            status, at therapy episode outset, at
                            reporting intervals, and at discharge or to
                            end reporting.
G8995....................  Other physical or occupational subsequent
                            functional limitation, discharge status, at
                            discharge from therapy or to end reporting.
------------------------------------------------------------------------
                               Swallowing
------------------------------------------------------------------------
G8996....................  Swallowing functional limitation, current
                            status at time of initial therapy treatment/
                            episode outset and reporting intervals.
G8997....................  Swallowing functional limitation, projected
                            goal status, at initial therapy treatment/
                            outset and at discharge from therapy.
G8998....................  Swallowing functional limitation, discharge
                            status, at discharge from therapy/end of
                            reporting on limitation.
------------------------------------------------------------------------
                              Motor Speech
------------------------------------------------------------------------
G8999....................  Motor speech functional limitation, current
                            status at time of initial therapy treatment/
                            episode outset and reporting intervals.
G9157....................  Motor speech functional limitation, projected
                            goal status at initial therapy treatment/
                            outset and at discharge from therapy.
G9158....................  Motor speech functional limitation, discharge
                            status at discharge from therapy/end of
                            reporting on limitation.
------------------------------------------------------------------------
                      Spoken Language Comprehension
------------------------------------------------------------------------
G9159....................  Spoken language comprehension functional
                            limitation, current status at time of
                            initial therapy treatment/episode outset and
                            reporting intervals.
G9160....................  Spoken language comprehension functional
                            limitation, projected goal status at initial
                            therapy treatment/outset and at discharge
                            from therapy.
G9161....................  Spoken language comprehension functional
                            limitation, discharge status at discharge
                            from therapy/end of reporting on limitation.
------------------------------------------------------------------------
                       Spoken Language Expression
------------------------------------------------------------------------
G9162....................  Spoken language expression functional
                            limitation, current status at time of
                            initial therapy treatment/episode outset and
                            reporting intervals.
G9163....................  Spoken language expression functional
                            limitation, projected goal status at initial
                            therapy treatment/outset and at discharge
                            from therapy.
G9164....................  Spoken language expression functional
                            limitation, discharge status at discharge
                            from therapy/end of reporting on limitation.
------------------------------------------------------------------------
                                Attention
------------------------------------------------------------------------
G9165....................  Attention functional limitation, current
                            status at time of initial therapy treatment/
                            episode outset and reporting intervals.
G9166....................  Attention functional limitation, projected
                            goal status at initial therapy treatment/
                            outset and at discharge from therapy.
G9167....................  Attention functional limitation, discharge
                            status at discharge from therapy/end of
                            reporting on limitation.
------------------------------------------------------------------------
                                 Memory
------------------------------------------------------------------------
G9168....................  Memory functional limitation, current status
                            at time of initial therapy treatment/episode
                            outset and reporting intervals.
G9169....................  Memory functional limitation, projected goal
                            status at initial therapy treatment/outset
                            and at discharge from therapy.
G9170....................  Memory functional limitation, discharge
                            status at discharge from therapy/end of
                            reporting on limitation.
------------------------------------------------------------------------

[[Page 68968]]

 
                                  Voice
------------------------------------------------------------------------
G9171....................  Voice functional limitation, current status
                            at time of initial therapy treatment/episode
                            outset and reporting intervals.
G9172....................  Voice functional limitation, projected goal
                            status at initial therapy treatment/outset
                            and at discharge from therapy.
G9173....................  Voice functional limitation, discharge status
                            at discharge from therapy/end of reporting
                            on limitation.
------------------------------------------------------------------------
                     Other SLP Functional Limitation
------------------------------------------------------------------------
G9174....................  Other speech language pathology functional
                            limitation, current status at time of
                            initial therapy treatment/episode outset and
                            reporting intervals.
G9175....................  Other speech language pathology functional
                            limitation, projected goal status at initial
                            therapy treatment/outset and at discharge
                            from therapy.
G9176....................  Other speech language pathology functional
                            limitation, discharge status at discharge
                            from therapy/end of reporting on limitation.
------------------------------------------------------------------------

(4) Severity/Complexity Modifiers
    We proposed that for each functional G-code used on a claim, a 
modifier would be required to report the severity/complexity for that 
functional limitation. We proposed to adopt a 12-point scale to report 
the severity or complexity of the functional limitation involved. The 
proposed modifiers are listed in Table 22.

                      Table 22--Proposed Modifiers
------------------------------------------------------------------------
                                                Impairment limitation
                 Modifier                      restriction  difficulty
------------------------------------------------------------------------
XA........................................  0%.
XB........................................  Between 1-9%.
XC........................................  Between 10-19%.
XD........................................  Between 20-29%.
XE........................................  Between 30-39%.
XF........................................  Between 40-49%.
XG........................................  Between 50-59%.
XH........................................  Between 60-69%.
XI........................................  Between 70-79%.
XJ........................................  Between 80-89%.
XK........................................  Between 90-99%.
XL........................................  100%.
------------------------------------------------------------------------

    We noted that there are many valid and reliable measurement and 
assessment tools that therapists use to inform their clinical decision-
making and to quantify functional limitations, including the four 
assessment tools we discussed in CY 2011 PFS rulemaking that produce 
functional scores--namely, the Activity Measure--Post Acute Care (AM-
PAC) tool, the FOTO Patient Inquiry, OPTIMAL, and NOMS. We list these 
four tools as recommended for use by therapists, though not required, 
in the outpatient therapy IOM provision of the Benefits Policy Manual, 
Chapter 15, Section 220.3C ``Documentation Requirements for Therapy 
Services.'' We suggested that the scores from these and other 
measurement tools already in use by therapists that produce numerical 
or percentage scores be mapped or crosswalked to the proposed 12-point 
severity modifier scale.
    In assessing the ability of therapists to provide the required 
severity information regardless of what assessment tool or combination 
of tools they use, if any, we considered the comments received on the 
CY 2011 PFS proposed rule discussion. These indicated that we needed 
greater granularity in our severity scale so that the changes in 
functional limitation over the course of therapy could be more 
accurately reflected. Specifically, most commenters on the CY 2011 
proposed rule favored the 7-point scale over the 5-point ICF-based 
scale. They indicated that they preferred a scale with more severity 
levels and equal increments since it would allow the therapist to 
document smaller changes that many therapy beneficiaries make towards 
their goals.
    Believing that neither the 5- or 7-point scales would be adequate 
for this reporting system, we developed and proposed a 12-point scale 
that we believed was an enhancement over the 7-point scale. We thought 
it addressed concerns that those commenting on the CY 2011 options had 
raised regarding the 7-point scale. We thought that a more sensitive 
rating scale (one with more increments) had the advantage of 
demonstrating the progress of beneficiaries with conditions that 
improve slowly, such as those recovering from strokes or with spinal 
cord injuries. In addition, we believed that the proposed scale's 10-
percentage point increments would make it easier for therapists to 
convert composite and overall scores from assessment instruments or 
other measurement tools to this scale.
    The following is a summary of the comments we received regarding 
our proposal for a 12-point scale to capture the severity/complexity of 
beneficiaries' functional limitations.
    Comment: Several commenters stated that not all tests and 
measurement tools that therapists use could be easily crosswalked to 
any single numerical scale, stating that, for example, some tests and 
measures of functional limitations use ordinal scales. Further, the 
scores from some tests that are not linear or proportional to each 
other are not easily translatable to the 12-point scale. Some 
commenters pointed out the problems of developing a single score when 
more than one tool is used. Some commenters noted that there are a wide 
variety of therapy measurement tools that are used to inform clinical 
decision making and these are not measures that typically produce a 
functional assessment. Further, these commenters told us that combining 
the results of multiple measures make it extremely difficult to 
quantify beneficiary function and, as such, said it will be very 
difficult to crosswalk this type of information to a severity scale. 
And, many of these commenters expressed concerns about how therapist 
will implement the use of our severity/complexity modifier scale; they 
noted that much education is needed for therapists to understand the 
selection of a severity modifier. One commenter questioned whether 
aggregated subjective and objective data would be valid or usable by 
CMS.
    Response: It is essential that the data reported on functional 
limitations be grouped using the same numeric scale. Moreover, we 
believe that is easier for those reporting data on functional 
limitations to use ranges of percentages rather than the absolute 
values. We acknowledge that therapists will incur some challenges when 
initially adopting our system as they learn how to translate the 
information obtained through various tests and measures to a particular 
modifier scale. However, as therapists gain experience in doing so, we 
anticipate that these translations will become easier and a normal part 
of their evaluative and treatment processes. Moreover, we are hopeful 
that forthcoming modifications from tool sponsors or others will make 
it easier for therapists to report the functional

[[Page 68969]]

limitations measured by these tools, such as modifying the tool so the 
results match the Medicare severity/complexity scale or issuing 
instructions or guidance on translating the results to the Medicare 
severity/complexity scale. We also expect that some translation tools 
are likely to become available. We are hopeful that forthcoming 
guidance and translation tools from tool sponsors and others will 
clarify some of translation questions therapists have regarding the 
Medicare severity scale. Given that it is essential for our purposes to 
have a severity/complexity scale, we are adopting one in this final 
rule. With regard to education, CMS will make information about the 
severity/complexity scale, as well as other aspects of our new system, 
widely available to therapists. It will be incumbent upon individual 
therapists to learn how to translate the score from a singular 
assessment tool or the combined results from multiple tests/measures 
along with other information regarding their patient's functional 
limitation to the Medicare scale. Finally, we acknowledge that a system 
that combines objective and subjective data is not ideal. However, at 
this time it appears that there is not an alternative. We will continue 
to refine and improve this system.
    Comment: Some commenters offered alternative suggestions to the use 
of a severity/complexity scale. Several commenters suggested that we 
use the secondary diagnoses on claims instead. Others suggested 
capturing the medical complexity of a beneficiary using other 
indicators, such as E/M codes or co-morbidities.
    Response: We appreciate these suggestions. While we are able to 
collect secondary diagnosis data from claims, we know from prior 
studies that diagnoses alone cannot predict the amount of therapy 
services needed. We do not believe that diagnoses and comorbidities 
measure functional limitations, which the statute requires us to 
collect. Nor do we believe using existing or therapy-specific E/M codes 
would provide the data on functional limitations that we are seeking to 
collect. We do, however, believe that these elements may provide 
additional data that could contribute to our analysis of payment 
alternatives. As we consider refinements to the claims-based data 
collection system in future years we will consider these additional 
data elements.
    Comment: Commenters had differing views on the use of the proposed 
12-point scale to convey the severity of the beneficiary's functional 
limitations. Those supporting the use of the proposed 12-point scale 
stated that it was more sensitive and so better reflected change in a 
beneficiary's functional limitation. For example, commenters using FOTO 
said that they would not have problems adopting our proposed 12-point 
scale because they receive a composite score from FOTO, based on the 
patient's functional survey results, which can be easily mapped as a 
percentage of overall beneficiary function. Other commenters suggested 
that the 12-point scale we proposed was too complicated and had too 
many levels. Some of these commenters also stated that therapists were 
not familiar with such a scale. Several commenters believed that we 
should modify the 12-point scale to a 10-point one by eliminating the 
separate modifiers for zero and 100 percent because they believed it 
would be more recognizable and easier for therapists to use. Many 
suggested that we use the 7-point scale discussed in the CY 2011 
rulemaking. A couple of these commenters thought that this 7-point 
scale was a valid and reliable one. Another commenter added that a 7-
point scale is used by many outcome tools, such as NOMS, although no 
other examples of a tool using a 7-point scale were provided. One 
commenter was opposed to a severity/complexity scale but suggested that 
if one was used, it should be a 5- or 7-point scale.
    Response: After reviewing the comments, it is clear to us that, 
given the diversity of views among therapy professionals, the range in 
functional limitations being measured, the variability of beneficiary 
conditions being treated and the plethora of assessment tools and 
instruments being used, the translation of functional information to 
any scale used is likely to require adjustments by some therapists. 
Although we proposed a 12-point scale as we thought it would be easier 
to use and provided more sensitivity, a majority of commenters favored 
the 7-point scale over the 12-point scale. After consideration of the 
many comments on the use of a 12-point scale, we have determined that a 
7-point scale as preferred by commenters will provide appropriate data 
for our analysis. Accordingly, are finalizing the 7-point scale in 
Table 23.
    Comment: Some commenters read our proposal to require that 
therapists use one of the IOM-recommended assessment tools, and thought 
that we should allow therapists to assign a severity/complexity 
modifier using their clinical judgment when a functional assessment 
tool is not used. Other commenters noted that physical and occupational 
therapists typically use multiple measurement tools during the 
evaluative process to inform clinical decision making; and, that 
clinical judgment is needed to combine these results to determine a 
functional limitation percentage. One commenter pointed out that the 
IOM outpatient coverage guidelines recommend, but do not mandate, the 
use of standardized measurement instruments and sought guidance as to 
how the modifier scale would apply to a therapist who satisfies 
documentation guidelines but does not use a standardized measurement 
instrument that produces a global functional score.
    Response: We appreciate commenters' concerns that our proposed 
policy would require therapists to use a functional assessment tool to 
determine the overall degree of functional impairment. This was not our 
intent. However, when one of the four functional assessment instruments 
is not utilized, we require as part of our IOM Documentation 
Guidelines, that the therapist documents using objective measures the 
beneficiary's physical functioning. We are also aware that use of one 
of the four functional instruments is not widespread; and that physical 
and occupational therapists typically use multiple objective tests and 
measures to establish and compare a beneficiary's physical function and 
progress throughout the therapy episode. As such, we recognize that a 
therapist's judgment is critical in determining how to best measure 
their patient's functional impairment and how to assimilate the various 
necessary objective findings to ascertain a certain percentage of 
function that can be translated to the Medicare severity scale. Our 
requirements for documenting the beneficiary's functional status were 
established prior to this data collection effort, and the primary 
purpose for measuring functional impairment continues to aid the 
therapist in furnishing therapy services. Our data collection system is 
designed to collect data that is developed in the evaluative process 
and assessed throughout the course of treatment, not to prescribe how 
or what measures therapists use to assess functional impairment or 
deliver services. Accordingly, it is acceptable for therapists to use 
their professional judgment in the selection of the appropriate 
modifier. Our IOM provisions already assert that when assessing the 
level of functional impairment, the therapist uses his/her professional 
judgments in addition to the objective measures and accepted 
methodologies that are recognized in the

[[Page 68970]]

therapy community and in professional practice guidelines.
    Because there will be many cases for which one single functional 
measurement tool is not available or clinically inappropriate, 
therapists can use their clinical judgment in the assignment of the 
appropriate modifier. Therapists will need to document in the medical 
record how they made the modifier selection so that the same process 
can be followed at succeeding assessment intervals.
    Comment: Many commenters evaluated our proposed 12-point scale as 
if it was itself to be used as an assessment tool, rather than simply a 
scale to report results of assessments. Some of these commenters also 
warned us that the 12-point scale could not give us valid and reliable 
data to use as an alternative payment system for therapy services 
unless a single assessment tool were used.
    Response: We appreciate the views expressed by the many commenters. 
However, the 12-point scale was not intended to be used as an 
assessment tool. Rather, it was intended to be used to express the 
beneficiary's functional limitation in terms of a percentage of 100 
total points so that there is a uniform scale for the degree of 
functional limitation. In other words, the scale that is used to report 
the degree of impairment would not affect the validity of the data. The 
reported data are as valid and reliable as the assessment tool or 
instrument (at times in combination with the therapist's judgment) that 
was used to develop the score. We also realize that there are 
limitations to the data that we will collect, in part because it is not 
all derived from one consistent, assessment tool.
    Comment: Commenters noted that pain is a clinical complexity that 
is factored in when the beneficiary and therapist plan the course of 
treatment, but is not factored in to the proposed scale.
    Response: We believe that the commenter meant that pain is a 
definite limiter of function and is difficult to measure and hard to 
quantify. However, we believe that pain and the functional limitations 
that it engenders can be captured by our severity scale. There are many 
valid and reliable measures that a therapist can use to quantify the 
functional limitations of painful conditions.
    In response to the comments, we are adopting the following 7-point 
severity/complexity scale to report the severity of the beneficiary's 
functional impairment, which is based upon the scale developed as part 
of the STATs project.

           Table 23--Severity/Complexity Modifiers for CY 2013
------------------------------------------------------------------------
                                                Impairment limitation
                 Modifier                            restriction
------------------------------------------------------------------------
CH........................................  0 percent impaired, limited
                                             or restricted.
CI........................................  At least 1 percent but less
                                             than 20 percent impaired,
                                             limited or restricted.
CJ........................................  At least 20 percent but less
                                             than 40 percent impaired,
                                             limited or restricted.
CK........................................  At least 40 percent but less
                                             than 60 percent impaired,
                                             limited or restricted.
CL........................................  At least 60 percent but less
                                             than 80 percent impaired,
                                             limited or restricted.
CM........................................  At least 80 percent but less
                                             than 100 percent impaired,
                                             limited or restricted.
CN........................................  100 percent impaired,
                                             limited or restricted.
------------------------------------------------------------------------

 (4) Assessment Tools
    In the proposed rule we noted that therapists frequently use 
assessment tools to quantify beneficiary function. FOTO and NOMS are 
two such assessment tools in the public domain that can be used to 
determine a score for an assessment of beneficiary function. Therapists 
could use the score produced by such instruments to select the 
appropriate modifier for reporting the beneficiary's functional status. 
Although we recommend the use of four of these functional assessment 
instruments to determine beneficiary functional limitation in the IOM, 
we did not propose to require the use of a particular functional 
assessment tool to determine the severity/complexity modifier. We 
explained our reasons for not doing so in the proposed rule saying 
``Some tools are proprietary, and others in the public domain cannot be 
modified to explicitly address this data collection project. Further, 
this data collection effort spans several therapy disciplines. 
Requiring a specific instrument could create burdens for therapists 
that would have to be considered in light of any potential improvement 
in data accuracy, consistency and appropriateness that such an 
instrument would generate.'' We noted that we might reconsider this 
decision once we have more experience with claims-based data collection 
on beneficiary function associated with furnished therapy services. We 
sought public comment on the use of assessment tools. In particular, we 
were interested in feedback regarding the benefits and burdens 
associated with use of a specific tool to assess beneficiary functional 
limitations. We requested that those favoring a requirement to use a 
specific tool provide information on the preferred tool and describe 
why the tool is preferred.
    The following is a summary of the comments we received regarding 
the use of assessment tools and the benefits and burdens associated 
with use of a specific tool to assess beneficiary functional 
limitations.
    Comment: Many commenters appreciated that we recognized the need to 
use consistent and objective measurement tools to quantify beneficiary 
function. All commenters who addressed assessment tools agreed that 
there is not currently a single assessment tool that would meet the 
diverse needs of beneficiaries receiving therapy services, and most did 
not recommend requiring the use of a single tool. However, many 
commenters stated we would be ineffective in reaching our data 
collection goals without prescribing some rules about assessing 
function; and thus suggested alternatives due to concerns of 
consistency and validity of the data. MedPAC noted that collecting data 
without a tool ``would generate large amounts of data, and not provide 
clear information on the patients' limitations or functional status.'' 
MedPAC elaborated that variations among the assessment methods used by 
therapists ``would potentially impede the utility of such data for 
policymakers.''
    Commenters found the following potential drawbacks to our proposal 
to allow therapists to choose the assessment tool(s) (or use their 
professional judgment) to determine the complexity/severity modifier. 
Commenters stated that the current proposal would collect individual 
level data that is not comparable among groups of beneficiaries or 
providers. Commenters also stated that gathering data on beneficiary 
condition, functional limitation, and progression necessitates the use 
of one standardized collection tool by all therapists. One commenter 
revealed that the same beneficiary could obtain widely distinct 
modifier scores depending on the tool used. Further, a commenter 
acknowledged that there are over 400 different measurement tools used 
by physical therapists, many of which only measure one domain of 
function. Additionally, another commenter urged us to provide more 
instruction on how each tool interfaces with the complexity/severity 
scale and provide crosswalks and guidance for each tool to promote 
consistency in the data collected.

[[Page 68971]]

    Commenters suggested the following alternatives to our proposal to 
address the potential drawbacks they identified. Commenters supported 
endorsing a small number of standardized tools with proven validity, 
reliability, and responsiveness that would be distinct for each therapy 
discipline. The American Speech-Language and Hearing Association (ASHA) 
urged we adopt NOMS and a 7-point severity scale specifically for SLP 
to recognize the distinctiveness of the discipline and record 
meaningful outcomes for SLP beneficiaries. Many commenters supported 
the use of FOTO stating that it measures a broad scope of conditions 
reliably, results in a composite score, and creates little undue burden 
to report. Those commenters also stated that FOTO is already the tool 
of choice for their respective providers.
    Two commenters suggested developing a list of approved tools for 
specific beneficiary populations and settings. Another commenter 
suggested assigning G-codes to specific assessment tools so that the 
data could be compared. As a future alternative, a few commenters 
proposed developing core items that could be used in any tool to 
standardize data collection. MedPAC suggested that ``CMS consider 
developing an instrument that collects the necessary information that 
would allow Medicare to categorize beneficiaries by condition and 
severity in order to pay appropriately'' and pointed to the ``Reason 
for Therapy'' form used in the DOTPA study as a starting point, noting 
that it is ``concise, easy to assess and document for clinicians, and 
collects information on function and limitations across three therapy 
disciplines.''
    Response: We continue to recommend the use of four functional 
assessment tools to determine beneficiaries' functional limitations. In 
addition, when these tools are not used, we require the use of 
objective measures to document the functional status of beneficiaries. 
We continue to believe that no one tool currently meets the needs of 
all three therapy disciplines; and, therefore, we are not requiring the 
use of any one specific assessment tool, or even the use of any 
assessment tool. We acknowledge that because of the use of the variety 
and kinds of assessment tools and other measurement instruments, 
including the use of a therapist's professional judgment, the value of 
the data we collect under this system will have limitations. However, 
we believe that the data we gather will assist us in taking a first 
step towards an improved payment system.
    We appreciate the comments providing information on the benefits of 
using specific tools, such as NOMS and FOTO. However, at this time we 
do not believe that they are sufficiently widely used to require the 
use of one of these tools. In this final rule with comment period, we 
are not requiring the use of a specific assessment tool. We are 
continuing to encourage, but not require, the use of assessment tools 
in the IOM.
    We did, however, adopt G-codes and a modifier scale for SLP that 
are consistent with NOMS so it is possible to move to a standardized 
tool for SLP in the future. We will consider the possibility using 
coding to identify the specific functional assessment tool used in 
subsequent refinements. As noted above, therapists can also use their 
professional judgment in determining the percentage of functional 
limitations in conjunction with objective data from evaluations and 
assessments and the subjective reports from beneficiaries.
(5) Reporting Projected Goal Status
    We proposed that the therapist's projected goal for the 
beneficiary's functional status at the end of treatment would be 
reported on the first claim for services, periodically throughout an 
episode of care, and at discharge from therapy.
    The following is a summary of the comments regarding goal 
reporting.
    Comment: Of those commenting on goal status, most objected to the 
collection of goal data, particularly during the first year of data 
collection. Commenters noted that reporting on goals was not specified 
as part of the claims-based data collection effort required by MCTRJCA. 
Some stated that it would be a significant practice change to report 
goal data, involving changes to medical documentation, electronic 
health records, and billing processes. Commenters stated the 
identification and reporting of goals raised several clinical issues, 
such as the variability in goals among therapists, the need to change 
goals over the course of treatment, and the fact that therapists often 
set several goals (for example, short and long-term goals) for each 
beneficiary. Others noted that using goal data to classify a group of 
beneficiaries would be flawed because therapists create goals specific 
to the individual. One commenter noted that if goals influence payment, 
therapists could set the goal low or high to induce ongoing therapy and 
therefore the data would not be useful. As a result of these factors, 
many commenters believed data reporting on therapy goals would not 
provide reliable and useful information. In addition, a number of 
commenters stated that the proposal did not clearly express the intent 
of collecting goal data and many commenters expressed concerns about 
how we would use this data. Some commenters suggested that we clarify 
that the functional status data would be used only to track a 
beneficiary's progression rather than for any other purposes, such as 
making comparisons across beneficiaries, therapists, or settings. 
Several commenters expressed concern that the reporting of goals 
implied an improvement standard and that care would be denied to 
beneficiaries who improved slowly or not at all. Alternatively, one 
commenter supported our proposal for reporting of a projected goal, as 
well as periodic updates of the beneficiary status in the context of 
that goal.
    Response: We understand the commenters' concerns about the 
complexity and intricacies of goal reporting. However, we currently 
require in the Benefit Policy Manual (Chapter 15, section 220.1.2) that 
long-term treatment goals be developed for the entire episode of care. 
Further, we specify that the projected goals should be measurable and 
pertain to identified functional limitations, and that these goals also 
need to be documented in the medical record. Since many of these goal 
requirements already exist, the additional work imposed by this 
requirement would be for the therapist to establish the percentage of 
functional limitation for projected for this goal at the end of the 
therapy episode and translate the goal to the G-code/modifier scale. We 
understand that the claims-based reporting is a change for therapists; 
however, these adjustments in operations will yield meaningful 
information on beneficiary functional status. We appreciate the 
recommendation to delay goal reporting for a year, but we believe that 
it is important to include goal data to gather a complete description 
of a beneficiary's functional status.
    At this time, we intend to use the projected goal to have an 
understanding of therapists' ability to project the likely progress a 
beneficiary will make. We ultimately may employ these data to help us 
develop proposals to improve payment for therapy services, but do not 
anticipate using the goal data for purposes of payment or coverage 
decisions. In cases where the therapist does not expect improvement, 
such as for those individuals receiving maintenance therapy, the 
reported projected goal status will be the same as current status. We 
appreciate that commenters raised concerns about

[[Page 68972]]

potential ambiguity of the description of the proposal on progress and 
outcomes but, given as we have clarified in this final rule with 
comment period, goal reporting does not establish an improvement 
standard. In fact, it allows the therapist to state at the outset the 
expectations. We understand there will be wide variability in goals. 
Since these goals are used in beneficiary treatment, as well as for 
reporting, we do not expect therapists to establish goals purely to 
make themselves look better. Recognizing the limitations of the 
collected goal data, we still believe it will be useful to us. 
Therefore, we are finalizing our requirement for reporting of goal G-
codes on the claims form along with the related severity modifier for 
that goal.
(6) Reporting Frequency
    We proposed to require claims-based reporting in conjunction with 
the initial service at the outset of a therapy episode, at established 
intervals during treatment, and at discharge. As proposed, the number 
of G-codes required on a particular claim would have varied from one to 
four, depending on the circumstances. We provided the following (Table 
24) graphic example of which codes would have been used for periodic 
reporting. This example represents a therapy episode of care occurring 
over an extended period, such as might be typical for a beneficiary 
receiving therapy for the late effects of a stroke. We chose to use an 
example with a much higher than average number of treatment days in 
order to show a greater variety of reporting scenarios.
[GRAPHIC] [TIFF OMITTED] TR16NO12.003

     Outset. As proposed, the first reporting of G-codes and 
modifiers would occur when the outpatient therapy episode of care 
begins. This would typically be the date of service when the therapist 
furnishes the evaluation and develops the required plan of care (POC) 
for the beneficiary. At the outset, the therapist would use the G-codes 
and modifiers to report a current status and a projected goal for the 
primary functional limitation. We indicated in the proposal that if a 
secondary functional limitation would need to be reported, the same 
information would be reported using G-codes and associated modifiers 
for the secondary functional limitation.
    The following is a summary of comments on the frequency of 
reporting at the outset.
    Comment: All commenters that addressed frequency of reporting 
agreed that reporting should occur at the outset of the therapy episode 
of care. Although commenters agreed with reporting at the outset, many 
recommended removing the requirement to report the projected goal 
status. (Comments on reporting projected goal status are discussed 
above.)
    Response: We are finalizing the requirement to report current 
status and projected goal status at the outset of therapy.
     Every 10 Treatment Days or 30 Calendar Days, Whichever Is 
Less. We proposed to require reporting once every 10 treatment days or 
at least once during each 30 calendar days, whichever time period is 
shorter. As we explained in the proposed rule, the first treatment day 
for purposes of reporting would be the day that the initial visit takes 
place. The date the episode of care begins, typically at the 
evaluation, even when the therapist does not furnish a separately 
billable procedure in addition to the evaluation on this day,

[[Page 68973]]

would be considered treatment day one, effectively beginning the count 
of treatment days or calendar days for the first reporting period.
    A treatment day is defined as a calendar day in which treatment 
occurs resulting in a billable service. Often a treatment day and a 
therapy ``session'' (or ``visit'') may be the same, but the two terms 
are not interchangeable. For example, a beneficiary might receive 
certain services twice a day, although this is a rare clinical 
scenario, these two different sessions (or visits) on the same day by 
the same discipline are counted as one treatment day.
    We explained that the proposal would require that on the claim for 
service on or before the 10th treatment day or the 30th calendar day 
after treatment day one, the therapist would only report the G-code and 
the appropriate modifier to show the beneficiary's current functional 
status at the end of this reporting period under the proposal. We added 
that the next reporting period begins on the next treatment day and 
that the time period between the end of one reporting period and the 
next treatment day does not count towards the 30-calendar day period. 
On the claim for services furnished on this date, the therapist would 
report both the G-code and modifier showing the current functional 
status at this time along with the G-code and modifier reflecting the 
projected goal that was identified at the outset of the therapy 
episode. This process would continue until the beneficiary concludes 
the course of therapy treatment.
    Further, we proposed that on a claim for a service that does not 
require specific reporting of a G-code with modifier (that is, on a 
claim for therapy services within the time period for which reporting 
is not required), GXXX7 would be used. By using this code, the 
therapist would be confirming that the claim does not require specific 
functional reporting. This is the only G-code that we proposed to be 
reported without a severity modifier.
    As we noted in the proposed rule, we proposed the 10/30 frequency 
of reporting to be consistent with our existing timing requirements for 
progress reports. These timing requirements are included in the 
Documentation Requirements for Therapy Services (see Pub. 100-02, 
Chapter 15, Section 220.3, Subsection D). By making these reporting 
timeframes consistent with Medicare's other requirements, therapists 
who are already furnishing therapy services to Medicare outpatients 
would have a familiar framework for successfully adopting our new 
reporting requirement. In addition to reflecting the Medicare required 
documentation for progress reports, we believe that this simplifies the 
process and minimizes the new burden on therapists since many therapy 
episodes would be completed by the 10th treatment day. In 2008, the 
average number of days in a therapy episode was 9 treatment days for 
SLP, 11 treatment days for PT, and 12 treatment days for OT. Under the 
proposal, when reporting on two functional limitations, the therapist 
would report the G-codes and modifiers for the second condition in the 
manner described above. In other words, at the end of the reporting 
period as proposed, two G-codes would be reported to show current 
functional status--one for the primary (GXXX1) and one for the 
secondary (GXXX4) limitation. Similarly as proposed, at the beginning 
of the reporting period four G-codes would be reported. GXXX1 and GXXX4 
would be used to report current status for the primary and secondary 
functional limitations, respectively; and, GXXX2 and GXXX5 would be 
used to report the goal status for the primary and secondary functional 
limitations, respectively.
    We noted that the proposal required that the same reporting periods 
be used for both the primary and secondary functional limitation. We 
added that the therapist can accomplish this by starting them at the 
same time or if the secondary functional limitation is added at some 
point in treatment, the primary functional limitation's reporting 
period must be re-started by reporting GXXX1 and GXXX2 at the same time 
the new secondary functional limitation is added using GXXX4 and GXXX5.
    Further, for those therapy treatment episodes lasting longer 
periods of time, the periodic reporting of the G-codes and associated 
modifiers would reflect any progress that the beneficiary made toward 
the identified goal. In summary, we proposed to require the reporting 
of G-codes and modifiers at episode outset (evaluation or initial 
visit), and once every 10th treatment day or at least every 30 calendar 
days, whichever time period is less, and at discharge.
    We noted that we believed it was important that the requirements 
for this reporting system be consistent with the requirements for 
documenting any progress in the medical record as specified in our 
manual. Given the current proposal for claims-based data collection, we 
believe it is an appropriate time to reassess the manual requirements. 
We sought comment on whether it would be appropriate to modify the 
periodicity of the progress report requirement in the IOM to one based 
solely on the number of treatment days, such as six or ten. We noted 
that if a timing modification was made for progress reporting, a 
corresponding change would be made in the functional reporting 
interval.
    The following is a summary of the comments we received on our 
proposal to require reporting every 10 treatment days or 30 calendar 
days, whichever is less, and whether it would be appropriate to modify 
the progress report requirement in the IOM to one based solely on the 
number of treatment days, such as six or ten, and the clinical impact 
of such a change.
    Comment: Although many commenters appreciated our effort to align 
the claims-based reporting with existing requirements for a progress 
report, several commenters requested that we recognize the significant 
time burden of the new reporting frequency and that we ameliorate some 
of the burden with a simplification of the existing manual requirement. 
Commenters in favor of reporting every 10 treatment days explained that 
using treatment days as compared to calendar days is more easily 
programmed into software systems and in accord with certain therapist's 
billing practices. A couple of other commenters supported reporting 
every 30 calendar days as this accommodates therapists working in 
settings where claims are required to be submitted on a monthly basis, 
such as hospitals, rehabilitation agencies and SNFs. Several commenters 
objected to the periodic reporting and suggested that reporting only at 
the outset and at discharge of therapy would be sufficient to capture a 
beneficiary's functional progression. A few of those commenters were 
okay with the proposed 10 treatment day or 30 calendar day reporting 
timeframe, if periodic claims reporting is necessary.
    A few commenters urged us to eliminate the requirement for 
functional status reporting at the visit subsequent to the progress 
report because a beneficiary's status probably would remain the same 
unless there is a significant gap between visits.
    We received many comments concerning the reporting of GXXX7; which 
we proposed to be used to indicate that the therapist confirms 
functional reporting not required. These commenters stated that the 
reporting of GXXX7, which is required for claims with dates of services 
when a functional status measure is not collected, would be unnecessary 
and burdensome, especially for daily billers. They urged us to require 
reporting only when a functional status is required to be reported. 
Further commenters stated

[[Page 68974]]

that there was no purpose for this G-code.
    Response: Based on the public comments, we are making several 
changes. We believe that reporting every 10 treatment days would be 
less burdensome for therapists than the proposed 10 treatment days/30 
calendar days. We believe a 10\-\treatment day reporting period is 
straightforward for therapists to track, allows for better monitoring 
of changes in functional status, and is more easily adopted within our 
current claims processing systems. Therefore, we are finalizing the 
requirement that G-codes and associated modifiers are reported at least 
once every 10 treatment days and we will modify the IOM to establish 
the same timing requirement for progress reports. By making this 
change, we no longer need the therapist to report functional status at 
the visit subsequent to the end of a reporting period to signal the 
beginning of a new reporting period. So in response to comments, we 
have eliminated the requirement to report data at the start of a new 
reporting period.
    After assessing the comments, we agree that reporting a G-code 
(GXXX7) to tell us that no reporting is required would not provide 
meaningful data and would pose an additional burden for therapists and 
therapy providers. When proposed, we believed it would be convenient 
for therapists to use the code to indicate that this was a claim for 
therapy services that did not require the functional reporting because 
it would assist them in complying with the reporting requirements and 
would assist us in enforcing them. When we reassessed the issue based 
on feedback from commenters, it was clear that the ``no report due'' 
code would not aid us in enforcing the requirements as we would still 
have to verify that claims with the proposed GXXX7 were in fact claims 
that did not require reporting. Since commenters pointed out that not 
only would it not assist them, but would in fact burden them, we have 
decided not to include this code. Accordingly, we are also modifying 
our proposal to remove the requirement to report a ``no report due'' 
code on claims when functional reporting is not due, such as between 
the first and the tenth day of service. We expect these changes will 
significantly reduce the frequency of required reporting during a 
therapy episode and believe they will appropriately simplify the 
claims-based reporting system.
     Discharge. In addition, we proposed to require reporting 
of the G-code/modifier functional data for the current status and for 
the goal at the conclusion of treatment so that we have a complete set 
of data for the therapy episode of care. Requiring the reporting at 
discharge mirrors the IOM requirement of a discharge note or summary. 
This set of data would reveal any functional progress or improvement 
the beneficiary made toward the projected therapy goal during the 
entire therapy episode. Specifically, information on the beneficiary's 
functional status at the time of discharge shows whether the 
beneficiary made progress towards or met the projected therapy goal. As 
we noted in the proposed rule, the imposition of this reporting 
requirement does not justify scheduling an additional and perhaps 
medically unnecessary final session in order to measure the 
beneficiary's function for the sole purpose of reporting.
    Although collection of discharge data is important in achieving our 
goals, we recognize that data on functional status at the time therapy 
concludes is sometimes likely to be incomplete for some beneficiaries 
receiving outpatient therapy services. The DOTPA project has found this 
to be true. There are various reasons as to why the therapist would not 
be able to report functional status using G-codes and modifiers at the 
time therapy ends. Sometimes, beneficiaries may discontinue therapy 
without alerting their therapist of their intention to do so; simply 
because they feel better; they can no longer fit therapy into their 
life, work, or social schedules; a physician told them further therapy 
was not necessary; or their transportation is unavailable. Whatever the 
reason, there would be situations where the therapy ends without the 
planned discharge visit taking place. In these situations, we said that 
we would not require the reporting at discharge. However, we encourage 
therapists to include discharge reporting whenever possible on the 
final therapy claim for services.
    Since the therapist is typically reassessing the beneficiary during 
the therapy episode, the data critical to the severity/complexity of 
the functional measure may be available even when the final therapy 
session does not occur. In these instances, the G-codes and modifiers 
appropriate to discharge should be reported when the final claim for 
therapy services has not already been submitted.
    We sought feedback on how often the therapy community finds that 
beneficiaries discontinue therapy without the therapist knowing in 
advance that it is the last treatment session and other situations in 
which the discharge data would not be available for reporting.
    The following is a summary of the comments we received regarding 
the proposal to require reporting of the G-code/modifier functional 
data at the conclusion of treatment so that we have a complete set of 
data for the therapy episode of care.
    Comment: In addition to outset reporting, a majority of commenters 
supported claims-based reporting at discharge of the therapy episode of 
care. With regard to the number of beneficiaries who stop therapy 
services without notice, the responses varied from about 12 percent for 
beneficiaries being treated for a spinal cord injury to 26 percent of 
patients with orthopedic conditions in a large system of outpatient 
therapy clinics. Many commenters who supported discharge reporting 
recommended that if the beneficiary misses his or her last visit, the 
therapist should be exempt from reporting the functional status at 
discharge. Another commenter believed, however, that having a separate 
G-code in each set to report discharge status is unnecessary; the 
commenter further stated that the last reported current status and goal 
status G-codes could be used to represent the end of treatment.
    Response: Although we recognize that there may be some challenges 
with discharge reporting, this information is important for our 
purposes to complete the data set for each therapy episode; and, thus, 
we are maintaining the requirement. We do not agree with the commenter 
who suggested that we could simply use the last reported current status 
to represent the status at discharge since this may not be an accurate 
representation of the beneficiary's status at the time of discharge. 
However, in those cases where this functional status is derived from a 
patient survey, for example, FOTO, Am-PAC or OPTIMAL, and the survey is 
routinely sent to the patient who misses his/her final treatment, the 
therapist should report this data once subsequently gained, on the 
final bill for services unless the bill for the last treatment day has 
already been submitted. There are instances where not reporting the 
discharge status would make it impossible for us to distinguish the 
start of the reporting for a new or subsequently-reported functional 
limitation or the treatment for a new therapy episode in the data. We 
are finalizing our proposal to require discharge reporting (except in 
cases where therapy services are discontinued by the beneficiary prior 
to the planned discharge visit) using the discharge G-code, along with 
the goal status G-code, to indicate the end of a therapy episode or to 
signal the end of reporting on one

[[Page 68975]]

functional limitation, while further therapy is necessary for another 
one.
     Significant Change in Beneficiary Condition. We proposed 
that, in addition to reporting at the intervals discussed above, the G-
code/modifier measures would be required to be reported when a formal 
and medically necessary re-evaluation of the beneficiary results in an 
alteration of the goals in the beneficiary's POC. This could result 
from new clinical findings, an added comorbidity, or a failure to 
respond to treatment. We noted that this reporting affords the 
therapist the opportunity to explain a beneficiary's failure to 
progress toward the initially established goal(s) and permits either 
the revision of the severity status of the existing goal or the 
establishment of a new goal or goals. Under the proposal, the therapist 
would be required to begin a new reporting period when submitting a 
claim containing a CPT code for an evaluation or a re-evaluation. This 
functional reporting of G-codes, along with the associated modifiers, 
could be used to show an increase in the severity of functional 
limitations; or, they could be used to reflect the severity of newly 
identified functional limitations as delineated in the revised plan of 
care.
    The following is a summary of the comments we received regarding 
the proposal that in addition to reporting at the intervals discussed 
above, the G-code and related modifier would be required to be reported 
when a formal and medically necessary re-evaluation of the beneficiary 
results in an alteration of the goals in the beneficiary's POC.
    Comment: One commenter recommended that instead of requiring 
periodic reporting throughout a therapy episode that we require it only 
at the time of a re-evaluation. This commenter believed that capturing 
the functional information using G-codes within the treatment episode 
is burdensome and reporting at the time of the progress report would 
put unnecessary emphasis on a therapist capturing a change in a 
beneficiary's assessment.
    Response: We did not receive comments objecting to claims-based 
reporting at the time that a re-evaluation code is billed for PT or OT 
or a subsequent or second evaluation code is billed for SLP. Therefore, 
we are finalizing the requirement for functional reporting when a 
formal and medically necessary re-evaluation, for PT or OT, or a second 
or repeat SLP evaluation of the beneficiary is furnished. We are 
requiring claims-based reporting in conjunction with the evaluation at 
the outset of therapy, on or before each 10th treatment day throughout 
therapy, and at therapy discharge (except in cases where therapy 
services are unexpectedly discontinued by the beneficiary prior to the 
planned discharge visit and the necessary information is not available) 
or to signal the end of reporting on one functional limitation. On a 
claim, two G-codes would be required depending on the reporting 
interval. Table 25 shows a revised example of which codes are used for 
specified reporting under our final policy. We should note that this 
example utilizes the mobility functional limitation G-codes, G8978-
G8980 for ``walking and moving around'' and the ``Other or Primary'' G-
codes, G8990-G8992 and is for illustrative purposes only. This table 
not only shows how the final reporting works but by comparing it to the 
table showing the same details for reporting under the proposed policy 
one can see how much less reporting is required. Any of the other 
functional limitation G-code sets listed in Table 21 would also be 
applicable here.

[[Page 68976]]

[GRAPHIC] [TIFF OMITTED] TR16NO12.004

    In summary, we maintain that claims-based reporting should occur at 
the outset of therapy episode, on or before every 10 treatment days 
throughout the course of therapy, and at the time of discharge from 
therapy. Additionally, functional reporting is also required at the 
time the beneficiary's condition changes significantly enough to 
clinically warrant a re-evaluation such that a HCPCS/CPT code for a re-
evaluation or a repeat evaluation is billed.
(7) Documentation
    We proposed to require that documentation of the information used 
for reporting under this system must be included in the beneficiary's 
medical record. As proposed, the therapist would need to track in the 
medical record the G-codes and the corresponding severity modifiers 
that were used to report the status of the functional limitations at 
the time reporting was required. Including G-codes and related 
modifiers in the medical record creates an auditable record, assists in 
improving the quality of data CMS collects, and allows therapists to 
track assessment and functional information. In the proposed rule, we 
provided the example of a situation where the therapist selects the 
mobility functional limitation of ``walking and moving'' as the primary 
functional limitation and determines that at therapy outset the 
beneficiary has a 60 percent limitation and sets the goal to reduce the 
limitation to 5 percent. We noted that the therapist uses GXXX1-XH to 
report the current status of the functional impairment and GXXX2-XB to 
report the goal. Additionally, we said that the therapist should note 
in the beneficiary's medical record that the functional limitation is 
``walking and moving'' and document the G-codes and severity modifiers 
used to report this functional limitation on the claim for therapy 
services.
    The following is a summary of comments we received concerning our 
documentation requirements.
    Comment: Some commenters suggested that the proposal would impose 
significant additional documentation and claims reporting requirements. 
Further, one commenter objected to the requirement to include 
information in the medical record on the G-codes and modifiers used for 
billing as it would be highly unusual and time intensive to do so. 
Another commenter supported our proposal, agreeing that documentation 
of the information used for reporting under this system must be 
included in the beneficiary's medical record.
    Response: We disagree with the commenters' statements that the 
required documentation is overly burdensome. In fact, by maintaining 
the G-code descriptor and related modifier in the medical record, 
therapists may find it easier to link treatment and reporting. 
Additionally, to enforce the reporting requirements on the claims, 
documentation in the medical record is required. In cases where the 
therapist uses other information in addition to certain measurement 
tools in order to assess functional impairment, he or she would also 
want to document the relevant information used to determine the overall 
percentage of functional limitation to select the severity modifier. In 
instances where it becomes necessary for a different therapist to 
furnish the therapy services, the substitute therapist can look in the 
beneficiary's medical record to note previous G-codes and related 
modifiers

[[Page 68977]]

reported. We are finalizing the proposed requirement that the G-codes 
and related modifiers must be documented in the beneficiary's medical 
record.
(8) Claims Requirements
    In the proposed rule, we noted that except for the addition of the 
proposed G-codes and the associated modifiers, nothing in this proposal 
would modify other existing requirements for submission of therapy 
claims. We noted in the proposed rule that, in addition to the new G-
codes and modifiers used for the claims-based data collection system, 
the therapy modifiers--GO, GP, and GN, would still be required on 
claims to indicate that the therapy services are furnished under an OT, 
PT, or SLP plan of care, respectively; and, therefore, we are 
designating these nonpayable G-codes as ``always therapy.'' We noted in 
the proposed rule that institutional claims for therapy services would 
require that a charge be included on the service line for each one of 
these G-codes used in the required functional reporting. We also noted 
that this charge would not be used for payment purposes and would not 
affect processing. Further, we noted claims for professional services 
do not require that a charge be included for these nonpayable G-codes, 
but that reporting a charge for the nonpayable G-codes would not affect 
claims processing. To illustrate this policy, for each nonpayable G-
code on the claim, that line of service would also need to contain one 
of the severity modifiers, the corresponding GO, GP, or GN therapy 
modifier to indicate the respective OT, PT, or SLP therapy discipline 
and related POC; and the date of service it references. For each line 
on the institutional claim submitted by hospitals, SNFs, rehabilitation 
agencies, CORFs and HHAs, a charge of one penny, $0.01, can be added. 
For each line on the professional claim submitted by private practice 
therapists and physician/NPPs, a charge of $0.00 can be added. We 
believe that many therapists submitting professional claims are already 
submitting nonpayable G-code quality measures under the PQRS and will 
be familiar with the parameters of nonpayable G-codes on claims for 
Medicare services.
    Finally, we noted that Medicare does not process claims that do not 
include a billable service. As a result, reporting under this claims-
based data collection system would need to be included on the same 
claim as a furnished service that Medicare covers.
    We did not receive any comments specifically on the claims 
requirements so we are finalizing these as proposed.
(9) Implementation Date
    In accordance with section 3005(g) of the MCTRJCA, we proposed to 
implement these data reporting requirements on January 1, 2013. We 
recognized that with electronic health records and electronic claims 
submission, therapists might encounter difficulty in including this new 
data on claims. To accommodate those that may experience operational or 
other difficulties with moving to this new reporting system and to 
assure smooth transition, we proposed a testing period from January 1, 
2013 until July 1, 2013. We noted that we would expect that all those 
billing for outpatient therapy services would take advantage of this 
testing period and would begin attempting to report the new G-codes and 
modifiers as close to January 1, 2013, as possible, in preparation for 
required reporting beginning on July 1, 2013. Taking advantage of this 
testing period would help to minimize potential problems after July 1, 
2013, when claims without the appropriate G-codes and modifiers would 
be returned unpaid.
    The following is a summary of comments we received concerning our 
implementation of the new system on January 1, 2013 with enforcement 
beginning after July 1, 2013.
    Comment: Given the statutory deadline, most commenters acknowledged 
that the new program needed to be implemented on January 1, 2013. Many 
commenters supported the proposed testing period. They indicated that a 
testing period was needed to train therapists, change documentation 
practices, modify electronic health records systems, educate billing 
contractors, and adjust billing systems. However, numerous commenters 
expressed concern that 6 months is an insufficient and unrealistic 
amount of time to transition to the new data reporting requirements. 
Commenters requested that we recognize the significant time and 
financial burden of the new reporting requirement and that we alleviate 
these concerns with delayed enforcement. Commenters requested a longer 
period to make software adjustments and educate therapists on the new 
reporting and frequency of documentation requirements. Further, 
commenters believed that we, in the limited time period, did not 
recognize the potential capital changes that would be necessary or 
allow for the typical process for acquiring funds. Commenters proposed 
various alternatives, which included extending the testing period to 9 
or 12 months. A few suggested that we delay implementation of the 
mandate until the completion of the DOTPA study. As an alternative to 
nationwide data reporting, a few commenters suggested we consider 
testing the requirement under a pilot program in a small sample of the 
country, allowing us to analyze preliminary data and draw conclusions 
regarding the effectiveness of reporting through non-payable G-codes 
and modifiers before it is implemented nationwide.
    Response: We are required by law to implement the claims-based data 
collection strategy on January 1, 2013. Our contractors and systems 
will be able to accept and process claims for therapy services with 
functional information at this time. We recognize that therapists may 
need time to adjust their claims processing to accommodate these 
additional codes but, we believe the necessary changes can be 
accomplished well within the 8 months between the time this final rule 
with comment period is issued and the end of the testing period. We do 
not believe a small pilot as suggested by some commenters would meet 
the statutory requirement to implement as of January 1, 2013 a claims-
based data collection strategy to assist in reforming outpatient 
therapy services. Nor would it meet our needs to gather data to assist 
in developing potential alternative payment systems for therapy 
services. We are finalizing an implementation date of January 1, 2013 
with a 6-month testing period such that claims that do not comply with 
the data reporting requirements will be returned beginning July 1, 
2013.
(10) Compliance Required as a Condition for Payment and Regulatory 
Changes
    To implement the claims-based data collection system required by 
MCTRJCA and described above, we proposed to amend the regulations 
establishing the conditions for payment governing outpatient and CORF 
PT, OT, and SLP services to add a requirement that the claims include 
information on beneficiary functional limitations. In addition, we 
proposed to amend the POC requirements set forth in the regulations for 
outpatient therapy services and CORFs to require that the therapy 
goals, which must be included in the POC, are consistent with the 
beneficiary's functional limitations and goals reported on claims for 
services.
    Specifically, we proposed to amend the regulations for outpatient 
OT, PT, and SLP (Sec.  410.59, Sec.  410.60, and Sec.  410.62, 
respectively) by adding a new paragraph (a)(4) to require that claims 
submitted for services furnished contain

[[Page 68978]]

the required information on beneficiary functional limitations.
    We also proposed to amend the POC requirements set forth at Sec.  
410.61(c) to require that the therapy goals, which must be included in 
the treatment plan, must be consistent with those reported on claims 
for services. This requirement is in addition to those already existing 
conditions for the POC.
    To achieve consistency in the provision of PT, OT, and SLP services 
across therapy benefits, we proposed to amend Sec.  410.105 to include 
the same requirements for these services furnished in CORFs. These 
proposed revisions would require that the goals specified in the 
treatment plan be consistent with the beneficiary functional 
limitations and goals reported on claims for services and that claims 
submitted for services furnished contain specified information on 
beneficiary functional limitations, respectively. The requirements do 
not apply to respiratory therapy services.
    We did not receive any comments on the proposed regulatory changes 
and are finalizing the changes as proposed.
(11) Consulting With Relevant Stakeholders
    Section 3005(g) of the MCTRJCA requires us to consult with relevant 
stakeholders as we propose and implement this reporting system. In the 
CY 2013 PFS proposed rule, we indicated that we are meeting this 
requirement through the publication of this proposal and specifically 
by soliciting public comment on the various aspects of our proposal. In 
addition, we noted that we would meet with key stakeholders and discuss 
this issue in Open Door Forums over the course of the summer.
    During the CY 2013 proposed rule comment period, we met with the 
various therapy professional associations and provider groups in order 
to solicit their comments on the various aspects of this proposal. At 
the CMS Physicians, Nurses & Allied Health Professionals Open Door 
Forum on July 17, 2012, we discussed the provisions of the proposed 
rule, including these requirements. We also discussed this proposed 
rule at the CMS Hospital & Hospital Quality Open Door Forum on July 18, 
2012. In developing the final rule, we took into consideration many of 
the critical issues that were raised by the various stakeholders in 
these meetings and Forums. Accordingly, we believe we have met our 
obligation to consult with relevant stakeholders in proposing and 
implementing the required claims-based data collection strategy, and in 
developing our final policies, we have taken into consideration the 
various needs of stakeholders affected by this effort.

H. Primary Care and Care Coordination

    In recent years, we have recognized primary care and care 
coordination as critical components in achieving better care for 
individuals, better health for individuals, and reduced expenditure 
growth. Accordingly, we have prioritized the development and 
implementation of a series of initiatives designed to improve payment 
for, and encourage long-term investment in, primary care and care 
management services. These initiatives include the following programs 
and demonstrations:
     The Medicare Shared Savings Program (described in 
``Medicare Program; Medicare Shared Savings Program: Accountable Care 
Organizations; Final Rule'' which appeared in the Federal Register on 
November 2, 2011 (76 FR 67802)).
    ++ The testing of the Pioneer ACO model, designed for experienced 
health care organizations (described on the Center for Medicare and 
Medicaid Innovation's (Innovation Center's) Web site at 
innovations.cms.gov/initiatives/ACO/Pioneer/index.html).
    ++ The testing of the Advance Payment ACO model, designed to 
support organizations participating in the Medicare Shared Savings 
Program (described on the Innovation Center's Web site at 
innovations.cms.gov/initiatives/ACO/Advance-Payment/index.html).
     The Primary Care Incentive Payment (PCIP) Program 
(described on the CMS Web site at www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/Downloads/PCIP-2011-Payments.pdf).
     The patient-centered medical home model in the Multi-payer 
Advanced Primary Care Practice (MAPCP) Demonstration designed to test 
whether the quality and coordination of health care services are 
improved by making advanced primary care practices more broadly 
available (described on the CMS Web site at www.cms.gov/Medicare/Demonstration-Projects/DemoProjectsEvalRpts/downloads/mapcpdemo_Factsheet.pdf).
     The Federally Qualified Health Center (FQHC) Advanced 
Primary Care Practice demonstration (described on the CMS Web site at 
www.cms.gov/Medicare/Demonstration-Projects/DemoProjectsEvalRpts/downloads/mapcpdemo_Factsheet.pdf and the Innovation Center's Web site 
at innovations.cms.gov/initiatives/FQHCs/index.html).
     The Comprehensive Primary Care (CPC) initiative (described 
on the Innovation Center's Web site at innovations.cms.gov/initiatives/Comprehensive-Primary-Care-Initiative/index.html). The CPC initiative 
is a multi-payer initiative fostering collaboration between public and 
private health care payers to strengthen primary care in certain 
markets across the country.
    In coordination with these initiatives, we also continue to explore 
other potential refinements to the PFS that would appropriately value 
primary care and care coordination within Medicare's statutory 
structure for fee-for-service physician payment and quality reporting. 
We believe that improvements in payment for primary care and 
recognizing care coordination initiatives are particularly important as 
EHR technology diffuses and improves the ability of physicians and 
other providers of health care to work together to improve patient 
care. We view these potential refinements to the PFS as part of a 
broader strategy that relies on input and information gathered from the 
initiatives described above, research and demonstrations from other 
public and private stakeholders, the work of all parties involved in 
the potentially misvalued code initiative, and from the public at 
large.
    In the CY 2012 PFS proposed rule (76 FR 42793 through 42794), we 
initiated a discussion to gather information about how primary care 
services have evolved to focus on preventing and managing chronic 
conditions. We also proposed to review evaluation and management (E/M) 
services as potentially misvalued and suggested that the American 
Medical Association Relative (Value) Update Committee (AMA RUC) might 
consider changes in the practice of chronic conditions management and 
care coordination as key reason for undertaking this review. In the CY 
2012 PFS final rule with comment period (76 FR 73062 through 73065), we 
did not finalize our proposal to review E/M codes due to consensus from 
an overwhelming majority of commenters that a review of E/M services 
using our current processes could not appropriately value the evolving 
practice of chronic care coordination at the time, and therefore, would 
not accomplish the agency's goal of paying appropriately for primary 
care services. We stated that we would continue to consider ongoing 
research projects, demonstrations, and the numerous policy alternatives 
suggested by commenters. In addition, in the CY 2012 PFS proposed rule 
(76 FR 42917 through 42920), we initiated a public

[[Page 68979]]

discussion regarding payments for post-discharge care management 
services. We sought broad public comment on how to further improve care 
management for a beneficiary's transition from the hospital to the 
community setting within the existing statutory structure for physician 
payment and quality reporting. We specifically discussed how post 
discharge care management services are coded and valued under the 
current E/M coding structure, and we requested public comment. The 
physician community responded that comprehensive care coordination 
services are not adequately represented in the descriptions of, or 
payments for, office/outpatient E/M services. The American Medical 
Association (AMA) and the American Academy of Family Physicians (AAFP) 
created workgroups to consider new options for coding and payment for 
primary care services. The AAFP Task Force recommended that CMS create 
new primary care E/M codes and pay separately for non-face-to-face E/M 
Current Procedural Terminology (CPT) codes. (A summary of these 
recommendations is available at www.aafp.org/online/en/home/publications/news/news-now/inside-aafp/20120314cmsrecommendations.html.) The AMA workgroup, Chronic Care 
Coordination Workgroup (C3W), has and continues to develop codes to 
describe care transition and care coordination activities. (Several 
workgroup meeting minutes and other related items are available at 
www.ama-assn.org/ama/pub/physician-resources/solutions-managing-your-practice/coding-billing-insurance/medicare/care-coordination.page.) 
Since the publication of the proposed rule, the C3W has completed 
development of two new transitional care management (TCM) codes. These 
new codes are:
     99495 Transitional Care Management Services with the 
following required elements:
    ++ Communication (direct contact, telephone, electronic) with the 
patient and/or caregiver within 2 business days of discharge.
    ++ Medical decision making of at least moderate complexity during 
the service period.
    ++ Face-to-face visit, within 14 calendar days of discharge.
     99496 Transitional Care Management Services with the 
following required elements:
    ++ Communication (direct contact, telephone, electronic) with the 
patient and/or caregiver within 2 business days of discharge.
    ++ Medical decision making of high complexity during the service 
period.
    ++ Face-to-face visit, within 7 calendar days of discharge.
    We discuss these codes in greater detail below.
    Under current PFS policy, care coordination is a component of E/M 
services which are generally reported using E/M CPT codes. The pre- and 
post-encounter non-face-to-face care management work is included in 
calculating the total work for the typical E/M services, and the total 
work for the typical service is used to develop RVUs for the E/M 
services. In the CY 2012 PFS proposed rule, we highlighted some of the 
E/M services that include substantial care coordination work. 
Specifically, we noted that the vignettes that describe a typical 
service for mid-level office/outpatient services (CPT codes 99203 and 
99213) include furnishing care coordination, communication, and other 
necessary care management related to the office visit in the post-
service work. We also highlighted vignettes that describe a typical 
service for hospital discharge day management (CPT codes 99238 and 
99239), which include furnishing care coordination, communication, and 
other necessary management related to the hospitalization in the post-
service work.
    The payment for non-face-to-face care management services is 
bundled into the payment for face-to-face E/M visits. Moreover, 
Medicare does not pay for services that are furnished to parties other 
than the beneficiary and which Medicare does not cover, for example, 
communication with caregivers. Accordingly, we do not pay separately 
for CPT codes for telephone calls, medical team conferences, prolonged 
services without patient contact, or anticoagulation management 
services.
    However, the physician community continues to tell us that the care 
coordination included in many of the E/M services, such as office 
visits, does not adequately describe the non-face-to-face care 
management work involved in primary care. Because the current E/M 
office/outpatient visit CPT codes were designed to support all office 
visits and reflect an overall orientation toward episodic treatment, we 
agree that these E/M codes may not reflect all the services and 
resources required to furnish comprehensive, coordinated care 
management for certain categories of beneficiaries such as those who 
are returning to a community setting following discharge from a 
hospital or SNF stay. As part of our multi-year strategy to recognize 
and support primary care and care management, we proposed in the CY 
2013 PFS proposed rule (77 FR 44776-44780) to create a HCPCS G code to 
describe care management involving the transition of a beneficiary from 
care furnished by a treating physician during a hospital stay 
(inpatient, outpatient observation services, or outpatient partial 
hospitalization), SNF stay, or community mental health center (CMHC) 
partial hospitalization program to care furnished by the beneficiary's 
primary physician in the community. We also solicited comment on how 
care furnished in these settings might be incorporated into the current 
fee-for-service structure of the PFS.
    Specifically, this HCPCS G code would describe all non-face-to-face 
services related to the TCM furnished by the community physician or 
qualified nonphysician practitioner within 30 calendar days following 
the date of discharge from an inpatient acute care hospital, 
psychiatric hospital, long-term care hospital, skilled nursing 
facility, and inpatient rehabilitation facility; hospital outpatient 
for observation services or partial hospitalization services; and a 
partial hospitalization program at a CMHC to community-based care. The 
post-discharge TCM service includes non-face-to-face care management 
services furnished by clinical staff member(s) or office-based case 
manager(s) under the supervision of the community physician or 
qualified nonphysician practitioner. We based the concept of this 
proposal, in part, on our policy for care plan oversight services. We 
currently pay physicians for the non-face-to-face care plan oversight 
services furnished for beneficiaries under care of home health agencies 
or hospices. These beneficiaries require complex and multidisciplinary 
care modalities that involve: Regular physician development and/or 
revision of care plans, subsequent reports of patient status, review of 
laboratory and other studies, communication with other health 
professionals not employed in the same practice who are involved in the 
patient's care, integration of new information into the care plan, and/
or adjustment of medical therapy. Physicians furnishing these services 
bill HCPCS codes G0181 or G0182 (See the Medicare benefit manual, 100-
02, Chapter 15, Section 30 for detailed description of these services.)
    For CY 2013, we proposed to create a new code to describe post-
discharge TCM services. This service was proposed to include:
     Assuming responsibility for the beneficiary's care without 
a gap.
    ++ Obtaining and reviewing the discharge summary.
    ++ Reviewing diagnostic tests and treatments.

[[Page 68980]]

    ++ Updating of the patient's medical record based on a discharge 
summary to incorporate changes in health conditions and on-going 
treatments related to the hospital or nursing home stay within 14 
business days of the discharge.
     Establishing or adjusting a plan of care to reflect 
required and indicated elements, particularly in light of the services 
furnished during the stay at the specified facility and to reflect 
result of communication with beneficiary.
    ++ An assessment of the patient's health status, medical needs, 
functional status, pain control, and psychosocial needs following the 
discharge.
     Communication (direct contact, telephone, electronic) with 
the beneficiary and/or caregiver, including education of patient and/or 
caregiver within 2 business days of discharge based on a review of the 
discharge summary and other available information such as diagnostic 
test results, including each of the following tasks:
    ++ An assessment of the patient's or caregiver's understanding of 
the medication regimen as well as education to reconcile the medication 
regimen differences between the pre- and post-hospital, CMHC, or SNF 
stay.
    ++ Education of the patient or caregiver regarding the on-going 
care plan and the potential complications that should be anticipated 
and how they should be addressed if they arise.
    ++ Assessment of the need for and assistance in establishing or re-
establishing necessary home and community based resources.
    ++ Addressing the patient's medical and psychosocial issues, and 
medication reconciliation and management.
    When indicated for a specific patient, the post-discharge 
transitional care service was also proposed to include:
     Communication with other health care professionals who 
will (re)assume care of the beneficiary, education of patient, family, 
guardian, and/or caregiver.
     Assessment of the need for and assistance in coordinating 
follow up visits with health care providers and other necessary 
services in the community.
     Establishment or reestablishment of needed community 
resources.
     Assistance in scheduling any required follow-up with 
community providers and services.
    The proposed post-discharge transitional care HCPCS G code was 
described as follows:
    GXXX1 Post-discharge transitional care management with the 
following required elements:
     Communication (direct contact, telephone, electronic) with 
the patient or caregiver within 2 business days of discharge.
     Medical decision making of moderate or high complexity 
during the service period.
     To be eligible to bill the service, physicians or 
qualified nonphysician practitioners must have had a face-to-face E/M 
visit with the patient in the 30 days prior to the transition in care 
or within 14 business days following the transition in care.
    The post-discharge transitional care services HCPCS G code we 
proposed would be used by the community physician or qualified 
nonphysician practitioner to report the services furnished in the 
community to ensure the coordination and continuity of care for 
patients discharged from a hospital (inpatient stay, outpatient 
observation, or outpatient partial hospitalization), SNF stay, or CMHC. 
The post-discharge transitional care service would parallel the 
discharge day management service for the community physician or 
qualified nonphysician practitioner and complement the E/M office/
outpatient visit CPT codes.
    We proposed that the post-discharge transitional care service HCPCS 
G code would be used to report physician or qualifying nonphysician 
practitioner services for a patient whose medical and/or psychosocial 
problems requires moderate or high complexity medical decision-making 
during transitions in care from hospital (inpatient stay, outpatient 
observation, and partial hospitalization), SNF stay, or CMHC settings 
to community-based care. The Evaluation and Management Guidelines 
define decision-making of moderate and high medical complexity. In 
general, moderate complexity medical decision-making includes multiple 
diagnoses or management options, moderate complexity and amount of data 
to be reviewed, a moderate amount and/or complexity of data to be 
reviewed; and a moderate risk of significant complications, morbidity, 
and/or mortality. High complexity decision-making includes an extensive 
number of diagnoses or management options, an extensive amount and/or 
complexity of data to be reviewed, and high risk of significant 
complications, morbidity, and/or mortality (See Evaluation and 
Management Services Guide, Centers for Medicare & Medicaid Services, 
December 2010.) We proposed that the post-discharge transitional care 
HCPCS code (GXXX1) would be payable only once in the 30 days following 
a discharge, per patient per discharge, to a single community physician 
or qualified nonphysician practitioner (or group practice) who assumes 
responsibility for the patient's post-discharge TCM services. The 
service would be billable only at 30 days post discharge or thereafter. 
The post-discharge TCM service would be distinct from services 
furnished by the discharging physician or qualified nonphysician 
practitioner reporting CPT codes 99238 (Hospital discharge day 
management, 30 minutes or less); 99239 (Hospital discharge day 
management, more than 30 minutes); 99217 (Observation care discharge 
day management); or Observation or Inpatient Care services, CPT codes 
99234 -99236; as appropriate.
    We proposed to pay only one claim for the post-discharge 
transitional care GXXX1 billed per beneficiary at the conclusion of the 
30 day post-discharge period Given the elements of the service and the 
short window of time following a discharge during which a physician or 
qualifying nonphysician practitioner will need to perform several tasks 
on behalf of a beneficiary, we stated our belief that it would be 
unlikely that two or more physicians or practitioners would have had a 
face-to-face E/M contact with the beneficiary in the specified window 
of 30 days prior or 14 days post discharge and have furnished the 
proposed post-discharge TCM services listed above. Therefore, we did 
not believe it necessary to take further steps to identify a 
beneficiary's community physician or qualified nonphysician 
practitioner who furnished the post-discharge TCM services. We proposed 
to pay only one claim for the post-discharge transitional care GXXX1 
billed per beneficiary at the conclusion of the 30 day post-discharge 
period. Post-discharge TCM services relating to any subsequent 
discharges for a beneficiary in the same 30-day period would be 
included in the single payment. Practitioners billing this post-
discharge transitional care code accept responsibility for managing and 
coordinating the beneficiary's care over the first 30 days after 
discharge.
    Comment: We received many comments on the proposed new code. The 
vast majority supported the concept in whole or in part. Only a handful 
of comments were generally opposed to the proposal to recognize and pay 
for TCM services. One commenter, while acknowledging that our proposal 
was ``well intentioned,'' expressed concern about adopting such an 
important proposal without explicit statutory direction. In particular, 
the commenter

[[Page 68981]]

recommended that we should be more judicious in using the PFS 
rulemaking process to adopt far-reaching new policies requiring sizable 
BN adjustments. The commenter suggested that, if the proposed policies 
had been mandated by the Congress, the BN adjustment would presumably 
not be required. Another commenter suggested that the proposed new code 
was duplicative, because pre- and post-encounter non-face-to-face care 
management work is included in the total work for the typical E/M 
services, and the total work for subsequent post-operative visits that 
accompany surgical procedures.
    Response: We thank the commenters who wrote in support of this 
proposal. For the reasons that we stated in the proposed rule, we do 
not believe that all the pre- and post- encounter non-face-to-face care 
management work that typically occurs when a beneficiary is discharged 
from a hospital, SNF or CMHC stay is included in the total work for the 
typical E/M services. This is because the E/M codes represent the 
typical outpatient visit and do not capture or reflect the significant 
care coordination that needs to occur when a beneficiary transitions 
from institutional to community-based care. (77 FR 44776) Therefore, we 
continue to believe that separate payment for TCM services does not 
duplicate payment for typical E/M services. We also believe that 
adoption of new codes such as our proposed TCM code is consistent with 
our statutory directive to maintain the physician fee schedule by 
recognizing changes in practice patterns and by adjusting codes, 
relative values, and payment accordingly. We have routinely added new 
codes created by AMA CPT to the fee schedule. As we indicated in the 
proposed rule, our proposal was, in part, a response to work by the 
AMAs C3W to develop new codes for TCM services. Below we discuss the 
AMA's recommendation that we adopt the TCM codes developed by that 
workgroup in place of our proposed TCM G-code.
    Comment: Most comments were generally supportive of the proposal to 
recognize and pay for TCM services. A few commenters merely expressed 
general support for the proposal. However, the great majority of these 
generally positive comments also recommended adopting the proposed TCM 
G code with revisions to the code description, or adopting the AMA's 
new CPT TCM codes in place of our proposed TCM G-code.
    Response: We appreciate the widespread support for our initiative 
to recognize and pay for TCM services. As we discuss below, we are 
proceeding with our proposal in a modified form, adopting some of the 
commenters' specific recommendations for revision. Most importantly, we 
are accepting the recommendation of many commenters that we adopt the 
AMA's CPT TCM codes in place of our proposed TCM G-code. As discussed 
below, we will therefore pay for new CPT TCM codes 99495 and 99496 with 
some small modifications to the code descriptions developed by the 
AMA's C3W. The new TCM codes developed by the AMA C3W are:
     99495 Transitional Care Management Services with the 
following required elements:
    ++ Communication (direct contact, telephone, electronic) with the 
patient and/or caregiver within 2 business days of discharge.
    ++ Medical decision making of at least moderate complexity during 
the service period.
    ++ Face-to-face visit, within 14 calendar days of discharge.
     99496 Transitional Care Management Services with the 
following required elements:
    ++ Communication (direct contact, telephone, electronic) with the 
patient and/or caregiver within 2 business days of discharge.
    ++ Medical decision making of high complexity during the service 
period.
    ++ Face-to-face visit, within 7 calendar days of discharge.
    We discuss these codes in greater detail and respond to these 
specific recommendations below.
    Comment: Many commenters, including the AMA and other specialty 
societies, expressed appreciation for our initiative to propose a new 
G-code and language to describe TCM, but urged us instead to implement 
the new CPT TCM codes. Commenters emphasized that these codes 
represented the consensus of the physician community as represented by 
the AMA's C3W. Commenters also emphasized that the CPT TCM codes are 
very similar to our proposal, with a few key differences. We summarize 
the key differences between our proposed TCM G-code and the CPT TCM 
codes in Table 26.

 Table 26--Key Differences Between Proposed Transitional Care Management
                     (TCM) G-Code and the CPT Codes
------------------------------------------------------------------------
                               CMS Proposed TCM G-
                                      code              CPT TCM codes
------------------------------------------------------------------------
Code(s).....................  GXXX1--Post-          99490X--Transitional
                               discharge             care management
                               transitional care     services (medical
                               management (medical   decision making of
                               decision making of    moderate
                               moderate to high      complexity), and
                               complexity).          99491X--Transitiona
                                                     l care management
                                                     services (decision
                                                     making of high
                                                     complexity).
Face-to-face visit..........  Separately billed     Face-to-face visit
                               face-to-face E/M      within 14 calendar
                               visit within 30       days of discharge
                               days prior to the     (99490X), or within
                               hospital discharge    7 calendar days
                               or within the first   (99491X). The first
                               14 days of the 30-    face-to-face visit
                               day period of TCM     is part of the TCM
                               services.             service and not
                                                     reported
                                                     separately. E/M
                                                     services after the
                                                     first face-to-face
                                                     visit may be
                                                     reported
                                                     separately.
Relationship with patient...  The patient may be    The reporting
                               new to the            physician or NPP
                               physician's           must have an
                               practice (provided    established
                               the face-to-face      relationship with
                               visit requirements    the patient.
                               above are met).       Established patient
                                                     means a visit in
                                                     the past 3 years.
Discharge management........  The physician or NPP  A physician or NPP
                               who bills for         may report both the
                               discharge             discharge code and
                               management services   appropriate TCM
                               during the time       code.
                               period covered by
                               TCM services may
                               not also bill for
                               GXXX1.

[[Page 68982]]

 
Global services.............  The physician who     The physician who
                               reports a service     reports a service
                               with a global         with a global
                               period of 010 or      period of 010 or
                               090 days may not      090 days may not
                               also report the TCM   also report the TCM
                               service.              service. However,
                                                     the AMA recommends
                                                     that specialties
                                                     work on a CPT
                                                     proposal for a new
                                                     code to describe
                                                     extensive post-
                                                     discharge TCM
                                                     services.
------------------------------------------------------------------------

    A few commenters from the medical community did not specifically 
recommend adopting the CPT TCM codes. For example, one major medical 
society supported our proposal on the grounds, among other 
considerations, that it was consistent with the ``general direction of 
organized medicine, as evidenced by the fact that the AMA's CPT 
Editorial Panel has created two new codes for transitional care 
management.'' This commenter then expressed support for several of the 
several elements in our proposed G code which differ from the CPT TCM 
codes, such as our ``proposal to keep the required post-discharge face-
to-face E/M separately reportable.'' (We discuss this issue in further 
detail later in this section.)
    Response: We agree with those commenters who recommended that we 
should acknowledge the physician community's work on primary care by 
adopting the CPT TCM codes in place of our proposed G-code. With regard 
to the differences noted above, we agree with the AMA's CPT 
construction that uses two separate codes to distinguish moderate and 
high complexity services in place of our single proposed G-code, which 
allowed for reporting services of either moderate or high complexity. 
We discuss the issues connected with the other differences between our 
proposed TCM G-code and the AMA's CPT TCM codes in responses to more 
specific comments of the AMA and others below.
    We explicitly constructed this proposal as a payment for non-face-
to-face post-discharge TCM services separate from payment for E/M or 
other medical visits. However, we believe that it is important to 
ensure that the community physician or qualified nonphysician 
practitioner furnishing post-discharge TCM services either already have 
or establish, soon after discharge, a relationship with the 
beneficiary. As such, we proposed that the community physician or 
qualified nonphysician practitioner reporting post-discharge TCM GXXX1 
should already have a relationship with the beneficiary, or establish 
one soon after discharge, prior to furnishing TCM and billing this 
code. Therefore, we specifically proposed that the community physician 
or qualified nonphysician practitioner reporting a TCM G-code must have 
billed an E/M visit for that beneficiary within 30 days prior to the 
hospital discharge (the start of post-discharge TCM period), or must 
conduct an E/M office/outpatient visit (99201 to 99215) within the 
first 14 days of the 30-day post-discharge period of TCM services. In 
either case, the E/M visit would be separately billed under our G-code 
proposal. While we proposed that the post-discharge TCM code would not 
include a face-to-face visit, and that physicians or qualified 
nonphysician practitioners would bill and be paid for this care 
management service separately from a medical visit, we sought comments 
about whether we should require a face-to-face visit when billing for 
the post-discharge TCM service: That is, whether we should bundle a 
required visit into the reporting and payment for the TCM codes. We 
were also concerned about whether beneficiaries would understand their 
coinsurance liability for the post-discharge transitional care service 
when they did not visit the physician's or qualified nonphysician 
practitioner's office.
    Comment: The AMA and many other commenters recommended that we 
should require a face-to-face visit within 7 to 14 days after discharge 
when billing for the post-discharge TCM service. Under the CPT TCM 
codes, the first face-to-face visit is part of the TCM service and not 
reported separately. Additional E/M services required for managing the 
beneficiary's clinical issues in addition to the required face-to-face 
visit may be reported separately. These commenters emphasized that 
requiring a face-to-face visit within 7 to 14 days of discharge will 
provide for a more successful transition from facility to community. 
Other commenters maintained that we should retain the requirement for a 
separately billable face-to-face E/M either within 30 days before or 14 
days after discharge. These commenters emphasized that such a 
requirement acknowledges that an established relationship with the 
patient is needed to bill the new code, and the level of E/M service 
will not be the same for every patient. A few commenters specifically 
recommended that it was not necessary to adopt any such requirement for 
a face-to-face visit (whether separately billable or not) in the 
context of a service that is essentially non-face-to-face. Some 
emphasized that it could be inefficient to require a visit that may not 
always be clinically necessary, and that the clinical decision about 
whether a visit is necessary should be left to the physician or 
qualified nonphysician practitioner. Other commenters emphasized that 
an office visit could be impractical in cases where patients may have 
limited mobility or otherwise have difficulty travelling to a physician 
office. Some of these commenters urged that we not adopt such a 
requirement, while others recommended that we expand the list of 
acceptable face-to-face visits to include other outpatient visit codes, 
such as home visits (99341-99350) and domiciliary/rest home visits 
(99324-99337). Still others stated that the window in which the post 
discharge visit must occur should be extended to 30 days post-
discharge, not 14 days.
    Response: The primary driver in creating these new CPT TCM codes 
has been to improve care coordination and to provide better incentives 
to ensure that these patients are seen in a physician's office, rather 
than be at risk for readmission. Therefore, we agree that care 
coordination beginning immediately upon discharge and the face-to-face 
visit within 7 or 14 days of discharge (as appropriate) will provide 
for a more successful transition from a facility to the community. 
However, as we indicated in the proposed rule, our adoption of codes 
for TCM services is part of the broader HHS and CMS multi-year strategy 
to recognize and support primary care and care management, and we are 
committed to considering new options and developing future proposals 
for payment of primary care services under the MPFS. Therefore, we 
consider the requirement for a face-to-face visit in

[[Page 68983]]

association with the non-face-to-face tasks of TCM to be a short-term, 
transitional strategy while we continue to explore our interest in 
further improvements to advanced primary care payment.
    We also share the commenters' concerns about beneficiaries who may 
have limited mobility or otherwise have difficulty travelling to a 
physician office in the period following a discharge. We note that the 
final CPT TCM codes, 99495 and 99496, which we are adopting in this 
final rule with comment period, requires a face-to-face visit, but does 
not specify the location/setting for that portion of the service. The 
AMA RUC states in its recommendation that, ``each code includes a 
timely face-to-face visit which typically occurs in the office, but can 
also occur at home or other location where the patient resides.'' 
Finally, we agree with those commenters who stated that beneficiaries 
would understand their coinsurance liability better if the TCM services 
included a required E/M visit as part of the service.
    We also sought comments regarding whether we should incorporate 
such a required visit on the same day into the payment for the proposed 
code. We considered several reasons for requiring a face-to-face visit 
on the same day as the date of discharge. We wondered whether, with a 
face-to-face visit immediately after discharge, the plan of care would 
be more accurate given that the patient's medical or psychosocial 
condition may have changed from the time the practitioner last met with 
the patient and the practitioner could better develop a plan of care 
through an in-person visit and discussion. On the other hand, we 
contemplated several scenarios where it is not possible for a 
beneficiary to get to the physician's or qualified nonphysician 
practitioner's office and welcomed comment on whether an exception 
process would be appropriate if we were to finalize a same day face-to-
face visit as a requirement for billing the post-discharge TCM code.
    Comment: Commenters were almost uniformly opposed to a requirement 
for a same day visit. The commenters believed that a same day visit is 
unrealistic and should not be required because hospital discharge 
records are not always immediately available to the physician who would 
be assuming responsibility for transitional care. Some commenters, 
including several who favor a face-to-face requirement other than a 
same day requirement, also favored an exception for beneficiaries too 
feeble to travel to an office. Other commenters maintained that a 
requirement for a face-to-face encounter with an exception process 
could prove confusing and administratively challenging as it would 
require communication of exceptions criteria and audit/appeals 
processes.
    Response: In conjunction with adopting the AMA's recommendation to 
require a face-to-face visit within 7 or 14 days of discharge for 
reporting the CPT TCM codes, we have also decided not to proceed with a 
requirement for a same day face-to-face visit. We agree with commenters 
who stated that such a requirement would be unrealistic in many 
situations, and would require the adoption of an exceptions process 
that could, unto itself, prove administratively difficult and 
confusing. At the same time, we emphasize that we believe physicians 
should seek to make an assessment and conduct the face-to-face visit as 
quickly as medically necessary after discharge in order to address 
patient care needs.
    Comment: As we noted above, we proposed to require communication 
(direct contact, telephone, electronic) with the patient or caregiver 
within 2 business days of discharge. Some commenters stated that the 
specific requirement for the physician to communicate with the patient 
within 2 business days of discharge to begin the coordination of care 
is unrealistic. Some contended that hospital discharge records are not 
always available that quickly. Several other commenters expressed 
concern about the references to ``business days'' in this requirement. 
(Other requirements, for length of TCM service and the timing of the 
required E/M visit are established in terms of calendar days for 
purposes of the TCM codes.) The commenters noted that, traditionally, 
business days are Monday through Friday, except for holidays. However, 
many primary care practices are also open on weekends, making those 
``business days'' for those practices. Most importantly, beneficiaries' 
need for medical care and care coordination is not limited to 
``business days,'' nor are their discharges. Thus, the commenters 
recommended that CMS change ``business days'' to ``calendar days'' in 
this context, which, they asserted, would be consistent with CMS's 
proposal to define the code as a 30 calendar day service. The AMA CPT 
TCM codes incorporate a requirement for an interactive contact with the 
patient or caregiver, as appropriate, within 2 business days of 
discharge. This contact may be direct (face-to-face), telephonic, or by 
electronic means. The AMA CPT TCM codes also specify that, for purposes 
of this requirement, business days are Monday through Friday, except 
holidays, without respect to normal practice hours or date of 
notification of discharge. If two or more separate attempts are made in 
a timely manner, but are unsuccessful and other TCM criteria are met, 
the service may be reported. We emphasize, however, that we expect 
attempts to communicate to continue until they are successful.
    Response: Our proposed TCM G-code contained a requirement for 
communication with the patient or caretaker within 2 business days of 
discharge. We also agree with the AMA's assessment concerning the 
importance of such a requirement to meeting the goals of successful 
TCM. We also agree with the AMA's provision to allow for billing of the 
TCM service if two or more separate, unsuccessful attempts at 
communication are made within a timely fashion. We believe that this 
provision should substantially reduce the concerns of some commenters 
about the tight timeline for making this initial contact. We also 
believe that concerns about the availability of hospital discharge 
records should decline dramatically as both hospitals and physicians 
respond to the current incentive payments (and the payment reductions 
beginning in 2015) to encourage adoption of electronic health records 
systems. We cannot agree with those commenters who suggested that we 
should substitute ``calendar days'' for ``business days'' in this 
requirement. We do not believe that the timeframe for this requirement 
needs to be expressed in calendar days to be consistent with the 30 
calendar day timeframe for the service. More importantly, establishing 
a timeframe of 2 calendar days for this initial contact would severely 
disadvantage those practices which do not have regular business hours 
on the weekends.
    Comment: In our proposed G-code, we required that physicians or 
qualified nonphysician practitioners must have had a face-to-face E/M 
visit with the beneficiary in the 30 days prior to the transition in 
care or within 14 business days following the transition in care. 
However, we allowed that, if the physician or qualified nonphysician 
practitioner met this requirement, the patient could otherwise be new 
to the practice. The AMA recommended that the physician reporting the 
CPT TCM codes must have an established relationship with the patient, 
as required for the those codes, rather than allowing physicians to 
bill for TCM services furnished to patients who are new to their 
practices. Under CPT TCM definitions, an established relationship with 
a patient exists when a physician has billed a visit with the patient 
within

[[Page 68984]]

the last three years. Many commenters maintained that a visit within 30 
days prior to the discharge was largely irrelevant to the actual 
provision of TCM services. Other commenters maintained that defining a 
pre-existing relationship as a visit within 30 days prior to the 
discharge is far too restrictive. A patient with established disease 
may only be seen by a physician every 3 to 6 months. We should 
therefore allow an E/M service to be furnished any time in the 12 
months prior to the discharge to be considered evidence of an 
established relationship.
    Response: We agree with commenters that a visit within 30 days 
before the hospital discharge might be too restrictive for purposes of 
establishing an existing relationship with a patient. We are therefore 
accepting the AMA's recommendation not to include such a requirement in 
the CPT TCM codes and note that the CPT TCM codes also do not require a 
visit within 30 days before discharge. Rather, as the AMA has 
recommended, we will include a requirement for a face-to-face visit 
with the beneficiary within 14 days (in the case of CPT code 99495) or 
7 days (in the case of CPT code 99495. This required visit is bundled 
into the payment for the codes and is not separately payable. We do not 
entirely agree with the AMA's recommendation that the physician must 
have an established relationship prior to the discharge with the 
patient to report the CPT TCM codes. We are concerned that such a 
requirement would make it impossible for an especially vulnerable group 
of patients, specifically, those who do not have an established a 
relationship with a primary care or other community physician, to 
receive the benefit of post-discharge TCM services. These patients may 
well be among those who would benefit most from these services, 
particularly because receiving TCM services could provide the 
opportunity for them to establish a continuing relationship with a 
physician who is able to assume overall management of their care. 
Therefore,, in conjunction with our adoption of the CPT TCM codes, we 
will develop additional Medicare-specific guidance for the use of these 
codes that modifies this element of the CPT TCM prefatory instructions, 
to allow a physician to bill these codes for new patients (provided 
that the physician meets visit requirement and all other requirements 
for the CPT TCM codes). It is important to note, however, that the 
payment amount for the CPT TCM codes will be the same whether the codes 
are billed under Medicare for treating new or established patients 
under the TCM codes. For Medicare purposes we are modifying the 
prefatory instructions for the CPT TCM codes because we wish to 
encourage the provision of TCM services to those beneficiaries who can 
benefit from the services--whether the beneficiary is a new or 
established patient. However, we believe that the typical case will 
involve provision of TCM services to an established patient, and 
relative values for codes are established on the basis of the typical 
case. Physicians may choose to bill other appropriate codes (for 
example, new patient E/M codes) that better describe the services 
furnished.
    Comment: We proposed that a physician or qualified nonphysician 
practitioner who bills for discharge day management during the time 
period covered by the TCM services code may not also bill for HCPCS 
code GXXX1. The CPT discharge day management codes are 99217, 99234-
99236, 99238-99239, 99281-99285, or 99315-99316. The AMA/RUC and many 
other commenters recommended that a physician reporting the discharge 
management should also be able to report the new TCM service. The AMA/
RUC and other commenters noted an AMA data analysis that nearly 25 
percent of those visits reported within 14 days of discharge were from 
the physician who also furnished the discharge services. The commenters 
emphasized that discharge management services reflect the work done at 
the time of discharge. The TCM service describes the work following 
discharge. Therefore, the commenters contended that there should be 
minimal or no overlap in the actual work performed in providing these 
two services. Other commenters emphasized that the physician or group 
practice billing for discharge day management could also be the 
physician or group practice regularly responsible for the patient's 
primary care and would therefore be the appropriate physician to take 
responsibility for the patient's transition to the community.
    Response: We accept the AMA/RUC's recommendation (as supported by a 
number of commenters) to allow a physician to report both the discharge 
management code and a CPT TCM code. We agree with those commenters who 
emphasized that the physician billing discharge day management could 
also be the physician who is regularly responsible for the 
beneficiary's primary care (this may be especially the case in rural 
communities), and who would therefore be the appropriate physician to 
take responsibility for the patient's transition to the community. 
However, we continue to be concerned that there could be some overlap 
in the actual work involved in providing these two services and, that 
payment to one physician for both of these services might be excessive 
as a result. Therefore, we will monitor claims data to ascertain the 
extent to which the same physician bills for both the discharge day 
management and TCM services and analyze whether it may be appropriate 
to develop a payment adjustment that recognizes overlap in resources in 
the future.
    In addition, we note that the CPT TCM code prefatory language 
provides that the TCM service period ``commences upon the date of 
discharge and continues for the next 29 days.'' Subsequent CPT TCM 
language indicates that the first visit must occur within 7 or 14 
calendar days of the date of discharge depending on the level of 
decision-making. We are unclear as to whether the CPT TCM prefatory 
language intends to allow the first visit to occur on the same date as 
discharge. We note that there is a distinction between the discharge 
day management and TCM services, and we wish to avoid any implication 
that the E/M services furnished on the day of discharge as part of the 
discharge management service could be considered to meet the 
requirement for the TCM service that the physician or nonphysician 
practitioner must conduct an E/M service within 7 or 14 days of 
discharge. Therefore, we will specify that the E/M service required for 
the CPT TCM codes cannot be furnished by the same physician or 
nonphysician practitioner on the same day as the discharge management 
service.
    Comment: A number of commenters suggested that payment for the E/M 
hospital discharge management codes (CPT 99238 or 99239) is inadequate 
to reflect the discharging duties of the physician. While most of these 
commenters supported enhanced payment for community physicians to 
furnish care coordination services on the receiving end, they stated 
that a corresponding increase in payment to those physicians who are 
discharging patients is also warranted.
    Response: We continue to believe that the current hospital 
discharge management codes (CPT codes 99238 and 99239) and nursing 
facility discharge services (CPT codes 99315 and 99316) adequately 
capture the care coordination services required to discharge a 
beneficiary from hospital or skilled nursing facility care. The work 
relative values for those discharge management services include a 
number of pre-, post-, and intra-care

[[Page 68985]]

coordination activities. For example, the hospital discharge management 
codes include the following pre-, intra-, and post- service activities 
relating to care coordination:
    Pre-service care coordination activities include:
     Communicate with other professionals and with patient or 
patient's family.
    Intra-service care coordination activities include:
     Discuss aftercare treatment with the patient, family and 
other healthcare professionals;
     Provide care coordination for the transition including 
instructions for aftercare to caregivers;
     Order/arrange for post discharge follow-up professional 
services and testing; and
     Inform the primary care or referring physician or 
qualified nonphysician practitioner of discharge plans.
    Post-service care coordination activities include:
     Provide necessary care coordination, telephonic or 
electronic communication assistance, and other necessary management 
related to this hospitalization; and
     Revise treatment plan(s) and communicate with patient and/
or caregiver, as necessary.
    The hospital and nursing facility discharge management codes also 
include a number of other pre-, intra and post-service activities.
    We certainly recognize that the services of physicians and other 
practitioners providing discharge management services are crucial to 
the overall success of TCM services. These codes have been valued by 
the AMA/RUC in the past, and these valuations have been reviewed and 
accepted by us. At this time, we are not aware of any substantive 
evidence that these codes are systematically undervalued.
    Comment: We proposed that a physician or qualified nonphysician 
practitioner who bills for emergency department visits (99281-99285), 
home health care plan oversight services (HCPCS code G0181), or hospice 
care plan oversight services (HCPCS code G0182) during the time period 
covered by the TCM services code may not also bill for HCPCS code 
GXXX1. We indicated that we believed these codes describe care 
management services for which Medicare makes separate payment and 
should not be billed in conjunction with GXXX1, which is a 
comprehensive post-discharge TCM service. The AMA noted that for the 
proposed TCM G-code we would not allow TCM services to be reported with 
emergency department visits, home health care oversight (G0181), 
hospice care plan oversight (G0182). The AMA CPT TCM codes allow for 
reporting of emergency department visits. The AMA also indicated that a 
physician or other qualified health care professional who reports a TCM 
code may not report the CPT codes for care plan oversight services 
(99339, 99340, 99374-99380). At the same time, the CPT TCM codes also 
specify that many other codes may not be reported with TCM (for 
example, non-face-to-face services such as telephone calls).
    Response: In conjunction with adopting the AMA CPT TCM, we accept 
the recommendation to allow reporting of emergency department visits 
when also billing the CPT TCM codes. We also agree with the 
recommendation not to allow reporting of care plan oversight services 
when also billing the CPT TCM codes. We had proposed to prohibit 
billing of the G-codes that we employ for home health care oversight 
(G0181), and hospice care plan oversight (G0182) with our proposed TCM 
G-code, on the grounds that such care management services duplicate the 
services provide in TCM. We are including these G-codes in the list of 
codes for such services that are precluded from billing with the CPT 
TCM codes, because we continue to believe that they are duplicative of 
the CPT care plan management aspects of the CPT TCM codes. We will also 
accept the AMA recommendation specifying many additional codes that may 
not be reported with CPT TCM codes (for example, non-face-to-face 
services such as telephone calls), as specified in the descriptions of 
CPT TCM codes 99495 or 99496 below. We are accepting these 
recommendations because they similarly avoid duplicate payment for the 
same services.
    Further, we proposed that a physician or qualified nonphysician 
practitioner billing for a procedure with a 10- or 90-day global period 
would not also be permitted to bill HCPCS code GXXX1 in conjunction 
with that procedure because any follow-up care management would be 
included in the post-operative portion of the global period.
    Comment: Many commenters expressed concerns with prohibiting 
physicians who bill services with a global period from billing the TCM 
code as well. One commenter stated that ``permitting a surgeon to 
receive payment under these circumstances would not result in duplicate 
payment for the same service * * * [I]f follow-up care management 
included in the post-operative portion of a global period can be 
reimbursed separately from the proposed transitional care management 
code when performed by two different physicians, they should remain 
separately reimbursable when these functions are all performed by the 
same physician.'' One commenter specifically agreed with our proposal 
to prohibit the billing of TCM by a physician providing the original 
care within a 010 or 090 day global period code. The AMA CPT TCM codes 
do not allow physicians billing services with global periods of 010 and 
090 days to bill for TCM services. However, the AMA RUC recommends that 
specialties work with the CPT Editorial Panel to develop a new code for 
those cases in which comprehensive TCM services are furnished along 
with the services already bundled into the global codes. However, the 
AMA RUC also indicates that it would not be typical for a surgeon to 
furnish TCM services.
    Response: We agree with the commenters that the physician who 
reports a global procedure should not be permitted to also report the 
TCM service, and we are adopting that policy in this final rule. The 
AMA RUC specifically states in its comment letter that it would not be 
typical for surgeons billing global procedures to also provide TCM 
services. Our goal is that the physician billing for TCM services 
should have an ongoing relationship with the beneficiary. We do not 
believe surgeons typically would be in a position to coordinate all 
aspects of a patient's care, because their relationship with a 
beneficiary frequently ends after the end of the global period (unless 
or until additional surgery is required).
    We proposed that the TCM code would be payable only once in the 30 
days following a discharge, per patient per discharge, to a single 
community physician or qualified nonphysician practitioner (or group 
practice) who assumes responsibility for the patient's post-discharge 
TCM. We expressed our belief that, given the elements of the TCM 
service and the short time period during which they must be furnished, 
it would be unlikely that two or more physicians would meet the 
requirements for billing the TCM code.
    Comment: Many commenters requested clarification concerning whether 
the TCM codes could be billed again if another hospital admission and 
discharge occur within the initial 30 day period following a discharge. 
The commenters recommended that we allow the clock to start over with 
each admission, that is, allow for payment of TCM even when readmission 
occurs within the original 30 day period after a discharge. A few 
commenters recommended that CMS develop a mechanism to monitor 
readmissions for patients receiving TCM services to

[[Page 68986]]

determine if this effort positively impacts beneficiary outcomes and 
decreases the burden on the healthcare system. The mechanism would 
require physician reporting at the beginning and end of the care 
period, and may require a ``start'' and a ``stop'' modifier to the new 
G-code. A few commenters specifically supported the ``only once within 
30 days of discharge'' policy. The AMA's C3W stipulated that the CPT 
TCM codes may be reported ``* * * only once per patient within 30 days 
of discharge. Another CPT TCM code may not be reported by the same 
individual or group for any subsequent discharge(s) within the 30 
days.''
    Response: In adopting the CPT TCM codes, we believe it is 
appropriate to maintain the limitation that the codes can be billed 
only once per patient within 30 days of discharge, which is consistent 
with the policy we proposed for our TCM G-code. Preventing unnecessary 
hospital readmissions in the period shortly after a discharge is an 
important goal and part of the reason we proposed improved recognition 
and payment of TCM services (as well as other initiatives within the 
Medicare program). We believe that it would be at least inconsistent 
with this goal, and perhaps even counterproductive to it, to allow for 
another TCM code to be billed when a hospital discharge occurs within 
30 days after the original discharge for which a TCM code has been 
billed. We appreciate the comments recommending that we monitor 
readmissions for patients receiving TCM services to determine if this 
effort positively impacts beneficiary outcomes and decreases the burden 
on the healthcare system. We will consider how to incorporate this into 
our existing initiatives that address these issues.
    Comment: We proposed that the TCM G-code would be payable to a 
single community physician or nonphysician practitioner (or group 
practice) who assumes responsibility for the patient's post-discharge 
TCM. Many commenters recommended allowing more than one physician to 
bill a TCM code during the same 30-day period on the grounds that: 
``Complex patients often have to follow-up with more than one provider 
after a discharge. Each of these providers could be performing care 
coordination and should be compensated accordingly.'' The CPT TCM codes 
allow for only one individual to report these services and only once 
per patient within 30 days of discharge.
    Response: We disagree that more than one physician should be 
allowed to bill the TCM codes during a single 30 day period after a 
discharge. Coordination of care intrinsically involves developing and 
implementing a single plan of care for a patient. Allowing multiple 
physicians to furnish this service simultaneously would introduce the 
danger that an individual patient might be subjected to inconsistent or 
even contradictory plans of care. In other words, allowing more than 
one physician to bill TCM codes simultaneously could lead to 
uncoordinated rather than coordinated post-discharge care. We will 
therefore follow the CPT TCM code rule that these services may be 
billed by only one individual during the 30 day period after discharge.
    Comment: Other commenters recommended further restricting and/or 
raising the bar for billing TCM codes. Many objected to our proposal to 
pay the first physician or qualified nonphysician practitioner who 
submitted a claim because, they asserted, it would lead to an 
uncoordinated, sub-optimal ``race to bill.'' One of these commenters 
expressed concern that practitioners' offices would have to compete 
with each other to submit the bill first. In addition, this commenter 
was concerned that practitioners' offices would not be able to track 
whether or not they are the first to submit a claim and could get paid 
for the service. MedPAC noted that the first physician or nonphysician 
practitioner to submit a claim may not be providing the bulk of the TCM 
services, and recommended raising the bar to ensure payment goes to 
physicians actually providing comprehensive primary care to the 
beneficiary by requiring that the billing provider must have billed for 
an E&M visit (that is, a face-to-face visit) that took place within the 
30 days prior to admission and within the 14 days following discharge. 
Another commenter recommended that we adopt a multi-stage process of 
screening claims to identify the beneficiary's primary care physician, 
who then would be the only physician permitted to bill a TCM code. The 
commenter noted that we referred to the community-based physician as 
the one who would manage and coordinate a beneficiary's care in the 
post-discharge period, and we anticipated that most community 
physicians will be primary care physicians and practitioners. The 
commenter also stated: ``It is thus perplexing that CMS did not propose 
to restrict the use of this code to actual primary care physicians.'' 
Others recommended employing a ``plurality of services'' determination 
in case more than one physician and/or nonphysician practitioner bills 
TCM after the same discharge. One commenter recommended that we should 
require beneficiaries to prospectively identify their primary care 
provider.
    Response Any physician who is appropriately enrolled in Medicare 
and furnishes the service may bill for that service. We continue to 
expect that most community physicians who are furnishing TCM services 
will be primary care physicians and practitioners. However, we also 
believe that there will be circumstances in which cardiologists, 
oncologists, or other specialists will be in the best position to 
furnish transitional care coordination after a hospital discharge. 
Furthermore, we believe that the requirements for physicians or 
qualified nonphysician practitioners to furnish multiple specific 
services for the beneficiary within a restricted period of time will 
limit the circumstances under which more than one practitioner might be 
able to bill the TCM codes. We appreciate MedPAC's suggestion that we 
require that the billing provider must have billed for an E/M visit 
(that is, a face-to-face visit) that took place within the 30 days 
prior to admission and within the 14 days following discharge. However 
we are concerned that adopting such a policy would actually have the 
unintended consequence of prohibiting many physicians with well-
established relationships and a history of providing comprehensive care 
for their beneficiaries from reporting the TCM service for these same 
patients, simply because an office visit may not have occurred within 
30 days prior to a, possibly even unanticipated, hospitalization. After 
considering all these comments, we continue to believe that it is not 
necessary to develop any further restrictions or complex operational 
mechanisms to identify one and only one physician or nonphysician 
practitioner who may bill the codes for a specific beneficiary. We have 
used such a ``first claim'' policy in other areas, such as a radiology 
interpretation and the Annual Wellness Visit. However, we would expect 
the discharging physician to support TCM services by discussing post-
discharge services with the beneficiary (which is an element in the 
discharge day management vignette), and to identify a community 
physician for follow-up whenever possible. Specifically, we expect 
discharging physicians and other physicians seeing beneficiaries in a 
facility to inform the beneficiaries that they should receive TCM 
services from their doctor or other practitioner after their discharge, 
and that Medicare will pay for those services. As a part of this

[[Page 68987]]

disclosure to patients, we also expect that the discharging physician 
would ask the beneficiary to identify the physician or nonphysician 
practitioner whom he or she wishes to furnish these transitional care 
management services. If the beneficiary does not have a preference for 
the physician who would furnish these services, the discharging 
physician may suggest a specific physician who might be in the best 
position to furnish the TCM services. The recording of this information 
could also help in the transitional care coordination activities. We 
believe that it could be helpful for the physician providing discharge 
day management services to record the community physician who would be 
providing TCM services in the discharge medical record and the 
discharge instructions for patients. We note that recent literature 
highlights the importance of these patient-centered communication 
activities for effective transitional care management.\1\ As we further 
consider how Advanced Primary Care practices can fit with a fee-for-
service model, we also will actively consider methodologies that could 
allow Medicare to identify the beneficiary's community/primary care 
physician.
---------------------------------------------------------------------------

    \1\ Hesselink MA, Schoonhoven L, Barach P et al. Improving 
patient handovers from hospital to primary care. Annals of Internal 
Medicine 2012; 157: 417-428.
---------------------------------------------------------------------------

    Comment: Many commenters endorsed our proposal not to restrict 
billing of this proposed TCM code to primary care physicians. Other 
commenters requested that we confirm that specialists can bill the new 
code if they meet the service requirements of comprehensive TCM 
services. Other commenters similarly requested confirmation that they 
can bill the TCM code if they meet the requirements. Some commenters 
from health care professions other than physicians, NPs, PAs, CNSs, and 
CNMs similarly requested that they be permitted to bill the CPT TCM 
codes and receive payment for these services.
    Response: We appreciate these comments and take this opportunity to 
confirm that, while we expect the TCM codes to be billed most 
frequently by primary care physicians, specialists who furnish the 
requisite services in the code descriptions may also bill the new TCM 
codes. As for nonphysician qualified health care professionals, we 
believe only NPs, PAs, CNSs, and certified nurse midwives (CNMs) can 
furnish the full range of E/M services and complete medical management 
of a patient under their Medicare benefit to the limit of their state 
scope of practice. Other nonphysician practitioners (such as registered 
dieticians, nutrition professionals or clinical social workers) or 
limited-license practitioners, (such as optometrists, podiatrists, 
doctors of dental surgery or dental medicine), are limited by the scope 
of their state licensing or their statutory Medicare benefit to furnish 
comprehensive medical evaluation and management services, and there is 
no Medicare benefit category that allows explicit payment to some of 
the other health professionals (such as pharmacists and care 
coordinators) seeking to bill TCM services. Accordingly, we will not 
adopt the requests of other health care professionals to bill the CPT 
TCM codes because these services go beyond the statutory benefit and 
state scope of practice for the requesting practitioners. As already 
discussed, we consider the separate coding and payment for these TCM 
services to be a short-term initiative as we further consider 
alternatives to ensure that any payment for primary care services would 
constitute a minimum level of care coordination, such as payments in a 
FFS setting.
    Comment: Several commenters requested that we extend recognition of 
care coordination to RHC physicians and providers as well or at least 
clarify whether providers practicing in rural health clinics may 
utilize the new HCPCS G-code.
    Response: While we recognize that RHCs have an important role in 
furnishing care in their communities, RHCs are paid an all-inclusive 
rate per visit. Since RHCs are not paid under the PFS, physicians and 
other RHC providers whose services are paid within the RHC all-
inclusive rate cannot bill using the CPT TCM codes for services 
furnished in the RHC. However, an RHC physician or other qualified 
provider who has a separate fee-for-service practice when not working 
at the RHC may bill the CPT TCM codes, subject to the other existing 
requirements for billing under the MPFS.
    Comment: We also proposed that the TCM G-code would be ``billable 
only at 30 days post discharge or thereafter.'' Although we proposed 
that the billing for TCM services would occur, as it does for most 
services, after the conclusion of the service that is, only at 30 days 
post discharge or thereafter), we welcomed comment on whether, in this 
case, there would be merit to allowing billing for the code to occur at 
the time the plan of care is established. Many commenters recommended 
that billing of TCM services should occur (as proposed) at the end of 
the 30-day TCM period. A smaller number of commenters recommended that 
it should be allowed to occur at the time the plan of care is 
established. One commenter observed that billing for the post-
transitional service at the time the plan of care is established may 
help prevent a ``race to the billing office'' by various providers, as 
the appropriate provider coordinating the post-transitional care would 
be well-established among the various medical providers involved in the 
patient's care. The CPT TCM code prefatory language provides: ``Only 
one individual may report these services and only once per patient 
within 30 days of discharge.'' (Emphasis supplied.)
    Response: We continue to believe that the billing for TCM services 
under the PFS should occur, as it does for most fee schedule services, 
after the conclusion of the service (that is, only at 30 days post 
discharge or thereafter). Allowing for billing at the time the plan of 
care is established, or at any other time prior to the end of the 30-
day period, would pose serious administrative problems. For example, 
adopting any policy other than billing at the end of the 30-day service 
period would make it difficult to monitor the CPT TCM requirement that 
the code be billed only once in the 30-day period beginning with the 
discharge. It would also be very challenging to monitor our policy that 
subsequent hospital admissions during that period will not begin a new 
30-day period and allow reporting of another TCM service. We will 
provide guidance to physicians and qualified NPPs regarding the billing 
of the CPT TCM codes, which will occur at the conclusion of the period 
for providing TCM services, 30 days post discharge. We appreciate the 
concern about preventing a situation where two physicians may rush to 
bill for TCM services. However, as we have previously discussed, we 
believe it would be quite unlikely that more than one physician or 
nonphysician practitioner will be able simultaneously to satisfy the 
numerous and complex requirements for billing the CPT TCM codes.
    Comment: Some commenters were concerned about the large number of 
activities that are required to furnish the TCM service. The commenters 
emphasized that many of the activities listed could require a lengthy 
discussion or actions that need to be undertaken with the patient that 
would far exceed that allowable time. Some commenters stated that the 
specific requirement that the physician communicate with the patient 
within 2 business days of discharge to begin the coordination of care 
is unrealistic because hospital

[[Page 68988]]

discharge records are not always available that quickly. Other 
commenters pointed to the requirement for an assessment of the 
patient's psychosocial needs as potentially an excessively burdensome 
requirement. One commenter asked us to reconsider the requirement that 
these codes only cover patients of moderate to high complexity on the 
grounds that most admissions are relatively straightforward and 
patients do not require moderate to complex decision making but that 
these less complex patients still require TCM services. On the other 
hand, some commenters recommended additions to the services already 
listed, such as the addition of communication between the accepting 
primary care/community physician and the discharging inpatient 
physician.
    Response: We agree with the commenters that a large number of 
activities are required to report the TCM codes. However, we believe 
that these requirements are entirely appropriate. As we have noted 
before, TCM services require management and coordination of all 
relevant aspects of a beneficiary's health status in the post-discharge 
period. And as a number of commenters maintained, physicians should not 
undertake TCM services unless they are capable and willing to assume 
comprehensive responsibility for a patient's care during the period of 
the service. In the light of these considerations, we believe the 
lengthy list of services required by our proposed G-code, and largely 
paralleled in the AMA's CPT TCM codes that we are adopting in this 
final rule, is quite appropriate to the nature of the service. With 
regard to the specific requirement for assessment of psychosocial 
needs, we note again for example that depression in older adults occurs 
in a complex psychosocial and medical context and opportunities are 
often missed to improve behavioral health and general medical outcomes 
when mental disorders are under-recognized and undertreated in primary 
care settings. We believe that it is therefore important to emphasize 
the equal importance of the beneficiary's mental health and his or her 
physical condition to successful discharge into the community. We 
believe that AMA has confirmed our assessment by requiring those 
reporting the CPT TCM codes to oversee the ``management and 
coordination of services, as needed, for all medical conditions, 
psychosocial needs and activity of daily living supports * * *'' The 
AMA has also confirmed our assessment that patients typically require 
complex and multidisciplinary care modalities in the post-discharge 
period by establishing a requirement of moderate to high complexity for 
reporting the CPT TCM codes. We do not believe that it is necessary to 
add a formal requirement for communication between the accepting 
primary care/community physician and the discharging inpatient 
physician. The accepting community physician is responsible for 
reviewing the discharge summary, and the community physician can decide 
whether standard clinical practice indicates the need for further 
communication with the discharging physician. However, as indicated 
above, we note our expectation that the discharging physician will 
communicate with the community physician as necessary as part of 
billing for discharge day management services.
    Comment: Some commenters recommended that we create disease 
specific TCM codes for major chronic conditions (for example, 
Alzheimer's, diabetes, HIV, cancer survivors planning services, etc.) 
or for special services (for example, comprehensive medication 
management services). The commenters were concerned that, otherwise, 
many cognitive specialists and other practitioners would not be able to 
bill the proposed TCM G-code.
    Response: With regard to treatment of the chronic conditions 
mentioned by commenters, both our proposed TCM G-code and the CPT TCM 
codes we are adopting in this final rule are defined broadly enough to 
incorporate the TCM activities involved in the treatment of patients 
with such diseases in the period after discharge. In addition, as we 
discuss below, we will be considering adoption of the complex care 
coordination codes developed by the AMA as we continue to explore 
payment for primary care services in future rulemaking. With regard to 
the TCM codes, we indicated in the proposed rule that we proposed the 
TCM G-code to recognize the services related to TCM by a community 
physician or qualified nonphysician practitioner. We used the term 
community physician and practitioner to refer to the community-based 
physician managing and coordinating a beneficiary's care in the post-
discharge period. We also indicated that we anticipated that most 
community physicians would be primary care physicians and 
practitioners. This is because the nature of the services involved in 
TCM (for example, communication with patient and family education to 
support self-management, independent living, and activities of daily 
living, assessment and support for treatment regimen adherence and 
medication management, etc.) are characteristic of primary care 
services as such services are usually understood. At the same time, 
neither the TCM G-code we proposed, nor the CPT TCM codes we are 
adopting in this final rule, preclude cognitive or other specialists 
from reporting these codes when they are appropriately furnishing the 
required primary care services of TCM. We certainly want to encourage 
cognitive and other specialists to assume responsibility for the 
comprehensive care of patients contemplated in the requirements of the 
CPT TCM codes when they are in the position to do so during the post-
discharge period.
    Comment: A few commenters recommended that there should be special 
TCM G-codes for psychologists and others who are not permitted to bill 
E/M codes.
    Response: The TCM service includes ``the management and/or 
coordination of services, as needed, for all medical conditions, 
psychosocial needs and activities of daily living.'' For reasons we 
have discussed at length above, the services described in the CPT E/M 
codes are intrinsic to furnishing the TCM service. It was for this 
reason that the AMA decided to include a post-discharge, face to face 
E/M service as a requirement for reporting the CPT TCM codes. We have 
had a longstanding restriction on the use of E/M codes by clinical 
psychologists. As we have explained in previous rulemaking (62 FR 
59057), the evaluation and management services included in the codes 
that psychologists cannot bill are services involving medical 
evaluation and management. Psychologists are not licensed to perform 
these types of services. Therefore, we do not believe it would be 
appropriate to provide a special TCM G-code for these practitioners. 
However, we would expect the community physicians and qualified 
nonphysician practitioners to refer patients to psychologists and other 
mental health professionals as part of the TCM service when doing so is 
warranted by evaluation of patients' psychosocial needs in the period 
after discharge. As indicated above, we believe the only nonphysician 
practitioners who may furnish the full range of E/M services and 
complete medical management of a patient under their Medicare benefit 
are NPs, PAs, CNSs, and CNMs, unless they are otherwise limited by 
their state scope of practice. Other nonphysician practitioners or 
limited-license practitioners, (such as optometrists, podiatrists, 
doctors of dental surgery or

[[Page 68989]]

dental medicine), are limited by the scope of their state licensing or 
their Medicare benefit from furnishing comprehensive medical evaluation 
and management services. As already discussed, we consider these TCM 
services to be a short-term initiative as we further consider 
alternatives to target payment for primary care services.
    Comment: Some commenters cited our statement that the proposed TCM 
G-code may be used ``[d]uring transitions in care from hospital 
(inpatient stay, outpatient observation, and partial hospitalization), 
SNF stay, or CMHC settings to community-based care.'' The commenters 
stated that this statement seems to avoid the reality that in many 
instances the transition from a hospital to a facility such as a SNF 
is, for all intents and purposes, the transition back to the community 
for many patients.
    Response: Individuals in SNFs are considered inpatients, and 
therefore the TCM codes may not be billed when patients are discharged 
to a SNF. For patients in SNFs there are E/M codes for initial, 
subsequent, discharge care, and the visit for the annual facility 
assessment, specifically CPT codes 99304-99318. These codes may be 
billed for SNF beneficiaries for the care management services they 
receive in the period after discharge from an acute care hospital. And 
then when SNF patients are discharged from the SNF to the community or 
to a nursing facility (even when the SNF and nursing facility are part 
of the same entity or located in the same building), the physician or 
practitioner who furnishes transitional care management services can 
use the CPT TCM codes to bill for those services. As such, we believe 
there will be appropriate payment for transitional care management 
services furnished following each transition of care from acute 
inpatient, to SNF, to the community or nursing facility setting.
    After considering all these comments, and for the reasons stated 
above we are adopting the CPT TCM codes subject to the modifications 
described in our responses to comments on the issues discussed above. 
In summary, these specific modifications are: Our decision not to 
restrict the billing of the CPT TCM codes to established patients, our 
clarification of the post-discharge service period, and our prohibition 
against billing a discharge day management service on the same day that 
a required E/M visit is furnished under the CPT TCM codes for the same 
patient. We will provide guidance to contractors and revise the 
relevant manual provisions in order to implement these policies.
    Below are the requirements of the CPT TCM codes as modified for 
Medicare purposes in this final rule.
     99495 Transitional Care Management Services with the 
following required elements:
    ++ Communication (direct contact, telephone, electronic) with the 
patient and/or caregiver within 2 business days of discharge.
    ++ Medical decision making of at least moderate complexity during 
the service period.
    ++ Face-to-face visit, within 14 calendar days of discharge.
     99496 Transitional Care Management Services with the 
following required elements:
    ++ Communication (direct contact, telephone, electronic) with the 
patient and/or caregiver within 2 business days of discharge.
    ++ Medical decision making of high complexity during the service 
period.
    ++ Face-to-face visit, within 7 calendar days of discharge.
    CPT codes 99495 and 99496 are used to report transitional care 
management services. These services are for a patient whose medical 
and/or psychosocial problems require moderate or high complexity 
medical decision making during transitions in care from an inpatient 
hospital setting (including acute hospital, rehabilitation hospital, 
long-term acute care hospital), partial hospital, observation status in 
a hospital, or skilled nursing facility/nursing facility, to the 
patient's community setting (home, domiciliary, rest home, or assisted 
living). Transitional care management commences upon the date of 
discharge and continues for the next 29 days.
    Transitional care management is comprised of one face-to-face visit 
within the specified time frames, in combination with non-face-to-face 
services that may be performed by the physician or other qualified 
health care professional and/or licensed clinical staff under his or 
her direction. It is our expectation that the services in the two lists 
of non-face-to-face services below will be routinely provided as part 
of transitional care management service unless the practitioner's 
reasonable assessment of the patient indicates that a particular 
service is not medically indicated or needed.
    Non-face-to-face services provided by clinical staff, under the 
direction of the physician or other qualified health care professional, 
may include:
     Communication (direct contact, telephone, electronic) with 
the patient and/or caregiver within 2 business days of discharge.
     Communication with home health agencies and other 
community services utilized by the patient.
     Patient and/or family/caretaker education to support self-
management, independent living, and activities of daily living.
     Assessment and support for treatment regimen adherence and 
medication management.
     Identification of available community and health 
resources.
     Facilitating access to care and services needed by the 
patient and/or family.
    Non-face-to-face services provided by the physician or other 
qualified health care provider may include:
     Obtaining and reviewing the discharge information (for 
example, discharge summary, as available, or continuity of care 
documents).
     Reviewing need for or follow-up on pending diagnostic 
tests and treatments.
     Interaction with other qualified health care professionals 
who will assume or reassume care of the patient's system-specific 
problems.
     Education of patient, family, guardian, and/or caregiver.
     Establishment or reestablishment of referrals and 
arranging for needed community resources.
     Assistance in scheduling any required follow-up with 
community providers and services.
    Transitional care management requires a face-to-face visit, initial 
patient contact, and medication reconciliation within specified time 
frames. The first face-to-face visit is part of the transitional care 
management service and not reported separately. Additional E/M services 
after the first face-to-face visit may be reported separately. 
Transitional care management requires an interactive contact with the 
patient or caregiver, as appropriate, within 2 business days of 
discharge. The contact may be direct (face-to-face), telephonic, or by 
electronic means. telephonic, or by electronic means. Medication 
reconciliation and management must occur no later than the date of the 
face-to-face visit.
    Medical decision making and the date of the first face-to-face 
visit are used to select and report the appropriate transitional care 
management code. For 99496, the face-to-face visit must occur within 7 
calendar days of the date discharge and medical decision making must be 
of high complexity. For 99495, the face-to-face visit must occur within 
14 calendar days of the date of discharge and medical decision making 
must be of at least moderate complexity.

[[Page 68990]]

    Medical decision making is defined by the E/M Services Guidelines. 
The medical decision making over the service period reported is used to 
define the medical decision making of transitional care management. 
Documentation includes the timing of the initial post discharge 
communication with the patient or caregivers, date of the face-to-face 
visit, and the complexity of medical decision making.
    (The E/M Services Guidelines define levels of medical decision 
making on the basis of the following factors:
     The number of possible diagnoses and/or the number of 
management options that must be considered;
     The amount and/or complexity of medical records, 
diagnostic tests, and/or other information that must be obtained, 
reviewed, and analyzed; and
     The risk of significant complications, morbidity, and/or 
mortality as well as comorbidities associated with the patient's 
presenting problem(s), the diagnostic procedure(s), and/or the possible 
management options.

Medical decision making of moderate complexity requires multiple 
possible diagnoses and/or the management options, moderate complexity 
of the medical data (tests, etc.) to be reviewed, and moderate risk of 
significant complications, morbidity, and/or mortality as well as 
comorbidities. Medical decision making of high complexity requires an 
extensive number of possible diagnoses and/or the management options, 
extensive complexity of the medical data (tests, etc.) to be reviewed, 
and a high risk of significant complications, morbidity, and/or 
mortality as well as comorbidities)
    Only one individual may report these services and only once per 
patient within 30 days of discharge. Another transitional care 
management service may not be reported by the same individual or group 
for any subsequent discharge(s) within the 30 days. The same individual 
may report hospital or observation discharge services and transitional 
care management. The same individual should not report transitional 
care management services provided in the post-operative period for a 
service with a global period.
    A physician or other qualified health care professional who reports 
codes 99495, 99496 may not report care plan oversight services (99339, 
99340, 99374-99380), prolonged services without direct patient contact 
(99358, 99359), anticoagulant management (99363, 99364), medical team 
conferences (99366-99368), education and training (98960-98962, 99071, 
99078), telephone services (98966-98968, 99441-99443), end stage renal 
disease services (90951-90970), online medical evaluation services 
(98969, 99444), preparation of special reports (99080), analysis of 
data (99090, 99091), complex chronic care coordination services 
(99481X-99483X), medication therapy management services (99605-99607), 
during the time period covered by the transitional care management 
services codes.
    It is very important to emphasize that we consider the non-face-to-
face services to be furnished by physicians, qualified health care 
professionals, and clinical staff to be intrinsic, indeed essential, 
components of the TCM codes. To support the non-face-to-face services, 
the TCM service requires a face-to-face visit, initial patient contact, 
and medication reconciliation within specified time frames. The first 
face-to-face visit is part of the TCM service and may not be reported 
separately. Additional reasonable and necessary E/M services required 
for managing the beneficiary's clinical issues in addition to the face-
to-face visit may be reported separately.
    Despite the importance of the face-to-face service that is a 
required element of the CPT TCM codes, the non-face-to-face services 
such as communication, referrals, education, identification of 
community resources, and medication management constitute the truly 
essential features that distinguish TCM from those services that are 
predominantly or exclusively face-to-face in nature.
    We are adopting these new CPT TCM codes to provide a separate 
reporting mechanism for the community physician for these services in 
the context of the broader CMS multi-year strategy to recognize and 
support primary care and care management. Therefore, we plan to monitor 
the use of the transitional care management billing codes. We wish to 
emphasize again that the policies we are finalizing in this final rule 
may be short-term payment strategies that may be modified and/or 
revised over time to be consistent with broader primary care and care 
management initiatives. Because CPT TCM codes 99495 and 99496 are new 
codes, they will be valued and designated as interim final in this 
final rule with comment period and subject to public comment.
    We would also note that this proposal coincides with our discussion 
under section III.J. of this final rule with comment period on the 
Value-based Payment Modifier and Physician Feedback Reporting Program 
which discusses hospital admission measures and a readmission measure 
as outcome measures for the proposed value-based payment modifier 
adjustment beginning in CY 2015.
c. Proposed Payment for Post-Discharge Transitional Care Management 
Service
    To establish a physician work relative value unit (RVU) for the 
proposed post-discharge TCM, HCPCS code GXXX1, we compared GXXX1 with 
CPT code 99238 (Hospital discharge day management; 30 minutes or less) 
(work RVU = 1.28). We recognized that, unlike CPT code 99238, HCPCS 
code GXXX1 is not a face-to-face visit. However, we believed that the 
physician time and intensity involved in post-discharge community care 
management is most equivalent to CPT code 99238 which, like the 
proposed new G code, involves a significant number of care management 
services. Therefore, we proposed a work RVU of 1.28 for HCPCS code 
GXXX1 for CY 2013. We also proposed the following physician times: 8 
minutes pre-evaluation; 20 minutes intra-service; and 10 minutes 
immediate post-service. In addition, we proposed to crosswalk the 
clinical labor inputs from CPT code 99214 (Level 4 established patient 
office or other outpatient visit) to proposed HCPCS code GXXX1. For 
malpractice expense, we proposed a malpractice crosswalk of CPT code 
99214 for HCPCS code GXXX1 for CY 2013. We believe the malpractice risk 
factor for CPT code 99214 appropriately reflects the relative 
malpractice risk associated with furnishing HCPCS code GXXX1. In our 
proposal, we noted that, as with other services paid under the PFS, the 
20 percent beneficiary coinsurance would apply to the post-discharge 
TCM service as would the Part B deductible.
    Comment: Several commenters recommended that we await the 
recommendations of the RUC and accept the RUC RVU values, so that we 
can fully take into account feedback from practicing physicians of all 
specialties before finalizing values for these non-face-to-face, care 
management services. With regard to the proposed RVU for physician 
work, a few commenters noted that our source code for GXXX1 included 
only 30 minutes of work for the discharging physician for whom most of 
the information is more readily available and that that time 
understates the effort required of the receiving physician. The 
commenters urged us to consider the significant potential variability 
in time and effort for the receiving physician. Another commenter urged 
CMS to utilize the

[[Page 68991]]

work RVUs used for care plan oversight HCPCS codes G0181 and G0182 in 
valuing the new code.
    With regard to PE, another commenter recommended that we assign 
clinical staff type RN/LPN only for the clinical staff work for the TCM 
codes because those are the only two clinical staff types who furnish 
clinical staff TCM activities. A commenter noted that this proposal 
largely ignores equipment costs (for example, computer, electronic 
health record, and telephone) that are essential to furnishing this 
service, and urged us to reconsider whether 1.41 is an appropriate 
practice expense RVU amount. Another commenter noted that our source 
code for practice expense, CPT code 99214, is for moderate complexity 
decision-making and that we should consider the greater costs 
associated with a patient of high complexity. One commenter agreed with 
our proposed malpractice value.
    Response: We agree with commenters that any valuation under the PFS 
should benefit from as much public review and input as possible, 
including review by the AMA RUC. The AMA RUC conducted a multi-
specialty survey of 110 physicians and recommended an RVU for each of 
the new CPT TCM codes. For CPT code 99495, the AMA RUC recommended the 
median survey work RVU of 2.11 with 40 minutes of intra-service time, 
and for CPT code 99496, the AMA RUC recommended the median work RVU of 
3.05 with 60 minutes of intra-service time. For CPT code 99496, we 
disagree with the observed median intra-service time of 60 minutes. We 
believe that 50 minutes of intra-service time is a more appropriate 
intra-service time for CPT code 99496. We observe that the primary 
reference code for CPT code 99495, CPT code 99214, has 25 minutes of 
intra-service time. We conclude that the typical physician time 
engaging in additional non-face-to-face activities and overseeing 
clinical staff care management activities is the difference between the 
intra-service time for CPT code 99214 and median intra-service time for 
CPT code 99495, 15 minutes. We believe that 50 minutes of intra-service 
time is more appropriate for CPT codes 99496 because it adds the 
additional non-face-to-face care management time of 15 minutes, to the 
intra-service time for the primary reference CPT code 99496, which is 
CPT code 99215 with an intra-service time of 35 minutes.
    We appreciate comments suggesting that we value our proposed G-
code, GXXX1, comparable to CPT codes G0180 and G0181. However, because 
we not finalizing the proposed G-codes and instead are adopting the CPT 
TCM codes on an interim final basis in this final rule with comment 
period, we believe that the AMA RUC recommendation, which reflects the 
services we included in the proposed G-code as well as a face-to-face 
visit, is a more basis for appropriate valuation. In response to 
comments noting that the discharge day management source code, CPT code 
99238, for GXXX1, does not contain sufficient time for the receiving 
physician and that the time does not reflect differences in the 
complexity of decision-making, we note that we are adopting AMA RUC 
recommended times as modified in the preceding paragraph on an interim 
final basis, with refinement, which include a longer time than the 
proposed time of 30 minutes, and those times are specific to the level 
of complexity. We also note that there is a significant amount of 
clinical labor time incorporated in the practice expense calculation 
for these codes. In summary, we are assigning a work RVU of 2.11 to CPT 
TCM code 99495 with intra-service time of 40 minutes, and a work RVU of 
3.05 with intra-service time of 50 minutes. The work RVUs included in 
Addendum B to this final rule with comment period reflect these interim 
final values. The physician time file associated with this PFS final 
rule with comment period is available on the CMS Web site in the 
Downloads section for the CY 2013 PFS final rule with comment period at 
www.cms.gov/PhysicianFeeSched/.
    Consistent with our policy discussed in section II.C.1. of this 
final rule with comment period for assigning malpractice RVUs, we 
developed malpractice RVUs for the new CPT TCM codes. For CPT code 
99495, the AMA RUC recommended a malpractice risk factor crosswalk to 
CPT code 99214, resulting in a malpractice RVU of 0.14 for CPT code 
99495. For CPT code 99496, the AMA RUC recommended a malpractice risk 
factor crosswalk to CPT code 99215, resulting in a malpractice RVU of 
0.20 for CPT code 99496. We are accepting the AMA RUC's recommended 
malpractice crosswalks for CPT codes 99495 and 99496 on an interim 
final basis. We appreciate comments in support of our proposed 
malpractice value for our non-face-to-face G-code, GXXX1, of 0.09. We 
believe that the interim final malpractice crosswalks recommended by 
the AMA RUC provide appropriate malpractice values for the CPT TCM 
codes, which include a face-to-face visit.
    For practice expense, we are accepting the AMA RUC-recommended 
practice expense inputs for these codes with one refinement to clinical 
labor time for CPT code 99496. We are refining the 60 minutes of 
recommended clinical labor time for a RN/LPN nurse blend dedicated to 
non-face-to-face care management activities from 60 minutes to 70 
minutes. We believe that the total clinical labor staff time and 
physician intra-service work time that the AMA RUC-recommended for non-
face-to-face care management activities was accurate, but that the 
proportionality between physician work and clinical staff time should 
be refined to reflect greater clinical staff time. In response to the 
comment on appropriate clinical staff type for non-face-to-face care 
management services, we note that we are accepting the AMA RUC 
recommended clinical labor staff type of an RN/LPN for conducting non-
face-to-face care coordination activities. The AMA RUC did not include 
additional costs for computer, EHR, and telephone in their 
recommendations. We believe accounting for the infrastructure required 
to furnish advanced primary care services is an issue we will consider 
as we pursue the broader HHS and CMS multi-year strategy to recognize 
and support primary care and care management under the MPFS.
    The CY 2013 final rule with comment period direct PE input database 
reflects these inputs and is available on the CMS Web site under the 
supporting data files for the CY 2013 PFS final rule with comment 
period at www.cms.gov/PhysicianFeeSched/. The PE RVUs included in 
Addendum B to this final rule with comment period reflect the RVUs that 
resulted from adopting these interim final values.
    For BN calculations, we estimated that physicians or qualified 
nonphysician practitioners would furnish post-discharge TCM services 
for 10 million discharges in CY 2013. We estimated that this number 
roughly considers the total number of hospital inpatient and SNF 
discharges, hospital outpatient observation services and partial 
hospitalization patients that may require moderate to high complexity 
decision-making following discharge.
    Comment: Some commenters indicated that our estimate of the number 
of claims we would receive for the transitional care services was 
overstated. Using a different set of assumptions, the AMA RUC commented 
that the number of billings would be closer to 2 million per year. The 
AMA RUC provided us with detailed utilization assumptions for the CPT 
TCM codes. These detailed utilization assumptions indicated physicians 
would bill 2,166,719 claims in CY 2013 for the CPT TCM codes, with 60 
percent of those claims for CPT TCM code99495

[[Page 68992]]

and 40 percent for CPT TCM code99496. Commenters also indicated that we 
should offset the cost of the TCM codes in our BN calculation with 
savings from reduced readmissions to hospitals and other facilities.
    Response: The estimate of the number of billings we will receive in 
CY 2013 for TCM services is sensitive to the utilization assumptions 
used and cannot be easily derived from existing codes. The number of 
discharge day management visits that are billed to Medicare is 
approximately 10 million. As reflected in the RUC recommendations, we 
agree with commenters that this is a reasonable starting point in the 
development of the estimate for the number of billings for the TCM 
services.
    The next step is to determine how many of these discharges will be 
readmissions in CY 2013. Since the patient would only be eligible for 
one TCM service associated with a hospital discharge and the later 
readmission, we are not counting the readmission in our utilization 
estimate. The AMA RUC used an estimate of 19.6 percent. We disagree 
with this estimate. More recent work by MedPAC indicates that the all 
cause readmission rate was closer to 15 percent in CY 2011.\2\ 
Accordingly, we adopted a 15 percent readmission rate.
---------------------------------------------------------------------------

    \2\ MedPAC September 7, 2012 Public Meeting Transcript, page 94, 
at http://medpac.gov/transcripts/092012_transcript.pdf, or slide 4 
at http://www.medpac.gov/transcripts/readmissions%20Sept%2012%20presentation.pdf.
---------------------------------------------------------------------------

    The AMA RUC also cited a variety of factors that it believes will 
reduce the number of billings from the universe of discharges, 
including the number of patients requiring moderate or high complexity 
decision-making based on the percentage of high cost Medicare patients 
in the Medicare population, the number of patients currently seen 
within 14 days of discharge, discharges where the primary care 
physician didn't know patient was in the hospital, cases where the 
patient couldn't be contacted or seen, cases where the patient died, 
cases where the patient changed doctors or didn't see the primary care 
doctor, and cases for which physicians will not furnish the TCM service 
as rapidly as we have assumed. The AMA RUC provided assumptions about 
the number of discharges it believes will not result in the billing of 
a TCM service. We have posted the AMA RUC calculation on our Web site 
at www.cms.gov/PhysicianFeeSched/. While we generally agree that some 
of these factors will impact the billings for the TCM code, we believe 
that the construct of the RUC estimate with assumed exact values for 
each and every one of these factors understates the likely TCM 
billings.
    In considering this and similar comments, we examined the current 
distribution of the inpatient, observation, and nursing facility 
evaluation and management codes. Within each of these families, we also 
examined the severity of the presenting problems and the level of 
complexity of the medical decision-making to help differentiate the 
codes. We found that 85 percent of Hospital Observation and Initial and 
Subsequent Hospital Care services (CPT codes 99218-99233) were at Level 
2 or Level 3, generally indicating moderate to high severity and 
complexity. We note that over 90 percent of place of service 
designations for the discharge codes are inpatient or outpatient 
hospital. We found that 43 percent of Nursing Facility Care services 
(CPT codes 99304-99310) were at Level 2 or Level 3, generally 
indicating moderate to high severity and complexity. Although less 
relevant for the TCM policy, we also examined the Office or Other 
Outpatient visits (CPT codes 99201-99213) as a point of comparison and 
found that 41 percent of services were at Level 4 or Level 5, generally 
indicating moderate to high severity and complexity.
    In light of the data on the current severity and complexity levels 
of the evaluation and management services, and after consideration of 
the factors included in the AMA RUC estimate and removing 15 percent 
for readmissions, we believe that two-thirds of the discharges 
reflected in the discharge day management codes, are likely to result 
in TCM claims. This represents approximately 5.7 million claims [=10 
million discharges * (1-.15) for readmissions * (\2/3\) for severity 
and other factors)].
    We disagree with the RUC that 60 percent of those claims will be 
for 99495 and 40 percent for 99496. In looking at the relationship 
between the moderate and high Hospital Observation and Initial and 
Subsequent Hospital Care services (CPT codes 99218-99233) and the 
relationship between the moderate and high Nursing Facility Care 
services (99304-99310), we believe a more reasonable estimate is that 
75 percent of the TCM claims will be for 99495 and 25 percent for 
99496.
    Because the practice expense RVUs for the transitional care codes 
will vary depending on whether or not the service is billed in a 
facility or non-facility setting, we also need to further refine the 
estimate to determine the proportion of TCM services that will be paid 
at the facility rate versus the non-facility rate. After examining the 
facility and non-facility distribution of the 99214 and 99215 visit 
codes billed by primary care specialties, we believe that 92 percent of 
the TCM services will be billed in the non-facility setting.
    Lastly, we agree with the RUC that 26 percent of patients had at 
least one visit within 7 calendar days of discharge and 44 percent had 
one within 14 days of discharge. Because these are existing visits that 
will potentially now be billed as part of the TCM service, we partially 
offset the cost of the TCM services with the cost of the existing 
visits assumed to be billed as part of the CPT TCM code.
    For the comments requesting that we also offset the cost of the CPT 
TCM codes in our BN calculation with savings from reduced readmissions, 
there are currently many efforts underway to reduce hospital 
readmissions. We do not believe that it would be possible to isolate 
the effect of payment for TCM services on the readmission rate. 
Furthermore, the statute does not permit costs or savings from outside 
of the physician fee schedule to be used in the physician fee schedule 
BN calculation.
    For purposes of the Primary Care Incentive Payment Program (PCIP), 
we proposed to exclude the post discharge TCM services from the total 
allowed charges used in the denominator calculation to determine 
whether a physician is a primary care practitioner. Under section 
1833(x) of the Act, the PCIP provides a 10 percent incentive payment 
for primary care services within a specific range of E/M services when 
furnished by a primary care practitioner. Specific physician 
specialties and qualified nonphysician practitioners can qualify as 
primary care practitioners if 60 percent of their PFS allowed charges 
are primary care services. As we explained in the CY 2011 PFS final 
rule (75 FR 73435-73436), we do not believe the statute authorizes us 
to add codes (additional services) to the definition of primary care 
services. However, to avoid inadvertently disqualifying community 
primary care physicians who follow their patients into the hospital 
setting, we finalized a policy to remove allowed charges for certain E/
M services furnished to hospital inpatients and outpatients from the 
total allowed charges in the PCIP primary care percentage calculation.
    In the proposed rule, we also proposed that the TCM code should be 
treated in the same manner as those services for the purposes of PCIP 
because post-discharge TCM services are a complement in the community 
setting to the hospital-based discharge day management services already

[[Page 68993]]

excluded from the PCIP denominator. Similar to the codes already 
excluded from the PCIP denominator, we expressed concern that inclusion 
of the TCM code in the denominator of the primary care percentage 
calculation could produce unwarranted bias against ``true primary care 
practitioners'' who are involved in furnishing post-discharge care to 
their patients. Therefore, while physicians and qualified nonphysician 
practitioners who furnish TCM services would not receive an additional 
incentive payment under the PCIP for the service itself (because it is 
not considered a ``primary care service'' for purposes of the PCIP), 
the allowed charges for TCM services would not be included in the 
denominator when calculating a physician's or practitioner's percent of 
allowed charges that were primary care services for purposes of the 
PCIP.
    Comment: Some commenters recommended that the proposed TCM G-codes 
should be eligible for the PCIP. The commenters acknowledged that, to 
add our proposed G-code to the codes eligible for PCIP, we would have 
to revise our previous interpretation concerning the extent of the 
Secretary's discretion to modify the list of primary care E/M services 
eligible for PCIP. However, the commenters stated that our previous 
interpretation of the statutory language was incorrect, or at least not 
the only reasonable interpretation of the statutory language. A few 
commenters opposed excluding the allowed charges for TCM services from 
the denominator of the ratio used to determine qualification for the 
PCIP.
    Response: We continue to believe that the statute does not permit 
us to add codes (additional services) to the statutory definition of 
primary care services, which is a range of E/M services including 
office visits. The new CPT TCM codes fall outside the designated range 
of codes that qualify for the PCIP. Therefore, we cannot agree with 
those commenters who contended that it is permissible to add the new 
TCM codes to the list of codes eligible for PCIP. However, to avoid 
disadvantaging physicians who furnish post-discharge TCM services to 
their patients, we are finalizing our proposal to exclude the allowed 
charges for TCM services from the denominator when calculating a 
physician's or practitioner's percent of allowed charges that were 
primary care services for purposes of the PCIP.
    Comment: Many commenters urged us not to apply the 20 percent 
beneficiary coinsurance to TCM services. Some commenters stated a 
belief that we should categorize TCM as a preventive service and that 
we should therefore waive the coinsurance for the service. Other 
commenters expressed concern that beneficiaries will not understand 
their coinsurance liability for this service, since our proposed new 
post-discharge TCM G-code would not include a face-to-face visit. Some 
commenters were also concerned that this confusion would lead to 
increased bad debt for physicians and qualified NPPs billing the CPT 
TCM codes. Others urged us to work with the Congress to enact 
legislation to waive the beneficiary coinsurance for post-discharge 
care management services. On the other hand, some commenters noted that 
requiring a face-to-face E/M visit when billing the TCM code would 
reduce potential beneficiary confusion about the coinsurance for the 
TCM service.
    Response: We appreciate the reasons commenters have offered for 
waiving the beneficiary coinsurance for TCM as a preventive service. 
However, we do not believe we have authority to do so through the 
rulemaking process. This is because section 1861(ddd)(1)(B) of the Act 
requires, among other criteria, that ``additional preventive services'' 
can be added only if such services are recommended with a grade of A or 
B by the United States Preventive Services Task Force. We lack such a 
recommendation regarding the services described by the new CPT TCM 
codes. As we have discussed above, we agree with those commenters who 
observed that requiring a face-to-face E/M visit when billing the TCM 
code would reduce potential beneficiary confusion about the coinsurance 
for the TCM service. Now that we have modified our proposal for a TCM 
service to include a face-to-face service, beneficiaries will 
experience a face-to-face encounter to which they can relate their 
copayments for the service. We therefore believe that our adoption of 
the CPT TCM codes that include a required face-to-face visit as a 
component of the service will greatly reduce the potential for 
beneficiary confusion over the coinsurance for the service and the 
possibility of increased bad debt for physicians.
2. Primary Care Services Furnished in Advanced Primary Care Practices
a. Background
    As we discussed above, we are committed to considering new options 
and developing future proposals for payment of primary care services 
under the MPFS. Such options would promote comprehensive and continuous 
assessment, care management, and attention to preventive services that 
constitute effective primary care by establishing appropriate payment 
when physicians furnish such services. One potential method for 
ensuring that any targeted payment for primary care services would 
constitute a minimum level of care coordination and continuous 
assessment under the MPFS would be to pay physicians for services 
furnished in an ``advanced primary care practice'' that has implemented 
a medical home model supporting patient-specific care. The medical home 
model has been the subject of extensive study in medical literature. 
Since 2007, the AMA, American Academy of Family Physicians (AAFP), the 
American Academy of Pediatrics (AAP), the American College of 
Physicians (ACP), and the American Osteopathic Association (AOA), and 
many other physician organizations have also endorsed ``Joint 
Principles of the Patient-Centered Medical Home.'' In February 2011, 
the AAFP, the AAP, the ACP, and AOA also published formal ``Guidelines 
for Patient-Centered Medical Home (PCMH) Recognition and Accreditation 
Programs'' to develop and promote the concept and practice of the PCMH. 
(These guidelines are available at www.aafp.org/online/etc/medialib/aafp_org/documents/membership/pcmh/pcmhtools/pcmhguidelines.Par.0001.File.dat/GuidelinesPCMHRecognitionAccreditationPrograms.pdf.) As we have 
discussed above, the Innovation Center has been conducting several 
initiatives based on the medical home concept.
    The medical home concept emphasizes establishing an extensive 
infrastructure requiring both capital investments and new staffing, 
along with sophisticated processes, to support continuous and 
coordinated care with an emphasis on prevention and early diagnosis and 
treatment. The literature, reports, and guidelines dealing with the 
medical home concept define the requisite elements or functions that 
constitute this infrastructure and processes in various ways. For 
example, the Innovation Center's CPC initiative identified a set of 
five ``comprehensive primary care functions,'' which form the service 
delivery model being tested and the required framework for practice 
transformation under the CPC initiative. In the proposed rule (77 FR 
44780), we discussed these five ``comprehensive primary care 
functions'' as an appropriate starting point for discussing the 
incorporation of the comprehensive primary care services delivered in 
advanced primary care practices (practices implementing a medical home 
model) into the MPFS. These five

[[Page 68994]]

functions are: Risk-stratified care management, access and continuity, 
planned care for chronic conditions and preventive care, patient and 
caregiver engagement, and coordination of care across the medical 
neighborhood. (See our detailed discussion of these functions at the 
citation noted above.)
    In the proposed rule, we also discussed the need to establish a set 
of parameters to determine whether or not a clinical practice could be 
considered an advanced primary care practice (medical home) in the 
event that we were to establish an enhanced payment for primary care 
services furnished to Medicare beneficiaries in an advanced primary 
care practice environment. (77 FR 44781-44782) Specifically, we 
discussed two possible approaches to determining whether a practice has 
implemented all the necessary functions to be considered an advanced 
primary care practice or medical home. One approach would be to 
recognize one or more of the nationally available accreditation 
programs currently in use by major organizations that provide 
accreditation for advanced primary care practices, frequently 
credentialed as ``PCMHs.'' We identified four national models that 
provide accreditation for organizations wishing to become an advanced 
primary care practice; the Accreditation Association for Ambulatory 
Health, The Joint Commission, the NCQA, and the Utilization Review 
Accreditation Commission (URAC). Alternatively, we could develop our 
own criteria using, for example, the five functions of comprehensive 
primary care used in the CPC initiative and described above, to 
determine what constitutes advanced primary care for purposes of 
Medicare payment. We would then need to develop a process for 
determining whether specific physician practices meet the criteria for 
advanced primary care. This could include creating our own processes 
for review or could include using existing accrediting bodies to 
measure compliance against advanced primary care criteria determined by 
CMS.
    We also discussed another potential issue surrounding comprehensive 
primary care services delivered in an advanced primary care practice, 
specifically attribution of a beneficiary to an advanced primary care 
practice. (77 FR 44782) In a fee-for-service environment we would need 
to determine which practice is currently serving as the advanced 
primary care practice for the beneficiary to ensure appropriate 
payment. One method of attribution could be that each beneficiary 
prospectively chooses an advanced primary care practice. Other 
attribution methodologies might examine the quantity and type of E/M or 
other designated services furnished to that beneficiary by the 
practice. We welcomed input on the most appropriate approach to the 
issue of how to best determine the practice that is functioning as the 
advanced primary care practice for each beneficiary. We emphasized that 
we would not consider proposals that would restrict a beneficiary's 
free choice of practitioners.
    In summary, we stated our belief that targeting primary care 
management payments to advanced primary care practices could have many 
merits, including ensuring a basic level of care coordination and care 
management. We recognize that the advanced primary care model has 
demonstrated efficacy in improving the value of health care in several 
contexts, and we are exploring whether we can achieve these outcomes 
for the Medicare population through several demonstration projects. 
Careful analysis of the outcomes of these demonstration projects will 
inform our understanding of how this model of care affects the Medicare 
population and of potential PFS payment mechanisms for these services. 
At the same time, we also believe that there are many policy and 
operational issues to be considered when nationally implementing such a 
program within the PFS. Therefore, we generally invited broad public 
comment on the accreditation and attribution issues discussed above and 
any other aspect, including payment, of integrating an advanced primary 
care model into the PFS.
    We received many helpful and informative comments on the issues we 
discussed in relation to recognizing advanced primary care practices, 
especially on the criteria and processes that should be used to 
identify such practices. We welcome these comments because we are 
actively considering such an advanced primary care practice model in 
the near future after a complete assessment of the results of ongoing 
demonstrations and policy and operational considerations.
    We also received many comments recommending that we adopt the 
complex care coordination codes developed by the AMA's C3W for CY 2013. 
As discussed in section III.M.3.a. of this final rule with comment 
period, on an interim final basis for CY 2013, we are assigning CPT 
codes 99487, 99488, and 99489 a PFS procedure status indicator of B 
(Payments for covered services are always bundled into payment for 
other services, which are not specified. If RVUs are shown, they are 
not used for Medicare payment. If these services are covered, payment 
for them is subsumed by the payment for the services to which they are 
bundled (for example, a telephone call from a hospital nurse regarding 
care of a patient). We will consider these codes, as well as other 
payment approaches as we continue our multi-year strategy to recognize 
and support primary care and care management.

I. Payment for Molecular Pathology Services

    The AMA CPT Editorial Panel has created new CPT codes to replace 
the codes used to bill for molecular pathology services that will be 
deleted at the end of CY 2012. The new codes describe distinct 
molecular pathology tests and test methods. CPT divided these molecular 
pathology codes into Tiers. Tier 1 codes describe common gene-specific 
and genomic procedures. Tier 2 codes capture reporting for less common 
tests. Each Tier 2 code represents a group of tests that the CPT 
Editorial Panel believes involve similar technical resources and 
interpretive work. The CPT Editorial Panel created 101 new molecular 
pathology CPT codes for CY 2012 and another 14 new molecular pathology 
codes for CY 2013.
    We stated in our notice for the Clinical Laboratory Fee Schedule 
(CLFS) Annual Public Meeting held on July 16, 2012 (77 FR 31620) that 
we were following our regular process to determine the appropriate 
basis and payment amounts for new clinical diagnostic laboratory tests, 
including molecular pathology tests, under the CLFS for CY 2013. 
However, we also stated that we understand stakeholders in the 
molecular pathology community continue to debate whether Medicare 
should pay for molecular pathology tests under the CLFS or the PFS. 
Medicare pays for clinical diagnostic laboratory tests through the CLFS 
and for services that ordinarily require physician work through the 
PFS. We stated that we believed we would benefit from additional public 
comments on whether these tests are clinical diagnostic laboratory 
tests that should be paid under the CLFS or whether they are 
physicians' services that should be paid under the PFS. Therefore, we 
solicited public comment on this issue in the CY 2013 PFS proposed rule 
(77 FR 44782 and 44783), as well as public comment on pricing policies 
for these tests under the CLFS during the CLFS Annual Public Meeting 
process.
    In the PFS proposed rule, we first discussed and requested public 
comment on whether these molecular pathology CPT codes describe 
services

[[Page 68995]]

that ordinarily require physician work, and then we discussed our 
proposal to address payment for these CPT codes on the PFS, pending 
public comment and resolution of the first question. The PFS proposal 
paralleled the CLFS Annual Public Meeting process during which we 
receive comments and recommendations on the appropriate basis for 
establishing a payment amount for the molecular pathology CPT codes as 
clinical diagnostic laboratory tests under the CLFS.
    As detailed in section II.B.1. of this final rule with comment 
period, Medicare establishes payment under the PFS by setting RVUs for 
work, practice expense (PE), and malpractice expense for services that 
ordinarily require physician work. To establish RVUs for physician 
work, we conduct a clinical review of the relative physician work (time 
by intensity) required for each PFS service. This clinical review 
includes the review of RVUs recommended by the American Medical 
Association/Specialty Society Relative Value Scale Update Committee 
(AMA RUC) and others. The AMA RUC-recommended work RVUs for a service 
typically are based in part on results of a survey conducted by the 
relevant specialty society. CMS establishes PE RVUs under a resource-
based PE methodology that considers the cost of direct inputs, as well 
as indirect PE costs. The AMA RUC, through the Practice Expense 
Subcommittee, recommends direct PE inputs to CMS, and the relevant 
specialty societies provide pricing information for those direct inputs 
to CMS. After we determine the appropriate direct PE inputs, the PE 
methodology is used to develop PE RVUs. Physician work and PE RVUs for 
each CPT code are constructed to reflect the typical case; that is, 
they reflect the service as it is most commonly furnished (71 FR 
69629). CMS establishes resource-based malpractice expense RVUs using 
weighted specialty-specific malpractice insurance premium data 
collected from commercial and physician-owned insurers, last updated 
for the CY 2010 final rule (74 FR 61758). For most services paid under 
the PFS, beneficiary cost-sharing is 20 percent of the fee schedule 
payment amount.
    CMS establishes a payment rate for new clinical diagnostic 
laboratory tests under the CLFS by either crosswalking or gap-filling. 
Crosswalking is used when a new test code is comparable to an existing 
test code, multiple existing test codes, or a portion of an existing 
test code on the CLFS. Under this methodology, the new test code is 
assigned the local fee schedule amounts and the national limitation 
amount (NLA) of the existing test, with payment made at the lesser of 
the local fee schedule amount or the NLA. Gap-filling is used when no 
comparable test exists on the CLFS. In the first year a test is gap-
filled, contractor-specific amounts are established for the new test 
code using the following sources of information: Charges for the test 
and routine discounts to charges; resources required to perform the 
test; payment amounts determined by other payers; and charges, payment 
amounts, and resources required for other tests that may be comparable 
or otherwise relevant. For the second year, the NLA is calculated, 
which is the median of the carrier-specific amounts. See Sec.  414.508. 
Services paid under the CLFS do not account for any physician work, 
although tests paid under the CLFS can involve assessment by a 
laboratory technician/technologist, a chemist, molecular biologist, or 
a geneticist--none of which are health care professional occupations 
that meet the statutory definition of a physician. Although payments 
can vary geographically due to contractor discretion across locality 
areas (which are the same localities used for the GPCIs under the PFS), 
payments cannot exceed a NLA, nor are they adjusted once rates are 
determined (apart from inflation updates as required by statute). In 
the CY 2008 PFS final rule with comment period, we adopted a 
prospective reconsideration process for new tests paid under the CLFS, 
allowing a single year for Medicare and stakeholders to review pricing 
for new tests after a payment is initially established through 
crosswalking, and in certain circumstances, up to 2 years for Medicare 
and stakeholders to review pricing for new tests after a payment is 
initially established through gap-filling (72 FR 66275 through 66279, 
66401 through 66402). Finally, in almost all circumstances, there is no 
beneficiary cost-sharing for clinical laboratory diagnostic tests paid 
on the CLFS.
    For a handful of clinical laboratory services paid under the CLFS, 
we allow an additional payment under the PFS for the professional 
services of a pathologist when they meet the requirements for a 
clinical consultation service as defined in Sec.  415.130(c). The PFS 
pays for services that ordinarily require the work of a physician and, 
with regard to pathology services, explicitly pays for both the 
professional and technical component of the services of a pathologist 
as defined in Sec.  415.130(b), including surgical pathology, 
cytopathology, hematology, certain blood banking services, clinical 
consultations, and interpretive clinical laboratory services.
    Molecular pathology tests are currently billed using combinations 
of longstanding CPT codes that describe each of the various steps 
required to perform a given test. This billing method is called 
``stacking'' because different ``stacks'' of codes are billed depending 
on the components of the furnished test. Currently, all of the stacking 
codes are paid through the CLFS; and one stacking code, CPT code 83912 
(molecular diagnostics; interpretation and report), is paid on both the 
CLFS and the PFS. Payment for the interpretation and report of a 
molecular pathology test when furnished and billed by a physician is 
made under the PFS using the professional component (PC, or modifier 
26) of CPT code 83912 (83912-26). Payment for the interpretation and 
report of a molecular pathology test when furnished by nonphysician 
laboratory professional is bundled into payment made under the CLFS 
using CPT code 83912.
    As we stated in the CY 2013 PFS proposed rule (77 FR 44783), since 
the creation of new molecular pathology CPT codes, there has been 
significant debate in the stakeholder community regarding whether these 
new molecular pathology CPT codes describe physicians' services that 
ordinarily require physician work and would be paid under the PFS, or 
whether they describe clinical diagnostic laboratory tests that would 
be paid on the CLFS. In the CY 2013 PFS proposed rule (77 FR 44783), we 
stated that there is little agreement on whether the technical 
component and/or professional component (interpretation and report) of 
these services are ordinarily furnished by a physician or a 
nonphysician laboratory professional. Additionally, we stated that some 
stakeholders have suggested that interpretation and report by any 
health care professional is generally not necessary for these services, 
as the laboratory result reporting is becoming more automated.
    In the CY 2012 PFS final rule with comment period (76 FR 73190), we 
stated that for CY 2012, Medicare would continue to use the existing 
stacking codes for the reporting and payment of these molecular 
pathology tests, and that the new molecular pathology CPT codes would 
not be valid for payment for CY 2012. We did this because we were 
concerned that we did not have sufficient information to know whether 
the new molecular pathology CPT codes describe clinical diagnostic 
laboratory tests or services that ordinarily require physician work. In 
the PFS proposed

[[Page 68996]]

rule, we stated that, for CY 2013, we continue to have many of the same 
concerns that led us not to recognize the 101 molecular pathology CPT 
codes for payment for CY 2012. We requested comment on whether the new 
molecular pathology CPT codes describe physicians' services that should 
be paid under the PFS, or whether they describe clinical diagnostic 
laboratory tests that should be paid under the CLFS. We also requested 
comment on the following more specific questions:
     Do each of the 101 molecular pathology CPT codes describe 
services that are ordinarily furnished by a physician?
     Do each of these molecular pathology CPT codes ordinarily 
require interpretation and written report?
     What is the nature of that interpretation and does it 
typically require physician work?
     Who furnishes interpretation services and how frequently?
    In the CY 2013 PFS proposed rule, we also proposed to price all of 
the new molecular pathology CPT codes through a single fee schedule, 
either the CLFS or the PFS. We stated that after meeting with 
stakeholders and reviewing each CPT code, we believed that there are a 
discrete number of laboratory methods used to generate results across 
molecular pathology tests. For example, two different tests 
(represented by different CPT codes) may be run using the same testing 
methodologies, but using different genes. However, there are very 
different processes for establishing payment rates under the PFS and 
the CLFS. As discussed above, Medicare sets payment under the CLFS by 
either crosswalking or gap-filling and, after the prospective 
reconsideration process we do not adjust the payment amount further 
(apart from inflation updates as required by statute). In contrast, 
Medicare sets payment under the PFS through a set of resource-based 
methodologies for physician work, PE, and malpractice expense, and 
payment can be reviewed and adjusted as the resources required to 
furnish a service change. We stated that we were concerned that 
establishing different prices for comparable laboratory services across 
two different payment systems would create a financial incentive to 
choose one test over another simply because of its fee schedule 
placement. We stated that we were also concerned that the differences 
in prices would become more pronounced over time, as we continue to 
review the values for physician work and PE inputs on the PFS relative 
to established CLFS prices. Therefore, largely because of the 
homogeneity of the laboratory methodologies behind these procedure test 
codes, we stated that we believe that it is appropriate for all new 
molecular pathology CPT codes to be priced on the same fee schedule 
using the same methodology. We invited public comment on that proposal.
    As we considered public comment on whether these molecular 
pathology CPT codes describe services that ordinarily require physician 
work, we wanted to ensure that there was a payment mechanism in place 
to pay for these CPT codes for CY 2013, either on the PFS or the CLFS. 
We stated that, because we believe that these molecular pathology CPT 
codes may be clinical diagnostic laboratory tests payable on the CLFS, 
comments and recommendations from the public on the appropriate basis 
for establishing payment amounts on the CLFS would be discussed and 
received through the CY 2013 CLFS Annual Public Meeting process. More 
information on these tests is available on the CMS Web site at 
www.cms.hhs.gov/ClinicalLabFeeSched.
    As a parallel to determining the appropriate basis and payment 
amounts for the molecular pathology CPT codes as clinical diagnostic 
laboratory tests through the CLFS Annual Public Meeting process, we 
also proposed payment for these codes under the PFS for CY 2013. In the 
CY 2013 PFS proposed rule, we stated that the AMA RUC and the College 
of American Pathologists (CAP) provided CMS with recommendations for 
physician work RVUs and PE inputs for most of the molecular pathology 
CPT codes. We did not have recommendations on physician work RVUs or 
direct PE inputs for a small number of codes, which represent tests 
that are patented, and therefore the methodology used to furnish the 
test is proprietary and was unavailable to the AMA RUC or CMS to 
support developing appropriate work and direct PE inputs. As we stated 
in the PFS proposed rule, the AMA RUC-recommended physician work RVUs 
range from 0.13 to 2.35, with a median work RVU of 0.45. The AMA RUC-
recommended physician intra-service times (which, for these codes, 
equals the total times) range from 7 minutes to 80 minutes, with a 
median intra-service time of 18 minutes. We noted that the physician 
work RVU for CPT code 83912-26 and all but one of the other clinical 
diagnostic laboratory services for which CMS recognizes payment for 
clinical interpretation is 0.37. Table 27 lists AMA RUC-recommended 
physician work RVUs and times, as well as the AMA RUC-estimated CY 2013 
utilization for these codes. This table contains the AMA RUC's 
estimated CY 2013 utilization for all 115 molecular pathology codes 
effective for CY 2013 and recommended physician work RVUs and times 
only for those codes that CAP believes are ordinarily performed by a 
physician. These values are listed for reference only and were not used 
for PFS rate-setting.
    As we stated in the PFS proposed rule, molecular pathology tests 
can be furnished in laboratories of different types and sizes (for 
example, a large commercial laboratory, academic or research 
laboratory, typically hospital-based, or potentially, a pathology group 
practice), and tests may be furnished in small or large batches. Also, 
although there are largely homogenous methods across the different 
tests considered here, we recognize that for a specific test, the 
combination of methods may vary across different laboratories. When 
developing direct PE input recommendations for CMS, CAP and the AMA RUC 
made assumptions about the typical laboratory setting and batch size to 
determine the typical direct PE inputs for each service. Given that 
many of these services are furnished by private laboratories, it was 
challenging for CAP and the AMA RUC to provide recommendations on the 
typical inputs for many services, and not possible for other services. 
We posted the AMA RUC- and CAP-recommended direct PE inputs on the CMS 
Web site in the files supporting the CY 2013 PFS proposed rule at 
www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html. We stated in the 
CY 2013 PFS proposed rule (77 FR 44784) that we appreciate all of the 
effort CAP has made to develop national pricing inputs; however, we 
agree with its view that, in many cases, there is no established 
approach for the specific number and combination of methods involved in 
executing many of these tests and that the potential pathways for a 
laboratory or pathology group practice to execute these tests can vary 
considerably.
    As we discussed in the CY 2013 PFS proposed rule, in addition to 
recommendations on physician work and direct PE inputs, the AMA RUC 
provided CMS with recommended utilization crosswalks for most of the 
molecular pathology tests. When there are coding changes, the 
utilization crosswalk tracks Medicare utilization from an existing code 
to a new code. The existing code utilization figures are drawn from 
Medicare Part B claims data. We use utilization crosswalk assumptions 
to ensure PFS budget neutrality and to create PE RVUs

[[Page 68997]]

through the PE methodology. The AMA RUC's recommended crosswalk 
utilization is presented in Table 27 for reference, however, we note 
that because these services are not payable under the PFS, these values 
were not used for rate-setting. In the CY 2013 PFS proposed rule, we 
stated that we believe that the utilization assumptions for the 
technical component of the new CPT codes should be based on the 
utilization of the corresponding CPT codes currently billed on the 
CLFS, and not on the utilization of CPT code 83912-26. As we discussed 
in the CY 2013 PFS proposed rule, several laboratories provided us with 
a list of the molecular pathology tests that they perform, and 
identified the stacking codes that are currently used to bill for each 
test and the new CPT code that would be billed for each test. However, 
because the same molecular pathology test may be billed using different 
stacks, and the same stack may be billed for different tests, it is not 
possible to determine which stacks match which new CPT codes unless the 
billing entity billed both the new molecular pathology CPT code and the 
stacking codes. Additionally, if a beneficiary has more than one test 
on the same date of service and both stacks are billed on the same 
Medicare claim, it is not possible to determine which stacking codes on 
the claim relate to each test. Furthermore, some tests described by the 
new CPT codes are currently billed using general ``not otherwise 
classified'' (NOC) pathology CPT codes that capture a range of services 
and not just the specific molecular pathology tests described by the 
new CPT codes. We stated that, given these factors, it is difficult to 
estimate the utilization of the new molecular pathology CPT codes based 
on the Medicare billing of the current stacking and NOC codes.
    We stated that if we were to finalize payment for molecular 
pathology tests under the PFS, we did not believe that we could propose 
national payment rates, because the following questions remained:
     If these services are furnished by a physician, what are 
the appropriate physician work RVUs and times relative to other similar 
services?
     Where and how are each of these services typically 
furnished--for example, what is the typical laboratory setting and 
batch size?
     What is the correct projected utilization for each of 
these services?
    In the CY 2013 PFS proposed rule, we stated that, given these major 
areas of uncertainty, if CMS determined that new molecular pathology 
CPT codes should be paid under the PFS for CY 2013, we would propose to 
allow the Medicare contractors to price these codes because we do not 
believe that we have sufficient information to engage in accurate 
national pricing and because the price of tests can vary locally. As 
previously discussed, this proposal was parallel to the CLFS Annual 
Public Meeting process through which we received comments and 
recommendations on the appropriate basis for establishing a payment 
amount for these molecular pathology tests as clinical diagnostic 
laboratory tests under the CLFS. We stated that if we decided to 
finalize payment for these new codes under the PFS, we would consider 
modifying Sec.  415.130 as appropriate to provide for payment to a 
pathologist for molecular pathology tests.
    Finally, we stated that, after reviewing comments received on the 
proposals contained within the CY 2013 PFS proposed rule (77 FR 44782 
through 44787), and after hearing the discussion at the CLFS Annual 
Public Meeting and reviewing comments and recommendations during the 
public meeting process, we would determine the appropriate basis for 
establishing payment amounts for the new molecular pathology CPT codes. 
We stated that we would publish our final decision in the CY 2013 PFS 
final rule with comment period and, at the same time the final rule is 
published, post final payment determinations for any molecular 
pathology tests that will be paid under the CLFS.
    A summary of the comments received on the questions and proposals 
discussed in the CY 2013 PFS proposed rule, followed by our responses 
and conclusions are below.
    We received the following comments in response to our questions on 
whether these molecular pathology CPT codes describe services that are 
ordinarily furnished by a physician; whether the services require 
interpretation and written report and, if so, who ordinarily furnishes 
that interpretation and how frequently; what is the nature of that 
interpretation and does it typically require physician work; and the 
broader question of whether these codes describe physicians' services 
that should be paid under the PFS or if they describe clinical 
diagnostic laboratory tests that should be paid under the CLFS; as well 
as our proposal to price all molecular pathology CPT codes through a 
single fee schedule:
    Comment: Many commenters stated that these molecular pathology 
tests are not ordinarily furnished by a physician. These commenters 
stated that the services described by the new molecular pathology CPT 
codes do not require physician involvement, and that the vast majority 
of tests are performed (both the technical component and the 
interpretation) without a physician. The American Clinical Laboratory 
Association (ACLA) commented that a survey of its members showed that 
in most cases, the tests are performed, supervised, and interpreted by 
nonphysicians, most often doctoral-level scientists with expertise in 
medical genetics. ACLA noted that both Ph.D. geneticists and 
pathologists can be certified in genetics by an American Board of 
Medical Specialties. Comments indicated that some laboratories 
performing these tests do not employ physicians.
    In contrast, other commenters noted that the molecular pathology 
CPT codes were developed as global services, including both 
professional (physician work) and technical components together, and so 
the CPT codes inherently include physician work. They noted that many 
of the clinical vignettes developed as a part of the CPT and AMA RUC 
processes demonstrate the incorporation of the technical steps and the 
professional services by a pathologist associated with each code.
    There was little agreement among commenters on whether molecular 
pathology tests require any interpretation and whether that 
interpretation is ordinarily furnished by a physician. Several 
commenters noted that molecular pathology tests can be divided into 
three groups based on interpretation requirements. The first group 
includes tests that require interpretation by a physician to generate a 
beneficiary-specific result, which, they stated, includes tests that 
utilize fluorescence in situ hybridization or immunohistochemistry 
technology. The second group includes tests that require interpretation 
by a nonphysician qualified healthcare professional to produce a 
beneficiary-specific result, which, they stated, includes many of the 
genetic tests assigned to Tier 1 and Tier 2 CPT codes. The third group 
includes tests that do not require interpretation by either a physician 
or health care professional because the test system produces the 
beneficiary-specific result, which, they stated, includes multi-analyte 
assays with algorithmic analyses (MAAAs) and in vitro diagnostic kits 
for genetic tests that have been assigned Tier 1 and Tier 2 CPT codes.
    Other commenters noted that each of the tests represented by the 
new molecular pathology CPT codes ordinarily requires interpretation 
and report. Several commenters explained that even clearly negative 
results, in

[[Page 68998]]

most instances, require an expenditure of resources for interpretation. 
One commenter explained that the results of these technical procedures 
require interpretation of the raw data generated, and that a 
pathologist assumes the responsibility for the generation of these 
results and performs the work associated with interpreting them, 
irrespective of whether the beneficiary has a positive or negative 
result. Additionally, one commenter noted that as molecular pathology 
tests become more and more automated as the field and science evolve, 
the interpretation and reporting of these tests is concurrently 
becoming more and more complex.
    There was also little agreement among commenters as to whether the 
interpretation and report associated with these molecular pathology 
tests is ordinarily performed by a physician. Many commenters stated 
that clinical molecular diagnostics is a rapidly evolving diagnostic 
subspecialty that requires both technical and medical knowledge to 
interpret test results for use in beneficiary care. They explained that 
these molecular pathology tests require review by an expert who is 
well-versed in the interpretation of molecular pathology test results, 
who has the medical knowledge to place the results in a clinical 
context, and who can guide decisions about beneficiary treatment 
options and care management. They contended that selecting the best 
treatment path for an individual beneficiary's disease state is a key 
facet of molecular pathology and depends upon the pathologist's 
clinical expertise in the disease area. Commenters stated that, with 
molecular pathology, it is medically necessary for the pathologist to 
provide the referring physician with clinical insight about how the 
result should be interpreted based on the technique used and on the 
beneficiary's history and medical condition. They contended that this 
differs from other laboratory subspecialties where the ordering 
physician typically has the expertise to interpret test results. These 
commenters stated that interpretation and report of a molecular 
pathology test is ordinarily furnished by a physician.
    In contrast, other commenters noted that, regardless of the nature 
of the interpretation for a molecular pathology test, doctoral-level 
geneticists are qualified and credentialed to perform the 
interpretation. The commenters stated that physician interpretation is 
not typical. They stated that in some laboratories, physicians may 
interpret test results when circumstances require a broader clinical 
review. They went on to note that among 367,370 molecular pathology 
allowed services with interpretation and report paid by Medicare in 
2010, approximately 80 percent of the services did not require a 
physician interpretation.
    Commenters who stated that molecular pathology tests ordinarily 
require the interpretation of a physician also stated that the 
molecular pathology tests should be paid under the PFS. Generally, 
these commenters contended that it is medically necessary for a 
physician to interpret the molecular pathology test results, guide the 
beneficiary's treatment, assess the beneficiary's progress, and prepare 
the final report for the beneficiary's record. As such, the commenter 
stated molecular pathology, as a field, is fundamentally different from 
laboratory medicine. They reasoned that complex tests that require 
physician interpretation to be clinically meaningful belong on the PFS. 
Additionally, some commenters stated that these services should be paid 
under the PFS because the resources involved in furnishing molecular 
pathology tests are changing rapidly. They pointed out that only the 
PFS currently allows the valuation of the codes to be continuously 
reviewed and scrutinized, taking into account changing technology and 
increased efficiencies as technology is adopted and becomes more 
widespread. They noted that placing the CPT codes for these molecular 
pathology tests on the PFS will enable the healthcare system to capture 
those savings. Finally, some commenters who stated that the molecular 
pathology tests should be paid under the PFS also thought that CMS 
should establish CLFS payment for laboratory interpretation and report 
of a molecular pathology test.
    Commenters who stated that molecular pathology tests do not 
ordinarily require the interpretation of a physician also stated that 
the molecular pathology tests should be paid under the CLFS. Generally, 
these commenters contended that if a service is not ordinarily 
furnished by a physician, then CMS is precluded from paying for the 
service under the PFS. They explained that, as stated by the regulation 
at Sec.  415.130(b), allowable physician pathology tests can only be 
paid if they first meet the threshold criteria of Sec.  415.102(a)(1) 
(``The services are personally furnished for an individual beneficiary 
by a physician'') and Sec.  415.102(a)(3) (``The services ordinarily 
require performance by a physician.'') Additionally, some commenters 
stated that the tests described by the new molecular pathology CPT 
codes will continue to be performed exactly as they were prior to the 
coding change and that there is no reason why the tests should not 
continue to be paid under the CLFS. Finally, some commenters who stated 
that the molecular pathology tests should be paid under the CLFS also 
suggested that CMS should establish PFS payment for physician 
interpretation and report of a molecular pathology test.
    Finally, in response to our proposal to price all molecular 
pathology CPT codes through a single fee schedule, most commenters 
stated that CMS should assess each CPT code independently and include 
the molecular pathology tests that require physician work on the PFS, 
and the molecular pathology tests that do not require physician work on 
the CLFS. However, as stated above, some commenters stated that all the 
molecular pathology CPT codes include physician work, and should all be 
placed together on the PFS, while others stated that none of the 
molecular pathology CPT codes require physician work, and all should be 
placed together on the CLFS. Finally, as stated above, some commenters 
suggested that the tests should be paid under the CLFS with a PFS 
payment for physician interpretation and report of a molecular 
pathology test whereas others stated that the tests should be paid 
under the PFS with a CLFS payment for laboratory interpretation and 
report of a molecular pathology test.
    Response: We thank the commenters for their thorough responses to 
our questions and proposals. After reviewing the comments, we believe 
that the molecular pathology CPT codes describe clinical diagnostic 
laboratory tests that should be paid under the CLFS because these 
services do not ordinarily require interpretation by a physician to 
produce a meaningful result. While we recognize that these tests may be 
furnished by a physician, after reviewing the public comments and 
listening to numerous presentations by stakeholders throughout the 
comment period, we are not convinced that all these tests ordinarily 
require interpretation by a physician. Many commenters stated that 
geneticists can provide any necessary interpretation for a meaningful 
test result of a molecular pathology test if some interpretation is 
required. ACLA noted that both Ph.D. geneticists and pathologists can 
be certified in genetics by an American Board of Medical Specialties, 
evidence that the medical community recognizes geneticists as qualified 
to interpret molecular pathology test results. Commenters described 
automated laboratory processes and organizational structures that rely 
on geneticist

[[Page 68999]]

interpretation when needed, and they presented a claims analysis 
demonstrating that physician interpretation currently is not typical 
across molecular pathology services in CY 2010. Further, commenters 
stated that these molecular pathology tests are currently payable on 
the CLFS.
    We do not agree with some commenters that these codes inherently 
include physician work because they were developed as global services. 
We have a long-standing policy of dividing a global diagnostic service 
into a professional and technical component to separately capture the 
resources involved in the professional work and technical component of 
the test. We are not convinced that a physician must be involved in 
performing portions of the technical component. We believe that some 
molecular pathology tests are automated and do not require 
interpretation. Where the laboratory processes are not automated, 
laboratory personnel, including doctoral-level geneticists, can produce 
accurate molecular pathology test results. Although there might be 
occasions when a physician furnishes some of the technical component of 
a clinical laboratory test paid under the CLFS, we do not believe that 
performance by a physician changes the nature of the work. Rather, we 
believe it would still be appropriate to make payment for the technical 
work as part of the CLFS payment for the test. One commenter provided a 
claims analysis demonstrating that physicians are the most common 
entity to bill CPT code 89312 in the 2009 claims data; that there are 
more individual pathologists submitting claims for molecular pathology 
services than there are independent laboratories submitting claims for 
molecular pathology services. We believe this speaks to the different 
business structures in the pathology and laboratory communities. We 
would expect numerous different pathologists working in a hospital-
based academic or research laboratory to bill for their professional 
services interpreting and reporting on a molecular pathology test 
independently under their NPI or group NPI using CPT code 83912-26. We 
would expect commercial laboratories to bill CPT code 83912 for 
interpretation and report by a nonphysician laboratory professional, 
like a doctoral-level geneticist, for a great volume of tests under a 
single laboratory NPI. We do not believe this analysis of the typical 
provider supports an assessment of whether interpretation is ordinarily 
required for furnishing molecular pathology services.
    Finally, while we considered the differences in methodology for 
pricing under the CLFS versus the PFS, including the ability to apply a 
budget neutrality adjustment under the PFS, we do not believe that the 
differences in payment methodologies should be a definitive basis for 
deciding to choose a specific fee schedule. Rather, the statute 
requires Medicare to pay using separate methodologies for physicians' 
services and for clinical diagnostic laboratory tests. Ultimately, we 
believe the primary criterion for determining the appropriate payment 
methodology is the identification of a service as one or the other.
    Therefore, for CY 2013, we are assigning a PFS procedure status 
indicator of X (Statutory exclusion. These codes represent an item or 
service that is not within the statutory definition of ``physicians' 
services'' for PFS payment purposes (for example, ambulance services). 
No RVUs are shown for these codes and no payment may be made under the 
PFS to the molecular pathology CPT codes listed in Table 27, because 
payment will be made for these tests under the CLFS. More information 
on the CLFS determination of the appropriate basis for payment 
(crosswalk or gap-filling) for these tests is available on the CMS Web 
site at www.cms.hhs.gov/ClinicalLabFeeSched.
    While we do not believe the molecular pathology tests are 
ordinarily performed by physicians, we do believe that, in some cases, 
a physician interpretation of a molecular pathology test may be 
medically necessary to provide a clinically meaningful, beneficiary-
specific result. In order to make PFS payment for that physician 
interpretation, on an interim basis for CY 2013, we have created HCPCS 
G-code G0452 (molecular pathology procedure; physician interpretation 
and report) to describe medically necessary interpretation and written 
report of a molecular pathology test, above and beyond the report of 
laboratory results. This professional component-only HCPCS G-code will 
be considered a ``clinical laboratory interpretation service,'' which 
is one of the current categories of PFS pathology services under the 
definition of physician pathology services at Sec.  415.130(b)(4). 
Section Sec.  415.130(b)(4) of the regulations and section 60 of the 
Claims Processing Manual (IOM 100-04, Ch. 12, section 60.E.) specify 
certain requirements for billing the professional component of certain 
clinical laboratory services including that the interpretation (1) must 
be requested by the patient's attending physician, (2) must result in a 
written narrative report included in the patient's medical record, and 
(3) requires the exercise of medical judgment by the consultant 
physician. We note that a hospital's standing order policy can be used 
as a substitute for the individual request by a patient's attending 
physician. The current CPT code for interpretation and report, 83912-
26, is included on the current list of clinical laboratory 
interpretation services but will be deleted at the end of CY 2012.
    We will monitor the utilization of this service and collect data on 
billing patterns to ensure that G0452 is only being used when 
interpretation and report by a physician is medically necessary and is 
not duplicative of laboratory reporting paid under the CLFS. In the 
near future, we intend to reassess whether this HCPCS code is 
necessary, and if so, in conjunction with which molecular pathology 
tests. A discussion of the work and direct PE inputs for HCPCS G-code 
G0452 can be found later in this section. We note that physicians can 
continue to receive payment for the current clinical pathology 
consultation CPT codes 80500 (Clinical pathology consultation; limited, 
without review of a patient's history and medical records) and 80502 
(Clinical pathology consultation; comprehensive, for a complex 
diagnostic problem, with review of patient's history and medical 
records) if the pathology consultation services relating to a molecular 
pathology test meet the definition of those codes.
    We do not believe it is appropriate to establish a HCPCS G-code on 
the CLFS for the interpretation and report of a molecular pathology 
test by a doctoral-level scientist or other appropriately trained 
nonphysician health care professional. The new molecular pathology CPT 
codes consolidate the services previously reported using the CLFS 
stacking codes, including the CLFS stacking code for laboratory 
interpretation and report of a molecular pathology test (CPT code 
83912). As such, we believe that payment for the interpretation and 
report service would be considered part of the overall CLFS payment for 
the molecular pathology CPT codes. In addition, geneticists and other 
nonphysician laboratory personnel do not have a Medicare benefit 
category that allows them to bill and be paid for their interpretation 
services; therefore, they cannot bill or receive PFS payment for HCPCS 
code G0452.
    In response to our questions about the appropriate physician work 
RVUs and times, utilization crosswalks, and direct PE inputs for the 
molecular pathology services described by the CPT codes, as

[[Page 69000]]

well as our proposal to contractor price the codes for CY 2013 if we 
determined that the codes should be paid under the PFS for CY 2013, we 
received the following comments:
    Comment: Commenters were not in favor of our proposal to contractor 
price these CPT codes if we determined that the codes should be paid 
under the PFS. Commenters urged CMS to establish national payment rates 
for the new molecular pathology CPT codes. Several commenters 
recommended that we use the AMA RUC- and CAP-recommended RVUs and 
inputs for these tests. One commenter suggested that contractor pricing 
is unnecessary to set payment rates for the technical component, since 
CMS has hospital cost data that can be used to develop payment rates. 
This commenter went on to strongly urge CMS to provide clear and 
specific guidance that contractors must work with cost data from 
constituents in their areas to set appropriate rates for physician 
services.
    Commenters stated that they are concerned that contractor pricing 
would lack the breadth of input, external scrutiny, and relativity 
utilized in the development of the AMA RUC recommendations. Commenters 
also believe that contractor pricing would add administrative 
complexities and costs, and that variations in contractor pricing would 
be disruptive. Also, commenters stated that contractor pricing could 
result in movement of sites of testing to the highest paying regions in 
order to maximize Medicare payment for individual services. 
Furthermore, commenters suggested that the variation in the costs of 
these tests is related to differences in laboratory facilities, 
equipment, and/or test methodologies, and that the variation is not 
geographically based; therefore, contractor pricing is not appropriate.
    Regarding the utilization estimates for the new molecular pathology 
CPT codes, the AMA RUC noted that its utilization projections were 
based on the utilization of CPT code 83912 (molecular diagnostics; 
interpretation and report), which includes interpretation on both the 
physician fee schedule (83912-26) and the clinical laboratory fee 
schedule (83912), when interpretation by technical laboratory 
personnel, such as a geneticist, accompanies performance of the 
molecular pathology test represented by other ``stacking'' codes on a 
claim. The AMA RUC noted that utilization of this service has been 
growing rapidly and provided updated utilization assumptions based on 
2011 Medicare allowed charges for CPT code 83912. These utilization 
assumptions, and the AMA RUC-recommended physician work RVUs and times, 
for all 115 codes are included in Table 27 for reference. However, we 
note that because these services are not payable under the PFS, these 
values were not used for rate-setting.
    Response: We thank the commenters for their detailed responses to 
our questions and proposals. Beginning in CY 2013, the molecular 
pathology CPT codes will be paid under the CLFS, and HCPCS code G0452 
(Molecular diagnostics; interpretation and report) will be paid under 
the PFS. Because payment for the molecular pathology CPT codes will be 
made under the CLFS rather than the PFS, it is not necessary to 
consider further whether contractor pricing would be appropriate for 
the molecular pathology CPT codes under the PFS. We will add a new 
HCPCS code, G0452, to replace the current CPT code that is used to bill 
under the PFS for interpretation and report of a molecular pathology 
test (CPT code 83912-26), which is being deleted at the end of CY 2012. 
After reviewing the public comments, the AMA RUC and CAP 
recommendations, and the values of the current and similar services, we 
believe we have enough information to nationally price HCPCS code G0452 
for CY 2013. We believe it is appropriate to directly crosswalk the 
work RVUs, time, utilization, and malpractice risk factor of CPT code 
83912-26 to HCPCS code G0452, because we do not believe this coding 
change reflects a change in the service or in the resources involved in 
furnishing the service. The current work RVU of 0.37 for CPT code 
83912-26 is the same as nearly all the clinical laboratory 
interpretation service codes. This value is also within the range of 
AMA RUC- recommended values for the molecular pathology CPT codes--the 
utilization-weighted average AMA RUC-recommended work RVU was 0.33, and 
the median AMA RUC-recommended work RVU was 0.45 for the molecular 
pathology CPT codes. Based on this information, we believe a work RVU 
of 0.37 appropriately reflects the work of HCPCS code G0452. Therefore, 
we are assigning a work RVU of 0.37 and 5 minutes of pre-service time, 
10 minutes of intra-service time, and 5 minutes of post-service time to 
HCPCS code G0452 on an interim final basis for CY 2013. We request 
public comment on the interim final values for HCPCS code G0452.

    Table 27--AMA RUC-Recommended Physician Work RVUs, Times, and Estimated CY 2013 Utilization for Molecular
                                               Pathology CPT Codes
      [Please note, these values are displayed for reference only and were not used for PFS rate-setting.]
----------------------------------------------------------------------------------------------------------------
                                                                                                      AMA RUC
                                                                      AMA RUC         AMA RUC      estimated CY
          CPT code                     Short descriptor             recommended     recommended        2013
                                                                     work RVU     physician time    utilization
----------------------------------------------------------------------------------------------------------------
81200......................  Aspa gene..........................  ..............  ..............             450
81201......................  Apc gene full sequence.............            1.40              60             450
81202......................  Apc gene known fam variants........            0.77              28              90
81203......................  Apc gene dup/delet variants........            0.80              30             400
81205 *....................  Bckdhb gene........................  ..............  ..............             450
81206......................  Bcr/abl1 gene major bp.............            0.37              15          45,729
81207......................  Bcr/abl1 gene minor bp.............            0.15              11           3,500
81208......................  Bcr/abl1 gene other bp.............            0.46              18           1,000
81209 *....................  Blm gene...........................  ..............  ..............             450
81210......................  Braf gene..........................            0.37              15           7,000
81211 *....................  Brca1&2 seq & com dup/del..........  ..............  ..............           4,000
81212 *....................  Brca1&2 185&5385&6174 var..........  ..............  ..............           2,000
81213 *....................  Brca1&2 uncom dup/del var..........  ..............  ..............           4,000
81214 *....................  Brca1 full seq & com dup/del.......  ..............  ..............           4,000
81215 *....................  Brca1 gene known fam variant.......  ..............  ..............           1,000
81216 *....................  Brca2 gene full sequence...........  ..............  ..............           4,000
81217 *....................  Brca2 gene known fam variant.......  ..............  ..............             600

[[Page 69001]]

 
81220......................  Cftr gene com variants.............            0.15              10           7,000
81221......................  Cftr gene known fam variants.......            0.40              20           1,000
81222......................  Cftr gene dup/delet variants.......            0.22              13           1,300
81223......................  Cftr gene full sequence............            0.40              20           1,000
81224......................  Cftr gene intron poly t............            0.15              10           1,300
81225......................  Cyp2c19 gene com variants..........            0.37              13           2,000
81226......................  Cyp2d6 gene com variants...........            0.43              15           2,000
81227......................  Cyp2c9 gene com variants...........            0.38              14           4,000
81228 *....................  Cytogen micrarray copy nmbr........  ..............  ..............             900
81229 *....................  Cytogen m array copy no&snp........  ..............  ..............             900
81235......................  Egfr gene com variants.............            0.51              20           9,000
81240......................  F2 gene............................            0.13               7          31,000
81241......................  F5 gene............................            0.13               8          43,000
81242 *....................  Fancc gene.........................  ..............  ..............             450
81243......................  Fmr1 gene detection................            0.37              15           4,000
81244......................  Fmr1 gene characterization.........            0.51              20             100
81245......................  Flt3 gene..........................            0.37              15           6,000
81250 *....................  G6pc gene..........................  ..............  ..............             450
81251 *....................  Gba gene...........................  ..............  ..............             450
81252......................  Gjb2 gene full sequence............            0.65              30             400
81253......................  Gjb2 gene known fam variants.......            0.52              28             150
81254......................  Gjb6 gene com variants.............            0.40              15             500
81255 *....................  Hexa gene..........................  ..............  ..............             450
81256......................  Hfe gene...........................            0.13               7          25,000
81257......................  Hba1/hba2 gene.....................            0.50              20           4,500
81260 *....................  Ikbkap gene........................  ..............  ..............             450
81261......................  Igh gene rearrange amp meth........            0.52              21           4,500
81262......................  Igh gene rearrang dir probe........            0.61              20             700
81263......................  Igh vari regional mutation.........            0.52              23             400
81264......................  Igk rearrangeabn clonal pop........            0.58              22           4,000
81265......................  Str markers specimen anal..........            0.40              17          14,000
81266......................  Str markers spec anal addl.........            0.41              15             300
81267......................  Chimerism anal no cell selec.......            0.45              18           2,000
81268......................  Chimerism anal w/cell select.......            0.51              20             300
81270......................  Jak2 gene..........................            0.15              10          19,000
81275......................  Kras gene..........................            0.50              20          14,000
81280 *....................  Long qt synd gene full seq.........  ..............  ..............             450
81281 *....................  Long qt synd known fam var.........  ..............  ..............             450
81282 *....................  Long qt syn gene dup/dlt var.......  ..............  ..............             450
81290 *....................  Mcoln1 gene........................  ..............  ..............             450
81291......................  Mthfr gene.........................            0.15              10           9,000
81292......................  Mlh1 gene full seq.................            1.40              60           1,000
81293......................  Mlh1 gene known variants...........            0.52              28             500
81294......................  Mlh1 gene dup/delete variant.......            0.80              30             800
81295......................  Msh2 gene full seq.................            1.40              60           1,000
81296......................  Msh2 gene known variants...........            0.52              28             500
81297......................  Msh2 gene dup/delete variant.......            0.80              30             800
81298......................  Msh6 gene full seq.................            0.80              30             450
81299......................  Msh6 gene known variants...........            0.52              28             600
81300......................  Msh6 gene dup/delete variant.......            0.65              30             500
81301......................  Microsatellite instability.........            0.50              20           1,000
81302......................  Mecp2 gene full seq................            0.65              30             200
81303......................  Mecp2 gene known variant...........            0.52              28              50
81304......................  Mecp2 gene dup/delet variant.......            0.52              28             150
81310......................  Npm1 gene..........................            0.39              19           4,500
81315......................  Pml/raralpha com breakpoints.......            0.37              15           1,000
81316......................  Pml/raralpha 1 breakpoint..........            0.22              12           5,000
81317......................  Pms2 gene full seq analysis........            1.40              60             600
81318......................  Pms2 known familial variants.......            0.52              28             200
81319......................  Pms2 gene dup/delet variants.......            0.80              30             375
81321......................  Pten gene full sequence............            0.80              30             950
81322......................  Pten gene known fam variant........            0.52              28             150
81323......................  Pten gene dup/delet variant........            0.65              30             200
81324 *....................  Pmp22 gene dup/delet...............  ..............  ..............             450
81325 *....................  Pmp22 gene full sequence...........  ..............  ..............             450
81326 *....................  Pmp22 gene known fam variant.......  ..............  ..............             450
81330 *....................  Smpd1 gene common variants.........  ..............  ..............             450
81331......................  Snrpn/ube3a gene...................            0.39              15             250

[[Page 69002]]

 
81332......................  Serpina1 gene......................            0.40              15           1,000
81340......................  Trb@ gene rearrange amplify........            0.63              25           4,000
81341......................  Trb@ gene rearrange dirprobe.......            0.45              19           1,000
81342......................  Trg gene rearrangement anal........            0.57              25           5,000
81350......................  Ugt1a1 gene........................            0.37              15             850
81355......................  Vkorc1 gene........................            0.38              15           4,000
81370......................  Hla i & ii typing lr...............            0.54              15          14,000
81371......................  Hla i & ii type verify lr..........            0.60              30           9,000
81372......................  Hla i typing complete lr...........            0.52              15           4,000
81373......................  Hla i typing 1 locus lr............            0.37              15           4,000
81374......................  Hla i typing 1 antigen lr..........            0.34              13          13,000
81375......................  Hla ii typing ag equiv lr..........            0.60              15           2,000
81376......................  Hla ii typing 1 locus lr...........            0.50              15           2,000
81377......................  Hla ii type 1 ag equiv lr..........            0.43              15           2,000
81378......................  Hla i & ii typing hr...............            0.45              20           2,000
81379......................  Hla i typing complete hr...........            0.45              15           1,000
81380......................  Hla i typing 1 locus hr............            0.45              15           1,000
81381......................  Hla i typing 1 allele hr...........            0.45              12           1,000
81382......................  Hla ii typing 1 loc hr.............            0.45              15           1,000
81383......................  Hla ii typing 1 allele hr..........            0.45              15           1,000
81400......................  Mopath procedure level 1...........            0.32              10           2,500
81401......................  Mopath procedure level 2...........            0.40              15           2,000
81402......................  Mopath procedure level 3...........            0.50              20           2,000
81403......................  Mopath procedure level 4...........            0.52              28           2,000
81404......................  Mopath procedure level 5...........            0.65              30           2,000
81405......................  Mopath procedure level 6...........            0.80              30           1,850
81406......................  Mopath procedure level 7...........            1.40              60           1,000
81407......................  Mopath procedure level 8...........            1.85              60           1,000
81408......................  Mopath procedure level 9...........            2.35              80           1,000
81479 *....................  Unlisted molecular pathology.......  ..............  ..............               0
----------------------------------------------------------------------------------------------------------------
 * The AMA RUC concluded that these services are not typically performed by a physician at this time. Therefore,
  they have not been reviewed for physician work or time by the AMA RUC.

J. Payment for New Preventive Service HCPCS G-Codes

    Under section 1861(ddd) of the Act, as amended by section 4105 of 
the Affordable Care Act, CMS is authorized to add coverage of 
``additional preventive services'' if certain statutory criteria are 
met as determined through the national coverage determination (NCD) 
process, including that the service meets all of the following 
criteria: (1) They must be reasonable and necessary for the prevention 
or early detection of illness or disability, (2) they must be 
recommended with a grade of A or B by the United States Preventive 
Services Task Force (USPSTF), and (3) they must be appropriate for 
individuals entitled to benefits under Part A or enrolled under Part B. 
After reviewing the USPSTF recommendations for the preventive services, 
conducting evidence reviews, and considering public comments under the 
NCD process, we determined that the above criteria were met for the 
services listed in Table 28. Medicare now covers each of the following 
preventive services:
     Screening and Behavioral Counseling Interventions in 
Primary Care to Reduce Alcohol Misuse, effective October 14, 2011;
     Screening for Depression in Adults, effective October 14, 
2011;
     Screening for Sexually Transmitted Infections (STIs) and 
High Intensity Behavioral Counseling (HIBC) to Prevent STIs, effective 
November 8, 2011;
     Intensive Behavioral Therapy for Cardiovascular Disease, 
effective November 8, 2011; and
     Intensive Behavioral Therapy for Obesity, effective 
November 29, 2011.
    Table 28 lists the HCPCS G-codes created for reporting and payment 
of these services. The Medicare PFS payment rates for these services 
are discussed below. The NCD process establishing coverage of these 
preventive services was not complete at the time of publication of the 
CY 2012 PFS final rule with comment period, so we could not include 
interim RVUs for these preventive services in the addenda to our CY 
2012 final rule with comment period. However, we were able to include 
these HCPCS G-codes with national payment amounts for these services in 
the CY 2012 PFS national relative value files, which were effective 
January 1, 2012. From the effective date of each service to December 
31, 2011, the payment amount for these codes was established by the 
Medicare Administrative Contractors.

[[Page 69003]]



             Table 28--New Preventive Service HCPCS G-Codes
------------------------------------------------------------------------
                                         CMS national
                      HCPCS code long      coverage        CMS change
     HCPCS code          descriptor     determination     request  (CR)
                                            (NCD)
------------------------------------------------------------------------
G0442...............  Annual alcohol   Screening and    CR7633
                       misuse           Behavioral
                       screening, 15    Counseling
                       minutes.         Interventions
                                        in Primary
                                        Care to Reduce
                                        Alcohol Misuse
                                        (NCD 210.8).
G0443...............  Brief face-to-   Screening        CR7633
                       face             Behavioral
                       behavioral       Counseling
                       counseling for   Interventions
                       alcohol          in Primary
                       misuse, 15       Care to Reduce
                       minutes.         Alcohol Misuse
                                        (NCD 210.8).
G0444...............  Annual           Screening for    CR7637
                       Depression       Depression in
                       Screening, 15    Adults (NCD
                       minutes.         210.9).
G0445...............  High-intensity   Screening for    CR7610
                       behavioral       Sexually
                       counseling to    Transmitted
                       prevent          infections(STI
                       sexually         s) and High-
                       transmitted      Intensity
                       infections,      Behavioral
                       face-to-face,    Counseling
                       individual,      (HIBC) to
                       includes:        prevent STIs
                       education,       (NCD 210.10).
                       skills
                       training, and
                       guidance on
                       how to change
                       sexual
                       behavior;
                       performed semi-
                       annually, 30
                       minutes.
G0446...............  Annual, face-to- Intensive        CR7636
                       face intensive   Behavioral
                       behavioral       Therapy for
                       therapy for      Cardiovascular
                       cardiovascular   Disease (NCD
                       disease,         210.11).
                       individual, 15
                       minutes.
G0447...............  Face-to-face     Intensive        CR7641
                       behavioral       Behavioral
                       counseling for   Therapy for
                       obesity, 15      Obesity (NCD
                       minutes.         210.12).
------------------------------------------------------------------------

    Two new HCPCS codes, G0442 (Annual alcohol misuse screening, 15 
minutes), and G0443 (Brief face-to-face behavioral counseling for 
alcohol misuse, 15 minutes), were created for the reporting and payment 
of screening and behavioral counseling interventions in primary care to 
reduce alcohol misuse.
    As we explained in the proposed rule, we believe that the screening 
service described by HCPCS code G0442 requires similar physician work 
as CPT code 99211 (Level 1 office or other outpatient visit, 
established patient). Accordingly, we proposed a work RVU of 0.18 for 
HCPCS code G0442 for CY 2013, the same work RVU as CPT code 99211. For 
physician time, we proposed 15 minutes, which is the amount of time 
specified in the HCPCS code descriptor for G0442. We proposed a 
malpractice expense crosswalk to CPT code 99211. The proposed direct PE 
inputs were reflected in the CY 2013 proposed direct PE input database, 
available on the CMS Web site under the downloads for the CY 2013 PFS 
proposed rule at www.cms.gov/PhysicianFeeSched/. We requested public 
comment on this CY 2013 proposed value for HCPCS code G0442.
    Comment: Commenters supported the proposed payment for HCPCS code 
GO442 although a commenter suggested that in the future CMS should use 
the AMA RUC to assist us in valuing new codes.
    Response: In response to the suggestion that we rely upon AMA RUC 
input in valuing new codes, we agree with the commenter that the input 
of the AMA RUC is extremely useful in valuing new codes and in general, 
we obtain its recommendations in establishing the original values for 
new codes. However, because this new code was added through an NCD 
effective as of October 14, 2011, public commenters, including the AMA 
RUC, were not able to comment for consideration for CY 2012. We note 
that since this code was valued in CY 2012 based upon CPT code 99211 
and the AMA RUC had provided a recommendation on this code previously, 
the AMA RUC was involved, albeit indirectly, in setting this rate. In 
addition, there was opportunity for the AMA RUC to provide comment on 
this code in response to the solicitation for comment on the CY 2013 
proposed rule.
    After consideration of the public comments we received, we are 
finalizing our CY 2013 proposal to establish a work RVU of 0.18 and a 
time of 15 minutes for HCPCS code G0442. For malpractice expense, we 
are finalizing our proposed crosswalk for HCPCS code G0442 to CPT code 
99211. We are also finalizing the direct PE inputs as proposed. The 
direct PE inputs associated with this code are included in the CY 2013 
direct PE input database, available on the CMS Web site under the 
downloads for the CY 2013 PFS final rule with comment period at 
www.cms.gov/PhysicianFeeSched/. Additionally, we note that the PE RVUs 
included in Addendum B reflect the values that result from the 
finalization of this policy.
    As we explained in the proposed rule, we believe that the 
behavioral counseling service described by HCPCS code G0443 requires 
similar work as CPT code 97803 (Medical nutrition therapy; re-
assessment and intervention, individual, face-to-face with the patient, 
each 15 minutes). Accordingly, we proposed a work RVU of 0.45 for HCPCS 
code G0443 for CY 2013, the same work RVU as CPT code 97803. For 
physician time, we proposed 15 minutes, which is the amount of time 
specified in the HCPCS code descriptor for G0443. For malpractice 
expense, we proposed a malpractice expense crosswalk to CPT code 97803. 
The proposed direct PE inputs are reflected in the CY 2013 proposed 
direct PE input database, available on the CMS Web site under the 
downloads for the CY 2013 PFS proposed rule at www.cms.gov/PhysicianFeeSched/. We requested public comment on this CY 2013 
proposed value for HCPCS code G0443.
    Comment: Commenters supported the proposed payment for HCPCS code 
G0443. A commenter inquired why HCPCS code G0443 was crosswalked to CPT 
code 99212 and CPT code 97803 rather than to CPT code 99407 (Smoking 
and tobacco use cessation counseling visit; intensive, greater than 10 
minutes). We also received a comment that in the future CMS should use 
the AMA RUC to assist us in valuing new codes.
    Response: The commenter was mistaken in stating that HCPCS code 
G0443 was crosswalked to CPT code 99212; it was crosswalked only to CPT 
code 97803. In response to the comment about crosswalking this code to 
CPT 99407, we had considered CPT code 99407 when we initially set the 
payment rate for HCPCS code G0443 and after consideration of this 
comment we continue to believe that the value based upon CPT code 
97803, which is a 15-minute counseling code is appropriate. In response 
to the suggestion that we rely upon AMA RUC input in valuing new codes, 
we agree with the commenter that the input of the AMA RUC is extremely 
useful in valuing new codes and in general, we obtain its 
recommendations in establishing the original values for new codes. 
However, because this new code

[[Page 69004]]

was added through an NCD effective as of October 14, 2011, public 
commenters, including the AMA RUC, were not able to comment for 
consideration for CY 2012. We note that since this code was valued in 
CY 2012 based upon CPT code 97803 and the AMA RUC had provided 
recommendation on this code previously, the AMA RUC was involved, 
albeit indirectly, in setting this rate. In addition, there was 
opportunity for the AMA RUC to provide comment on this code in the 
solicitation for comment on the CY 2013 proposed rule.
    After consideration of the public comments that we received, we are 
finalizing the proposed work RVU of 0.45 and a time of 15 minutes for 
HCPCS code G0443. For malpractice expense, we are finalizing our 
proposed crosswalk to for HCPCS code G0443 to CPT code 97803. We are 
also finalizing the direct PE inputs as proposed. The direct PE inputs 
associated with this code are included in the CY 2013 direct PE input 
database, available on the CMS Web site under the downloads for the CY 
2013 PFS final rule with comment period at www.cms.gov/PhysicianFeeSched/. Additionally, we note that the PE RVUs included in 
Addendum B reflect the values that result from the finalization of this 
policy. HCPCS code G0444 (Annual Depression Screening, 15 minutes) was 
created for the reporting and payment of screening for depression in 
adults. As we explained in the proposed rule, we believe that the 
screening service described by HCPCS code G0444 requires similar 
physician work as CPT code 99211. Accordingly, we proposed a work RVU 
of 0.18 for HCPCS code G0444 for CY 2013, the same work RVU as CPT code 
99211. For physician time, we proposed 15 minutes, which is the amount 
of time specified in the HCPCS code descriptor for G0444. For 
malpractice expense, we proposed a malpractice expense crosswalk to CPT 
code 99211. The proposed direct PE inputs were reflected in the CY 2013 
proposed PE input database, available on the CMS Web site under the 
downloads for the CY 2013 PFS proposed rule at www.cms.gov/PhysicianFeeSched/. We requested public comment on this CY 2013 
proposed value for HCPCS code G0444.
    Comment: Commenters supported the proposed payment for HCPCS code 
GO444 although a commenter suggested that in the future CMS should use 
the AMA RUC to assist us in valuing new codes.
    Response: In response to the suggestion that we rely upon AMA RUC 
input in valuing new codes, we agree with the commenter that the input 
of the AMA RUC is extremely useful in valuing new codes and in general 
, we obtain its recommendations in establishing the original values for 
new codes. However, because this new code was added through an NCD 
effective as of October 14, 2011, public commenters, including the AMA 
RUC, were not able to comment for consideration for CY 2012. We note 
that since this code was valued in 2012 based upon CPT code 99211 and 
the AMA RUC had provided recommendation on this code previously, the 
AMA RUC was involved, albeit indirectly, in setting this rate. In 
addition, there was opportunity for the AMA RUC to provide comment on 
this code in response to the solicitation for comment on the CY 2013 
proposed rule.
    After consideration of the public comments we received, we are 
finalizing the proposed a work RVU of 0.18, and a time of 15 minutes 
for HCPCS G0444 code. For malpractice expense, we are finalizing our 
proposed crosswalk for HCPCS G0444 code. For malpractice expense, we 
are finalizing our proposed crosswalk for HCPCS code G0444 to CPT code 
99211. We are also finalizing the direct PE inputs as proposed. The 
direct PE inputs associated with this code are included in the CY 2013 
direct PE input database, available on the CMS Web site under the 
downloads for the CY 2013 PFS final rule with comment period at 
www.cms.gov/PhysicianFee Sched/. Additionally, we note that the PE RVUs 
included in Addendum B reflect the values that result from the 
finalization of this policy. HCPCS code G0445 (high-intensity 
behavioral counseling to prevent sexually transmitted infections, face-
to-face, individual, includes: Education, skills training, and guidance 
on how to change sexual behavioral, performed semi-annually, 30 
minutes) was created for the reporting and payment of HIBC to prevent 
STIs. As we explained in the proposed rule, we believe that the 
behavioral counseling service describe by HCPCS code G0445 requires 
similar physician work as CPT code 97803. Accordingly, we proposed a 
work RVU of 0.45 for HCPCS code G0445 for CY 2013, the same work RVU as 
CPT code 97803. For physician time, we proposed 30 minutes, which is 
the amount of time specified in the HCPCS code descriptor for G0445. 
For malpractice expense, we proposed a malpractice expense, we proposed 
a malpractice expense crosswalk to CPT code 97803. The proposed direct 
PE inputs were reflected in the CY 2013 proposed direct PE input 
database, available on the CMS Web site under the downloads for the CY 
2013 PFS CY 2013 proposed rule at www.cms.gov/PhysicianFeeSched/. We 
requested public comment on this CY 2013 proposed value for HCPCS code 
G0445.
    Comment: Commenters supported the proposed payment for HCPCS code 
G0445 although a commenter suggested that in the future we should use 
the AMA RUC to assist us in valuing new codes.
    Response: In response to the suggestion that we rely upon AMA RUC 
input in valuing new codes, we agree with the commenter that the input 
of the AMA RUC is extremely useful in valuing new codes and in general, 
we obtain its recommendations in establishing the original values for 
new codes. However, because this new code was added through an NCD 
effective as of October 14, 2011, public commenters, including the AMA 
RUC, were not able to comment for consideration for CY 2012. We note 
that since this code was valued in CY 2012 based upon CPT code 97803 
and the AMA RUC had provided recommendation on this code previously, 
the AMA RUC was involved, albeit indirectly, in setting this rate. In 
addition, there was opportunity for the AMA RUC to provide comment on 
this code in response to the solicitation for comment on the CY 2013 
proposed rule.
    After consideration of the public comments we received, we are 
finalizing the proposed a work RVU of 0.45 and a time of 30 minutes for 
HCPCS code G0445. For malpractice expense, we are finalizing our 
proposed crosswalk for HCPCS code G0445 to CPT code 97803. We are also 
finalizing the direct PE inputs as proposed. The direct PE inputs 
associated with this code are included in the CY 2013 direct PE input 
database, available on the CMS Web site under the downloads for the CY 
2013 PFS final rule with comment period at www.cms.gov/PhysicianFeeSched/. Additionally, we note that the PE RVUs included in 
Addendum B reflect the values that result from the finalization of this 
policy. HCPCS code G0446 (Annual, face-to-face intensive behavioral 
therapy for cardiovascular disease, individual, 15 minutes) was created 
for the reporting and payment of intensive behavioral therapy for 
cardiovascular disease. As we explained in the proposed rule, we 
believe that the behavioral therapy service described by HCPCS code 
G0446 requires similar physician work as CPT code 97803. Accordingly, 
we proposed a work RVU of 0.45 for HCPCS code G0446 for CY 2013, the 
same work RVU as CPT code

[[Page 69005]]

97803. For physician time, we proposed 15 minutes, which is the amount 
of time specified in the HCPCS code descriptor for G0446. For 
malpractice expense, we proposed a malpractice expense crosswalk to CPT 
code 97803. The proposed direct PE inputs were reflected in the CY 2013 
proposed direct PE input database, available on the CMS Web site under 
the downloads for the CY 2013 PFS proposed rule at www.cms.gov/PhysicianFeeSched/. We requested public comment on this CY 2013 
proposed value for HCPCS code G0446.
    Comment: Commenters supported the proposed payment for HCPCS code 
GO446. In addition, a commenter urged a change in our policy to allow 
billing of multiple units of this code in one encounter. We also 
received a comment that in the future CMS should use the AMA RUC to 
assist us in valuing new codes.
    Response: In response to the suggestion regarding billing multiple 
units of HCPCS code G0446, this proposal deals only with the payment 
rate for this service, not coverage issues. We note that the NCD is 
clear that only one visit annually is covered. In response to the 
suggestion that we rely upon AMA RUC input in valuing new codes, we 
agree with the commenter that the input of the AMA RUC is extremely 
useful in valuing new codes and in general, we obtain its 
recommendations in establishing the original values for new codes. 
However, because this new code was added through an NCD effective as of 
October 14, 2011, public commenters, including the AMA RUC, were not 
able to comment for consideration for CY 2012. We note that since this 
code was valued based upon CPT code 97803 and AMA RUC had provided 
recommendation on this code previously, the AMA RUC was involved, 
albeit indirectly, in setting this rate. In addition, there was 
opportunity for the AMA RUC to provide comment on this code in response 
to the solicitation for comment on the CY 2013 proposed rule.
    Based upon the comments we received, we are finalizing the proposed 
rate for HCPCS code G0446. It will be valued with a work RVU of 0.45, 
and with a time of 15 minutes. For malpractice expense, we are 
finalizing our proposed crosswalk for HCPCS code G0446 to CPT code 
97803. We are also finalizing the direct PE inputs as proposed. The 
direct PE inputs associated with this code are included in the CY 2013 
direct PE input database, available on the CMS Web site under the 
downloads for the CY 2013 PFS final rule with comment period at 
www.cms.gov/PhysicianFeeSched/. Additionally, we note that the PE RVUs 
included in Addendum B reflect the values that result from the 
finalization of this policy. HCPCS G0447 (Face-to-face behavioral 
counseling for obesity, 15 minutes) was created for the reporting and 
payment of intensive behavioral therapy for obesity. As we explained in 
the proposed rule, we believe that the behavioral counseling service 
described by HCPCS code G0447 requires similar physician work to CPT 
code 97803. Accordingly, we proposed a work RVU of 0.45 for HCPCS code 
G0447 for CY 2013, the same work RVU as CPT code 97803. For physician 
time, we proposed 15 minutes, which is the amount of time specified in 
the HCPCS code descriptor for G0447. For malpractice expense, we 
proposed a malpractice expense crosswalk to CPT code 97803. The 
proposed direct PE inputs were reflected in the CY 2013 direct PE input 
database, available on the CMS Web site under the downloads for the CY 
2013 PFS proposed rule at www.cms.gov/PhysicianFeeSched/. We requested 
public comment on this CY 2013 proposed value for HCPCS code G0447.
    Comment: Commenters supported the proposed payment for HCPCS code 
GO447. In addition, a commenter urged a change in our policy to allow 
billing of multiple units of this code in one encounter. We also 
received a comment that in the future CMS should use the AMA RUC to 
assist us in valuing new codes.
    Response: With regard to billing for multiple units of HCPCS code 
G0447 in the same encounter, this proposal addresses only the payment 
rate for, not the coverage of this code. We note that the NCD 
establishes that coverage is for one visit per day of service. In 
response to the suggestion that we rely upon AMA RUC input in valuing 
new codes, we agree with the commenter that the input of the AMA RUC is 
extremely useful in valuing new codes and in general, we obtain its 
recommendations in establishing the original values for new codes. 
However, because this new code was added through an NCD effective as of 
October 14, 2011, public commenters, including the AMA RUC, were not 
able to comment for consideration for CY 2012. We note that since this 
code was valued in CY 2012 based upon CPT code 97803 and AMA RUC had 
provided recommendation on this code previously, the AMA RUC was 
involved, albeit indirectly, in setting this rate. In addition, there 
was opportunity for the AMA RUC to provide comment on this code in the 
response to the solicitation for comment on the CY 2013 proposed rule.
    After the consideration of the public comments we received, we are 
finalizing the proposed work RVU of 0.45 and a time of 15 minutes for 
HCPCS G0447 code. For malpractice expense, we are finalizing our 
proposal to crosswalk HCPCS code G0447 to CPT code 97803. We are also 
finalizing the direct PE inputs as proposed. The direct PE inputs 
associated with this code are included in the CY 2013 direct PE input 
database, available on the CMS Web site under the downloads for the CY 
2013 PFS final rule with comment period at http://www.cms.gov/PhysicianFeeSched/. Additionally, we note that the PE RVUs included in 
Addendum B reflect the values that result from the finalization of this 
policy.

K. Certified Registered Nurse Anesthetists Scope of Benefit

    The benefit category for services furnished by a certified 
registered nurse anesthetist (CRNA) was added in section 1861(s)(11) of 
the Act by section 9320 of the Omnibus Budget Reconciliation Act (OBRA) 
of 1986. Since this benefit was implemented on January 1, 1989, CRNAs 
have been eligible to bill Medicare directly for services within this 
benefit category. Section 1861(bb)(2) of the Act defines a CRNA as ``a 
certified registered nurse anesthetist licensed by the State who meets 
such education, training, and other requirements relating to anesthesia 
services and related care as the Secretary may prescribe. In 
prescribing such requirements the Secretary may use the same 
requirements as those established by a national organization for the 
certification of nurse anesthetists.''
    Section 410.69(b) defines a CRNA as a registered nurse who: (1) Is 
licensed as a registered professional nurse by the State in which the 
nurse practices; (2) meets any licensure requirements the State imposes 
with respect to nonphysician anesthetists; (3) has graduated from a 
nurse anesthesia educational program that meets the standards of the 
Council on Accreditation of Nurse Anesthesia Programs, or such other 
accreditation organization as may be designated by the Secretary; and 
(4) meets one of the following criteria: (i) Has passed a certification 
examination of the Council on Certification of Nurse Anesthetists, the 
Council on Recertification of Nurse Anesthetists, or any other 
certification organization that may be designated by the Secretary; or 
(ii) is a graduate of a program described in paragraph (3) of

[[Page 69006]]

this definition and within 24 months after that graduation meets the 
requirements of paragraph (4)(i) of this definition.
    Section 1861(bb)(1) of the Act defines services of a CRNA as 
``anesthesia services and related care furnished by a certified 
registered nurse anesthetist (as defined in paragraph (2)) which the 
nurse anesthetist is legally authorized to perform as such by the State 
in which the services are furnished.'' CRNAs are paid at the same rate 
as physicians for furnishing such services to Medicare beneficiaries. 
Payment for services furnished by CRNAs only differs from physicians in 
that payment to CRNAs is made only on an assignment-related basis 
(Sec.  414.60) and supervision requirements apply in certain 
circumstances.
    At the time that the Medicare benefit for CRNA services was 
established, anesthesia practice, for anesthesiologists and CRNAs, 
largely occurred in the surgical setting and services other than 
anesthesia (medical and surgical) were furnished in the immediate pre- 
and post-surgery timeframe. The scope of ``anesthesia services and 
related care'' as delineated in section 1861(bb)(1) of the Act 
reflected that practice. As anesthesiologists and CRNAs have moved into 
other practice settings, questions have arisen regarding what services 
are encompassed under the benefit category's characterization of 
``anesthesia and related care.'' As an example, some CRNAs now offer 
chronic pain management services that are separate and distinct from a 
surgical procedure. We recently received additional information about 
upcoming changes to CRNA curricula to include specific training 
regarding chronic pain management services. Such changes in CRNA 
practice have prompted questions as to whether these services fall 
within the scope of section 1861(bb)(1) of the Act.
    As we noted in the CY 2013 proposed rule (77 FR 44788), Medicare 
Administrative Contractors (MACs) have reached different conclusions as 
to whether the statutory benefit category description of ``anesthesia 
services and related care'' encompasses the chronic pain management 
services furnished by CRNAs. The scope of the benefit category 
determines the scope of services for which a physician, practitioner, 
or supplier may receive Medicare payment. In order for the specific 
services to be paid by Medicare, the services must be reasonable and 
necessary for treatment of the patient's illness or injury.
    To address what is included in the benefit category for CRNAs in 
the CY 2013 proposed rule, we assessed our current regulations and 
subregulatory guidance, and determined that the existing guidance does 
not specifically address whether chronic pain management is included in 
the CRNA benefit. In the Internet Only Manual (Pub 100-04, Ch 12, Sec 
140.4.3), we discuss the medical or surgical services that fall under 
the ``related care'' language stating: ``These may include the 
insertion of Swan Ganz catheters, central venous pressure lines, pain 
management, emergency intubation, and the pre-anesthetic examination 
and evaluation of a patient who does not undergo surgery.'' Some have 
interpreted the reference to ``pain management'' in this language as 
authorizing direct payment to CRNAs for chronic pain management 
services, while others have taken the view that the services 
highlighted in the manual language are services furnished in the 
perioperative setting and refer only to acute pain management 
associated with the surgical procedure.
    After assessing in the proposed rule (see 77 FR 44788) the 
information available to us, we concluded that chronic pain management 
was an evolving field, and we recognized that certain states have 
determined that the scope of practice for a CRNA should include chronic 
pain management to meet health care needs of their residents and ensure 
their health and safety. We also found that several states, including 
California, Colorado, Missouri, Nevada, South Carolina, and Virginia, 
were debating whether to include pain management in the CRNA scope of 
practice. After determining that the scope of practice for CRNAs was 
evolving and that there was not a clear answer on pain management 
specifically, we proposed to revise our regulations at Sec.  410.69(b) 
to define the statutory benefit for CRNA services with deference to 
state scope of practice laws. Specifically, we proposed to add the 
following language: ``Anesthesia and related care includes medical and 
surgical services that are related to anesthesia and that a CRNA is 
legally authorized to perform by the state in which the services are 
furnished.'' We explained that this proposed definition would set a 
Medicare standard for the services that can be furnished and billed by 
CRNAs while allowing appropriate flexibility to meet the unique needs 
of each state. The proposal also dovetailed with the language in 
section 1861(bb)(1) of the Act requiring the state's legal 
authorization to furnish CRNA services as a key component of the CRNA 
benefit category. Finally, we stated that the proposed benefit category 
definition was also consistent with our policy to recognize state scope 
of practice as defining the services that can be furnished and billed 
by other NPPs.
    The following is a summary of the comments we received regarding 
the proposal to revise our regulations at Sec.  410.69(b) to define the 
statutory description of CRNA services. We received a significant 
volume of comments from specialty groups, individual physicians, and 
practitioners, including CRNAs and Student Registered Nurse 
Anesthetists (SRNAs), educational program directors, and patients, who 
strongly supported defining the CRNA benefit broadly. There were also 
many commenters who strongly opposed this proposal, including specialty 
groups, individual physicians and practitioners, patients, educational 
program directors, and a patient advocacy group.
    Comment: Among those supporting the concept of our proposal, we 
received several comments suggesting alternative regulatory definitions 
of the statutory benefit category phrase, ``anesthesia and related 
care.'' Many commenters said that CMS should allow CRNAs to practice to 
the full extent of state law. Some commenters provided alternative 
definitions for anesthesia and related care. These included ``medical 
and surgical services that are related to anesthesia or that a CRNA is 
legally authorized to perform by the State in which the services are 
furnished,'' ``medical and surgical services that are related to 
anesthesia, including chronic pain management services unless 
specifically prohibited or outside the scope of the CRNA's license to 
practice,'' ``medical services, surgical services, and chronic and 
acute pain management services that a CRNA is legally authorized to 
perform by the State in which the services are furnished,'' ``medical 
and surgical services a CRNA is legally authorized to perform by the 
state in which services are furnished and which are done to provide 
surgical or obstetrical anesthesia or alleviate post-operative or 
chronic pain,'' and ``medical and surgical services that are related to 
anesthesia, including chronic pain management, unless a CRNA is legally 
prohibited to perform by the State in which the services are 
furnished.'' One commenter made the point that Medicare should use a 
definition that included coverage of advanced practice registered nurse 
services that are within the scope of practice under applicable state 
law, just as physicians' services are now covered.

[[Page 69007]]

    Other commenters referenced preamble text in our 1992 final rule, 
which states ``we describe related care services as * * * pain 
management services, and other services not directly connected with the 
anesthesia service or associated with the surgical service'' and noted 
that historically, related care services have been recognized as a 
different class of anesthesia services, which may or may not be related 
to anesthesia. One commenter requested that we define ``related care'' 
separately from anesthesia, as ``medical and surgical services not 
directly related to anesthesia, including but not limited to the 
insertion of arterial lines, central venous pressure lines, and Swan 
Ganz catheters, acute and chronic pain management and emergency 
intubation, and that a CRNA is legally authorized to perform by the 
state in which the services are furnished.''
    Some commenters pointed to Medicare policies allowing other 
advanced practice nurses such as nurse practitioners or clinical nurse 
specialists to furnish and bill for physicians' services as support for 
recognizing a similar interpretation of the scope of CRNA practice. 
Commenters stated that CRNAs should be able to practice to the full 
extent of state law. Commenters cited the Institute of Medicine report 
[The Future of Nursing: Leading Change, Advancing Health, 11/17/10] 
that stated that nurses should be able to practice to the full extent 
of their education and training.
    Our proposal to define related care as ``related to anesthesia'' 
resulted in various views as to whether this would include pain 
management and other services. Some stated that it restricted the 
benefit category, but others believed that it expanded it. The 
commenters further stated that there are no chronic, long-term, 
anesthesia related services that occur outside the operating room or 
recovery room where the practice of anesthesia is appropriate. Others 
stated that chronic pain management services are outside the scope of 
perioperative related care defined in the Act, and that chronic pain is 
not related to anesthesia.
    Response: After reviewing comments regarding our proposed 
definition of ``anesthesia and related care,'' we believe that the 
proposed regulation language stating that ``Anesthesia and related care 
includes medical and surgical services that are related to anesthesia 
and that a CRNA is legally authorized to perform by the state in which 
the services are furnished'' would not accomplish our goals. It would 
require updating as health care evolves and as CRNA practice changes. 
It also would continue Medicare's differentiation between CRNAs and 
other NPPs because the Medicare benefit for other NPPs relies more 
heavily on the NPPs' authority under state law. In addition, we agree 
with commenters that the primary responsibility for establishing the 
scope of services CRNAs are sufficiently trained and, thus, should be 
authorized to furnish, resides with the states. We agree with 
commenters that, as CRNA training and practice evolve, the state scope 
of practice laws for CRNAs serve as a reasonable proxy for what 
constitutes ``anesthesia and related care.'' Therefore, we are revising 
Sec.  410.69(b) to define the statutory benefit category for CRNAs, 
which is specified as ``anesthesia and related care,'' as ``those 
services that a certified registered nurse anesthetist is legally 
authorized to perform in the state in which the services are 
furnished.'' By this action, we are defining the Medicare benefit 
category for CRNAs as including any services the CRNA is permitted to 
furnish under their state scope of practice. In addition, this action 
results in CRNAs being treated similarly to other advanced practice 
nurses for Medicare purposes. This policy is consistent with the 
Institute of Medicine's recommendation that Medicare cover services 
provided by advanced practice nurses to the full extent of their state 
scope of practice. CMS will continue to monitor state scope of practice 
laws for CRNAs to ensure that they do not expand beyond the appropriate 
bounds of ``anesthesia and related care'' for purposes of the Medicare 
program.
    Comment: Some commenters suggested that the proposal expands the 
scope of practice of CRNAs into the practice of medicine, and that the 
proposal undermines medical education, the practice of medicine, and 
the pain medicine specialty by equating nurses with physicians. 
Commenters further stated that such proposals, which lead to 
privileging and reimbursement for nonphysician practitioners that are 
identical to that of physicians, decrease the incentives to complete 
the rigorous training involved in medical school. Others stated that 
the proposal would interfere with the authority of states to regulate 
scope of practice.
    Response: We acknowledge the concerns of the physician community; 
however, the intent of the proposal is not to undermine medical 
education, the practice of medicine, or the pain medicine specialty, 
but to establish parity between the scope of the Medicare benefit 
category for CRNAs and the CRNA authority to practice under state law. 
This proposal does not address payment rates for anesthesiologists or 
CRNAs. The statutory provisions that establish payment rates for CRNAs 
at the same rate as anesthesiologists are relatively longstanding. Our 
proposal in no way is intended to interfere with the authority of 
individual states; rather, it largely defers to individual states to 
determine the scope of practice for CRNAs. We believe that using state 
scope of practice law as a proxy for services encompassed in the 
statutory benefit language ``anesthesia and related care'' is 
preferable to choosing among individual interpretations of whether 
particular services fall within the scope of ``anesthesia and related 
care.'' Moreover, we believe states are in an ideal position to gauge 
the status of, and respond to changes in, CRNA training and practice 
over time that might warrant changes in the definition of the scope of 
``anesthesia services and related care'' for purposes of the Medicare 
program. As such, we believe it is appropriate to look to state scope 
of practice law as a proxy for the scope of the CRNA benefit.
    Comment: Many commenters addressed the extent to which the 
standards for nurse anesthesia curricula and the content of nurse 
anesthesia educational programs do or do not prepare CRNAs to practice 
outside the perioperative setting, and specifically, to furnish chronic 
pain services. We received detailed comments regarding the necessary 
components of chronic pain services and conflicting information about 
whether CRNAs are trained or licensed to furnish such services. We 
received thorough descriptions of the skills required to furnish 
chronic pain services and the necessity of medical education to prepare 
one to furnish such services. Commenters also provided information 
about the inherent dangers involved in chronic pain services, the 
manner in which technical skills in chronic pain procedures are 
obtained, and the ways in which chronic pain services are or are not 
similar to other procedures performed by CRNAs in the perioperative 
setting and for labor epidurals. We received many comments from the 
physician community with concerns about the possibility of the 
furnishing of procedures that are not indicated due to lack of medical 
knowledge required to screen out patients who are not appropriate 
candidates for procedures.
    Some commenters pointed to the long period of time during which 
CRNAs have furnished chronic pain services with no documented 
differences in

[[Page 69008]]

patient outcomes, while others expressed concern about negative 
outcomes observed from inadequately trained providers. Descriptions 
were also provided regarding lawsuits at the state level that have 
debated whether CRNAs are qualified to furnish chronic pain services, 
the importance of medical regulation in protecting patients who may not 
be able to differentiate between different types of providers, and the 
role of the medical education process in ensuring competency of 
physicians. Other commenters opined that it is the responsibility of 
the individual provider to assure his or her competency for any and all 
procedures furnished.
    Response: We acknowledge the varying perspectives about the 
education and training of CRNAs to furnish chronic pain management 
services as well as differences of opinion regarding the safety of 
chronic pain management services furnished by CRNAs. We are unable, at 
this time, to assess the appropriateness of the CRNA training relating 
to specific procedures. We are also unaware of any data regarding the 
safety of chronic pain management services when furnished by different 
types of professionals. However, we expect that states take into 
account all appropriate practitioner training and certifications, as 
well as the safety of their citizens, when making decisions about the 
scope of services CRNAs are authorized to furnish and providing 
licenses to individual practitioners in their jurisdictions.
    We note that we did not address the services that CRNAs are trained 
and qualified to furnish in our proposal or in this final rule with 
comment period. Our proposal and this final rule merely define what 
services are included in the scope of the Medicare benefit established 
in section 1861(bb)(1) of the Act. The definition that we are adopting 
uses the state scope of practice as a proxy for what the term 
``anesthesia and related care'' in section 1861(bb)(1) of the Act means 
and thus leaves decisions about what services constitute anesthesia and 
related care to be resolved by the state. This appropriately recognizes 
the actions of state bodies formed specifically to address the issue of 
what constitutes the scope of practice for a CRNA. We believe that 
determining whether or not CRNAs are adequately trained and can safely 
furnish chronic pain management is an appropriate decision for state 
bodies. This proposal is consistent with the Institute of Medicine's 
report on advanced practice nursing, which recommends that Medicare 
should ``include coverage of advanced practice registered nurse 
services that are within the scope of practice under applicable state 
law, just as physicians' services are now covered.''
    We agree with commenters that it also is the responsibility of 
individual practitioners (physicians and CRNAs) to ensure that they are 
adequately trained and qualified to furnish any and all procedures that 
they furnish.
    Comment: We received comments about the cost of CRNA services 
relative to those furnished by anesthesiologists. Commenters stated 
that chronic pain management services are less costly than surgical 
interventions, and that the services of CRNAs are more cost-effective 
for the Medicare program. Others stated that allowing CRNAs to furnish 
these services could increase spending due to the provision of 
inappropriate services and the complications that could result from 
procedures furnished by CRNAs who are not adequately trained.
    Response: We do not have sufficient evidence to determine that 
chronic pain management interventions reduce the need for surgical 
interventions, or that there would be increased provision of 
inappropriate services and complications under a definition of the 
Medicare benefit category that defines ``anesthesia and related care'' 
as services a CRNA is authorized to furnish in his or her state. 
Spending for services under Medicare is not a factor in determining 
whether the statutory benefit encompasses particular services. However, 
we would note that CRNAs are generally paid at the same rate as 
anesthesiologists so there are no direct cost savings when services are 
furnished by CRNAs.
    Comment: We received comments regarding special concerns about 
access in rural areas. Commenters stated that CRNAs help patients avoid 
traveling long distances and long waits for appointments by having 
local providers available. Furthermore, commenters noted that as the 
population ages, the demand for chronic pain management services will 
increase. Commenters stated that decreased access to chronic pain 
management services (which would result if CRNAs are not permitted to 
furnish and bill for these services) would result in more 
institutionalization, reduced quality of life, longer wait times, and 
increased costs. Others stated that chronic pain management services 
are not emergent care services; that chronic pain management is a 
specialty that should be furnished by those with a high degree of sub-
specialty training, and that pain physicians can be spread out over 
large areas since only a small minority of patients need procedural 
care. Some commenters cited a shortage of pain management physicians 
qualified to treat chronic pain, others stated that there is no 
shortage of such providers, while still others stated that the proposal 
may increase access, but at the expense of having unqualified 
providers. Finally, some commenters stated that procedures furnished 
improperly pose a greater danger than a lack of available services.
    Response: While assuring access for beneficiaries in rural areas is 
a priority for Medicare, we do not have sufficient data to evaluate the 
presence or degree of problems of access to chronic pain management 
services in rural areas. We also do not have evidence that CRNAs have 
furnished chronic pain management services in quantities sufficient to 
improve any access problems in rural areas. We further lack sufficient 
data to determine whether beneficiaries who lack access to a CRNA care 
are more likely to suffer the negative outcomes cited by commenters. 
This lack of information does not deter us taking action to define the 
statutory benefit as it is not necessary to conclude that beneficiaries 
will suffer negative consequences to prompt us to act. Rather we are 
issuing this regulation based upon the factors we described above.
    Comment: We received comments regarding those services included in 
the definition of anesthesia and related care, as well as services 
``related to anesthesia.'' Some commenters stated that chronic pain 
management services are not directly ``related to anesthesia'' but 
still constitute ``related care''. Other commenters stated that CMS has 
already acknowledged in early preamble language that CRNAs may furnish 
services not directly related to anesthesia. Still other commenters 
stated that chronic pain services are not related to anesthesia in any 
way. One commenter suggested that CMS has already differentiated 
between anesthesia related acute pain and interventional chronic pain 
based on the creation of different specialty codes for anesthesia and 
chronic pain. One commenter requested that CMS make a regulatory change 
to allow CRNAs to order diagnostic tests in order to effectively 
provide chronic pain management services.
    Response: We believe that the statutory intent was to include 
services not directly related to the peri-anesthetic setting in the 
CRNA benefit category. We believe that relying on state scope of 
practice to define the services encompassed in anesthesia and related 
care is preferable to choosing among conflicting definitions of

[[Page 69009]]

``anesthesia and related care'' or listing the specific services that 
fall within that benefit category. Rather, we believe states are in a 
better position to gauge the status of, and respond to changes in, CRNA 
training and practice over time that might warrant changes in the 
definition of the scope of ``anesthesia services and related care'' for 
purposes of the Medicare program. As such, we believe it is appropriate 
to look to state scope of practice law as a proxy for the scope of the 
CRNA benefit.
    Comment: Several commenters expressed concern with the wording of 
our proposal; specifically, that the term ``related to anesthesia'' was 
unclear and subject to interpretation. States do not typically define 
services ``related to anesthesia'' in their state scope of practice 
acts.
    Response: We agree with commenters that the wording of the proposal 
was unclear. In response to these and other commenter concerns, we are 
adopting a modification of our proposal to rely on state scope of 
practice to define the services encompassed in ``anesthesia and related 
care'' under section 1861(bb)(1) of the Act.
    Comment: One commenter requested that we provide clarification for 
the payment of CRNA services furnished; specifically, which medical 
and/or surgical CRNA services are eligible for cost-based reimbursement 
(for CRNA pass-through payments or Method II billing for Critical 
Access Hospitals).
    Response: We will be modifying the Internet Only Manual to reflect 
the change we are making in this final rule with comment period. The 
request for the list of services that are eligible for cost-based 
reimbursement is beyond the scope of this rule, as it pertains to 
hospital billing. We anticipate this matter will be addressed 
separately in a forthcoming transmittal.
    Comment: Commenters requested that CMS instruct Medicare 
contractors to review prior denials of claims for CRNA services prior 
to any final rule determination of the scope of the CRNA Medicare 
benefit category.
    Response: This definition of the Medicare benefit for CRNAs will be 
effective for services furnished on or after January 1, 2013. It does 
not apply to services furnished prior to this point so we will not be 
instructing contractors to review prior denials of claims.
    After consideration of all comments, we are finalizing our proposal 
with modification to revise our regulations at Sec.  410.69(b) to 
define ``Anesthesia and related care'' under the statutory benefit for 
CRNA services as follows: ``Anesthesia and related care means those 
services that a certified registered nurse anesthetist is legally 
authorized to perform in the state in which the services are 
furnished.'' We will continue to monitor the state scope of practice 
laws for CRNAs in order to insure that the use of state scope of 
practice as a proxy to define ``anesthesia services and related care'' 
is consistent with the goals and needs of Medicare program.

L. Ordering of Portable X-Ray Services

    Portable x-ray suppliers furnish diagnostic imaging services at a 
beneficiary's location. These services are most often furnished in 
residences, including private homes and alternative living facilities 
(for example, nursing homes) rather than in a traditional clinical 
setting (for example, a doctor's office or hospital). The supplier 
transports mobile diagnostic imaging equipment to the beneficiary's 
location, sets up the equipment, and administers the test onsite. The 
supplier may interpret the results itself or it may furnish the results 
to an outside physician for interpretation. Portable x-ray services may 
avoid the need for expensive ambulance transport of frail beneficiaries 
to a radiology facility or hospital.
    Our Medicare Conditions for Coverage (CfC) regulations require that 
``portable x-ray examinations are performed only on the order of a 
doctor of medicine (MD) or doctor of osteopathy (DO) licensed to 
practice in the state * * *'' (Sec.  486.106(a)). With the exception of 
portable x-ray services, Medicare payment regulations at Sec.  
410.32(a) allow physicians, as defined in section 1861(r) of the Act, 
and certain nonphysician practitioners at Sec.  410.32(a)(2) to order 
diagnostic x-ray tests, diagnostic laboratory tests, and other 
diagnostic tests as long as those nonphysician practitioners are 
operating within the scope of their authority under state law and 
within the scope of their Medicare statutory benefit. Physicians other 
than an MD or DO recognized to order diagnostic tests under Sec.  
410.32(a) include the following limited-license practitioners: Doctor 
of optometry, doctor of dental surgery and doctor of dental medicine, 
and doctor of podiatric medicine. Nonphysician practitioners authorized 
to order diagnostic tests under Sec.  410.32(a)(2) include nurse 
practitioners, physician assistants, clinical nurse specialists, 
certified nurse-midwives, clinical psychologists, and clinical social 
workers. Nonphysician practitioners have become an increasingly 
important component of clinical care, and we believe that delivery 
systems should take full advantage of all members of a healthcare team, 
including nonphysician practitioners.
    Although current Medicare regulations limit the ordering of 
portable x-ray services to a MD or a DO, the Office of the Inspector 
General (OIG) in its December 2011 report entitled Questionable Billing 
Patterns of Portable X-Ray Suppliers (OEI-12-10-00190) found that 
Medicare was paying for portable x-ray services ordered by physicians 
other than MDs and DOs, including podiatrists and chiropractors, and by 
nonphysician practitioners. We issued a special education article on 
January 20, 2012, through the Medicare Learning Network (MLN) 
``Important Reminder for Providers and Suppliers Who Provide Services 
and Items Ordered or Referred by Other Providers and Suppliers,'' 
reiterating our current policy that portable x-ray services can only be 
ordered by a MD or DO. The article is available at http://www.cms.gov/MLNMattersArticles/downloads/SE1201.pdf on the CMS Web site. Since the 
publication of the above mentioned article, several stakeholders have 
told us that members of the healthcare community fail to distinguish 
ordering for portable x-ray services from ordering for other diagnostic 
services where our general policy is to allow nonphysician 
practitioners and physicians other than MDs and DOs to order diagnostic 
tests within the scope of their authority under state law and their 
Medicare statutory benefit. They report finding the different 
requirements confusing.
    We proposed to revise our current regulations, which limit ordering 
of portable x-ray services to only a MD or DO, to allow other 
physicians and nonphysician practitioners acting within the scope of 
their Medicare benefit and state law to order portable x-ray services. 
Specifically, we proposed revisions to the CfC at Sec.  486.106(a) and 
Sec.  486.106(b) to permit portable x-ray services to be ordered by a 
physician or nonphysician practitioner in accordance with the ordering 
policies for other diagnostic services under Sec.  410.32(a).
    This proposed change would allow a MD or DO, as well as a nurse 
practitioner, clinical nurse specialist, physician assistant, certified 
nurse-midwife, doctor of optometry, doctor of dental surgery and doctor 
of dental medicine, doctor of podiatric medicine, clinical 
psychologist, and clinical social worker to order portable x-ray 
services within the scope of their authority under state law and the 
scope of their Medicare benefit. Although all of these physicians and 
nonphysician practitioners are authorized to order

[[Page 69010]]

diagnostic services in accordance with Sec.  410.32(a), their Medicare 
benefit and state scope of practice delimits the services that they can 
furnish. For example, the state scope of practice for clinical 
psychologists typically is limited to the diagnosis and treatment of 
mental health disorders and related services. The scope of the Medicare 
benefit for clinical social workers under 1861(hh) of the Act limits 
their ability to order diagnostic tests to mental health related tests.
    Comment: The majority of commenters supported allowing additional 
nonphysician and limited-license practitioners to order portable x-ray 
services. The commenters stated that this proposal is consistent with 
the increasing role for practitioners other than MDs or DOs in health 
care delivery today, with nonphysician and limited license practitioner 
training and practice, with staffing decisions for care furnished in 
nursing homes and other home care settings, and with the scope of 
practice for various practitioners under state law.
    Response: We thank the commenters for their support and agree with 
these comments. As we stated in the CY 2013 PFS proposed rule, we 
believe nonphysician practitioners have become an increasingly 
important component of clinical care, and we believe that delivery 
systems should take full advantage of all members of a healthcare team, 
including nonphysician practitioners. Allowing limited-license and 
nonphysician practitioners to order portable x-ray services within the 
scope of their practice will enhance the role of those practitioners.
    Comment: Some commenters either questioned or opposed the ability 
of certain nonphysician or limited-license practitioners to order 
portable x-ray services. The commenters stated that by including 
clinical psychologists and clinical social workers, our proposal was 
too broad as these nonphysician practitioners do not have the 
appropriate education or training to order portable x-ray services. In 
addition, they noted that the ordering of portable x-ray services is 
not within clinical psychologists' and clinical social workers' state 
scopes of practice. One commenter stated that the ordering authority 
for portable x-ray services should only be expanded to physician 
assistants, nurse practitioners, and doctors of podiatric medicine, 
stating that there is no convincing or clinically supportable rationale 
for other practitioners identified in Sec.  410.32(a), including 
certified nurse-midwives, doctors of optometry, doctors of dental 
surgery and doctors of dental medicine, clinical social workers, and 
clinical psychologists, to order portable x-ray services. A few 
commenters stated that some nonphysician and limited-license 
practitioners have not been trained to diagnose an illness, to use x-
rays as part of the diagnosis and treatment of a beneficiary, to know 
how to interpret an x-ray, and to plan a course of medically 
appropriate follow-up treatment. Commenters requested the clinical 
rationale and FY 2011 data on portable x-ray ordering by select 
nonphysician practitioners. One commenter stated that deferring to 
state scope of practice laws for limited- license and nonphysician 
practitioners did not constitute sufficient stewardship by Medicare to 
ensure payment for appropriate services.
    Response: We disagree. We proposed to modify our rule for ordering 
portable x-ray services to make it consistent with rules for ordering 
all other diagnostic tests. Our proposed policy would eliminate the 
specific requirements limiting the types of practitioners who can order 
portable x-ray services, and instead place ordering for portable x-ray 
services under the general regulations governing ordering of diagnostic 
tests in Sec.  410.32(a)(2). Under Sec.  410.32(a)(2), limitations on 
the ability of various practitioners to order diagnostic tests are 
established by the practitioner's scope of practice under state law and 
the scope of the practitioner's Medicare benefit. The current 
regulation applies to x-rays (other than portable x-rays), MRI, CT 
scans, and a host of other diagnostic tests that are more complex and 
potentially higher risk than portable x-ray services. We do not believe 
that nonphysician and limited-license practitioners who can routinely 
order and employ the results of reasonable and necessary x-rays, MRIs, 
and CT scans should continue to be precluded from ordering and 
utilizing portable x-ray imaging in the same manner. Further, most of 
the nonphysician practitioners listed in Sec.  410.32(a)(2) are 
authorized by statute to furnish physician services under the scope of 
their Medicare benefit and state scope of practice, including ordering, 
interpreting, and using test results to treat a beneficiary.
    With regard to clinical social workers, under section 1861(hh) of 
the Act, the scope of their Medicare benefit is further limited to 
services ``for the diagnosis and treatment of mental illnesses.'' 
Therefore, the proposed change to our regulations to allow clinical 
social workers to order portable x-ray services in the same way that 
they are permitted to order other diagnostic tests under Sec.  
410.32(a) would not allow clinical social workers to order portable x-
ray services. Portable x-ray services fall within the scope of the 
Medicare benefit for the remaining nonphysician and limited-license 
practitioners, including clinical psychologists. As noted above, we 
believe state scope of practice laws might limit ordering of portable 
x-ray services by clinical psychologists or other practitioners. 
Additionally, certain other practitioners are unlikely to have a reason 
to order portable x-ray services, such as doctors of optometry. We have 
no evidence to suggest that clinical psychologists or other limited 
license or nonphysician practitioners are ordering significant numbers 
of x-rays, CTs, and MRIs under Sec.  410.32(a) authority at this time. 
We do not expect any marked change in ordering patterns following the 
change in regulation to allow for ordering of portable x-ray services.
    With regard to the request for FY 2011 data on portable x-ray 
ordering by select nonphysician practitioners, we do not believe this 
or any recent data on portable x-ray ordering patterns for limited-
license or nonphysician practitioners would be meaningful information 
regarding future potential ordering patterns for portable x-ray 
services because these practitioners are not permitted to order 
portable x-ray services under the current regulation. We believe our 
proposal is consistent with our current regulations that generally 
allow nonphysician practitioners to order diagnostic services, and the 
agency's interest in having delivery systems take full advantage of all 
members of a healthcare delivery team. We describe below our intention 
to design monitoring systems that will capture excessive ordering.
    Comment: Several commenters requested that CMS clarify that the 
proposal for CY 2013 is actually a clarification of long standing 
policy that nonphysician practitioners have been able to order portable 
x-ray services since implementation of the their authority to order 
diagnostic tests under Sec.  410.32(a)(2) and requested that CMS 
indicate that this authority is not a change in policy effective 
January 1, 2013. Commenters stated that the regulations at Sec.  
410.32(a), established as a result of the Balanced Budget Act (BBA) of 
1997 (Pub. L. 105-33), were promulgated long after the 1969 CfC 
requirement at Sec.  486.106 and that the more recent regulation trumps 
older requirements. These commenters stated that it was merely an 
oversight on the part of CMS when the agency failed to update the 
regulations at Sec.  486.106. They also stated that some manual 
language and educational materials have

[[Page 69011]]

been inconsistent in communicating that only MDs or DOs can order 
portable x-ray services over the years. Commenters requested that if 
CMS does conclude that allowing nonphysician and limited-license 
practitioner ordering of portable x-ray services is a change in policy 
for CY 2013, then CMS should specify in the preamble that no repayments 
or other actions are required, including recoupment efforts as a result 
of the OIG's findings in the December 2011 report entitled Questionable 
Billing Patterns of Portable X-ray Suppliers (OEI 12-10-00190).
    Response: There is a longstanding regulation requiring ordering of 
portable x-ray services by an MD or DO at Sec.  486.106(a) and Sec.  
486.106(b). There is a specific section of the regulation under Sec.  
410.32 dedicated to portable x-ray services, Sec.  410.32(c), that 
explicitly cross-references the requirements under Sec.  486.106. As 
such, we do not believe that, when revising the regulation at Sec.  
410.32 to expand the general rules for ordering diagnostic tests under 
the BBA, the agency simply failed to notice the requirement in the same 
section relating to portable x-ray tests. Further, the specific 
requirement for MD or DO ordering of portable x-ray services under 
Sec.  410.32(c) explicitly excepts portable x-ray services from the 
general ordering rules under Sec.  410.32(a). The only means to revise 
the regulations containing this longstanding CfC is through notice and 
comment rulemaking, which was the purpose of the proposal we made in 
the CY 2013 proposed rule. The change in policy to allow limited-
license and nonphysician practitioners to order portable x-ray services 
will be effective beginning in CY 2013.
    The OIG report concluded, and CMS concurred, that CMS should recoup 
payment for portable x-ray services identified under the report as 
ordered by limited-license physicians and nonphysician practitioners, 
other than a MD or DO in accordance with our regulations at Sec.  
410.32(c) and Sec.  486.106 since this was consistent with this 
recommendation. We will continue our recoupment efforts in response to 
the OIG report. However, we have instructed our payment contractors 
that the ordering of portable x-ray services should not be made a 
priority for additional medical review activity beyond claims 
identified in the OIG audit.
    After considering the public comments received, we are finalizing 
our CY 2013 proposal to revise the CfC at Sec.  486.106(a) and Sec.  
486.106(b) to permit portable x-ray services to be ordered by 
physicians or nonphysician practitioners in accordance with the general 
ordering policies for other diagnostic services as specified under 
Sec.  410.32(a). Therefore, effective for services furnished on or 
after January 1, 2013, the following practitioners will be permitted to 
order portable x-rays in accordance with Medicare regulations and 
subject to their scope of practice under state law and their applicable 
Medicare statutory benefit: A physician (including an MD or a DO, 
doctor of optometry, doctor of dental surgery and doctor of dental 
medicine, and doctor of podiatric medicine), or a nurse practitioner, 
clinical nurse specialist, physician assistant, certified nurse-
midwife, or clinical psychologist, where the ordering of portable x-ray 
services is within the scope of their practice under state law. As 
discussed above, although clinical social workers are permitted to 
order diagnostic tests under Sec.  410.32(a)(2), the scope of their 
Medicare benefit is limited to services for the diagnosis and treatment 
of mental illnesses. As such, we do not believe these nonphysician 
practitioners would need to order portable x-ray services. We also are 
finalizing revisions to the language included under Sec.  410.32(c) 
specific to portable x-ray services to recognize the same authority for 
physicians and nonphysician practitioners to order diagnostic tests as 
is prescribed for other diagnostic services under Sec.  410.32(a). 
Finally, we are finalizing two technical corrections that we proposed 
to make in the CY 2013 PFS proposed rule. One is to Sec.  410.32(d)(2), 
where we currently cite paragraph (a)(3) for the definition of a 
qualified nonphysician practitioner. The definition of a qualified 
nonphysician practitioner is currently found in paragraph (a)(2), while 
paragraph (a)(3) does not exist; therefore, we are correcting the 
citation. The second technical correction is in Sec.  410.32(b)(2)(iii) 
to better reflect the statutory authority to furnish neuropsychological 
testing in addition to psychological testing. We did not receive any 
comments on these proposed technical corrections. The documentation 
requirement for this paragraph remains unchanged.
    Although we believe it is appropriate to finalize policy to allow 
nonphysician practitioners and limited-license practitioners to order 
portable x-ray services within the scope of their authority under state 
law and the scope of their Medicare statutory benefit given overall 
changes in health care delivery practice patterns since the beginning 
of the Medicare program, we remain concerned about the OIG's recent 
findings. The OIG observed other questionable billing patterns for 
portable x-ray services in addition to ordering by nonphysician 
practitioners. Of specific note was the observation that some portable 
x-ray suppliers are furnishing services on the same day that the 
beneficiary also receives services in a clinical setting, such as the 
physician office or hospital. Under current regulations at Sec.  
486.106(a)(2), the order for portable x-ray services must include a 
statement concerning the condition of the beneficiary which indicates 
why portable x-ray services are necessary. If, on the same day that a 
portable x-ray service was furnished, the patient was able to travel 
safely to a clinical setting, we believe the statement of need for 
portable x-ray services could be questionable. We also are concerned 
that the OIG observed some portable x-ray suppliers billing for 
multiple trips to a facility on the same day Medicare makes a single 
payment for each trip the portable x-ray supplier makes to a particular 
location. We make available several modifiers to allow the portable x-
ray supplier to indicate the number of beneficiaries served on a single 
trip to a facility. We expect portable x-ray suppliers to use those 
modifiers and not to bill multiple trips to the same facility on a 
single day when only one trip was made. Additionally, we strongly 
encourage portable x-ray suppliers to make efficient use of resources 
and consolidate trips, to the extent it is clinically appropriate to do 
so, rather than making multiple trips on the same day.
    Comment: Several stakeholders provided scenarios where a portable 
x-ray service would be medically necessary on the same day as a 
hospital, physician office, or other clinical setting.
    Response: We agree that there may be unusual circumstances when 
portable x-ray services could be appropriate with a same day visit to a 
hospital, physician office, or other clinical setting. Proper 
documentation of the rationale for such same day occurrences would be 
required to substantiate the necessity for those services.
    In conjunction with our proposal to expand the scope of physicians 
and nonphysician practitioners who can order portable x-ray services, 
we intend to develop, as needed, monitoring standards predicated by 
these and other OIG findings. In addition, we will be conducting data 
analysis of ordering patterns for portable x-ray and other diagnostic 
services to determine if additional claims edits, provider audits, or 
fraud investigations are required to prevent abuse of these services 
and to allow for the collection of any potential

[[Page 69012]]

overpayments. We encourage physicians and practitioners, as with any 
diagnostic test, to proactively determine and document the medical 
necessity for this testing.
    Comment: One commenter noted that our proposal to expand the scope 
of ordering for portable x-ray services was at odds with our statements 
indicating our intent to engage in greater monitoring of the delivery 
of portable x-ray services overall. The commenter recommended that we 
target any new program integrity efforts to practitioner groups where 
there is evidence of abuse.
    Response: We disagree. We believe allowing nonphysician and 
limited-license practitioners to order portable x-ray services is 
consistent with statutory authority and changes in health care 
delivery. Any monitoring effort would target more generally, the 
utilization and delivery of portable x-ray services, of which of the 
actual x-ray service is only one small component.
    In the proposed rule (77 FR 44791), we solicited comments and 
suggestions for updating the current regulations at 42 CFR Part 486, 
Subpart C--Conditions for Coverage: Portable X-Ray Services through 
future rulemaking. Below are our responses to public comments on 
suggestions for future rulemaking at 42 CFR Part 486, Subpart C--
Conditions for Coverage: Portable X-Ray Services.
    Comment: One commenter suggested CMS clarify the differences 
between portable x-ray providers and mobile independent diagnostic 
testing facilities (IDTFs). The commenter specifically recommended that 
CMS clarify whether portable x-ray suppliers and mobile IDTFs can 
furnish the same services to Medicare beneficiaries or whether there 
are limitations on the types of services that portable x-ray suppliers 
and IDTFs can furnish. The commenter also recommended that CMS 
establish educational and training requirements for portable x-ray 
suppliers and IDTF technicians.
    Response: We appreciate these comments and will take them into 
consideration when undertaking future rulemaking.

M. Addressing Interim Final Relative Value Units (RVUs) From CY 2012 
and Establishing Interim Final RVUs for CY 2013

    Section 1848(c)(2)(B) of the Act requires that we review RVUs for 
physicians' services no less often than every 5 years. Under section 
1848(c)(2)(K) of the Act (as added by section 3134 of the Affordable 
Care Act), we are required to identify and revise RVUs for services 
identified as potentially misvalued. To facilitate the review and 
appropriate adjustment of potentially misvalued services, section 
1848(c)(2)(K)(iii) specifies that the Secretary may use existing 
processes to receive recommendations; conduct surveys, other data 
collection activities, studies, or other analyses as the Secretary 
determined to be appropriate; and use analytic contractors to identify 
and analyze potentially misvalued services, conduct surveys or collect 
data. In accordance with section 1848(c)(2)(K)(iii) of the Act, we 
identify potentially misvalued codes, and develop and propose 
appropriate adjustments to the RVUs, taking into account the 
recommendations provided by the AMA RUC, the Medicare Payment Advisory 
Commission (MedPAC), and other public commenters.
    For many years, the AMA RUC has provided CMS with recommendations 
on the appropriate relative values for PFS services. Over the past 
several years, CMS and the AMA RUC have identified and reviewed a 
number of potentially misvalued codes on an annual basis, based on 
various identification screens for codes at risk for being misvalued. 
This annual review of work RVUs and direct PE inputs for potentially 
misvalued codes was further bolstered by the Affordable Care Act 
mandate to examine potentially misvalued codes, with an emphasis on the 
following categories specified in section 1848(c)(2)(K)(ii) (as added 
by section 3134 of the Affordable Care Act):
     Codes and families of codes for which there has been the 
fastest growth.
     Codes or families of codes that have experienced 
substantial changes in practice expenses.
     Codes that are recently established for new technologies 
or services.
     Multiple codes that are frequently billed in conjunction 
with furnishing a single service.
     Codes with low relative values, particularly those that 
are often billed multiple times for a single treatment.
     Codes which have not been subject to review since the 
implementation of the RBRVS (the ``Harvard-valued'' codes).
     Other codes determined to be appropriate by the Secretary.
    In addition to providing recommendations to CMS for work RVUs, the 
AMA RUC's Practice Expense Subcommittee reviews, and then the AMA RUC 
recommends, direct PE inputs (clinical labor, medical supplies, and 
medical equipment) for individual services. To guide the establishment 
of malpractice RVUs for new and revised codes before each Five-Year 
Review of Malpractice, the AMA RUC also provides malpractice crosswalk 
recommendations, that is, ``source'' codes with a similar specialty mix 
of practitioners furnishing the source code and the new/revised code.
    CMS reviews the AMA RUC recommendations on a code-by-code basis. 
For AMA RUC recommendations regarding physician work RVUs, after 
conducting a clinical review of the codes, we determine whether we 
agree with the recommended work RVUs for a service (that is, whether we 
agree the AMA RUC-recommended valuation is accurate). If we disagree, 
we determine an alternative value that better reflects our estimate of 
the physician work for the service.
    Because of the timing of the CPT Editorial Panel decisions, the AMA 
RUC recommendations, and our rulemaking cycle, we publish these work 
RVUs in the PFS final rule with comment period as interim final values, 
subject to public comment. Similarly, we assess the AMA RUC's 
recommendations for direct PE inputs and malpractice crosswalks, and 
establish PE and malpractice interim final values, which are also 
subject to comment. We note that, with respect to interim final PE 
RVUs, the aspect of our valuation that is open for public comment for a 
new, revised, or potentially misvalued code is the direct PE inputs and 
not the other elements of the PE valuation methodology, such as the 
indirect cost allocation methodology, that also contribute to 
establishing the PE RVUs for a code.
    If we receive public comments on the interim final work RVUs for a 
specific code indicating that refinement of the interim final work 
value is warranted based on sufficient and new information from the 
commenters concerning clinical aspects of the physician work associated 
with the service (57 FR 55917) that were not already considered in 
making the interim valuation or the AMA RUC deliberations, we refer the 
service to a refinement panel, as discussed in further detail in 
section III.M.1.a. of this final rule with comment period.
    In the interval between closure of the comment period and the 
subsequent year's PFS final rule with comment period, we consider all 
of the public comments on the interim final work, PE, and malpractice 
RVUs for the new, revised, and potentially misvalued codes and the 
results of the refinement panel, if applicable. Finally, we address the 
interim final RVUs (including the interim final direct PE inputs) by 
providing a summary of the public comments and our responses to those 
comments, including a discussion of any changes to the interim final 
work or

[[Page 69013]]

malpractice RVUs or direct PE inputs, in the following year's PFS final 
rule with comment period. We typically finalize the direct PE inputs 
and the work, PE, and malpractice RVUs for the service in that year's 
PFS final rule with comment period, unless we determine it would be 
more appropriate to continue their interim final status for another 
year and solicit further public comment.
1. Methodology
    We conducted a clinical review of each code identified in this 
section and reviewed the current and recommended work RVUs, intensity, 
and time to furnish the pre-service, intra-service, and post-service 
activities, as well as other components of the service that contribute 
to the value. Our clinical review generally includes, but is not 
limited to, a review of information provided by the AMA RUC and other 
public commenters, medical literature, and comparative databases, as 
well as a comparison with other codes within the Medicare PFS, 
consultation with other physicians and healthcare professionals within 
CMS and the Federal Government, and the views based on clinical 
experience of the physicians on the PFS clinical review team. We also 
assessed the methodology and data used to develop the recommendations 
submitted to us by the AMA RUC and other public commenters and the 
rationale for the recommendations. As we noted in the CY 2011 PFS final 
rule with comment period (75 FR 73328 through 73329), there are a 
variety of methodologies and approaches used to develop work RVUs, 
including building block, survey data, crosswalk to key reference or 
similar codes, and magnitude estimation. The building block methodology 
is used to construct, or deconstruct, the work RVU for a CPT code based 
on component pieces of the code. Components may include pre-, intra-, 
or post-service time and post-procedure visits, or, when referring to a 
bundled CPT code, the components could be considered to be the CPT 
codes that make up the bundled code. Magnitude estimation refers to a 
methodology for valuing physician work that determines the appropriate 
work RVU for a service by gauging the total amount of physician work 
for that service relative to the physician work for similar service 
across the physician fee schedule without explicitly valuing the 
components of that work. The resource-based relative value system 
(RBRVS) has incorporated into it cross-specialty and cross-organ system 
relativity. This RBRVS requires assessment of relative value and takes 
into account the clinical intensity and time required to perform a 
service. In selecting which methodological approach will best determine 
the appropriate value for a service, we consider the current and 
recommended physician work and time values, as well as the intensity of 
the service, all relative to other services.
    Several years ago, to aid in the development of pre-service time 
recommendations for new and revised CPT codes, the AMA RUC created 
standardized pre-service time packages. The packages include pre-
service evaluation time, pre-service positioning time, and pre-service 
scrub, dress and wait time. Currently there are six pre-service time 
packages for services typically furnished in the facility setting, 
reflecting the different combinations of straightforward or difficult 
procedure, straightforward or difficult patient, and without or with 
sedation/anesthesia. Currently there are two pre-service time packages 
for services typically furnished in the nonfacility setting, reflecting 
procedures without and with sedation/anesthesia care.
    We have developed several standard building block methodologies to 
appropriately value services when they have very common billing 
patterns. As we have discussed in past rulemaking, most recently in the 
CY 2012 PFS final rule with comment period (76 FR 73107 through 73108), 
in cases where a service is typically furnished to a beneficiary on the 
same day as an evaluation and management (E/M) service, we believe that 
there is overlap between the two services in some of the activities 
furnished during the pre-service evaluation and post-service time. We 
believe that at least one-third of the physician time in both the pre-
service evaluation and post-service period is duplicative of work 
furnished during the E/M visit. Accordingly, in cases where we believe 
that the AMA RUC has not adequately accounted for the overlapping 
activities in the recommended work RVU and/or times, we adjust the work 
RVU and/or times to account for the overlap. The work RVU for a service 
is the product of the time involved in furnishing the service times the 
intensity of the work. Pre-service evaluation time and post-service 
time both have a long-established intensity of work per unit of time 
(IWPUT) of .0224, which means that 1 minute of pre-service evaluation 
or post-service time equates to .0224 of a work RVU. Therefore, in many 
cases where we remove 2 minutes of pre-service time and 2 minutes of 
post-service time from a procedure to account for the overlap with the 
same day E/M service, we also remove a work RVU of .09 (4 minutes x 
.0224 IWPUT) if we do not believe the overlap in time has already been 
accounted for in the work RVU. We continue to believe this adjustment 
is appropriate. The AMA RUC has recognized this valuation policy and, 
in many cases, addresses the overlap in time and work when a service is 
typically provided on the same day as an E/M service.
    We appreciate the creation and use of these standardized pre-
service time packages. However, we believe that services that involve 
only a local anesthetic agent do not typically involve the same amount 
of pre-service time as procedures involving sedation or non-local 
anesthesia care. We request that the AMA RUC consider assigning 
services that require only local anesthesia without sedation to the 
``no sedation/anesthesia care'' pre-service time package, or that the 
AMA RUC create one or more new pre-service time packages to reflect the 
pre-service time typically involved in furnishing local anesthesia 
without sedation.
    For many CPT codes that are typically billed on the same day as an 
E/M service, the recommendations from the AMA RUC state that the AMA 
RUC reviewed the work associated with the procedure, and adjusted the 
pre-service and/or post-service time to account for the work that is 
furnished as a part of the E/M service. For many codes, the AMA RUC 
made this adjustment from the pre-service evaluation time included in 
the AMA RUC-selected pre-service time package. However, as we noted 
above, we believe that the pre-service time packages for procedures 
with sedation or anesthesia care may overstate the time involved in 
furnishing services that involve only local or topical anesthesia 
without sedation. As a result, though the AMA RUC may have removed some 
pre-service time from the package to account for the same day E/M 
service, in a few instances, consistent with our established same day 
E/M reduction methodology discussed above, we further reduced the AMA 
RUC-recommended pre-service evaluation time to fully account for the 
overlapping time with the same day E/M service.
2. Finalizing CY 2012 Interim and CY 2013 Proposed Values for CY 2013
    In this section, we address the interim final values published in 
the CY 2012 PFS final rule with comment period (76 FR 73026 through 
73474), as subsequently corrected in the January 4, 2012 (77 FR 227 
through 232) correction notice; and the proposed values published in 
the CY 2013 PFS proposed

[[Page 69014]]

rule (77 FR 44722 through 45061). We discuss the results of the CY 2012 
refinement panels for certain CY 2012 interim final code values, 
respond to public comments received on specific interim final and 
proposed values (including direct PE inputs), and address the other 
new, revised, or potentially misvalued codes with interim final or 
proposed values. The final CY 2013 direct PE database that lists the 
direct PE inputs is available on the CMS Web site under the downloads 
for the CY 2013 PFS final rule with comment period at: www.cms.gov/PhysicianFeeSched/. The final CY 2013 work, PE, and malpractice RVUs 
are displayed in Addendum B to this final rule with comment period at: 
www.cms.gov/PhysicianFeeSched/.
a. Finalizing CY 2012 Interim and Proposed Work RVUs for CY 2013
i. Refinement Panel
(1) Refinement Panel Process
    As discussed in the 1993 PFS final rule with comment period (57 FR 
55938), we adopted a refinement panel process to assist us in reviewing 
the public comments on CPT codes with interim final work RVUs for a 
year and in developing final work values for the subsequent year. We 
decided the panel would be comprised of a multispecialty group of 
physicians who would review and discuss the work involved in each 
procedure under review, and then each panel member would individually 
rate the work of the procedure. We believed establishing the panel with 
a multispecialty group would balance the interests of the specialty 
societies who commented on the work RVUs with the budgetary and 
redistributive effects that could occur if we accepted extensive 
increases in work RVUs across a broad range of services.
    Depending on the number and range of codes that are subject to 
refinement in a given year, we establish refinement panels with 
representatives from four groups of physicians: Clinicians representing 
the specialty most identified with the procedures in question; 
physicians with practices in related specialties; primary care 
physicians; and contractor medical directors (CMDs). Typical panels 
have included 8 to 10 physicians across the four groups.
    Following the addition of section 1848(c)(2)(K) to the Act by 
Section 3134 of the Affordable Care Act, which authorized the Secretary 
to review potentially misvalued codes and make appropriate adjustments 
to the RVUs, we reassessed the refinement panel process. As detailed in 
the CY 2011 PFS final rule with comment period (75 FR 73306), we 
believed that the refinement panel process may provide an opportunity 
to review and discuss the proposed and interim final work RVUs with a 
clinically diverse group of experts, who then provide informed 
recommendations. Therefore, we indicated that we would continue the 
refinement process, but with administrative modification and 
clarification. We also noted that we would continue using the 
established composition that includes representatives from the four 
groups of physicians--clinicians representing the specialty most 
identified with the procedures in question, physicians with practices 
in related specialties, primary care physicians, and CMDs.
    One change relates to the calculation of the refinement panel 
results. The basis of the process is that following discussion of the 
information but without an attempt to reach a consensus, each member of 
the panel votes independently. Historically, the refinement panel's 
recommendation to change a work value or to retain the interim value 
had hinged solely on the outcome of a statistical test on the ratings 
(an F-test of panel ratings among the groups of participants). Over 
time, we found the statistical test used to evaluate the RVU ratings of 
individual panel members became less reliable as the physicians in each 
group tended to select a previously discussed value, rather than 
developing a unique value, thereby reducing the observed variability 
needed to conduct a robust statistical test. In addition, reliance on 
values developed using the F-test also occasionally resulted in rank 
order anomalies among services (that is, a more complex procedure is 
assigned lower RVUs than a less complex procedure). As a result, we 
eliminated the use of the statistical F-test and instead indicated that 
we would use the median work value of the individual panel members' 
ratings. We said that this approach would simplify the refinement 
process administratively, while providing a result that reflects the 
summary opinion of the panel members based on a commonly used measure 
of central tendency that is not significantly affected by outlier 
values. At the same time, we clarified that we have the final authority 
to set the RVUs, including making adjustments to the work RVUs 
resulting from the refinement process, and that we will make such 
adjustments if warranted by policy concerns (75 FR 73307).
    As we continue to strive to make the refinement panel process as 
effective an efficient as possible, we would like to remind readers 
that the refinement panels are not intended to review every code for 
which we did not propose to accept the AMA RUC-recommended RVUs. Rather 
the refinement panels are designed for situations where there is new 
information available that might provide a reason for a change in work 
values and for which a multi-specialty panel of physicians might 
provide input that would assist us in making work RVU decisions. To 
facilitate the selection of services for the refinement panels, we 
would like to remind specialty societies seeking reconsideration of 
proposed or interim final work RVUs, including consideration by a 
refinement panel, to specifically state they are requesting refinement 
panel review in their public comment letters.
    Furthermore we have asked commenters requesting refinement panel 
review to submit sufficient new information concerning the clinical 
aspects of the work assigned for a service to indicate that referral to 
the refinement panel is warranted (57 FR 55917). We note that the 
majority of the information presented during the CY 2012 refinement 
panel discussions was duplicative of the information provided to the 
AMA RUC during its development of recommendations. As detailed in 
section III.B. of this final rule with comment period, we consider 
information and recommendations from the AMA RUC when assigning 
proposed and interim final RVUs to services. Thus, if the only 
information that a commenter has to present is information already 
considered by the AMA RUC, referral to a refinement panel is not 
appropriate. To facilitate selection of codes for refinement, we 
request that commenters seeking refinement panel review of work RVUs 
submit supporting information that has not already been considered the 
AMA RUC in creating recommended work RVUs or by CMS in assigning 
proposed and interim final work RVUs. We can make best use of our 
resources as well as those of the specialties involved and physician 
volunteers, by avoiding duplicative consideration of information by the 
AMA RUC, CMS, and a refinement panel. To achieve this goal, CMS will 
continue to critically evaluate the need to refer codes to refinement 
panels in future years, specifically considering any new information 
provided by commenters.
(2) Interim Final Work RVUs Referred to the Refinement Panel in CY 2012
    We referred to the CY 2012 refinement panel 17 CPT codes with 
interim final work values for which we

[[Page 69015]]

received a request for refinement that met the process described above. 
For these 17 CPT codes, all commenters requested increased work RVUs. 
For ease of discussion, we will be referring to these services as 
``refinement codes.'' Consistent with the process described above, we 
convened a multi-specialty panel of physicians to assist us in the 
review of the comments. The panel was moderated by our physician 
advisors, and consisted of the following voting members:
     One to two clinicians representing the commenting 
organization;
     One to two primary care clinicians nominated by the 
American Academy of Family Physicians and the American College of 
Physicians;
     Four contractor medical directors (CMDs); and
     One to two clinicians with practices in related 
specialties who were expected to have knowledge of the services under 
review.
    The panel process was designed to capture each participant's 
independent judgment and his or her clinical experience which informed 
and drove the discussion of the refinement code during the refinement 
panel proceedings. Following the discussion, each voting participant 
rated the physician work of the refinement code and submitted those 
ratings to CMS individually and confidentially, with no attempt to 
achieve consensus among the panel members. As finalized in the CY 2011 
PFS final rule with comment period (75 FR 73307), we reviewed the 
ratings from each panel member and determined the median value for each 
service that was reviewed by the refinement panel.
    We note that the individual codes reviewed by the CY 2012 
refinement panel, and their final work RVUs are discussed in section 
III.B.1.b. of this final rule with comment period. Also, see Table 29 
for the refinement panel ratings and the final work RVUs for the codes 
reviewed by the CY 2012 refinement panel.

                       Table 29--Codes Reviewed Under the CY 2012 Refinement Panel Process
----------------------------------------------------------------------------------------------------------------
                                                                                       2012
                                                      CY 2012      AMA RUC/HCPAC    refinement     CY 2013 final
      CPT code             Short descriptor        interim final    recommended    median  panel       WRVU
                                                       WRVU          work RVU         rating
----------------------------------------------------------------------------------------------------------------
26341..............  Manipulat palm cord post               0.91            1.66            1.30            0.91
                      inj.
29581..............  Apply multlay comprs lwr               0.25            0.60            0.50        \3\ 0.25
                      leg.
32096..............  Open wedge/bx lung infiltr.           13.75           17.00           17.00           13.75
32097..............  Open wedge/bx lung nodule..           13.75           17.00           17.00           13.75
32098..............  Open biopsy of lung pleura.           12.91           14.99           14.99           12.91
32100..............  Exploration of chest.......           13.75           17.00           17.00           13.75
32505..............  Wedge resect of lung                  15.75           18.79           18.79           15.75
                      initial.
38230..............  Bone marrow harvest allogen            3.09            4.00            4.00            3.50
38232..............  Bone marrow harvest autolog            3.09            3.50            3.50            3.50
62370..............  Anl sp inf pmp/mdreprg&fil.            0.90            1.10            1.10            0.90
92587..............  Evoked auditory test                   0.35            0.45            0.45            0.35
                      limited.
92588..............  Evoked auditory tst                    0.55            0.60            0.60            0.55
                      complete.
94060..............  Evaluation of wheezing.....            0.26            0.31            0.27            0.27
94726..............  Pulm funct tst                         0.26            0.31            0.26            0.26
                      plethysmograp.
94727..............  Pulm function test by gas..            0.26            0.31            0.26            0.26
94728..............  Pulm funct test                        0.26            0.31            0.26            0.26
                      oscillometry.
94729..............  C02/membane diffuse                    0.17            0.19            0.19            0.19
                      capacity.
----------------------------------------------------------------------------------------------------------------

ii. Code-Specific Issues
---------------------------------------------------------------------------

    \3\ This value is interim for CY 2013.
---------------------------------------------------------------------------

    In this section, we discuss all code families for which we received 
a comment on an interim final physician work value in CY 2012 PFS final 
rule with comment period or on a proposed value in the CY 2013 PFS 
proposed rule. Refer to Addendum B for a comprehensive list of all 
final values.
(1) Integumentary System: Skin, Subcutaneous, and Accessory Structures 
(CPT Code 11056)
    For discussion on CY 2013 interim final work values for CPT code 
11056 refer to section III.M.3. of this final rule with comment period.
(2) Integumentary System: Nails (CPT Code 11719)
    For discussion on CY 2013 interim final work values for CPT code 
11719 refer to section III.M.3. of this final rule with comment period.
(3) Integumentary System: Repair (Closure) (CPT Codes 12035-12057)
    For discussion on CY 2013 interim final work values for CPT codes 
12035 through12057 refer to section III.M.3. of this final rule with 
comment period.
(4) Integumentary System: Repair (Closure) (CPT Codes 15272 and 15276)
    As detailed in the CY 2012 final rule with comment period (76 FR 
73112), for CY 2012, the CPT Editorial Panel deleted 24 skin substitute 
codes and established a 2-tier structure with 8 new codes (CPT codes 
15271 through 15278) to report the application of skin substitute 
grafts, which are distinguished according to the anatomic location and 
surface area rather than by product description.
    We assigned a work RVU of 0.33 to CPT code 15272 (Application of 
skin substitute graft to trunk, arms, legs, total wound surface area up 
to 100 sq cm; each additional 25 sq cm wound surface area, or part 
thereof (List separately in addition to code for primary procedure)) on 
an interim final basis for CY 2012. After clinical review of CPT code 
15272, we believed that a work RVU of 0.33 accurately reflected the 
work associated with this service. The AMA RUC reviewed the survey 
results for CPT code 15272 and recommended the survey 25th percentile 
work RVU of 0.59 for this service. However, we believed this value 
overstated the work of this procedure when compared to the base CPT 
code 15271 (Application of skin substitute graft to trunk, arms, legs, 
total wound surface area up to 100 sq cm; first 25 sq cm or less wound 
surface area). We believed that CPT code 15272 is similar in intensity 
to CPT code 15341 (Tissue cultured allogeneic skin substitute; each 
additional 25 sq cm, or part thereof (List separately in addition to 
code for primary procedure)), and that the primary factor 
distinguishing the work of these two services is the

[[Page 69016]]

intra-service physician time. CPT code 15341 has a work RVU of 0.50, 15 
minutes of intra-service time, and an IWPUT of 0.0333. CPT code 15272 
has 10 minutes of intra-service time. Ten minutes of intra-service work 
at the same intensity as CPT code 15341 is equal to a work RVU of 0.33 
(10 minutes x 0.0333 IWPUT). Therefore, we assigned a work RVU of 0.33 
to CPT code 15272 on an interim final basis for CY 2012.
    Comment: Commenters opposed the CMS-recommended interim final work 
RVU of 0.33 assigned to CPT code 15272. Commenters disagreed with our 
rationale to crosswalk CPT code 15272 to CPT code 15341 and stated that 
CPT code 15003 (Surgical preparation or creation of recipient site by 
excision of open wounds, burn eschar, or scar (including subcutaneous 
tissues), or incisional release of scar contracture, trunk, arms, legs; 
each additional 100 sq. cm, or part thereof, or each additional 1% of 
body area of infants and children (List separately in addition to code 
for primary procedure), which has a work RVU of 0.80, is a more 
suitable comparison code. Commenters noted that although CPT code 15003 
requires 15 minutes of intra-service time whereas CPT code 15272 
requires 10 minutes, it is a more appropriate comparison for valuation 
of the services under this code. Commenters stated that the AMA RUC-
recommended work RVU places this service in the proper rank order with 
the base code, CPT code 15271. Furthermore, commenters noted that if 
all the AMA RUC recommendations for the family of CPT codes 15271 
through15278 were accepted, the result would be financial savings for 
Medicare. Therefore, commenters recommended that we accept the AMA RUC-
recommended work RVU of 0.59 for CPT code 15272.
    Response: Based on the comments received, we re-reviewed CPT code 
15272 and continue to believe that CPT code 15272 is similar in 
intensity to CPT code 15341. The primary distinguishing factor between 
the two services is that CPT code 15272 has 10 minutes of intra-service 
time and CPT code 15341 has 15 minutes. We continue to believe that the 
AMA RUC-recommended work RVU overstates the intensity of this procedure 
compared to the base procedure CPT code 15271. We maintain that valuing 
the 10 minutes of intra-service work at the same intensity as CPT code 
15341, which equates to a work RVU of 0.33, is appropriate. We believe 
that this resulting work RVU maintains appropriate relativity with the 
base code and the entire family of CPT codes (15271 through15278). 
Therefore, we are finalizing a work RVU of 0.33 for CPT code 15272.
    We assigned a work RVU of 0.50 to CPT code 15276 (Application of 
skin substitute graft to face, scalp, eyelids, mouth, neck, ears, 
orbits, genitalia, hands, feet, and/or multiple digits, total wound 
surface area up to 100 sq cm; each additional 25 sq cm wound surface 
area, or part thereof (List separately in addition to code for primary 
procedure)) on an interim final basis for CY 2012 based on our clinical 
review of the work associated with this service. The AMA RUC reviewed 
the survey results for CPT code 15276 and recommended a work RVU of 
0.59, which corresponds to the AMA RUC's recommended work RVU for CPT 
code 15272. We disagreed with the AMA RUC that these two CPT codes 
should be valued the same. We assigned an interim final work RVU of 
0.33 to CPT code 15272 but believed that the work associated with CPT 
code 15276, which describes work on the face, scalp, eyelids, mouth, 
neck, ears, orbits, genitalia, hands, feet, and/or multiple digits, is 
more intense than the work associated with CPT code 15272, which 
describes work on the trunk, arms, and legs. Accordingly, we noted that 
our interim final work RVU for CPT code 15276 accurately captured the 
work associated with this service and established the appropriate 
relativity between the services. Therefore, we assigned a work RVU of 
0.50 to CPT code 15276 on an interim final basis for CY 2012.
    Comment: Commenters disagreed with the CMS-recommended interim 
final work RVU for CPT code 15276. Commenters suggested that CPT code 
15276 is analogous to CPT code 15272, for which the AMA RUC originally 
recommended a work RVU of 0.59, both in physician work and time and 
recommended that CPT code 15276 should be directly crosswalked to CPT 
code 15272. Further, the commenters agreed with the AMA RUC key 
reference to CPT code 15003 (Surgical preparation or creation of 
recipient site by excision of open wounds, burn eschar, or scar 
(including subcutaneous tissues), or incisional release of scar 
contracture, trunk, arms, legs; each additional 100 sq. cm, or part 
thereof, or each additional 1% of body area of infants and children), 
which has a work RVU of 0.80, and stated that CPT code 15276 requires 5 
minutes less intra-service time, 10 minutes versus 15 minutes, and 
requires less physician work to perform. Commenters recommended that we 
value CPT code 15276 based upon the AMA RUC-recommended work RVU of 
0.59 for CPT code 15276.
    Response: Based on the comments received, we re-evaluated whether 
CPT code 15003 was an appropriate comparison code for CPT code 15276. 
However, we concluded that the services of CPT code 15276 are more 
intense than those of CPT code 15272 accordingly; CPT code 15276 should 
be valued to reflect the difference in intensity. We believe a work RVU 
of 0.50 establishes the appropriate difference in intensity between 
these two services. Additionally, we believe this work RVU value 
maintains appropriate relativity with the base code, CPT code 15271, 
and maintains relatively within the entire family of CPT codes (15271 
through15278). Therefore, we are finalizing a work RVU of 0.50 for CPT 
code 15276.
(5) Musculoskeletal: Hand and Fingers (CPT Code 26341)
    CPT code 26341 (Manipulation, palmar fascial cord (ie, Dupuytren's 
cord), post enzyme injection (eg, collagenase), single cord) was 
created by the CPT Editorial Panel along with CPT code 20517 to 
describe a technique for treating Dupuytren's contracture by injecting 
an enzyme into the Dupuytren's cord for full finger extension and 
manipulation, effective January 1, 2012.
    As detailed in the CY 2012 final rule with comment period, we 
assigned an interim final work RVU of 0.91 to CPT code 26341 (76 FR 
73192). After reviewing survey results for CPT code 26341, the AMA RUC 
recommended a work RVU of 1.66, which corresponds to the survey 25th 
percentile value. After clinical review of CPT code 26341, we believed 
the service described by CPT code 26341 is analogous to that of CPT 
code 97140 (Manual therapy techniques (eg, mobilization/manipulation, 
manual lymphatic drainage, manual traction), 1 or more regions, each 15 
minutes), which has a work RVU of 0.43. However, since CPT code 97140 
has no post-service visits (global period = XXX), while CPT code 26341 
includes 1 CPT code 99212 (level 2 office or outpatient visit) (global 
period = 010), we added the work RVU of 0.48 for CPT code 99212, to the 
work RVU of 0.43 for CPT code 97140 to obtain the work RVU of 0.91 for 
CPT code 26341.
    Comment: Commenters disagreed with our decision to crosswalk the 
work RVU of CPT code 26341 to that of CPT code 97140, stating that the 
codes do not have comparable work because CPT code 97140 is performed 
by physical therapists while surgeons perform CPT code 26341. 
Commenters also stated that the work associated with CPT code 26341 
includes local or regional

[[Page 69017]]

anesthesia and the procedure may result in skin rupture, requiring 
physician attention to manipulation. In addition, commenters noted that 
the post-procedure neurovascular assessment involved in CPT code 26341 
is added physician work that is distinctly different from the manual 
therapy techniques furnished in CPT code 97140. Commenters asserted 
that the difference in physician work, intensity, and complexity 
distinguishes the two codes. Commenters also disagreed with our use of 
a reverse building block methodology to value the additional work and 
complexity and said that we arbitrarily reduced the value of the 
surgeon's work involved. Commenters recommended we instead value the 
code based upon the AMA RUC-recommended work RVU of 1.66 for CPT code 
26341 and requested refinement panel review of the code.
    Response: Based on comments received, we referred CPT code 26341 to 
the CY 2012 multi-specialty refinement panel for further review. The 
refinement panel median work RVU for CPT code 26341 was 1.30. We 
believe that the refinement panel median work RVU would create a rank 
order anomaly between this code and similar codes. Although CPT code 
97140 is typically furnished by a physical therapist, we do not believe 
that the difference in the provider specialty typically furnishing the 
service results in a difference in intensity of the service. Commenters 
stated that the post-procedure assessment involved in CPT code 26341 
added physician work that is distinctly different from the manual 
therapy techniques furnished in CPT code 97140. We disagree; both 
services require an assessment following manipulation appropriate to 
the provided service to determine the adequacy and outcome, both 
positive and negative, of the intervention and attention to an atypical 
response to treatment. We continue to believe that the crosswalk and 
reverse building block methodologies that we used in assigning the 
interim final work value are appropriate and the resulting work RVU 
accurately reflects the work associated with this service. After 
consideration of the public comments, refinement panel median, and our 
clinical review, we are finalizing a work RVU of 0.91 for CPT code 
26341.
(6) Musculoskeletal: Application of Casts and Strapping (CPT Codes 
29581-29584)
    For discussion on interim final work values for CPT codes 29581, 
29582, 29583, and 29584 refer to section III.M.3. of this final rule 
with comment period.
(7) Respiratory: Lungs and Pleura (CPT Codes 32096-32100, 32505)
    In the CY 2012 final rule with comment period, we assigned an 
interim final work RVU of 13.75 for CPT code 32096 (Thoracotomy, with 
diagnostic biopsy(ies) of lung infiltrate(s) (eg, wedge, incisional), 
unilateral) (76 FR 73193). As we noted, the CPT Editorial Panel 
reviewed the lung resection family of codes and deleted eight, revised 
five, and created 18 new codes to describe thoracoscopic procedures 
effective January 1, 2013. For the wedge resection procedures, the 
revisions were based on three tiers; first, the approach, thoracotomy 
or thoracoscopy; second, the target to remove nodules or infiltrates; 
and lastly the intent, diagnostic or therapeutic (for nodules only, all 
infiltrates will be removed for diagnostic purposes).
    As we noted in the CY 2012 final rule with comment period, after 
clinical review of CPT code 32096, we believed a work RVU of 13.75 
accurately reflected the work associated with this service compared to 
other related services. The AMA RUC reviewed the survey results, 
compared the code to other services, and concluded that the survey 25th 
percentile work RVU of 17.00 appropriately accounted for the work and 
physician time required to perform this procedure. We determined that 
the work associated with CPT code 32096 was similar in terms of 
physician time and intensity to CPT code 44300 (Placement, enterostomy 
or cecostomy, tube open (eg, for feeding or decompression) (separate 
procedure)). Therefore, we assigned the same work RVU to CPT code 32096 
as that of CPT code 44300 on an interim final basis for CY 2012.
    Comment: Commenters stated that CPT code 44300 is an arbitrary 
crosswalk, noting that CPT code 32096 describes an open thoracic 
procedure whereas CPT code 44300 is the placement of a feeding tube. A 
commenter shared a regression analysis of physician time and physician 
work of all thoracic surgery codes, which showed that the interim final 
work RVU value falls below the regression line and stated that this 
indicated an inappropriate work value. Commenters stated our work 
values are lower for equivalent physician time than virtually all our 
prior decisions for the specialty. Additionally, commenters noted that 
the values result in IWPUT values that are approximately half of those 
ordinarily associated with major surgical procedures. Therefore, 
commenters stated that the interim final work RVU of 13.75 for CPT code 
32096 would result in rank order anomalies with other codes in the 
physician fee schedule. Commenters recommended we use the AMA RUC-
recommended work RVU of 17.00 and requested refinement panel review of 
the code.
    Response: Based on comments received, we referred CPT code 32096 to 
the CY 2012 multi-specialty refinement panel for further review. The 
refinement panel median work RVU for CPT code 32096 was 17.00. 
Following the refinement panel, we again conducted a clinical review 
and continue to believe a work RVU of 13.75 accurately reflected the 
work associated with this service. For CY 2012, the CPT Editorial Panel 
deleted CPT code 32095 which had a work RVU of 10.14 and created CPT 
codes 32096, 32097, and 32100 to replace CPT code 32095. Upon our 
clinical review, we do not believe that there is a significant 
difference in intensity between deleted CPT code 32095 and replacement 
CPT code 32096. We believe that the appropriate work RVU for CPT code 
32096 should be close to a work RVU of 10.14, but should account for 
the increase in 15 minutes of total time between deleted CPT code 32095 
and new CPT code 32096. We believe that the refinement panel median 
work RVU of 17.00 far overstates this difference. Additionally, we 
continue to believe that the work associated with 32096 is similar in 
terms of physician time and intensity to CPT code 44300. Therefore, we 
still believe the work RVU of 13.75 appropriately values this service. 
After consideration of the public comments, refinement panel results, 
and our clinical review, we are assigning a work RVU of 13.75 as the 
final value for CPT code 32096.
    As detailed in the CY 2012 final rule with comment period, we 
assigned an interim final work RVU of 13.75 for CPT code 32097 
(Thoracotomy, with diagnostic biopsy(ies) of lung nodule(s) or mass(es) 
(eg, wedge, incisional), unilateral) (76 FR 73194). We noted that after 
clinical review of CPT code 32097, we believed a work RVU of 13.75 
accurately reflected the work associated with this service compared to 
other related services. We also noted that the AMA RUC had reviewed the 
specialty society survey results, compared the code to other services, 
and recommended the survey 25th percentile work RVU of 17.00. We stated 
that we determined that the work associated with CPT code 32097 was 
similar to CPT code 32096, to which we assigned a work RVU of 13.75 on 
an interim final basis for CY 2012.

[[Page 69018]]

Therefore, we assigned a work RVU of 13.75 for CPT code 32097 on an 
interim final basis for CY 2012.
    Comment: Commenters stated that CPT code 44300 is an arbitrary 
crosswalk for CPT code 32097 because it describes an open thoracic 
procedure whereas CPT code 44300 is the placement of a feeding tube. 
Commenters shared a regression analysis of physician work and time for 
all thoracic surgery codes, which shows that the interim final work RVU 
value falls below the regression line and noted that this indicates 
inappropriately low work intensity. Commenters stated our interim final 
work RVU values are lower for equivalent physician time than virtually 
all prior work RVU decisions for this specialty. Commenters noted that 
the interim final work RVU values result in IWPUT values that are 
approximately half of those ordinarily associated with major surgical 
procedures. Commenters added that the interim final work RVU of 13.75 
for CPT code 32097 result in rank order anomalies with other codes. 
Commenters recommended we instead use the AMA RUC-recommended work RVU 
of 17.00 for CPT code 32097 and requested refinement panel review of 
the code.
    Response: Based on comments received, we referred CPT code 32097 to 
the CY 2012 multi-specialty refinement panel for further review. The 
refinement panel median work RVU for CPT code 32097 was 17.00. CPT 
codes 32096, 32097, and 32100 were created to replace CPT code 32095, 
which was deleted, effective January 1, 2012. We believe these three 
services involve the same amount of physician work and should have the 
same work RVU. Thus, the same rationale that we used to value CPT code 
32096 applies to CPT code 32097. We continue to believe that the work 
associated with CPT code 32097 is similar in terms of physician time 
and intensity to CPT code 44300 and thus, still believe the work RVU of 
13.75 is appropriate. Additionally, we continue to believe that a work 
RVU of 17.00 overstates the increase in work between deleted CPT code 
32095 and its replacement CPT codes. After consideration of the public 
comments, refinement panel results, and our clinical review, we are 
assigning a work RVU of 13.75 as the final value for CPT code 32097.
    As detailed in the CY 2012 final rule with comment period, we 
assigned an interim final work RVU of 12.91 to CPT code 32098 
(Thoracotomy, with biopsy(ies) of pleura) (76 FR 73194). We noted that 
after clinical review, we believed a work RVU of 12.91 accurately 
reflected the work associated with this service as compared to other 
related services. After reviewing survey results and comparing the code 
to other services, the AMA RUC recommended the survey 25th percentile 
work RVU of 14.99. We noted that the work associated with CPT code 
32098 was similar in terms of physician time and intensity to CPT code 
47100 (Biopsy of liver, wedge) and therefore we believed that 
crosswalking to the work RVU of CPT code 47100 appropriately accounted 
for the work associated with CPT code 32098. Therefore, we assigned a 
work RVU of 12.91 to CPT code 32098 on an interim final basis for CY 
2012.
    Comment: Commenters shared a regression analysis of physician time 
and physician work of all thoracic surgery codes, and indicated that 
our interim final work RVU value falls below the regression line, which 
commenters noted indicated inappropriately low work intensity. 
Commenters stated that a work RVU of 12.91 results in an IWPUT of 
0.0741, which is insufficient intensity compared to other similar 
procedures. Commenters stated that our interim final work RVU of 12.91 
for CPT code 32098 placed this service out of relativity with the CPT 
codes in this family for which we accepted the AMA RUC recommendations 
and requested refinement panel review of the code.
    Response: Based on comments received, we referred CPT code 32098 to 
the CY 2012 multi-specialty refinement panel for further review. The 
refinement panel median was a work RVU of 14.99. This service would be 
out of rank order with the other services in the family described by 
CPT codes 32096, 32097, 32100, and 32505 if we adopted a work RVU of 
14.99. As noted above, we continue to believe a work RVU of 13.75 is 
appropriate for CPT code 32096. Since CPT code 32098 describes a more 
limited procedure that takes less time than the other codes in the 
family (CPT codes 32096, 32097, 32100, and 32505) it should have a 
lower work RVU. After consideration of the public comments, refinement 
panel results, and our clinical review, we believe that that the work 
associated with 32098 is similar in terms of physician time and 
intensity to CPT code 47100 and therefore we are assigning a work RVU 
of 12.91 as the final value for CY 2013 for CPT code 32098.
    We assigned a work RVU of 13.75 for CPT code 32100 (Thoracotomy; 
with exploration) on an interim final basis in the CY 2012 final rule 
with comment period (76 FR 73194). After clinical review of CPT code 
32100, we believed a work RVU of 13.75 accurately reflected the work 
associated with this service as compared to other related services. The 
AMA RUC reviewed the specialty society survey results, compared the 
code to other services, and recommended a work RVU of 17.00. We noted 
that the affected specialty society and AMA RUC asserted that CPT code 
32100 should be valued the same as CPT codes 32096 and 32097 because 
they believe that the work is similar for these three services. We 
noted that we assigned a work RVU of 13.75 to CPT codes 32096 and 
32097, and therefore a work RVU of 13.75 to CPT code 32100 as well.
    Comment: Commenters stated that CPT code 44300 is an inappropriate 
crosswalk for CPT code 32100 because it describes an open thoracic 
procedure whereas CPT code 44300 is the placement of a feeding tube. 
Commenters shared a regression analysis of physician work and time all 
thoracic surgery codes that shows the interim final work RVU value 
falls below the regression line and stated that this indicates 
inappropriately low work intensity. Commenters stated the interim final 
work RVU value is lower for equivalent physician time than virtually 
all prior work RVU assignments for this specialty. Commenters noted 
that the interim final work RVU value results in IWPUT values that are 
approximately half of those ordinarily associated with major surgical 
procedures. Therefore, commenters stated that the interim final work 
RVU of 13.75 for CPT code 32100 would result in rank order anomalies 
with other codes in the fee schedule. Commenters recommended we value 
the work based upon the AMA RUC-recommended work RVU of 17.00 for CPT 
code 32100 and requested refinement panel review of the code.
    Response: Based on comments received, we referred CPT code 32100 to 
the CY 2012 multi-specialty refinement panel for further review. The 
refinement panel median work RVU for CPT code 32100 was 17.00. CPT 
codes 32096, 32097, and 32100 were created to replace CPT code 32095, 
which was deleted, effective January 1, 2012. We believe these three 
services involve the same amount of physician work and should have the 
same work RVU. Thus, the same rationale that we used to value CPT codes 
32096 and 32097 applies to CPT code 32100. We continue to believe that 
the work associated with 32100 is similar in terms of physician time 
and intensity to CPT code 44300. In addition, we agree with the 
specialty society and AMA RUC's assertion that CPT code 32100 should be 
valued the same as CPT codes 32096 and 32097.

[[Page 69019]]

Furthermore, we continue to believe that a work RVU of 17.00 overstates 
the increase in work between deleted CPT code 32095 and its replacement 
CPT codes. Thus, we maintain that the interim final work RVU of 13.75 
is still appropriate. After consideration of the public comments, 
refinement panel results, and our clinical review, we are assigning a 
work RVU of 13.75 as the final value for CY 2013 for CPT code 32100.
    We assigned a work RVU of 15.75 for CPT code 32505 (Thoracotomy; 
with therapeutic wedge resection (eg, mass, nodule), initial) on an 
interim final basis in the CY 2012 final rule with comment period (76 
FR 73194). We noted that after clinical review of CPT code 32505, we 
believed a work RVU of 15.75 accurately reflected the work associated 
with this service compared to other related services. After reviewing 
the survey results, comparing the code to other services, the AMA RUC 
recommended the survey 25th percentile work RVU of 18.79. We explained 
that we assigned the interim final work RVU of 15.75 in recognition of 
the greater physician work and intensity involved in CPT 32505 as 
compared to CPT code 32096. We valued the additional 30 minutes of 
intra-service work associated with CPT code 32505 at 2.00 work RVUs. 
Accordingly, we assigned a work RVU of 15.75 for CPT code 32505 on an 
interim final basis for CY 2012.
    Comment: Commenters stated that they entirely disagreed with the 
methods used to value CPT code 32096 and therefore, disagreed with the 
value assigned to 32505 that was based upon the value assigned to CPT 
code 32096. Commenters said that the methods used for valuing CPT code 
32505 have never been employed to determine a code's work value. 
Further, commenters explained that our value results in an IWPUT of 
0.06, which is lower than the AMA RUC recommendation. Commenters 
recommended we value CPT code 32505 based upon the AMA RUC-recommended 
work RVU of 18.79 for this code and requested refinement panel review.
    Response: Based on comments received, we referred CPT code 32505 to 
the CY 2012 multi-specialty refinement panel for further review. We 
determined that the refinement panel median work RVU of 18.79 was 
relatively high in relation to the other codes in the family. We 
maintain that the incremental difference between CPT code 32096 and CPT 
code 32505 is 2.00 RVUs and, therefore continue to believe that a work 
RVU value of 15.75 accurately reflects the value of the service. As a 
result of the refinement panel results, the public comments, and our 
clinical review, we are assigning a work RVU of 15.75 as the final 
value for CPT code 32505.
(8) Respiratory: Lungs and Pleura (CPT Codes 32663, 32668-32673)
    For discussion on interim final work values for CPT codes 32663, 
32668 through 32673 refer to section III.M.3. of this final rule with 
comment period.
(9) Cardiovascular: Heart and Pericardium (CPT Code 36247)
    In the Fourth Five-Year Review of Work (76 FR 32445), we discussed 
CPT code 36247 (Selective catheter placement, arterial system; initial 
third order or more selective abdominal, pelvic, or lower extremity 
artery branch, within a vascular family) and proposed a CY 2012 work 
RVU of 6.29 and a global period change from 90 days (Major surgery with 
a 1-day pre-operative period and a 90-day postoperative period included 
in the fee schedule amount) to XXX (the global concept does not apply). 
In the CY 2012 PFS final rule with comment period (76 FR 73132), we 
agreed with commenters to the Fourth Five-Year Review of Work that our 
discussion of the global period was incorrect and should have indicated 
a change in global period from XXX to 000 (Minor procedure-includes 
RVUs for pre- and post-operative procedures on the same day). We stated 
that, based on comments received, we referred CPT code 36247 to the CY 
2011 multi-speciality refinement panel for further review. The 
refinement panel median value was a work RVU of 7.00, the AMA RUC-
recommended value. We went on to state that upon clinical review, we 
believed that our proposed work RVU of 6.29 was more appropriate. We 
stated that we observed a significant decrease in the physician times 
reported for this service that argue for a lower work RVU, 
notwithstanding that the survey was conducted for a 0-day global 
period, which includes an E/M service on the same day. Therefore, we 
assigned work RVUs of 6.29 and a global period of 000 to CPT code 36247 
on an interim basis for CY 2012 and invited additional public comment 
on this code in the CY 2012 final rule with comment period.
    Comment: A commenter appreciated that we acknowledged that we made 
an inadvertent error when we referred to the original global period of 
the code as 90 global days rather than XXX global days. However, this 
commenter stated that the new 0-day global period, which includes an E/
M service on the same day, justified the refinement panel's median 
value of a work RVU of 7.00. Additionally, commenters stated that the 
change from a global period of XXX (global concept does not apply) to a 
global period of 000 (Minor procedure-includes RVUs for pre- and post-
operative procedures on the same day) added additional pre-service 
work. Other commenters stated that with the removal of the lower 
extremity intervention patients from the code, the procedures now coded 
with this procedure are more complex and warrant an increased value. 
Commenters also pointed out that the CY 2011 refinement panel median 
for the code was 7.00 work RVUs. Commenters requested that we accept 
the AMA RUC recommendation of 7.00 work RVUs for CPT code 36247.
    Response: Based on comments received, we re-reviewed CPT code 
36247. We continue to believe that our proposed work RVU of 6.29 
accurately reflects the work associated with this service. Based on the 
significant reduction in the physician intra-service time assigned to 
this service from 86 minutes to 60 minutes, if this CPT code had 
maintained a global period of XXX, we believe it would have been 
appropriate to reduce the work RVU below the current value of 6.29 to 
reflect the reduction in time. We do not believe that the potential 
increase in intensity due to the complexity of the patient mix counter 
balances the decrease in intra-service time. We understand that this 
service now includes the work of a same day E/M visit, and we believe 
this additional work is accounted for by maintaining the current work 
RVU of 6.29 rather than reducing the work RVU, as would have been 
appropriate if the service had maintained global period of XXX. 
Therefore, we are finalizing a work RVU of 6.29 and a 000 global period 
for CPT code 36247.
(10) Renal Angiography Codes (CPT Code 36251)
    As detailed in the CY 2012 final rule with comment period (76 FR 
73196), the CPT Editorial Panel created four bundled renal angiography 
services (CPT codes 36251, 36252, 36253, and 36254), effective January 
1, 2012.
    We assigned a work RVU of 5.35 to CPT code 36251 (Selective 
catheter placement (first-order), main renal artery and any accessory 
renal artery(s) for renal angiography, including arterial puncture and 
catheter placement(s), fluoroscopy, contrast injection(s), image 
postprocessing, permanent recording of images, and radiologic 
supervision and interpretation, including pressure gradient 
measurements when performed, and flush aortogram when performed; 
unilateral) on an interim final basis for CY 2012 based upon our

[[Page 69020]]

clinical review of the code. The AMA RUC reviewed the survey results, 
compared the code to other services, and concluded that the work value 
for CPT code 36251 should be directly crosswalked to CPT code 31267 
(Nasal/sinus endoscopy, surgical, with maxillary antrostomy; with 
removal of tissue from maxillary sinus) endoscopy, surgical, with 
maxillary antrostomy; with removal of tissue from maxillary sinus), 
which has a work RVU of 5.45, and recommended a work RVU of 5.45 for 
CPT code 36251. We determined that the work associated with CPT code 
36251 is closely aligned in terms of physician time and intensity with 
that of CPT code 52341 (Cystourethroscopy; with treatment of ureteral 
stricture (eg, balloon dilation, laser, electrocautery, and incision), 
which has a work RVU of 5.35. We believed crosswalking to the work RVU 
of CPT code 52341 appropriately accounted for the work associated with 
CPT code 36251. Therefore, we assigned a work RVU of 5.35 to CPT code 
36251 on an interim final basis for CY 2012.
    Comment: Commenters disagreed with the interim final work RVU of 
5.35 for CPT code 36251, stating that the family of CPT codes (36251, 
36252, 36253, and 36254) was carefully reviewed by the AMA RUC and the 
rank order was appropriately established by the AMA RUC 
recommendations. Commenters recommended CPT code 36251 should be 
directly crosswalked to CPT code 31267 as the AMA had recommended and 
requested that we use 5.45 work RVUs for CPT code 36251.
    Response: Based on the comments received, we re-reviewed CPT code 
36251 and considered the commenters' recommendation that it be directly 
crosswalked to CPT code 31267. After re-considering the crosswalk, we 
continue to believe that the work associated with CPT code 36251 is 
closely aligned in terms of physician time and intensity with CPT code 
52341 and that crosswalking to CPT code 52341 appropriately results in 
a work RVU of 5.35. Therefore, we are finalizing a work RVU of 5.35 for 
CPT code 36251 for CY 2013.
    We assigned an interim final work RVU of 6.99 to CPT code 36252 
(Selective catheter placement (first-order), main renal artery and any 
accessory renal artery(s) for renal angiography, including arterial 
puncture and catheter placement(s), fluoroscopy, contrast injection(s), 
image postprocessing, permanent recording of images, and radiologic 
supervision and interpretation, including pressure gradient 
measurements when performed, and flush aortogram when performed; 
bilateral), for CY 2012 after clinical review. The AMA RUC reviewed the 
survey results, compared the code to other services, and concluded that 
the work value for CPT code 36252 should be directly crosswalked to CPT 
code 43272 (Endoscopic retrograde cholangiopancreatography (ERCP); with 
ablation of tumor(s), polyp(s), or other lesion(s) not amenable to 
removal by hot biopsy forceps, bipolar cautery or snare technique), 
which has a work RVU of 7.38. Although the AMA RUC recommended a work 
RVU of 7.38 for CPT code 36252, we found that the intensity of this 
service is more similar to CPT code 58560 (Hysteroscopy, surgical; with 
division or resection of intrauterine septum (any method)), which has a 
work RVU of 6.99. Accordingly, we assigned an interim final work RVU of 
6.99 to CPT code 36252 for CY 2012.
    Comment: Commenters stated that this family of CPT codes 36251, 
36252, 36253, and 36254 were carefully reviewed by the AMA RUC, that 
the rank order was appropriately established based on the AMA RUC 
recommendations, and that CPT code 36252 should be crosswalked to CPT 
code 43272 (Endoscopic retrograde cholangiopancreatography (ERCP); with 
ablation of tumor(s), polyp(s), or other lesion(s) not amenable to 
removal by hot biopsy forceps, bipolar cautery or snare technique), 
which has a work RVU of 7.38, as the AMA recommended.
    Response: Based on the comments received, we re-reviewed CPT code 
36252. Although commenters recommended a direct crosswalk to CPT code 
43272, we continue to believe that the work of the services is similar 
to the reference CPT code 58560. Accordingly, we find that the 
resulting work RVUs of 6.99 is still appropriate and accounts for the 
work associated with this service and we are finalizing a work RVU 
value of 6.99 for CPT code 36252.
(11) IVC Transcatheter Procedures (CPT Codes 37192 and 37193)
    As discussed in the CY 2012 final rule with comment period (76 FR 
73197), for CPT code 37192 (Repositioning of intravascular vena cava 
filter, endovascular approach inclusive of vascular access, vessel 
selection, and all radiological supervision and interpretation, 
intraprocedural roadmapping, and imaging guidance (ultrasound and 
fluoroscopy)), we assigned a work RVU of 7.35 to CPT code 37192, with a 
refinement to 45 minutes of intra-service time, on an interim final 
basis for CY 2012.
    After clinical review of CPT code 37192, we believed a work RVU of 
7.35 accurately reflected the work associated with this service. The 
AMA RUC reviewed the survey results, compared the code to other 
services, and concluded that the survey 75th percentile intra-service 
time of 60 minutes and the 25th percentile of work RVU of 8.00 
accurately described the physician work involved in the service. We 
determined that the work associated with CPT code 37192 is similar to 
CPT code 93460 (Catheter placement in coronary artery(s) for coronary 
angiography, including intraprocedural injection(s) for coronary 
angiography, imaging supervision and interpretation; with right and 
left heart catheterization including intraprocedural injection(s) for 
left ventriculography, when performed), which has a work RVU of 7.35, 
48 minutes pre-service time, 50 minutes intra-service time, and 30 
minutes post-service time. By comparing the times assigned to those of 
CPT code 93460, we determined that the survey median intra-service time 
of 45 minutes appropriately accounted for the time required to furnish 
the intra-service work of CPT code 37192. Therefore, we assigned it a 
work RVU of 7.35, with a refinement to 45 minutes of intra-service time 
on an interim final basis for CY 2012. A complete listing of the times 
associated with this code is available on the CMS Web site at: 
www.cms.gov/PhysicianFeeSched/.
    Comment: A commenter disagreed with our valuation for CPT code 
37192, but did not provide information as to why the valuation was 
inappropriate. The commenter urged that we accept the AMA RUC-
recommended work RVU and times.
    Response: After clinical re-review of CPT code 37192, we maintain 
that the work associated with CPT code 37192 is similar to CPT code 
93460, which has the following times: 48 minutes pre-service, 50 
minutes intra-service, and 30 minutes post-service. As a result, we 
continue to believe that the survey median intra-service time of 45 
minutes appropriately accounts for the time involved in furnishing the 
intra-service work of this procedure. We believe that the crosswalk 
work RVU of 7.35 more appropriately values the services furnished in 
this code than the AMA RUC recommended value of 8.00 RVUs. We are 
finalizing a work RVU of 7.35 to CPT code 37192, with a refinement to 
45 minutes of intra-service time. A complete listing of the times 
associated with this code is available on the CMS Web site at 
www.cms.gov/PhysicianFeeSched/.

[[Page 69021]]

    As discussed in the CY 2012 final rule with comment period (76 FR 
73197), for CPT code 37193 (Retrieval (removal) of intravascular vena 
cava filter, endovascular approach inclusive of vascular access, vessel 
selection, and all radiological supervision and interpretation, 
intraprocedural roadmapping, and imaging guidance (ultrasound and 
fluoroscopy)), we assigned a work RVU of 7.35 to CPT code 37193, with a 
refinement to 45 minutes of intra-service time, on an interim final 
basis for CY 2012. After clinical review of CPT code 37193, we believed 
a work RVU of 7.35 accurately reflected the work associated with this 
service. The AMA RUC reviewed the survey results, compared the code to 
other services, and concluded that the survey 75th percentile intra-
service time of 60 minutes and the 25th percentile of work RVU of 8.00 
accurately described the physician work involved in the service. We 
believed that the work associated with CPT code 37193 is similar to CPT 
code 93460 (Catheter placement in coronary artery(s) for coronary 
angiography, including intraprocedural injection(s) for coronary 
angiography, imaging supervision and interpretation; with right and 
left heart catheterization including intraprocedural injection(s) for 
left ventriculography, when performed), which has a work RVU of 7.35, 
48 minutes pre-service time, 50 minutes intra-service time, and 30 
minutes post-service time. Based upon these times, we believed that the 
survey median intra-service time of 45 minutes appropriately accounted 
for the time required to furnish the intra-service work associated with 
CPT code 37193. Therefore, we assigned a work RVU of 7.35 to CPT code 
37193, with a refinement to 45 minutes of intra-service time, on an 
interim final basis for CY 2012. A complete listing of the times 
associated with this code is available on the CMS Web site at: 
www.cms.gov/PhysicianFeeSched/.
    Comment: Without providing more information, a commenter disagreed 
with the work RVUs assigned and refinement to time for CPT code 37193 
and urged that we accept the AMA RUC-recommended work RVU of 8.00, and 
recommended time.
    Response: After clinical re-review of CPT code 37193, we maintain 
that the work associated with CPT code 37193 is similar to CPT code 
93460, which has the following times: 48 minutes pre-service, 50 
minutes intra-service, and 30 minutes post-service. We continue to 
believe that the survey median intra-service time of 45 minutes 
appropriately accounted for the time required to furnish the intra-
service work of this CPT code 37193 rather than the AMA RUC-recommended 
intra-service time of 60 minutes. We also continue to believe that the 
work RVU of 7.35 more appropriately values the services furnished in 
this code than the AMA-recommended work RVU of 8.00. Therefore, we are 
finalizing a work RVU of 7.35 to CPT code 37132, with a refinement to 
45 minutes of intra-service time. A complete listing of the times 
associated with this code is available on the CMS Web site at: 
www.cms.gov/PhysicianFeeSched/.
(12) Hemic and Lymphatic Systems: General, Bone Marrow or Stem Cell 
Services/Procedures (CPT Codes 38230 and 38232)
    On an interim final basis, we assigned a work RVU of 3.09 to CPT 
codes 38230 (Bone marrow harvesting for transplantation; allogeneic) 
and 38232 (Bone marrow harvesting for transplantation; autologous) for 
CY 2012 (76 FR 73197). In the CY 2012 final rule with comment period we 
noted that for CY 2012, the CPT Editorial Panel split CPT code 38230 
into two separate CPT codes: 38230 and 38232 to more accurately reflect 
current medical practice. We noted that we changed the global period 
from 010 to 000 for CPT code 38230, and assigned a global period of 000 
to CPT code 38232, as these services rarely required overnight 
hospitalization and physician follow-up in the days following the 
procedure.
    We noted that after clinical review of CPT codes 38230 and 38232, 
we believed that a work RVU of 3.09 appropriately accounted for the 
work associated with these services. The AMA RUC reviewed the survey 
results and, after comparison to similar CPT codes, the AMA RUC 
recommended the survey median work RVU of 4.00 for CPT code 38230, and 
the survey median work RVU of 3.50 for CPT code 38232. Notwithstanding 
the AMA-RUC recommendation, we noted that the work for these services 
is very similar and should be valued the same. In CY 2011, CPT code 
38230 had a work RVU of 4.85 with a ten-day global period that included 
a CPT code 99213 (Level 3 office or outpatient visit, established 
patient), and a CPT code 99238 (discharge day management service). We 
explained that we considered converting the value of CPT code 38230 
from a 10-day global period to a 0-day global period by subtracting the 
work RVUs for CPT code 99213 (work RVU=0.97) and CPT code 99238 (work 
RVU=1.28), but believed that the resulting work RVU of 2.60 would 
result in this code being valued too low compared to other similar 
services. Instead, we found that the CPT code 38230 survey 25th 
percentile work RVU of 3.09 accurately captured the intensity of this 
service with the revised global period. Therefore, we assigned a work 
RVU of 3.09 to CPT code 38230 on an interim final basis for CY 2012. 
Since, as explained above, we believed that CPT code 38232 should have 
the same work RVU as CPT code 38230, we also assigned a work RVU of 
3.09 to CPT code 38230 on an interim final basis for CY 2012.
    Comment: Commenters acknowledged that the intra-service times of 
CPT codes 38230 and 38232 are similar; however, they stated that the 
service described by CPT code 38230 is typically more intense and 
stressful since it is being performed on a donor, who does not directly 
benefit from the procedure. Commenters also noted that collecting donor 
cells is typically prolonged to ensure that enough cells have been 
collected. Commenters stated that although the survey did not reflect 
the intra-service time for CPT code 38230, the AMA RUC-recommended 
values appropriately accounted for the lower time reported in the 
survey with a higher work RVU value. Additionally, commenters stated 
that the reverse building block methodology was an inappropriate policy 
to apply to any services with changing global day periods and in this 
case, particularly inappropriate because the post-operative visits 
built into the code were initially valued by the Harvard study several 
years ago. Given these arguments, commenters requested the AMA RUC 
recommended work RVUs of 4.00 for CPT code 38230 and 3.50 for CPT code 
38232 be used to value these codes and requested refinement panel 
review of these codes.
    Response: Based on comments received, we referred CPT codes 38230 
and 32832 to the CY 2012 multi-specialty refinement panel for further 
review. The refinement panel median work RVU for CPT code 38230 was 
4.00, and the median work RVU for CPT code 38232 was 3.50. We continue 
to believe that CPT codes 38232 and 38230 require the same amount of 
physician work and should be valued the same. After reviewing the 
public comments and the refinement panel ratings, we agree that the 
refinement panel median work RVU of 3.50 for CPT code 38232 more 
appropriately reflects the work of CPT codes 38230 and 38232 than the 
interim final work RVU of 3.09. We believe the refinement panel median 
work RVU of 4.00 for CPT code 38230 overstates the work associated with 
these services, especially considering that for CPT code

[[Page 69022]]

38230 the survey 25th percentile work RVU was 3.09 and a building block 
methodology based on the CY 2011 work RVU and global period yielded 
work RVU of 2.60 for this service. As a result of the refinement panel 
ratings, the public comments, and our clinical review, we are 
finalizing a work RVU of 3.50 for CPT codes 32830 and 32832.
(13) Digestive: Abdomen, Peritoneum, and Omentum (CPT Code 49084)
    As detailed in the CY 2012 final rule with comment period (76 FR 
73198), the CPT Editorial Panel deleted CPT codes 49080 and 49081and 
created three new CPT codes, 49082, 49083, and 49084, effective January 
1, 2012, to more accurately describe the current medical practice.
    After clinical review, we assigned a work RVU of 2.00 to CPT codes 
49083 (Abdominal paracentesis (diagnostic or therapeutic); with imaging 
guidance) and 49084 (Peritoneal lavage, including imaging guidance, 
when performed) on an interim final basis for CY 2012. The AMA RUC 
recommended a work RVU of 2.00 for CPT code 49083 and a work RVU of 
2.50 for CPT code 49084. We agreed with the AMA RUC-recommended work 
RVU of 2.00 for CPT code 49083, but disagreed that CPT 49084 should be 
valued more. Instead, we believed that CPT code 49084 requires similar 
work to code 49083 and should be valued the same. Therefore, we 
assigned a work RVU of 2.00 to CPT codes 49083 and 49084 on an interim 
final basis for CY 2012.
    Comment: One commenter disagreed with our valuation of CPT code 
49084 and the resulting work RVU recommendation but did not describe 
why.
    Response: After clinical re-review of CPT code 49084, we continue 
to believe that CPT code 49084 requires similar work as CPT code 49083 
and should be valued the same. Accordingly, we are finalizing a work 
RVU of 2.00 for CPT codes 49083 and 49084.
(14) Nervous: Spine and Spinal Cord (CPT Codes 62370)
    CPT code 62370 (Electronic analysis of programmable, implanted pump 
for intrathecal or epidural drug infusion (includes evaluation of 
reservoir status, alarm status, drug prescription status)); with 
reprogramming and refill (requiring physician's skill)) newly created 
by the CPT Editorial Panel for CY 2012, was assigned an interim final 
work RVU of 0.90 for CY 2012 as discussed in the CY 2012 final rule 
with comment period (76 FR 73199).
    As we noted in the CY 2012 final rule with comment period, after 
clinical review of CPT code 62370, we believed that a work RVU of 0.90 
accurately accounted for the work associated with this service. We 
noted that after a comparison to similar services, the AMA RUC 
recommended a work RVU of 1.10 for CPT code 62370 based on a crosswalk 
to CPT code 56605 (Biopsy of vulva or perineum (separate procedure); 1 
lesion) however, we believed that a work RVU of 1.10 for CPT code 62370 
was too high compared to similar services in this family. Instead, we 
found CPT code 62370 to be similar in intensity and complexity to CPT 
code 93281 (Programming device evaluation (in person) with iterative 
adjustment of the implantable device to test the function of the device 
and select optimal permanent programmed values with physician analysis, 
review and report; multiple lead pacemaker system), which has a work 
RVU of 0.90. We noted that this value, which is between the specialty 
society survey 25th percentile and median work RVU, appropriately 
reflected the work of CPT code 62370. Therefore, we assigned a work RVU 
of 0.90 to CPT code 62370 on an interim final basis for CY 2012.
    Comment: Commenters disagreed with the value, explaining that CPT 
code 93281 was not an appropriate crosswalk because it was a 
programming only code while CPT code 62370, is a procedure and 
programming code. Commenters noted that the interim final work RVU of 
0.90 does not account for the work in refilling the pump, which 
requires a sterile puncture in a patient whose complexities preclude 
provision of these services by a nonphysician. Therefore, commenters 
requested that CPT code 62370 be valued based upon the AMA RUC 
recommended value of 1.10 work RVUs and requested refinement panel 
review of this code.
    Response: Based on comments received, we referred CPT code 62370 to 
the CY 2012 multi-specialty refinement panel for further review. The 
refinement panel median work RVU for CPT code 62370 was 1.10. In 
subsequent review, we determined that valuing this code at the 
refinement panel median work RVU value would result in too high a value 
as compared to the other codes in the family. CPT code 62369 
(Electronic analysis of programmable, implanted pump for intrathecal or 
epidural drug infusion (includes evaluation of reservoir status, alarm 
status, drug prescription status); with reprogramming and refill) has a 
work RVU of 0.67. CPT code 62369 describes the same procedure as CPT 
code 62370, except in CPT code 62369 the reprogramming and refill does 
not require physician skill and in CPT code 62370 the reprogramming and 
refill does require physician skill. We believe a work RVU of 0.90 for 
CPT code 62370 reflects the appropriate incremental increase in 
physician work for reprogramming and refill by a physician, versus a 
nonphysician. We also continue to believe that CPT code 93281, which 
was recently reviewed, has similar intensity and complexity to CPT code 
62370, and that CPT codes 93281 and 62370 include the same amount of 
intra-service physician time. We believe that CPT codes 93281 and 62370 
involve the same amount of physician work and maintain that a work RVU 
of 0.90 appropriately captures the physician work of these procedures. 
After reviewing the public comments, the refinement panel ratings, and 
our clinical review, we are finalizing a work RVU of 0.90 as for CPT 
code 62370.
(15) Diagnostic Radiology: Abdomen (CPT Codes 74174)
    For discussion on CY 2013 interim final work values for CPT code 
74174 refer to section III.M.3. of this final rule with comment period.
(16) Pathology and Laboratory: Urinalysis (CPT Codes 88120 and 88121)
    For discussion on CY 2013 interim work values for CPT codes 88120-
88121, refer to section III.M.3. of this final rule with comment 
period.
(17) Psychiatry: Psychiatric Therapeutic Procedures (CPT Codes 90845 
and 90869)
    For discussion on interim work values for CPT codes 90845 and 
90869, refer to section III.M.3. of this final rule with comment 
period.
(18) Ophthalmology: Special Ophthalmological Services (CPT Codes 92071)
    As detailed in the CY 2012 final rule with comment period (76 FR 
73202), for the Fourth Five-Year Review, we identified CPT code 92070 
through the Harvard-Valued--Utilization over 30,000 screen as a 
potentially misvalued code. Upon review of this service, the CPT 
Editorial Panel deleted CPT code 92070 and created two new CPT codes 
(92071 and 92072) to distinguish reporting of fitting of contact lens 
for treatment of ocular surface disease and fitting of contact lens for 
management of keratoconus.
    We assigned an interim final work RVU of 0.61, with refinement to 
time as noted above to CPT code 92071 (Fitting of contact lens for 
treatment of ocular surface disease) for CY 2012. We

[[Page 69023]]

determined that CPT code 92071 is expected to capture the utilization 
of the deleted code CPT code 92070 (Fitting of contact lens for 
treatment of disease, including supply of lens). Since CPT code 92070 
was typically billed with an E/M service on the same day, we believed 
that CPT code 92071 would also typically be billed with an E/M service 
on the same day. We concluded that some of the activities conducted 
during the pre- and post-service times of the procedure code and the E/
M visit overlapped and, therefore, should not be counted twice in 
developing the procedure's work value. To account for this overlap, we 
reduced the pre-service evaluation time and post-service time by one-
third each. Specifically, we reduced each the pre-service evaluation 
time and the post-service time from 5 minutes to 3 minutes. To 
determine the appropriate work RVU for CPT code 92071, we calculated 
the value of the extracted time and subtracted it from the AMA RUC-
recommended work RVU of 0.70, which equals the CY 2011 work RVU for the 
deleted code, CPT 92070. In valuing CPT code 92071, we removed a total 
of 4 minutes (as described above) at an intensity of 0.0224 per minute, 
which amounted to the removal of 0.09 work RVUs. Therefore, we assigned 
an interim final work RVU of 0.61, with refinement to time as noted 
above to CPT code 92071 for CY 2012. A complete listing of the times 
associated with this code is available on the CMS Web site at: 
www.cms.gov/PhysicianFeeSched/.
    Comment: Commenters disagreed with the rationale used to lower the 
value for CPT code 92071 and further disagreed with the reverse 
building block methodology used. Commenters stated that the AMA RUC and 
the affected specialty society had reviewed and valued CPT code 92071 
with the assumption that an E/M service would be billed in conjunction 
with the service and cited the AMA summary of recommendations as 
evidence. Therefore, none of the pre- and post-time allocated to this 
code overlapped with the E/M service. They pointed out that the AMA 
RUC-recommended work RVU of 0.70 was lower than the survey median work 
RVU of 1.11. Commenters preferred the AMA RUC comparison of CPT code 
92071 to CPT code 65205 (Removal of foreign body, external eye; 
conjunctival superficial) with a work RVU of 0.71 and noted that both 
services have identical physician time components and should be valued 
similarly. Therefore, commenters requested the AMA RUC recommended work 
RVU of 0.70 and the AMA RUC recommended pre-service and immediate post-
service physician time of 5 minutes, each.
    Response: After clinical re-review, we continue to believe that the 
reverse building block methodology is an appropriate way to value the 
services described by CPT code 92071. We maintain that some of the 
activities conducted during the pre- and post-service times of the 
procedure code and the E/M visit overlap and, therefore, should not be 
counted twice in developing the procedure's work value. To account for 
the overlap in work between CPT code 92071 and the same day E/M 
service, the AMA RUC removed 2 minutes pre-service time from the pre-
service package time of 7 minutes. We believe that the pre-service 
package overstates the time involved in this procedure and that a more 
appropriate starting point for the same day E/M reduction for this 
procedure is the survey median pre-service time. We believe that 
removing 2 minutes of pre-service time from the survey median pre-
service time of 5 minutes, as well as 2 minutes from the post-service 
time of 5 minutes better reflects the time involved in furnishing the 
work of this procedure alongside an E/M service. We continue to believe 
that a work RVU of 0.61 accurately reflects the work of the service 
relative to similar services. Therefore, we are finalizing a refinement 
to time and a work RVU of 0.61 for CPT code 92071. The times assigned 
to this CPT code are available on the CMS Web site at: www.cms.gov/PhysicianFeeSched/.
(19) Special Otorhinolaryngologic Services: Audiologic Function Tests 
(CPT Codes 92587 and 92588)
    On an interim final basis for CY 2012, we assigned a work RVU of 
0.35 to CPT code 92587 (Distortion product evoked otoacoustic 
emissions; limited evaluation (to confirm the presence or absence of 
hearing disorder, 3-6 frequencies) or transient evoked otoacoustic 
emissions, with interpretation and report) as detailed in the CY 2012 
final rule with comment period (76 FR 73202). We identified CPT code 
92587 as a potentially misvalued code through the Fastest Growing 
screen. The specialty society surveyed this service to create a new 
recommendation for CY 2011. However, after reviewing the survey data, 
it concluded that more than one service is represented by this code and 
requested the service be referred back to the CPT Editorial Panel for 
further clarification. As a result, the CPT Editorial Panel created CPT 
code 92558 (Distortion product evoked otoacoustic emissions; 
comprehensive diagnostic evaluation (quantitative analysis of outer 
hair cell function by cochlear mapping, minimum of 12 frequencies), 
with interpretation and report) to describe evoked otoacoustic 
emissions screening, and revised CPT codes 92587 and 92588 clarify the 
otoaucoustic emissions evaluations, effective January 1, 2012. After 
clinical review of CPT code 92587, we believed that the survey 25th 
percentile work RVU of 0.35 accurately described the work associated 
with this service. The HCPAC reviewed the survey results, and after a 
comparison to similar CPT codes, recommended a work RVU of 0.45 for CPT 
code 92587, which was between the survey 25th percentile and median 
values. We believed that CPT code 92587 was similar in time and 
intensity to CPT code 97124 (Therapeutic procedure, 1 or more areas, 
each 15 minutes; massage, including effleurage, petrissage and/or 
tapotement (stroking, compression, percussion)), which has a work RVU 
of 0.35, and that the survey 25th percentile value appropriately 
reflected the relativity of this service. Therefore, we assigned a work 
RVU of 0.35 to CPT code 92587 on an interim final basis for CY 2012.
    Comment: Commenters disagreed with the interim final work RVU of 
0.35 and urged CMS to use the HCPAC recommendation of 0.45 since it is 
between the survey 25th percentile and median values. Commenters stated 
that although 25th percentile might be reasonable in situations where 
the accuracy of the survey data is in doubt, in this case the overall 
distribution of the data, the size of the sample, and response rate 
made the median a better guide. Commenters noted the importance of 
cross specialty comparisons, but stated that a crosswalk to CPT code 
97124 was not appropriate. Commenters stated that CPT code 92587 is a 
cognitive diagnostic service that requires the audiologist to review 
and interpret data resulting from numerous tonal pair samples 
administered to a patient's inner ear whereas CPT code 97124 is a 
therapeutic service involving hands-on manipulation of tissue and 
muscles. As a result, a more appropriate comparison code listed within 
the physical therapy section is the cognitive diagnostic work required 
to perform CPT code 97001 (Physical Therapy Evaluation), which has a 
work RVU of 1.20 and an intra-service time of 30 minutes. Commenters 
stated that it was, therefore, comparable to the requested 0.45 for 12 
minutes of intra-service work for CPT code 92587. Commenters requested 
that we accept the HCPAC-

[[Page 69024]]

recommended work RVU of 0.45 for CPT code 92587 and requested 
refinement panel review of the code.
    Response: Based on comments received, we referred CPT code 92587 to 
the CY 2012 multi-specialty refinement panel for further review. The 
refinement panel median value for CPT code 92587 was a work RVU of 
0.45. We note that prior to our assignment of interim final work RVUs 
for CY 2012, CPT code 92587 had a work RVU of 0.13 because the work of 
this service was captured in the practice expense RVU as clinical 
labor, rather than in the work RVU as professional work. For CY 2012, 
the work of this service was moved from the PE RVU to the work RVU. In 
re-valuing the service to reflect this shift, we believe the survey 
25th percentile work RVU of 0.35 captured the intensity of the 
professional work. While CPT codes 97124 and 92587 describe different 
services, we believe they involve the same time and have a very similar 
level of intensity and complexity and therefore should be valued the 
same. After consideration of the public comments, refinement panel 
results, and our clinical review, we are finalizing a work RVU of 0.35 
for CPT code 92587.
    On an interim final basis for CY 2012, we assigned a work RVU of 
0.55 to CPT code 92588 (Distortion product evoked otoacoustic 
emissions; comprehensive diagnostic evaluation (quantitative analysis 
of outer hair cell function by cochlear mapping, minimum of 12 
frequencies), with interpretation and report) (76 FR 73202). After 
clinical review of CPT code 92588, we believed that the survey 25th 
percentile work RVU of 0.55 accurately described the work associated 
with this service. The HCPAC reviewed the survey results, and after a 
comparison to similar CPT codes, recommended the survey median work RVU 
of 0.62 for CPT code 92588. We believed that CPT code 92588 is similar 
in work to CPT code 92570 (Acoustic immittance testing, includes 
tympanometry (impedance testing), acoustic reflex threshold testing, 
and acoustic reflex decay testing), which has a work RVU of 0.55, and 
that the survey 25th percentile work RVU of 0.55 appropriately 
reflected the relativity of this service. Therefore, we assigned a work 
RVU of 0.55 to CPT code 92588 on an interim final basis for CY 2012.
    Comment: Commenters agreed with us that CPT code 92588 involves a 
higher level of professional work and should be valued incrementally 
higher than CPT code 92587. However, commenters disagreed with the 
interim final work RVU values and believe the services furnished under 
the code involve a greater degree of professional work. Commenters 
stated that CPT code 92570 is not an appropriate comparison code 
because it is a bundled code that includes three different audiology 
tests, acoustic reflex threshold testing and acoustic reflex decay, as 
currently represented individually by CPT codes 92567 and 92568. As a 
bundled service, the work RVU for 92570 was reduced below the level of 
the combined services to account for efficiencies involved in 
conducting the three tests together. Commenters noted it is not 
appropriate to compare a bundled service, for which the work RVU has 
been reduced, with a test intended to evaluate overall outer hair cell 
function, using a minimum of 12 frequencies. Therefore, commenters 
requested the code be reviewed by the refinement panel.
    Response: Based on comments received, we referred CPT code 92588 to 
the CY 2012 multi-specialty refinement panel for further review. The 
refinement panel median value for CPT code 92588 was a work RVU of 
0.60. We note that prior to our assignment of interim final work RVUs 
for CY 2012, CPT code 92588 had a work RVU of 0.36 because the work of 
this service was captured in the practice expense RVU as clinical 
labor, rather than in the work RVU as professional work. For CY 2012, 
the work of this service was moved from the PE RVU to the work RVU. In 
re-valuing the service to reflect this shift, we believe the survey 
25th percentile work RVU of 0.55 captured the intensity of the 
professional work. While CPT codes 92570 is a bundled service, we 
believe CPT codes 92570 and 92588 involve very similar time and 
intensity and should be valued the same. Furthermore, we believe a work 
RVU of 0.55 for CPT code 92588 reflects the appropriate incremental 
difference over the work RVU of 0.35 for CPT code 92587. After 
consideration of the public comments, refinement panel results, and our 
clinical review, we are finalizing a work RVU of 0.55 for CPT code 
92588.
(20) Cardiovascular: Cardiac Catheterization (CPT Codes 93451-93568)
    For CY 2012, we assigned the following interim final work RVUs for 
the following CPT codes: 2.72 for CPT code 93451 (Right heart 
catheterization including measurement(s) of oxygen saturation and 
cardiac output, when performed), 4.75 for CPT code 93452 (Left heart 
catheterization including intraprocedural injection(s) for left 
ventriculography, imaging supervision and interpretation, when 
performed), 6.24 for CPT code 93453 (Combined right and left heart 
catheterization including intraprocedural injection(s) for left 
ventriculography, imaging supervision and interpretation, when 
performed), 4.79 for CPT code 93454 (Catheter placement in coronary 
artery(s) including intraprocedural injection(s) for coronary 
angiography, imaging supervision and interpretation), 5.54 for CPT code 
93455 (with catheter placement(s) in bypass graft(s) (internal mammary, 
free arterial, venous grafts) including intraprocedural injection(s) 
for bypass graft angiography with catheter placement(s) in bypass 
graft(s) (internal mammary, free arterial, venous grafts) including 
intraprocedural injection(s) for bypass graft angiography), 6.15 for 
CPT code 93456 (Catheter placement in coronary artery(s) including 
intraprocedural injection(s) for coronary angiography, imaging 
supervision and interpretation with right heart catheterization), 6.89 
for CPT code 93457 (Catheter placement in coronary artery(s) including 
intraprocedural injection(s) for coronary angiography, imaging 
supervision and interpretation with catheter placement(s) in bypass 
graft(s) (internal mammary, free arterial, venous grafts) including 
intraprocedural injection(s) for bypass graft angiography and right 
heart catheterization), 5.85 for CPT code 93458 (Catheter placement in 
coronary artery(s) including intraprocedural injection(s) for coronary 
angiography, imaging supervision and interpretation with left heart 
catheterization including intraprocedural injection(s) for left 
ventriculography, when performed), 6.60 for CPT code 93459 (Catheter 
placement in coronary artery(s) including intraprocedural injection(s) 
for coronary angiography, imaging supervision and interpretation with 
left heart catheterization including intraprocedural injection(s) for 
left ventriculography, when performed, catheter placement(s) in bypass 
graft(s) (internal mammary, free arterial, venous grafts) with bypass 
graft angiography), 7.35 for CPT code 93460 (Catheter placement in 
coronary artery(s) including intraprocedural injection(s) for coronary 
angiography, imaging supervision and interpretation with right and left 
heart catheterization including intraprocedural injection(s) for left 
ventriculography, when performed), 8.10 for CPT code 93461 (Catheter 
placement in coronary artery(s) including intraprocedural injection(s) 
for coronary angiography, imaging supervision and interpretation with 
right and left heart catheterization including intraprocedural 
injection(s) for left ventriculography, when

[[Page 69025]]

performed, catheter placement(s) in bypass graft(s) (internal mammary, 
free arterial, venous grafts) with bypass graft angiography), 1.11 for 
CPT code 93563 (Injection procedure during cardiac catheterization 
including image supervision, interpretation, and report; for selective 
coronary angiography during congenital heart catheterization), 1.13 for 
CPT code 93564 (Injection procedure during cardiac catheterization 
including image supervision, interpretation, and report; for selective 
coronary angiography during congenital heart catheterization for 
selective opacification of aortocoronary venous or arterial bypass 
graft(s) (eg, aortocoronary saphenous vein, free radial artery, or free 
mammary artery graft) to one or more coronary arteries and in situ 
arterial conduits (eg, internal mammary), whether native or used for 
bypass to one or more coronary arteries during congenital heart 
catheterization, when performed), 0.86 for CPT code 93565 (Injection 
procedure during cardiac catheterization including image supervision, 
interpretation, and report; for selective coronary angiography during 
congenital heart catheterization for selective left ventricular or left 
arterial angiography), 0.86 for CPT code 93566 (Injection procedure 
during cardiac catheterization including image supervision, 
interpretation, and report; for selective coronary angiography during 
congenital heart catheterization for selective right ventricular or 
right atrial angiography), 0.97 for CPT code 93567 (Injection procedure 
during cardiac catheterization including image supervision, 
interpretation, and report; for selective coronary angiography during 
congenital heart catheterization for supravalvular aortography), and 
0.88 for CPT code 93568 (Injection procedure during cardiac 
catheterization including image supervision, interpretation, and 
report; for selective coronary angiography during congenital heart 
catheterization for pulmonary angiography). As discussed in the CY 2011 
final rule with comment period, the AMA RUC provided CMS with 
recommendations for several categories of new diagnostic cardiac 
catheterization services codes that previously were reported under 
multiple component codes. These AMA RUC-recommended values for the 
comprehensive diagnostic cardiac catheterization codes did not appear 
to reflect the efficiencies in work and/or PE that occur when component 
services are furnished together. The AMA RUC generally recommended the 
lower of either the sum of the current RVUs for the component services 
or the specialty society survey 25th percentile value for the 
comprehensive cardiac catheterization. In most cases, the AMA RUC's 
recommendation for the comprehensive service was actually the sum of 
the current work RVUs for the component services, and we stated in the 
CY 2011 final rule with comment period that we were unsure how this 
approach is resource-based with respect to physician work. As we noted 
in the CY 2011 final rule with comment period, in valuing these 
comprehensive services, we used a conservative estimate of 10 percent 
for the work efficiencies we would expect to occur when multiple 
component cardiac catheterization services are bundled together. In the 
CY 2011 final rule with comment period, we requested that the AMA RUC 
reexamine the cardiac catheterization codes.
    As discussed in the CY 2012 final rule with comment period (76 FR 
73202), the AMA RUC reviewed these codes again for CY 2012 and 
reiterated its previous recommendations, maintaining that there are 
negligible work efficiencies gained in the bundling of these services. 
However, we continued to believe that there would be efficiencies when 
these services are performed together that should be reflected in the 
values assigned. In lieu of a more specific estimate from the AMA RUC, 
and using the best information available to us at the time, we noted 
that we believed it was appropriate to assign as interim final for CY 
2012 the AMA RUC CY 2011 recommendation with a 10 percent reduction in 
work to reflect the efficiencies described above.
    Comment: Commenters noted that at CMS's second request, the AMA RUC 
workgroup reviewed significant documentation of the valuation and 
coding history of the codes and after this extensive review, still 
found the original work value recommendations for these codes to be 
appropriate. Commenters stated that maintaining the diagnostic 
catheterization codes at their CY 2011 work RVU levels is arbitrary and 
that instead we should accept the AMA RUC recommendation for these new 
set of codes for diagnostic cardiac catheterization.
    Response: Based on the comments we received, we re-reviewed the 
cardiac catheterization codes (CPT codes 93451 through 93568). We 
appreciate that the AMA RUC reviewed the code set again; however, we 
still maintain that there are work efficiencies gained in the bundling 
of these services, and all services. The AMA RUC used a variety of 
methodologies in developing RVUs for the comprehensive services 
reviewed for CY 2012. The AMA RUC-recommended RVUs for the 
comprehensive codes for diagnostic cardiac catheterization were an 
average of only one percent lower than the original component codes. 
Given that the AMA RUC recommendations for the bundling of endovascular 
revascularization and CT codes resulted in average reductions in the 
RVUs of 27 percent and 25 percent, respectively, we continue to believe 
an approximation of work efficiencies garnered through the bundling of 
the component codes could be as high as 27 percent. Thus, in the 
absence of more precise information, we believe that a 10 percent 
reduction in the AMA RUC-recommended work RVUs is an appropriate and 
conservative approximation of these efficiencies. Therefore, we are 
finalizing the CY 2012 interim final values for the cardiac 
catheterization codes as the final work RVU values for CY 2013. 
Specifically, we are finalizing the following work RVUs for the 
following CPT codes: a work RVU of 2.72 for CPT code 93451; a work RVU 
of 4.75 for CPT code 93452; a work RVU of 6.24 for CPT code 93453; a 
work RVU of 4.79 for CPT code 93454; a work RVU of 5.54 for CPT code 
93455; a work RVU of 6.15 for CPT code 93456; a work RVU of 6.89 for 
CPT code 93457; a work RVU of 5.85 for CPT code 93458; a work RVU of 
6.60 for CPT code 93459; a work RVU of 7.35 for CPT code 93460; a work 
RVU of 8.10 for CPT code 93461; a work RVU of 1.11 for CPT code 93563; 
a work RVU of 1.13 for CPT code 93564; a work RVU of 0.86 for CPT code 
93565; a work RVU of 0.86 for CPT code 93566; a work RVU of 0.97 for 
CPT code 93567; and a work RVU of 0.88 for CPT code 93568.
(21) Pulmonary: Other Procedures (CPT Codes 94060, 94726-94729)
    CPT code 94060 (Bronchodilation responsiveness, spirometry as in 
94010, pre- and post-bronchodilator administration) was assigned an 
interim final work RVU of 0.26 in the CY 2012 final rule with comment 
period (76 FR 73206). After CPT code 94060 was identified for review 
because it was on the Multispecialty Points of Comparison List, and 
also was identified as potentially misvalued through Codes Reported 
Together 75 percent or More screen, the CPT Editorial Panel reviewed 
the code and created CPT codes 94060, 94726 (Plethysmography for 
determination of lung volumes and, when performed, airway resistance), 
94727 (Gas dilution or washout for determination of lung volumes and, 
when performed, distribution of ventilation and closing volumes), 94728 
(Airway resistance by impulse

[[Page 69026]]

oscillometry), and 94729 (Diffusing capacity (eg, carbon monoxide, 
membrane) (List separately in addition to code for primary procedure)). 
For CY 2012, the CPT Editorial Panel also created CPT codes 94780 and 
94781 to report car seat testing administered to the patient in the 
private physician's office.
    For CY 2012, we assigned a work RVU of 0.26 to CPT codes 94060, 
94726, 94727, and 94728 on an interim final basis (76 FR 73206). After 
clinical review, we determined that CPT codes 94060, 94726, 94727, and 
94728, involve similar work and should have the same work RVUs. We 
noted that CPT code 94240 (Functional residual capacity or residual 
volume: helium method, nitrogen open circuit method, or other method) 
(work RVU=0.26) was deleted and the utilization associated with that 
service would be captured under the CPT codes 94726 and 92727. We also 
noted that we believed that a work RVU of 0.26 appropriately reflected 
the work associated with CPT codes 94060, 94726, 94727, and 94728 and 
that the AMA RUC had recommended the same work RVU (0.31) for all four 
codes, based upon each survey's 25th percentile work RVU. We explained 
that this value was further supported by CPT code 97012 (Application of 
a modality to 1 or more areas; traction, mechanical), which has a work 
RVU of 0.25) and which had similar time and intensity. Therefore, we 
assigned a work RVU of 0.26 to CPT codes 94060, 94726, 94727, and 94728 
on an interim final basis for CY 2012.
    Comment: Commenters disagreed with the work RVU assignments for 
these codes and stated that CPT code 94375 (Respiratory flow volume 
loop), which has a work RVU of 0.31, is the appropriate reference code, 
as the AMA RUC recommended. Although CPT code 94375 has more intra-
service time (7 minutes compared to 5 minutes), the survey respondents 
rated the surveyed codes as more intense and complex than the reference 
code. Commenters stated that the appropriate value for the level of 
physician work involved in CPT codes 94060, 94726, 94727, and 94728 is 
0.31 work RVUs. Therefore, commenters urged that we value CPT codes 
94060, 94726, 94727, and 94728 based upon the AMA RUC-recommended work 
RVU of 0.31 and requested these codes be reviewed by the refinement 
panel.
    Response: Based on comments received, we referred CPT codes 94060, 
94726, 94727, and 94728 to the CY 2012 multi-specialty refinement panel 
for further review. The refinement panel median work RVUs for the CPT 
codes were 0.27, 0.26, 0.26, and 0.26, respectively. As a result of the 
refinement panel ratings and our clinical review, we are assigning a 
work RVU of 0.27 as the final value for CPT code 94060 and 0.26 work 
RVUs as the final value for CPT code 94726, 94727, and 94728.
    After clinical review of CPT code 94729 (Diffusing capacity (eg, 
carbon monoxide, membrane) (List separately in addition to code for 
primary procedure)), we believed that a work RVU of 0.17 accurately 
reflected the work associated with this service. Based on a comparison 
to similar services, the AMA RUC recommended a work RVU of 0.19. We 
believed that CPT code 94010 (Spirometry, including graphic record, 
total and timed vital capacity, expiratory flow rate measurement(s), 
with or without maximal voluntary ventilation), which has a work RVU of 
0.17, was similar in time and intensity to CPT code 94729, and that the 
codes should have the same work RVUs. Therefore, we assigned a work RVU 
of 0.17 to CPT code 94729 on an interim final basis for CY 2012.
    Comment: Commenters disagreed that CPT code 94010 was similar in 
time and intensity to CPT code 94729, explaining that the service 
furnished under CPT code 94010, simple spirometry, is considered the 
foundation of pulmonary function testing and does not involve the same 
physician work as services furnished under CPT code 94729 a diffusing 
capacity including the membrane. Commenters suggested that the AMA RUC-
recommended crosswalk code 93352 (Use of echocardiographic contrast 
agent during stress echocardiography), which has a work RVU of 0.19 has 
identical physician time of 5 minutes and comparable physician work and 
intensity to CPT code 94729. Commenters requested that we value the 
code based upon the AMA RUC-recommended work RVU of 0.19 for CPT code 
94729 and requested this code be reviewed by the refinement panel.
    Response: Based on comments received, we referred CPT code 94729 to 
the CY 2012 multi-specialty refinement panel for further review. The 
refinement panel median work RVU for CPT code 94729 was 0.19. As a 
result of the refinement panel ratings and our clinical review, we are 
finalizing a work RVU of 0.19 for CPT code 94729.
    Furthermore, for CY 2013, we received no public comments on the CY 
2012 interim final work RVUs for CPT codes 94780 and 94781. We believe 
these values continue to be appropriate and are finalizing them without 
modification.
(22) Neurology and Neuromuscular Procedures: Autonomic Function Tests 
(CPT Codes 95938-95939)
    For discussion on interim work values for CPT codes 95938 and 
95939, refer to section III.M.3. of this final rule with comment 
period.
(23) Central Nervous System Assessments/Tests (CPT Codes 96110, HCPCS 
Code G0451)
    For CY 2012, the CPT Editorial Panel revised CPT code 96110 
(Developmental screening, with interpretation and report, per 
standardized instrument form) to reflect current practice and avoid use 
of inaccurate terms associated with this code. For CY 2012 we created 
HCPCS code G0451 (Development testing, with interpretation and report, 
per standardized instrument form) to replace CPT code 96110, which is 
discussed in the CY 2012 final rule with comment period (76 FR 73265). 
In the CY 2012 final rule correction notice (77 FR 227), we noted that 
the discussion of CPT codes 96110 and G0451 was omitted from the CY 
final rule with comment period due to an inadvertent error, and we 
included our intended discussion in subsequent the correction notice. 
Additionally, we corrected the PFS status indicator in Addendum B for 
CPT code 96110 to N (Non-covered service. These codes are noncovered 
services. Medicare payment is not made for these codes. If RVUs are 
shown, they are not used for Medicare payment.), from X (Statutory 
exclusion. These codes represent an item or service that is not within 
the statutory definition of ``physicians' services'' for PFS payment 
purposes (for example, ambulance services). No RVUs are shown for these 
codes and no payment may be made under the PFS.). The discussion and 
information in this section reflects the changes made in CY 2012 final 
rule correction notice.
    The CPT Editorial Panel revised the long descriptor for CPT code 
96110 from (Developmental testing; limited (for example, Developmental 
Screening Test II, Early Language Milestone Screen), with 
interpretation and report) to (Developmental screening, with 
interpretation and report, per standardized instrument form), effective 
January 1, 2012. With this change, we believed that the services 
described by CPT code 96110 consisted of screening services, and thus 
was not within the scope of benefits of the Medicare program, as 
defined by the Act. Therefore, we assigned CPT code 96110 a PFS 
procedure status indicator of N. To continue to make payment under the 
PFS for the testing services described

[[Page 69027]]

under CPT code 96110 prior to revision of the long descriptor, we 
created HCPCS code G0451 (Developmental testing, with interpretation 
and report, per standardized instrument form). To calculate resource-
based RVUs for HCPCS code G0451, we crosswalked the utilization, direct 
practice expense inputs, and malpractice risk factor from CPT code 
96110 to HCPCS code G0451. We noted in the CY 2012 final rule with 
comment period that CPT code 96110 did not have physician work RVUs, 
therefore no physician work RVUs had been assigned to HCPCS code G0451. 
The CY 2012 interim final RVUs assigned to G0451 were included in 
Addendum B of the CY 2012 final rule correction notice.
    Comment: We received notice from many commenters that they did not 
believe a procedure status of X was appropriate for CPT code 96110. 
Commenters stated that the change in the code description from 
``developmental testing; limited'' to ``developmental screening'' 
should not preclude payment for this service. Additionally, other 
commenters raised concerns that this code is used for early 
developmental screening in pediatric offices and worried that our 
decision not to cover this code under the Medicare program would 
influence Medicaid coverage. Commenters recommended that this testing 
service should continue to be paid under the Medicare PFS.
    Response: We thank commenters for bringing the error in the status 
indicator for CPT code 96110 to our attention. As noted above, we 
corrected the PFS status indicator in a correction notice (77 FR 227) 
to N (Noncovered service. These codes are noncovered services. Medicare 
payment may not be made for these codes. If RVUs are shown, they are 
not used for Medicare payment) is more appropriate for this code. 
Regarding commenters concern that the testing services previously 
reported under CPT code 96110 continue to be payable, we point out that 
while these service are no longer payable using CPT code 96110, they 
continue to be payable using HCPCS code G0451, effective January 1, 
2012. We understand that our lack of discussion of these services in 
the CY 2012 PFS final rule with comment period may have furthered this 
concern. We received no public comments on the CY 2012 interim final 
work RVUs for HCPCS code G0451. We believe these values continue to be 
appropriate and are finalizing them without modification.
b. Finalizing CY 2012 Interim Direct PE Inputs
i. Background and Methodology
    In this section, we address interim final direct PE inputs as 
presented in the CY 2012 PFS final rule with comment period and 
displayed in the final CY 2012 direct PE database available on the CMS 
Web site under the downloads at http://www.cms.gov/PhysicianFeeSched/PFSFRN/list.asp#TopOfPage.
    On an annual basis, the AMA RUC provides CMS with recommendations 
regarding direct PE inputs, including clinical labor, supplies, and 
equipment, for new, revised, and potentially misvalued codes. We review 
the AMA RUC-recommended direct PE inputs on a code-by-code basis, 
including the recommended facility PE inputs and/or nonfacility PE 
inputs, as clinically appropriate for the code. We determine whether we 
agree with the AMA RUC's recommended direct PE inputs for a service or, 
if we disagree, we refine the PE inputs to represent inputs that better 
reflect our estimate of the PE resources required for the service in 
the facility and/or nonfacility settings. We also confirm that CPT 
codes should have facility and/or nonfacility direct PE inputs, and 
make changes based on our clinical judgment and any PFS payment 
policies that would apply to the code.
    As we explained in the CY 2012 PFS final rule (76 FR 73212), we 
generally only establish interim final direct PE inputs for services 
when we receive direct PE input recommendations in the context of new, 
revised or potentially misvalued codes. However, for CY 2012, we 
established interim final direct PE inputs for several codes for which 
we did not receive direct PE recommendations. In the case of these 
codes, we believed it was necessary to establish new interim final 
direct PE inputs in order to maintain appropriate relativity among 
those codes and other related codes or between the PE, work and 
malpractice components of the PFS payment for the codes.
    Comment: Several commenters stated that they understood CMS' 
rationale for refining the direct PE inputs on an interim final basis 
as we explained above, but urged CMS to bring the AMA RUC's attention 
to these codes during the AMA RUC process so that these interim final 
refinements by CMS could be avoided.
    Response: We appreciate the commenters' suggestion. We also 
encourage the AMA RUC and other public commenters to consider issues 
related to maintaining appropriate relativity among related codes or 
between the PE, work, and malpractice components of the PFS payment for 
individual codes in the development of the recommendations that they 
provide to us. We believe that the AMA RUC and medical specialty 
societies, in light of CPT code descriptors and other language, as well 
as the guiding principles established through PFS rulemaking, are in a 
good position to identify, review, and develop direct PE input 
recommendations for coherent sets of codes, including component and 
combined codes, that ought to be developed or updated concurrently.
    In the CY 2012 PFS final rule with comment period (76 FR 73213), we 
addressed the general nature of some of our common refinements to the 
AMA RUC-recommended direct PE inputs as well as the reasons for 
refinements to particular inputs. In the following subsections, we 
respond broadly to comments we received regarding common refinements we 
made based on established principles or policies. Following those 
discussions, we summarize and respond to comments received regarding 
other refinements to particular codes.
    We note that the interim final direct PE inputs for CY 2012 that 
are being finalized for CY 2013 are displayed in the final CY 2013 
direct PE input database, available on the CMS Web site under the 
downloads for the CY 2013 PFS final rule at www.cms.gov/PhysicianFeeSched/. The inputs displayed there have also been used in 
developing the CY 2013 PE RVUs as displayed in Addendum B of this final 
rule.
    We also note that for several codes for which we established 
interim final direct PE inputs for CY 2012, we either made proposals in 
the CY 2013 PFS proposed rule with comment period as a result of those 
comments or we are establishing CY 2013 interim final direct PE inputs 
for the services based on new recommendations from the AMA RUC. We 
acknowledge receipt of those comments here and we note that those 
comments were taken into consideration in the development of CY 2013 
PFS proposals and our consideration of the CY 2013 AMA RUC direct PE 
input recommendations.
ii Common Refinements
(1) Equipment Time
    Prior to CY 2010, the AMA RUC did not generally provide CMS with 
recommendations regarding equipment time inputs. In CY 2010, in the 
interest of ensuring the greatest possible degree of accuracy in 
allocating equipment minutes, we requested that the AMA

[[Page 69028]]

RUC provide equipment times along with the other direct PE 
recommendations, and we provided the AMA RUC with general guidelines 
regarding appropriate equipment time inputs. We continue to appreciate 
the AMA RUC's willingness to provide us with these additional inputs as 
part of its direct PE recommendations.
    In general, the equipment time inputs correspond to the intra-
service portion of the clinical labor times. We have clarified that 
assumption to consider equipment time as the sum of the times within 
the intra-service period when a clinician is using the piece of 
equipment, plus any additional time the piece of equipment is not 
available for use for another patient due to its use during the 
designated procedure. In addition, when a piece of equipment is 
typically used during additional visits included in a service's global 
period, the equipment time should also reflect that use.
    We believe that certain highly technical pieces of equipment and 
equipment rooms are less likely to be used during all of the pre-
service or post-service tasks performed by clinical labor on the day of 
the procedure (the clinical labor service period) and are typically 
available for other patients even when one member of clinical staff may 
be occupied with a pre-service or post-service task related to the 
procedure.
    Some commenters have repeatedly objected to CMS' rationale for 
refinement of equipment minutes on this basis. We acknowledge the 
comments we received that reiterate those objections to this rationale 
and refer readers to our extensive discussion regarding those 
objections in the CY 2012 PFS final rule with commenter period (76 FR 
73182). In following paragraphs we address new comments on this policy.
    Comment: One commenter suggested that ``CMS allows only a single 
staff type'' for certain services, so that when pre-service and post-
service clinical labor tasks are assigned only to one type of clinical 
labor (a CT technologist, for example), the equipment otherwise used by 
that technologist (the CT room) is necessarily unavailable to another 
patient. Therefore, the commenter argued that in those cases CMS should 
also allocate the total number of minutes for all the clinical labor 
tasks on the day of the service to the CT room regardless of whether or 
not it is typical for the pre-service or post-service activities to 
actually take place in the room.
    Response: We understand the commenter's argument, but we do not 
agree with the conclusion for several reasons. First, we do not agree 
that allocating a number of minutes to a particular type of clinical 
staff in the direct PE input database can be appropriately viewed as 
CMS ``allowing only a single staff type'' being used to furnish 
services to Medicare beneficiaries. We believe that the direct PE input 
database should reflect the resources typically required in furnishing 
particular services, but we have no reason to believe that the inputs 
included in the database are prescriptive as to what actually happens 
in a medical practice. Therefore, we do not think the direct PE 
database staff type is likely to be a determining factor for the 
division of labor in physician offices and other nonfacility settings. 
Furthermore, we do not believe that most free-standing centers that 
furnish highly technical services to Medicare beneficiaries typically 
only employ one clinical staff member at a time. Therefore, it would 
not be reasonable to assume that all capital equipment in a typical 
practice is unavailable for use whenever pre- or post-service tasks are 
being undertaken by any individual technologist.
    We also note that there are hundreds of services in the direct PE 
input database that include more than one type of staff in the clinical 
labor inputs. For many services, for example, minutes are allocated for 
a standard nurse blend staff type for pre-service and post-service 
tasks, while technologists are only allocated intra-service period 
minutes. There is no standing CMS policy that would prevent 
consideration of dividing clinical labor tasks among different types of 
clinical labor in the direct PE input database.
    Comment: One commenter expressed a concern regarding the 
relationship between the CMS refinement of recommended equipment 
minutes and the 75% equipment utilization rate assumption mandated by 
section 1848(b)(4)(C) of the Act. The commenter also stated that these 
refinements are arbitrary and will further widen the gap between 
Medicare payments determined by the Medicare hospital outpatient 
prospective payment system (OPPS) and the technical component of PFS 
services.
    Response: As we have previously stated, we believe that many of the 
pre-service and post-service clinical labor tasks typically take place 
outside of resource-intensive equipment rooms to maximize use of 
capital-intensive resources. Monopolizing the room for fewer minutes 
per patient maximizes the availability of the machines. In turn, the 
assumed rate of use for the machine should be greater, and the resource 
cost of the machine is reduced through these efficiencies. Since the 
direct PE input database should reflect the typical resource costs of 
medical equipment, we believe that the reduced minutes and increased 
utilization rate are complementary, not contradictory.
    In response to the commenter's second assertion, these refinements 
are far from arbitrary. We have consistently applied these principles 
in refining the direct PE inputs for services as we review equipment 
inputs through the potentially misvalued code initiative and our review 
of new and revised codes since the AMA RUC started providing equipment 
minute recommendations to CMS in 2010. We believe that imprecise 
allocation of equipment minutes may be a significant factor in certain 
potentially misvalued codes. We understand the importance of relativity 
within the equipment category of direct practice expenses and seek 
public comment on whether it might be necessary to consider making 
corresponding refinements to equipment minutes for services across the 
fee schedule for the sake of maintaining relativity.
    Finally, as a general statement, differences in payment rates 
between different payment systems do not necessarily indicate a lack of 
appropriate relativity within each system. There can be legitimate 
reasons why a payment rate should vary in different payment systems 
(for example, higher indirect costs, different payment bundles). 
Nevertheless, excessive differences in payment rates between payment 
systems can be one indication of the need to examine the relativity 
between services in one or both systems. While we continue to examine 
this issue, we do not believe that it would be appropriate to establish 
or maintain inaccurate direct PE inputs for these services based on 
comparisons between the PFS and OPPS payment rates.
    We will continue to work to improve the accuracy of the equipment 
minutes as reflected in the direct PE input database and will address 
any further improvements in future rulemaking.
    After consideration of these comments, we are finalizing the 
current interim final direct PE inputs as refined based on this policy. 
The direct PE inputs are displayed in the final CY 2013 direct PE input 
database, available on the CMS Web site under the downloads for the CY 
2013 PFS final rule at www.cms.gov/PhysicianFeeSched/.

[[Page 69029]]

(2) Changes in Physician Time
    Some direct PE inputs are directly affected by revisions in 
physician time. Specifically, changes in the intra-service portions of 
the physician time and changes in the number or level of postoperative 
visits associated with the global periods result in corresponding 
changes to direct PE inputs. While the direct PE input recommendations 
generally correspond to the physician time values associated with 
services, we believe that in some cases inadvertent discrepancies 
between physician time values and direct PE inputs should be refined in 
the establishment of interim final direct PE inputs. In other cases, 
CMS refinement of recommended interim final physician times prompts 
necessary adjustments in the direct PE inputs. In the context of our 
establishment of interim final direct PE inputs for CY 2013, we explain 
those refinements in section III.M.3.b of this final rule with comment 
period.
    Comment: One commenter requested an explanation regarding why CMS 
assumes that the clinical time allocated for assisting the physician 
performing the procedure should conform to the physician intra-service 
time.
    Response: As we have explained in previous rulemaking (76 FR 
73213), for most codes valued in the nonfacility setting, a portion of 
the clinical labor time allocated to the intra-service period reflects 
minutes assigned for assisting the physician with the procedure. This 
time is usually allocated at some proportion of the physician time for 
a procedure. Frequently, the allocation is for the full physician 
intraservice time; this reflects the assumption that the clinical staff 
is assisting the physician during the entire procedure. For other 
services, the allocation is two-thirds or one-half of the physician 
time; this reflects the assumption that clinical staff is assisting the 
physician for a portion of the procedure time. In establishing interim 
final direct PE inputs, we note a change in clinical labor time (or 
corresponding change in equipment minutes) that results from a change 
in physician time as ``conforming to physician time.'' This note is not 
used to reflect a refinement to the recommended proportion for which 
the staff is assisting the physician performing the procedure. Instead, 
these refinements reflect a change in the base procedure time 
assumption for the service. After consideration of this comment, we are 
finalizing the current interim final direct PE inputs as refined based 
on this policy. The direct PE inputs are displayed in the final CY 2013 
direct PE input database, available on the CMS Web site under the 
downloads for the CY 2013 PFS final rule at www.cms.gov/PhysicianFeeSched/.
(3) Proxy Inputs for Digital Imaging
    Comment: In the context of several codes, several commenters 
objected to CMS' not accepting certain recommended items as direct PE 
inputs since these items, though atypical, may be considered surrogate 
items for digital imaging technology.
    Response: A variety of imaging services across the PFS include 
direct PE inputs that reflect film-based technology instead of digital 
technology. We have accepted the film-based technology inputs in the 
RUC recommendations as proxy inputs until a more comprehensive 
migration of such inputs from film to digital imaging can be executed. 
We anticipate updating all of the associated inputs in future 
rulemaking.
    After consideration of these comments, we are finalizing the 
current interim final direct PE inputs as refined based on this policy. 
The direct PE inputs are displayed in the final CY 2013 direct PE input 
database, available on the CMS Web site under the downloads for the CY 
2013 PFS final rule at www.cms.gov/PhysicianFeeSched/.
iii Code-Specific Direct PE Inputs
(1) Integumentary System: Repair (Closure) (CPT Codes 15271, 15273, 
15275, 15277)
    In establishing interim final direct PE inputs for 2012, CMS 
refined the AMA RUC's recommendation for CPT codes 15271 (Application 
of skin substitute graft to trunk, arms, legs, total wound surface area 
up to 100 sq cm; first 25 sq cm or less wound surface area), 15273 
(Application of skin substitute graft to trunk, arms, legs, total wound 
surface area greater than or equal to 100 sq cm; first 100 sq cm wound 
surface area, or 1% of body area of infants and children), 15275 
(Application of skin substitute graft to face, scalp, eyelids, mouth, 
neck, ears, orbits, genitalia, hands, feet, and/or multiple digits, 
total wound surface area up to 100 sq cm; first 25 sq cm or less wound 
surface area), and 15277 (Application of skin substitute graft to face, 
scalp, eyelids, mouth, neck, ears, orbits, genitalia, hands, feet, and/
or multiple digits, total wound surface area greater than or equal to 
100 sq cm; first 100 sq cm wound surface area, or 1% of body area of 
infants and children) to allocate the full service period minutes to 
the basic instrument pack (EQ137) by reducing the equipment allocation 
by 3 minutes to account for the overlapping time for cleaning the room 
and the pack.
    Comment: One commenter disagreed with CMS' reduction of the 
recommended minutes and stated that since the pack is unavailable for 
other patients while the room is being cleaned, the pack should be 
allocated the full number of service period clinical labor minutes, 
including the time for cleaning both the room and the pack. The 
commenter also stated that cleaning of the instruments is discrete 
work, most often done after the patient's departure.
    Response: Since clinical labor is allocated a specific number of 
minutes for cleaning surgical instrument packs, we do not believe that 
we should also allocate the clinical labor minutes for cleaning the 
other equipment associated with the services. Because we agree with the 
commenter that the task is discrete from the cleaning associated with 
the other equipment and the room itself, we do not think that the 
instrument pack is unavailable when the room is being cleaned.
    CMS also refined the recommended direct PE inputs for CPT codes 
15273 and 15275 by not including the post-op incision care (suture) 
pack (SA054) in each code because the code itself does not describe 
post-op care.
    Comment: One commenter disagreed with the refinement and pointed 
out that CPT guidelines state: ``Skin replacement surgery consists of 
surgical preparation and topical placement of an autograft (including 
tissue cultured autograft) or skin substitute graft (ie, homograft, 
allograft, xenograft). The graft is anchored using the provider's 
choice of fixation. When services are performed in the office, routine 
dressing supplies are not reported separately. Removal of current graft 
and/or simple cleansing of the wound is included, when performed.'' The 
commenter also noted that CPT codes 15273 and 15277 typically involve 
large grafts that will be anchored by sutures, and although these codes 
have a 0-day global period, removal of the graft is included in the 
work and therefore a suture removal kit is appropriate as a supply 
item.
    Response: Based on the rationale presented by the commenters, CMS 
agrees that one pack should be included as a supply item for CPT codes 
15273 and 15277. After consideration of the comments received, we are 
finalizing the direct PE inputs for CPT codes 15271, 15273, 15275, and 
15277 as established as interim final with the additional refinement of 
incorporating the supply item discussed above for CPT codes 15273 and 
15277.

[[Page 69030]]

(2) Musculoskeletal: General: Introduction or Removal (CPT Code 20527)
    In establishing interim final direct PE inputs for 2012, CMS 
refined the AMA RUC's recommendation for CPT code 20527 (Injection, 
enzyme (eg, collagenase), palmar fascial cord (ie, dupuytren's 
contracture)) by including a minimum multi-specialty visit pack (SA048) 
as a direct PE input for the service.
    Comment: A commenter presented information indicating that the 
multi-specialty pack is not typically used in furnishing the service.
    Response: We agree with the information presented by the commenter.
    After consideration of this comment, we are finalizing the direct 
PE inputs for CPT code 20527 as established as interim final with the 
additional refinement of removing the supply item discussed above. The 
direct PE inputs are displayed in the final CY 2013 direct PE input 
database, available on the CMS Web site under the downloads for the CY 
2013 PFS final rule at www.cms.gov/PhysicianFeeSched/.
(3) Musculoskeletal: Spine (Vetebral Column) (CPT Code 22525)
    In establishing interim final direct PE inputs for 2012, CMS 
refined the AMA RUC's recommendation for CPT code 22525 (Percutaneous 
vertebral augmentation, including cavity creation (fracture reduction 
and bone biopsy included when performed) using mechanical device, 1 
vertebral body, unilateral or bilateral cannulation (eg, kyphoplasty); 
each additional thoracic or lumbar vertebral body (list separately in 
addition to code for primary procedure))by not including additional 
clinical labor and equipment time for preparing the room, equipment, 
and supplies since the CPT code 22525 is an add-on code and time for 
those tasks is already included in the base code.
    Comment: A commenter disagreed with the removal of 2 minutes for 
preparing the room, equipment, and supplies and stated that since the 
add-on code requires more equipment than the base code the direct PE 
inputs should include additional minutes for preparing that equipment.
    Response: Based on our clinical review, we believe that the 
standard number of minutes allocated for the clinical labor to prepare 
the room, equipment, and supplies in the base code approximates the 
typical number of minutes for such tasks including the cases where the 
add-on code is necessary. Were the minutes accounted for separately in 
the add-on code, the number of minutes included in the base code would 
need to be re-examined. At this time, we believe that it would be more 
appropriate to maintain the standard number of minutes in the base code 
and not allocate additional time in the add-on code.
    Comment: A commenter informed CMS that the clinical labor codes 
associated with CPT Code 22525 were transposed in the direct PE input 
database.
    Response: We appreciate being informed of the inadvertent 
assignment of labor codes.
    After consideration of these comments, we are finalizing the direct 
PE inputs for CPT code 22525 as established as interim final with the 
additional refinement of assigning the appropriate labor codes.
(4) Musculoskeletal: Hand and Fingers (CPT Code 26341)
    In establishing interim final direct PE inputs for 2012, CMS 
refined the AMA RUC's recommendation for CPT code 26341 (Manipulation, 
palmar fascial cord (ie, dupuytren's cord), post enzyme injection (eg, 
collagenase), single cord) by including a minimum multi-specialty visit 
pack (SA048) as a direct PE input for the service period in the 
nonfacility and the same pack in both settings to account for the post-
service office visit included in the global period.
    Comment: A commenter stated that while the pack was typically used 
in the nonfacility setting during the service period, it is not 
typically used for the post-service office visit.
    Response: The allocation of the supply pack minutes in the facility 
setting reflects the standard allocation of direct PE inputs based on 
the office visits included in the global period for the service. We 
discuss the specifics related to these standard allocations in section 
III.M.3.b of this final rule with comment period. At this time, we do 
not believe it would be appropriate to deviate from these standards. We 
direct readers interested in the appropriate valuation of services with 
global periods to section III.B.2.d of this final rule with comment 
period.
    After consideration of this comment, we are finalizing the direct 
PE inputs for CPT code 26341 as established as interim final. The 
direct PE inputs are displayed in the final CY 2013 direct PE input 
database, available on the CMS Web site under the downloads for the CY 
2013 PFS final rule at www.cms.gov/PhysicianFeeSched/.
(5) Respiratory: Lungs and Pleura (CPT Code 32405) and Digestive: Liver 
(CPT Code 47000)
    In establishing interim final direct PE inputs for 2012, CMS 
refined the AMA RUC's recommendations for CPT codes 32405 (Biopsy, lung 
or mediastinum, percutaneous needle) and 47000 (Biopsy of liver, 
needle; percutaneous) by removing minutes allocated to the CT room 
(EL007) since these services are typically billed with radiological 
supervision and interpretation (S&I) services.
    Comment: A commenter pointed out that the CT room time included 
with the S&I code 77012 is only 9 minutes, which reflects a convention 
for some S&I codes. On this basis, the commenter suggested that for 
these codes, the CT room should be allocated the standard number of 
minutes minus the 9 minutes that overlap with the S&I code.
    Response: We appreciate the commenter pointing out this allocation 
of equipment minutes. We note that this convention does not apply 
consistently to all S&I codes and related procedure codes. We may 
address such inconsistencies in future rulemaking.
    After consideration of this comment, we are finalizing the direct 
PE inputs for CPT codes 32405 and 47000 as established as interim final 
with the additional refinement of including the CT room as a direct PE 
input for the services, with the reduction of 9 minutes to account for 
the overlapping number of minutes allocated in the S&I code.
(6) Cardiovascular: Arteries and Veins (CPT Codes 36200, 36246, 36247)
    In establishing interim final direct PE inputs for 2012, CMS 
refined the AMA RUC's recommendations for CPT codes 36200 (Introduction 
of catheter, aorta), 36246 (Selective catheter placement, arterial 
system; initial second order abdominal, pelvic, or lower extremity 
artery branch, within a vascular family), and 36247 (Selective catheter 
placement, arterial system; initial third order or more selective 
abdominal, pelvic, or lower extremity artery branch, within a vascular 
family) by reducing the number of clinical labor minutes allocated for 
preparing the room, equipment, and supplies used in the service to the 
standard number of minutes allocated to clinical labor for those tasks.
    Comment: One commenter stated that since vascular procedures have 
more variable supplies than typical procedures, more minutes for 
preparing supplies should be allocated for the clinical labor direct PE 
inputs.

[[Page 69031]]

    Response: Upon clinical review of these procedures, we believe that 
the standard number of minutes allocated for such tasks in similar 
services across the direct PE input database adequately accounts for 
the variability of supplies in these procedures.
    After consideration of this comment, we are finalizing the direct 
PE inputs for CPT codes 36200, 36246, and 36247 as established as 
interim final. The direct PE inputs are displayed in the final CY 2013 
direct PE input database, available on the CMS Web site under the 
downloads for the CY 2013 PFS final rule at www.cms.gov/PhysicianFeeSched/.
(7) Digestive: Abdomen, Peritoneum, and Omentum (CPT Code 49083)
    In establishing interim final direct PE inputs for 2012, CMS 
refined the AMA RUC's recommendations for CPT code 49083 (Abdominal 
paracentesis (diagnostic or therapeutic); with imaging guidance) by 
reducing the number of clinical labor minutes recommended for a series 
of tasks to correspond with the standard minutes as allocated across 
PFS services. Additionally, CMS refined the minutes allocated to the 
equipment associated with the service based on the standard allocation 
of minutes for highly technical and resource-intensive equipment.
    Comment: A commenter suggested that 42 minutes should be allocated 
to the equipment using CMS' methodologies and including the 25 minutes 
corresponding to the assist physician time.
    Response: We agree with the commenter that the 25 minutes is the 
appropriate time allocated for assisting the physician. However, we do 
not agree with the final number of minutes that should be allocated for 
the equipment. Based on our standard review for such equipment, we 
believe that the equipment should be allocated the minutes assumed for 
preparing the room, equipment, and supplies, preparing and positioning 
the patient, the procedure time itself, and the time allocated to clean 
the room and the equipment. Based on the procedure-specific assist 
physician time and the standard number of minutes allocated for the 
additional pre-service and post-service tasks, we have calculated the 
appropriate equipment minutes to sum to 32.
    After consideration of this comment, we are finalizing the direct 
PE inputs for CPT code 49083 as established as interim final, with the 
additional refinement of allocating 32 minutes for the equipment used 
in the service. The direct PE inputs are displayed in the final CY 2013 
direct PE input database, available on the CMS Web site under the 
downloads for the CY 2013 PFS final rule at www.cms.gov/PhysicianFeeSched/.
(8) Urinary: Bladder (CPT Code 51736)
    In establishing interim final direct PE inputs for 2012, CMS 
refined the AMA RUC's recommendations for CPT code 51736 (Simple 
uroflowmetry (ufr) (eg, stop-watch flow rate, mechanical uroflowmeter)) 
by adding the following supplies to the direct PE inputs for the 
service based on CMS clinical review: paper towel (SK082), disinfectant 
spray (SM012), and sanitizing cloth wipe (SM022).
    Comment: A commenter disagreed with this refinement and suggested 
instead that these supplies, as well as the digital uroflowmeter 
(EQ259), should instead only be included as direct PE inputs for CPT 
code 51741 (Complex uroflowmetry (eg, calibrated electronic 
equipment)).
    Response: Upon further clinical review, and on the basis of the 
commenter's recommendation, we agree that the items should be removed 
from the service.
    After consideration of this comment, we are finalizing the direct 
PE inputs for CPT code 51741 as established as interim final, with the 
additional refinement of removing the three supply items and one 
equipment item identified above. The direct PE inputs are displayed in 
the final CY 2013 direct PE input database, available on the CMS Web 
site under the downloads for the CY 2013 PFS final rule at www.cms.gov/PhysicianFeeSched/.
    (9) Nervous: Extracranial Nerves, Peripheral Nerves, and Autonomic 
Nervous System (CPT Codes 64633, 64635)
    In establishing interim final direct PE inputs for 2012, CMS 
refined the AMA RUC's recommendations for CPT code 64633 (Destruction 
by neurolytic agent, paravertebral facet joint nerve(s), with imaging 
guidance (fluoroscopy or ct); cervical or thoracic, single facet joint) 
and 64635 (Destruction by neurolytic agent, paravertebral facet joint 
nerve(s), with imaging guidance (fluoroscopy or ct); lumbar or sacral, 
single facet joint) by not including the recommended radiofrequency 
probe kit (SA100) as a supply item. As we explained in the CY 2012 PFS 
final rule (76 FR 73214), the very expensive disposable item had not 
previously been included as a direct PE input for predecessor codes 
that described the same services, and the recommendation did not 
include any information suggesting that such a significant resource 
cost had become typical in furnishing the services. At that time, we 
noted that the direct PE inputs for these codes were considered interim 
for CY 2012, and we would consider any submitted information regarding 
the use of this supply in furnishing these services prior to finalizing 
the direct PE inputs for CY 2013.
    Comment: One commenter responded to this refinement by explaining 
that furnishing the service requires a radiofrequency kit, but that the 
kit is reusable and typically has a useful life of several months.
    Response: We appreciate the information from the commenter, though 
we generally prefer additional information, including paid invoices, in 
order to price supply or equipment items accurately. For CY 2013, we 
believe it would be appropriate to finalize the direct PE inputs for 
these services with a new equipment item based on the disposable item 
included in the original recommendation and the information supplied by 
the commenter. We encourage stakeholders to submit additional 
information through the public process for updating prices for supplies 
and equipment we established in the CY 2011 PFS final rule (75 FR 
73205-73207). We believe that that process will allow us to describe 
the item and assign its price and useful life more accurately.
    CMS also refined the recommended direct PE inputs for CPT codes 
64633 and 64635 by allocating equipment minutes in the facility setting 
for the exam table (EF023) and the exam light (EQ168) based on the 
post-service office visits included in the global periods.
    Comment: One commenter suggested that allocating this time was not 
appropriate.
    Response: The allocation of equipment minutes in the facility 
setting reflects the standard allocation of direct PE inputs based on 
the office visits included in the global period for the service. We 
discuss the specifics related to these standard allocations in section 
III.M.3.b of this final rule with comment period. At this time, we do 
not believe it would be appropriate to deviate from these standards. We 
direct readers interested in the appropriate valuation of services with 
global periods to section III.B.2.d of this final rule with comment 
period.
    After consideration of these comments, we are finalizing the direct 
PE inputs for CPT code 64633 and 64635 as established as interim final, 
with the additional refinement of establishing this equipment item, 
``radiofrequency kit for destruction by

[[Page 69032]]

neurolytic agent'' (EQ354) as a placeholder direct PE input for the 
codes until we receive more information regarding the item. The direct 
PE inputs are displayed in the final CY 2013 direct PE input database, 
available on the CMS Web site under the downloads for the CY 2013 PFS 
final rule at www.cms.gov/PhysicianFeeSched/.
(10) Diagnostic Radiology: Spine and Pelvis (CPT Code 72120, 72170)
    In establishing interim final direct PE inputs for 2012, CMS 
refined the direct PE inputs for CPT codes 72120 (Radiologic 
examination, spine, lumbosacral; bending views only, 2 or 3 views) and 
72170 (Radiologic examination, pelvis; 1 or 2 views) by reducing the 
number of minutes allocated to the clinical labor for cleaning the room 
and equipment to one.
    Comment: A commenter disagreed with the revision and suggested that 
CMS should use the standard 3 minutes for this activity.
    Response: We appreciate the commenter's interest in CMS using the 
standard number of minutes for clinical labor tasks. As we explained in 
our refinements regarding reducing recommendations that exceeded the 
standard number of minutes, we believe that the standard number of 
minutes generally accommodates the range of minutes likely to be 
typical for such activities. We agree that it would be appropriate to 
include the standard minutes for these services.
    After consideration of these comments, we are finalizing the direct 
PE inputs for CPT codes 72120 and 72170, with the additional refinement 
of allocating two additional minutes to the clinical labor and the 
associated equipment inputs for cleaning the room and equipment. The 
direct PE inputs are displayed in the final CY 2013 direct PE input 
database, available on the CMS Web site under the downloads for the CY 
2013 PFS final rule at www.cms.gov/PhysicianFeeSched/.
(11) Nuclear Medicine: Diagnostic (CPT Codes 78226, 78227, 78579, 
78580, 78582, 78597, 78598)
    In establishing interim final direct PE inputs for 2012, CMS 
refined the AMA RUC's recommendations for CPT codes 78226 
(Hepatobiliary system imaging, including gallbladder when present;), 
78227(Hepatobiliary system imaging, including gallbladder when present; 
with pharmacologic intervention, including quantitative measurement(s) 
when performed), 78579 (Pulmonary ventilation imaging (eg, aerosol or 
gas)), 78580 (Pulmonary perfusion imaging (eg, particulate)), 78582 
(Pulmonary ventilation (eg, aerosol or gas) and perfusion imaging), 
78597 (Quantitative differential pulmonary perfusion, including imaging 
when performed), and 78598 (Quantitative differential pulmonary 
perfusion and ventilation (eg, aerosol or gas), including imaging when 
performed) by refining equipment time allocations as described in 
section III.M.2.b above.
    Comment: One commenter disagreed with those refinements and urged 
CMS to identify the clinical labor tasks associated with the minutes 
excluded from the equipment allocation.
    Response: We refer the commenter to the discussion above regarding 
the general principles of accurate assignment of equipment minutes. In 
the case of this family of codes, we believe that it is appropriate to 
allocate equipment minutes for clinical labor tasks of preparing the 
room, positioning the patient, placing the IV, acquiring images during 
the procedure itself, and cleaning the room, including additional 
minutes of cleaning for regulatory compliance. We do not believe that 
expensive equipment is typically unavailable for use for other patients 
while clinical staff performs such tasks as greeting and gowning the 
patient, reviewing mandatory radiation education, helping the patient 
to the waiting room, completing diagnostic forms or making lab and X-
ray requisitions. The minutes allocated to the equipment in the direct 
PE input database reflect the application of these principles as 
specifically determined through CMS clinical review.
    CMS also refined the recommended direct PE inputs for CPT codes 
78226, 78227, 78579, 78580, 78582, 78597, 78598 by examining all of the 
educational tasks included in the AMA RUC's recommendation and refining 
the sum of those times to a total number of minutes considered accurate 
under CMS clinical review. The AMA RUC recommendation included 6 
minutes of education by the nuclear medicine technologist. CMS refined 
the total number of minutes allocated for educational tasks to 4.
    Comment: One commenter disagreed with the refinement to remove the 
minutes allocated for providing patient counseling while the patient is 
being taken back to the waiting area. This commenter suggested that CMS 
may be confusing the recommended minutes for this task with the 
concurrent recommendation to include the standard number of minutes for 
patient education. The commenter suggested that since nuclear medicine 
patients are radioactive when they leave departments, they require more 
education than other services, especially since patients need to be 
reminded about the dangers of radioactivity after they leave the 
office.
    Response: We agree with the commenter that it is reasonable for 
more time to be allocated to these services for patient education. We 
also note that our interim refinements included more education time 
than typical for PFS services. However, we believe that it would be 
appropriate to include a total of 5 minutes for clinical labor patient 
education activities for these services in consideration of the 
comments received.
    CMS also refined the recommended direct PE inputs for CPT codes 
78226, 78227, 78579, 78580, 78582, 78597, 78598 by examining all of the 
cleaning tasks included in the AMA RUC's recommendation and refining 
the sum of those times to a total number of minutes considered accurate 
under CMS clinical review. The AMA RUC recommendation included 13 
minutes of cleaning tasks by a nuclear medicine technologist. CMS 
refined the total number of minutes allocated for educational tasks to 
10.
    Comment: One commenter suggested that the full 13 minutes of 
cleaning per service should be allocated on a standard basis for these 
codes to account for the number of minutes required to meet cleaning 
regulatory cleaning standards for services that use radioactive 
pharmaceuticals. The commenter also noted that this allocation has been 
included in similar services.
    Response: Upon clinical review, we continue to doubt that nuclear 
medicine technologists typically clean the room and equipment for 13 
minutes following every service. However, we acknowledge that there is 
an additional cleaning burden for these services, and we also agree 
with the commenter that other services that use similar substances 
incorporate the same number of minutes for mandated cleaning. 
Therefore, we believe it is appropriate that these services include 
these additional minutes for cleaning.
    After consideration of these comments, we are finalizing the direct 
PE inputs for CPT codes 78226, 78227, 78579, 78580, 78582, 78597, 78598 
with the additional refinement of allocating 1 additional clinical 
labor minute for patient education tasks and an additional 3 minutes to 
the clinical labor and equipment items to account for mandatory 
cleaning tasks. The direct PE inputs are displayed in the final CY 2013 
direct PE input database, available on the CMS Web site under the 
downloads for the CY 2013 PFS final

[[Page 69033]]

rule at www.cms.gov/PhysicianFeeSched/.
(12) Pulmonary: Diagnostic Testing and Therapies (CPT Codes 94728)
    In establishing interim final direct PE inputs for 2012, CMS 
refined the AMA RUC's recommendations for CPT code 94728 (Airway 
resistance by impulse oscillometry) by adding the body plethysmograph 
autobox (EQ044) as direct equipment input for the service based on the 
item's inclusion as a direct PE input for related services.
    Comment: One commenter noted that this code is used to describe 
services furnished primarily for children and that the equipment item 
cannot be used with pediatric patients.
    Response: We appreciate the additional information regarding the 
appropriate use of the equipment.
    After consideration of these comments, we are finalizing the direct 
PE inputs for CPT code 94728 with the additional refinement of removing 
the equipment item discussed above as a direct PE input for the 
service. The direct PE inputs are displayed in the final CY 2013 direct 
PE input database, available on the CMS Web site under the downloads 
for the CY 2013 PFS final rule at www.cms.gov/PhysicianFeeSched/.
(13) Hydration, Therapeutic, Prophylactic, Diagnostic Injections and 
Infusions, and Chemotherapy and Other Highly Complex Drug or Highly 
Complex Biologic Agent Administration (CPT Codes 96413, 96416)
    In establishing interim final direct PE inputs for 2012, CMS 
refined the AMA RUC's recommendations for CPT code 96413 (Chemotherapy 
administration, intravenous infusion technique; up to 1 hour, single or 
initial substance/drug) by not including the 6 clinical labor minutes 
in the pre-service period for completing pre-service diagnostic and 
referral forms and coordinating pre-surgery services since these tasks 
are not generally allocated for services without global periods.
    Comment: Several commenters suggested that the recommended times 
for these tasks reflects the time for the oncology nurse to document 
the upcoming chemotherapy session based on the physician's orders, 
coordinate the service under the physician's direction, ensure that the 
planned infusion is consistent with physician's direction, and confirm 
that there is no change in the drugs to be infused, anti-emetics to be 
supplied, or post-treatment instructions. The commenter also noted that 
the minutes allocated for those tasks in CPT code 96416 (Chemotherapy 
administration, intravenous infusion technique; initiation of prolonged 
chemotherapy infusion (more than 8 hours), requiring use of a portable 
or implantable pump) were removed in the same recommendation in order 
to account for the overlap in tasks since CPT code 96413 is typically 
also reported whenever CPT code 96416 is reported.
    Response: We agree with the commenter's recommendation to include 
those six minutes in CPT code 96413 and exclude those minutes in CPT 
code 96416, consistent with the AMA RUC recommendation.
    CMS refined the recommended direct PE inputs for CPT code 96416 by 
not including the 4 minutes assigned to the clinical labor for 
reviewing the charts and obtain chemotherapy-related medical history. 
This refinement reflected that CMS clinical review concluded that these 
tasks are already accounted for in the clinical labor minutes assigned 
to CPT code 96413 and would typically not be repeated when CPT code 
96416 is reported.
    Comment: Several commenters claimed that the nurse must perform 
these tasks and that the time is appropriately valued at 4 minutes.
    Response: We agree with the commenters that the time for the tasks 
is appropriately estimated at 4 minutes, but we maintain our belief 
that the tasks fully overlap with the same tasks associated with CPT 
code 96413, which is typically also reported whenever CPT code 96416 is 
reported. Therefore, we do not believe those 4 minutes should be 
allocated to both services.
    CMS also refined the recommended direct PE inputs for CPT code 
96416 by examining all of the tasks described in the AMA RUC's 
recommendation for monitoring the patient and removing the minutes that 
overlap with monitoring included in CPT code 96413. This refinement 
assumed no monitoring was necessary beyond the monitoring time already 
associated with CPT code 96413.
    Comment: One commenter objected to the refinement of the intra-
service time since the clinical labor performs the procedure.
    Response: We agree with the commenter that the recommendation 
reflects that the clinical staff is performing the procedure. The 
rationale for our refinement of the minutes for the task ``assist 
physician performing the procedure'' was described broadly as 
``conforming to physician time'' in the CY 2012 PFS final rule (76 FR 
73264), but was specifically intended to address the overlap in minutes 
allocated for monitoring the patient following the administration. We 
continue to believe that some of the 18 recommended minutes for 
monitoring tasks in CPT code 96416 overlap with the 24 minutes included 
in CPT code 96413 for monitoring. However, upon further clinical 
review, we believe that the overlap is not complete and that it would 
be appropriate to increase the total clinical labor minutes allocated 
in the service period by an additional 11 minutes to account for the 
additional monitoring that would typically occur when CPT code 96416 is 
furnished.
    After consideration of these comments, we are finalizing the direct 
PE inputs for CPT codes 96413 and 96416 with the additional refinements 
of including an additional 6 minutes of clinical labor time in the pre-
service period for CPT code 96413 and including an additional 11 
minutes of clinical labor time in the service period for CPT code 
96416. We also note that the minutes allocated to the equipment inputs 
will increase based on our standard allocation policies. The direct PE 
inputs are displayed in the final CY 2013 direct PE input database, 
available on the CMS Web site under the downloads for the CY 2013 PFS 
final rule at www.cms.gov/PhysicianFeeSched/.
    For all other CY 2012 new, revised, or potentially misvalued codes 
with CY 2012 interim final RVUs that are not specifically discussed in 
this final rule with comment period, we are finalizing, without 
modification, the interim final direct PE inputs that we initially 
adopted for CY 2012.
c. Finalizing CY 2012 Interim and Proposed Malpractice Crosswalks for 
CY 2013
    Consistent with our malpractice methodology described in section 
III.C.1. of this final rule with comment period, for the CY 2012 PFS 
final rule, we assigned malpractice RVUs for CY 2012 new and revised 
codes by utilizing crosswalks to source codes that have a similar 
malpractice risk-of-service. After reviewing the AMA RUC-recommended 
malpractice source code crosswalks for CY 2012 new and revised codes, 
we accepted nearly all of them on an interim final basis for CY 2012. 
As detailed in the CY 2012 final rule with comment period (76 FR 73264 
through 73265), for four CPT codes describing multi-layer compression 
systems, we assigned a malpractice crosswalk different from the 
malpractice crosswalk recommended by the AMA RUC and HCPAC.
    In the CY 2012 PFS final rule with comment period, for CPT codes 
29581 (Application of multi-layer compression

[[Page 69034]]

system; leg (below knee), including ankle and foot), 29582 (Application 
of multi-layer compression system; thigh and leg, including ankle and 
foot, when performed), 29583 (Application of multi-layer compression 
system; upper arm and forearm), and 29584 (Application of multi-layer 
compression system; upper arm, forearm, hand, and fingers), we assigned 
an interim final malpractice crosswalk from CPT code 97140 (Manual 
therapy techniques (eg, mobilization/manipulation, manual lymphatic 
drainage, manual traction), 1 or more regions, each 15 minutes). CPT 
codes 29582, 29583, and 29584 were new for CY 2012. The AMA RUC 
recommended, and we agreed, that the estimated utilization for CPT 
codes 29582, 29583, and 29584 would have previously been reported using 
CPT code 97140. After review, we believed that CPT code 97140 provides 
the most appropriate malpractice source code crosswalk for CPT codes 
29582, 29583, and 29584. As discussed in section III.M.3 of this CY 
2013 final rule with comment period, in the CY 2012 PFS final rule with 
comment period we stated that we believe CPT codes 29581, 29582, 29583, 
and 29584 all describe similar services from a resource perspective, 
and we assigned CPT code 29581 the same interim work RVU as CPT code 
29583. Because we find these services to be so similar, we stated that 
we also believed that it is appropriate for CPT codes 29581 and 29583 
to have the same malpractice source code crosswalk. Therefore, we 
assigned CPT code 97140 as the malpractice source code crosswalk for 
CPT codes 29581, 29582, 29583, and 29584.
    Additionally, for CY 2012 we created HCPCS G-code G0451 
(Development testing, with interpretation and report, per standardized 
instrument form) to replace CPT code 96110 (Developmental screening, 
with interpretation and report, per standardized instrument form). For 
CY 2012, we assigned CPT code 96110 as the malpractice source code 
crosswalk for HCPCS code G0451.
    In accordance with our malpractice methodology, we adjusted the 
malpractice RVUs for the CY 2012 new/revised codes for the difference 
in work RVUs (or, if greater, the clinical labor portion of the fully 
implemented PE RVUs) between the source codes and the new/revised codes 
to reflect the specific risk-of-service for the new/revised codes. The 
interim final malpractice crosswalks were listed in Table 22 of the CY 
2012 PFS final rule with comment period (76 FR 73266 through 73268).
    We received no comments on the CY 2012 interim final malpractice 
crosswalks and are finalizing them without modification for CY 2013. 
The malpractice RVUs for these services are reflected in Addendum B of 
this CY 2013 PFS final rule with comment period.
d. Other New, Revised or Potentially Misvalued Codes With CY 2012 
Interim Final RVUs or CY 2013 Proposed RVUs Not Specifically Discussed 
in the CY 2013 Final Rule With Comment Period
    For all other new, revised, or potentially misvalued codes with CY 
2012 interim final RVUs or CY 2013 proposed RVUs that are not 
specifically discussed in this final rule with comment period, we 
received no public comments and, as such, we are finalizing, without 
modification, the interim final or proposed work and direct PE inputs 
we initially adopted in the CY 2012 final rule with comment period or 
the CY 2013 proposed rule, respectively. The time values for all codes 
appear on the CMS Web site at www.cms.gov/PhysicianFeeSched/. Refer to 
Addenda B for a comprehensive list of all final values.
3. Establishing Interim Final RVUs for CY 2013
a. Establishing CY 2013 Interim Final Work RVUs
    As previously discussed in section III.M.2 of this final rule with 
comment period, on an annual basis the AMA RUC and HCPAC, along with 
other public commenters, provide CMS with recommendations regarding 
physician work values for new and revised CPT codes. This section 
discusses services for which CMS disagreed with the recommended 
physician work RVU or time values for CY 2013 new or revised CPT codes, 
services that had interim or interim final values in CY 2012 and will 
continue to have interim or interim final values for CY 2013, as well 
as the physician work and time values for new and revised HCPCS G-
codes. The interim or interim final work RVUs for all codes in this 
section, including those where CMS agreed with the recommended work 
RVU, appear in Table 2 at the start of this section. Unless otherwise 
indicated, we agreed with the time values recommended by the AMA RUC or 
HCPAC for all codes addressed in this section. The time values for all 
codes appear on the CMS Web site at: www.cms.gov/PhysicianFeeSched/.
    We note that in addition to the CPT codes discussed in this 
section, the CPT Editorial created, and the AMA RUC reviewed, many new 
CPT codes for molecular pathology tests. These services will be payable 
on the Medicare Clinical Laboratory Fee Schedule and are discussed in 
detail in section III.I of this CY 2013 PFS final rule with comment 
period.
i. Code-Specific Issues

                                      Table 30--Work RVUs for CY 2013 New, Revised, and Potentially Misvalued Codes
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                               Agree/disagree with
                                                                      AMA RUC/HCPAC       CY 2013  interim/       AMA RUC/HCPAC      CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU    recommended work RVU   interim final work   recommended work RVU        AMA/HCPAC
                                                                            *                    RVU                    *            recommended time *
--------------------------------------------------------------------------------------------------------------------------------------------------------
10120................  Remove foreign      1.25.................  1.25................  1.22................  Disagree............  Yes.
                        body.
11055................  Trim skin lesion..  0.43.................  0.43................  0.35................  Disagree............  Yes.
11056................  Trim skin lesions   0.50.................  0.50................  0.50................  Agree...............  No.
                        2 to 4.
11057................  Trim skin lesions   0.79.................  0.79................  0.65................  Disagree............  Yes.
                        over 4.
11300................  Shave skin lesion   0.51.................  0.60................  0.60................  Agree...............  No.
                        0.5 cm/<.
11301................  Shave skin lesion   0.85.................  0.90................  0.90................  Agree...............  No.
                        0.6-1.0 cm.
11302................  Shave skin lesion   1.05.................  1.16................  1.05................  Disagree............  No.
                        1.1-2.0 cm.
11303................  Shave skin lesion   1.24.................  1.25................  1.25................  Agree...............  No.
                        >2.0 cm.
11305................  Shave skin lesion   0.67.................  0.80................  0.80................  Agree...............  No.
                        0.5 cm/<.
11306................  Shave skin lesion   0.99.................  1.18................  0.96................  Disagree............  No.
                        0.6-1.0 cm.
11307................  Shave skin lesion   1.14.................  1.20................  1.20................  Agree...............  No.
                        1.1-2.0 cm.
11308................  Shave skin lesion   1.41.................  1.46................  1.46................  Agree...............  No.
                        >2.0 cm.
11310................  Shave skin lesion   0.73.................  1.19................  0.80................  Disagree............  No.
                        0.5 cm/<.
11311................  Shave skin lesion   1.05.................  1.43................  1.10................  Disagree............  No.
                        0.6-1.0 cm.

[[Page 69035]]

 
11312................  Shave skin lesion   1.20.................  1.80................  1.30................  Disagree............  No.
                        1.1-2.0 cm.
11313................  Shave skin lesion   1.62.................  2.00................  1.68................  Disagree............  No.
                        >2.0 cm.
11719................  Trim nail(s) any    0.17.................  0.17................  0.17................  Agree...............  No.
                        number.
G0127................  Trim nail(s)......  0.17.................  N/A.................  0.17................  N/A.................  N/A.
12035................  Intmd wnd repair s/ 3.50.................  3.60................  3.50................  Disagree............  No.
                        a/t/ext.
12036................  Intmd wnd repair s/ 4.23.................  4.50................  4.23................  Disagree............  Yes.
                        a/t/ext.
12037................  Intmd wnd repair s/ 5.00.................  5.25................  5.00................  Disagree............  No.
                        tr/ext.
12045................  Intmd wnd repair n- 3.75.................  3.90................  3.75................  Disagree............  Yes.
                        hf/genit.
12046................  Intmd wnd repair n- 4.30.................  4.60................  4.30................  Disagree............  Yes.
                        hf/genit.
12047................  Intmd wnd repair n- 4.95.................  5.50................  4.95................  Disagree............  Yes.
                        hf/genit.
12055................  Intmd wnd repair    4.50.................  4.65................  4.50................  Disagree............  Yes.
                        face/mm.
12056................  Intmd wnd repair    5.30.................  5.50................  5.30................  Disagree............  Yes.
                        face/mm.
12057................  Intmd wnd repair    6.00.................  6.20................  6.00................  Disagree............  Yes.
                        face/mm.
13100................  Cmplx rpr trunk     3.17.................  3.00................  3.00................  Agree...............  Yes.
                        1.1-2.5 cm.
13101................  Cmplx rpr trunk     3.96.................  3.50................  3.50................  Agree...............  Yes.
                        2.6-7.5 cm.
13102................  Cmplx rpr trunk     1.24.................  1.24................  1.24................  Agree...............  No.
                        addl 5cm/<.
13120................  Cmplx rpr s/a/l     3.35.................  3.23................  3.23................  Agree...............  Yes.
                        1.1-2.5 cm.
13121................  Cmplx rpr s/a/l     4.42.................  4.00................  4.00................  Agree...............  Yes.
                        2.6-7.5 cm.
13122................  Cmplx rpr s/a/l     1.44.................  1.44................  1.44................  Agree...............  No.
                        addl 5 cm/>.
13131................  Cmplx rpr f/c/c/m/  3.83.................  3.73................  3.73................  Agree...............  Yes.
                        n/ax/g/h/f.
13132................  Cmplx rpr f/c/c/m/  6.58.................  4.78................  4.78................  Agree...............  Yes.
                        n/ax/g/h/f.
13133................  Cmplx rpr f/c/c/m/  2.19.................  2.19................  2.19................  Agree...............  No.
                        n/ax/g/h/f.
13150................  Cmplx rpr e/n/e/l   3.85.................  N/A.................  3.58................  N/A.................  N/A.
                        1.0 cm/<.
13151................  Cmplx rpr e/n/e/l   4.49.................  4.34................  4.34................  Agree...............  Yes.
                        1.1-2.5 cm.
13152................  Cmplx rpr e/n/e/l   6.37.................  5.34................  4.90................  Disagree............  Yes.
                        2.6-7.5 cm.
13153................  Cmplx rpr e/n/e/l   2.38.................  2.38................  2.38................  Agree...............  No.
                        addl 5cm/<.
20985................  Cptr-asst dir ms    2.50.................  2.50................  2.50................  Agree...............  No.
                        px.
22586................  Prescrl fuse w/     New..................  N/A.................  28.12...............  N/A.................  N/A.
                        instr l5/s1.
23350................  Injection for       1.00.................  1.00................  1.00................  Agree...............  No.
                        shoulder x-ray.
23331................  Remove shoulder     7.63.................  7.63................  7.63................  Interim.............  No.
                        foreign body.
23332................  Remove shoulder     12.37................  12.37...............  12.37...............  Interim.............  No.
                        foreign body.
23472................  Reconstruct         22.65................  22.13...............  22.13...............  Interim.............  No.
                        shoulder joint.
23473................  Revis reconst       New..................  25.00...............  25.00...............  Interim.............  No.
                        shoulder joint.
23474................  Revis reconst       New..................  27.21...............  27.21...............  Interim.............  No.
                        shoulder joint.
23600................  Treat humerus       3.11.................  3.00................  3.00................  Agree...............  No.
                        fracture.
24160................  Remove elbow joint  8.00.................  8.00................  8.00................  Interim.............  No.
                        implant.
24363................  Replace elbow       22.65................  22.00...............  22.00...............  Interim.............  Yes.
                        joint.
24370................  Revise reconst      New..................  23.55...............  23.55...............  Interim.............  No.
                        elbow joint.
24371................  Revise reconst      New..................  27.50...............  27.50...............  Interim.............  No.
                        elbow joint.
28470................  Treat metatarsal    2.03.................  2.03................  2.03................  Agree...............  No.
                        fracture.
29075................  Application of      0.77.................  0.77................  0.77................  Agree...............  No.
                        forearm cast.
29581................  Apply multlay       0.25.................  0.60................  0.25................  Disagree............  No.
                        comprs lwr leg.
29582................  Apply multlay       0.35.................  0.35................  0.35................  Agree...............  No.
                        comprs upr leg.
29583................  Apply multlay       0.25.................  0.25................  0.25................  Agree...............  No.
                        comprs upr arm.
29584................  Appl multlay        0.35.................  0.35................  0.35................  Agree...............  No.
                        comprs arm/hand.
29824................  Shoulder            8.98.................  8.98................  8.98................  Interim.............  No.
                        arthroscopy/
                        surgery.
29826................  Shoulder            3.00.................  3.00................  3.00................  Interim.............  No.
                        arthroscopy/
                        surgery.
29827................  Arthroscop rotator  15.59................  15.59...............  15.59...............  Interim.............  No.
                        cuff repr.
29828................  Arthroscopy biceps  13.16................  13.16...............  13.16...............  Interim.............  No.
                        tenodesis.
31231................  Nasal endoscopy dx  1.10.................  1.10................  1.10................  Agree...............  Yes.
31647................  Bronchial valve     New..................  4.40................  4.40................  Agree...............  No.
                        init insert.
31648................  Bronchial valve     New..................  4.20................  4.20................  Agree...............  No.
                        addl insert.
31649................  Bronchial valve     New..................  2.00................  1.44................  Disagree............  No.
                        remov init.
31651................  Bronchial valve     New..................  1.58................  1.58................  Agree...............  No.
                        remov addl.
31660................  Bronch thermoplsty  New..................  4.50................  4.25................  Disagree............  No.
                        1 lobe.
31661................  Bronch thermoplsty  New..................  5.00................  4.50................  Disagree............  No.
                        2/> lobes.
32440................  Remove lung         27.28................  N/A.................  27.28...............  Interim.............  N/A.
                        pneumonectomy.
32480................  Partial removal of  25.82................  N/A.................  25.82...............  Interim.............  N/A.
                        lung.
32482................  Bilobectomy.......  27.44................  N/A.................  27.44...............  Interim.............  N/A.
32491................  Lung volume         25.24................  N/A.................  25.24...............  Interim.............  N/A.
                        reduction.
32551................  Insertion of chest  3.29.................  3.50................  3.29................  Disagree............  No.
                        tube.
32554................  Aspirate pleura w/  New..................  1.82................  1.82................  Agree...............  No.
                        o imaging.
32555................  Aspirate pleura w/  New..................  2.27................  2.27................  Agree...............  Yes.
                        imaging.
32556................  Insert cath pleura  New..................  2.50................  2.50................  Agree...............  No.
                        w/o image.
32557................  Insert cath pleura  New..................  3.62................  3.12................  Disagree............  Yes.
                        w/image.
32663................  Thoracoscopy w/     24.64................  24.64...............  24.64...............  Interim.............  No.
                        lobectomy.
32668................  Thoracoscopy w/w    3.00.................  4.00................  3.00................  Interim.............  No.
                        resect diag.
32669................  Thoracoscopy        23.53................  23.53...............  23.53...............  Interim.............  No.
                        remove segment.

[[Page 69036]]

 
32670................  Thoracoscopy        28.52................  28.52...............  28.52...............  Interim.............  No.
                        bilobectomy.
32671................  Thoracoscopy        31.92................  31.92...............  31.92...............  Interim.............  No.
                        pneumonectomy.
32672................  Thoracoscopy for    27.00................  27.00...............  27.00...............  Interim.............  No.
                        lvrs.
32673................  Thoracoscopy w/     21.13................  21.13...............  21.13...............  Interim.............  No.
                        thymus resect.
32701................  Thorax stereo rad   New..................  4.18................  4.18................  Agree...............  No.
                        targetw/tx.
33361................  Replace aortic      New..................  29.50...............  25.13...............  Disagree............  Yes.
                        valve perq.
33362................  Replace aortic      New..................  32.00...............  27.52...............  Disagree............  Yes.
                        valve open.
33363................  Replace aortic      New..................  33.00...............  28.50...............  Disagree............  Yes.
                        valve open.
33364................  Replace aortic      New..................  34.87...............  30.00...............  Disagree............  Yes.
                        valve open.
33365................  Replace aortic      New..................  37.50...............  33.12...............  Disagree............  No.
                        valve open.
33367................  Replace aortic      New..................  11.88...............  11.88...............  Agree...............  No.
                        valve w/byp.
33368................  Replace aortic      New..................  14.39...............  14.39...............  Agree...............  No.
                        valve w/byp.
33369................  Replace aortic      New..................  19.00...............  19.00...............  Agree...............  No.
                        valve w/byp.
33405................  Replacement of      41.32................  41.32...............  41.32...............  Interim.............  No.
                        aortic valve.
33430................  Replacement of      50.93................  50.93...............  50.93...............  Interim.............  No.
                        mitral valve.
33533................  Cabg arterial       33.75................  34.98...............  33.75...............  Interim.............  No.
                        single.
33990................  Insert vad artery   New..................  8.15................  8.15................  Agree...............  No.
                        access.
33991................  Insert vad          New..................  11.88...............  11.88...............  Agree...............  No.
                        art&vein access.
33992................  Remove vad          New..................  4.00................  4.00................  Agree...............  No.
                        different session.
33993................  Reposition vad      New..................  4.17................  3.51................  Disagree............  No.
                        diff session.
35475................  Repair arterial     9.48.................  6.60................  5.75................  Disgaree............  No.
                        blockage.
35476................  Repair venous       6.03.................  5.10................  4.71................  Disagree............  No.
                        blockage.
36221................  Place cath          New..................  4.51................  4.17................  Disagree............  Yes.
                        thoracic aorta.
36222................  Place cath carotid/ New..................  6.00................  5.53................  Disagree............  Yes.
                        inom art.
36223................  Place cath carotid/ New..................  6.50................  6.00................  Disagree............  Yes.
                        inom art.
36224................  Place cath carotd   New..................  7.55................  6.50................  Disagree............  Yes.
                        art.
36225................  Place cath          New..................  6.50................  6.00................  Disagree............  Yes.
                        subclavian art.
36226................  Place cath          New..................  7.55................  6.50................  Disagree............  Yes.
                        vertebral art.
36227................  Place cath xtrnl    New..................  2.32................  2.09................  Disagree............  No.
                        carotid.
36228................  Place cath          New..................  4.25................  4.25................  Agree...............  No.
                        intracranial art.
37197................  Remove intrvas      New..................  6.72................  6.29................  Disagree............  No.
                        foreign body.
37211................  Thrombolytic art    New..................  8.00................  8.00................  Agree...............  No.
                        therapy.
37212................  Thrombolytic        New..................  7.06................  7.06................  Agree...............  No.
                        venous therapy.
37213................  Thromblytic art/    New..................  5.00................  5.00................  Agree...............  No.
                        ven therapy.
37214................  Cessj therapy cath  New..................  3.04................  2.74................  Disagree............  No.
                        removal.
38240................  Transplt allo hct/  2.24.................  4.00................  3.00................  Disagree............  No.
                        donor.
38241................  Transplt autol hct/ 2.24.................  3.00................  3.00................  Agree...............  No.
                        donor.
38242................  Transplt allo       1.71.................  2.11................  2.11................  Agree...............  No.
                        lymphocytes.
38243................  Transplj            New..................  2.13................  2.13................  Agree...............  No.
                        hematopoietic
                        boost.
40490................  Biopsy of lip.....  1.22.................  1.22................  1.22................  Agree...............  No.
43206................  Esoph optical       New..................  Contractor Priced...  Contractor Priced...  N/A.................  N/A.
                        endomicroscopy.
43252................  Uppr gi opticl      New..................  Contractor Priced...  Contractor Priced...  N/A.................  N/A.
                        endomicrscopy.
44705................  Prepare fecal       New..................  1.42................  Invalid.............  N/A.................  N/A.
                        microbiota.
G0455................  Fecal microbiota    New..................  N/A.................  0.97................  N/A.................  N/A.
                        prep instill.
45330................  Diagnostic          0.96.................  0.96................  0.96................  Agree...............  No.
                        sigmoidoscopy.
47562................  Laparoscopic        11.76................  11.76...............  10.47...............  Disagree............  Yes.
                        cholecystectomy.
47563................  Laparo              11.47................  11.47...............  11.47...............  Agree...............  No.
                        cholecystectomy/
                        graph.
47600................  Removal of          17.48................  20.00...............  17.48...............  Disagree............  No.
                        gallbladder.
47605................  Removal of          15.98................  21.00...............  18.48...............  Disagree............  No.
                        gallbladder.
49505................  Prp i/hern init     7.96.................  7.96................  7.96................  Agree...............  No.
                        reduc >5 yr.
50590................  Fragmenting of      9.77.................  9.77................  9.77................  Agree...............  No.
                        kidney stone.
52214................  Cystoscopy and      3.70.................  3.50................  3.50................  Agree...............  No.
                        treatment.
52224................  Cystoscopy and      3.14.................  4.05................  4.05................  Agree...............  Yes.
                        treatment.
52234................  Cystoscopy and      4.62.................  4.62................  4.62................  Agree...............  No.
                        treatment.
52235................  Cystoscopy and      5.44.................  5.44................  5.44................  Agree...............  No.
                        treatment.
52240................  Cystoscopy and      9.71.................  8.75................  7.50................  Disagree............  No.
                        treatment.
52287................  Cystoscopy          New..................  3.20................  3.20................  Agree...............  No.
                        chemodenervation.
52351................  Cystouretero & or   5.85.................  5.75................  5.75................  Agree...............  No.
                        pyeloscope.
52352................  Cystouretero w/     6.87.................  6.75................  6.75................  Agree...............  No.
                        stone remove.
52353................  Cystouretero w/     7.96.................  7.88................  7.50................  Disagree............  No.
                        lithotripsy.
52354................  Cystouretero w/     7.33.................  8.58................  8.00................  Disagree............  No.
                        biopsy.
52355................  Cystouretero w/     8.81.................  10.00...............  9.00................  Disagree............  No.
                        excise tumor.
53850................  Prostatic           10.08................  10.08...............  10.08...............  Agree...............  No.
                        microwave
                        thermotx.
60520................  Removal of thymus   17.16................  N/A.................  17.16...............  Interim.............  N/A.
                        gland.
60521................  Removal of thymus   19.18................  N/A.................  19.18...............  Interim.............  N/A.
                        gland.
60522................  Removal of thymus   23.48................  N/A.................  23.48...............  Interim.............  N/A.
                        gland.

[[Page 69037]]

 
64450................  N block other       1.27.................  0.75................  0.75................  Agree...............  No.
                        peripheral.
64612................  Destroy nerve face  2.01.................  1.41................  1.41................  Interim.............  No.
                        muscle.
64613................  Destroy nerve neck  2.01.................  N/A.................  2.01................  Interim.............  N/A.
                        muscle.
64614................  Destroy nerve       2.20.................  N/A.................  2.20................  Interim.............  N/A.
                        extrem musc.
64615................  Chemodenerv musc    New..................  1.85................  1.85................  Interim.............  No.
                        migraine.
64640................  Injection           2.81.................  1.23................  1.23................  Agree...............  No.
                        treatment of
                        nerve.
65222................  Remove foreign      0.93.................  0.93................  0.84................  Disagree............  Yes.
                        body from eye.
65800................  Drainage of eye...  1.91.................  1.53................  1.53................  Agree...............  No.
66982................  Cataract surgery    15.02................  11.08...............  11.08...............  Agree...............  No.
                        complex.
66984................  Cataract surg w/    10.52................  8.52................  8.52................  Agree...............  No.
                        iol 1 stage.
67028................  Injection eye drug  1.44.................  1.44................  1.44................  Agree...............  No.
67810................  Biopsy eyelid &     1.48.................  1.18................  1.18................  Agree...............  Yes.
                        lid margin.
68200................  Treat eyelid by     0.49.................  0.49................  0.49................  Agree...............  Yes.
                        injection.
69200................  Clear outer ear     0.77.................  0.77................  0.77................  Agree...............  Yes.
                        canal.
69433................  Create eardrum      1.57.................  1.57................  1.57................  Agree...............  No.
                        opening.
72040................  X-ray exam neck     0.22.................  0.22................  0.22................  Agree...............  No.
                        spine 3/vws.
72191................  Ct angiograph pelv  1.81.................  N/A.................  1.81................  Interim.............  N/A.
                        w/o&w/dye.
73221................  Mri joint upr       1.35.................  1.35................  1.35................  Agree...............  No.
                        extrem w/o dye.
73721................  Mri jnt of lwr      1.35.................  1.35................  1.35................  Agree...............  No.
                        extre w/o dye.
74170................  Ct abdomen w/o & w/ 1.40.................  1.40................  1.40................  Agree...............  No.
                        dye.
74174................  Ct angio abd&pelv   2.20.................  2.20................  2.20................  Interim.............  No.
                        w/o&w/dye.
74175................  Ct angio abdom w/o  1.90.................  N/A.................  1.90................  Interim.............  N/A.
                        & w/dye.
74247................  Contrst x-ray uppr  0.69.................  0.69................  0.69................  Agree...............  No.
                        gi tract.
74280................  Contrast x-ray      0.99.................  0.99................  0.99................  Agree...............  No.
                        exam of colon.
74400................  Contrst x-ray       0.49.................  0.49................  0.49................  Agree...............  No.
                        urinary tract.
75896................  X-rays transcath    1.31 (PC), Contractor  Contractor Priced...  1.31 (PC),            Interim.............  N/A.
                        therapy.            Priced (TC).                                 Contractor Priced
                                                                                         (TC).
75898................  Follow-up           1.65 (PC), Contractor  Contractor Priced...  1.65 (PC),            Interim.............  N/A.
                        angiography.        Priced (TC).                                 Contractor Priced
                                                                                         (TC).
76830................  Transvaginal us     0.69.................  0.69................  0.69................  Agree...............  Yes.
                        non-ob.
76872................  Us transrectal....  0.69.................  0.69................  0.69................  Agree...............  No.
77001................  Fluoroguide for     0.38.................  N/A.................  0.38................  Interim.............  N/A.
                        vein device.
77002................  Needle              0.54.................  N/A.................  0.54................  Interim.............  N/A.
                        localization by
                        xray.
77003................  Fluoroguide for     0.60.................  0.60................  0.60................  Interim.............  No.
                        spine inject.
77080................  Dxa bone density    0.20.................  0.20................  0.20................  Agree...............  No.
                        axial.
77082................  Dxa bone density    0.17.................  0.17................  0.17................  Agree...............  No.
                        vert fx.
77301................  Radiotherapy dose   7.99.................  7.99................  7.99................  Agree...............  Yes.
                        plan imrt.
78012................  Thyroid uptake      New..................  0.19................  0.19................  Agree...............  No.
                        measurement.
78013................  Thyroid imaging w/  New..................  0.37................  0.37................  Agree...............  No.
                        blood flow.
78014................  Thyroid imaging w/  New..................  0.50................  0.50................  Agree...............  No.
                        blood flow.
78070................  Parathyroid planar  0.82.................  0.80................  0.80................  Agree...............  No.
                        imaging.
78071................  Parathyrd planar w/ New..................  1.20................  1.20................  Agree...............  No.
                        wo subtrj.
78072................  Parathyrd planar w/ New..................  1.60................  1.60................  Agree...............  No.
                        spect&ct.
78278................  Acute gi blood      0.99.................  0.99................  0.99................  Agree...............  No.
                        loss imaging.
78472................  Gated heart planar  0.98.................  0.98................  0.98................  Agree...............  No.
                        single.
G0452................  Molecular           New..................  N/A.................  0.37................  N/A.................  N/A.
                        pathology interpr.
86153................  Cell enumeration    New..................  0.69................  0.69................  Agree...............  Yes.
                        phys interp.
88120................  Cytp urne 3-5       1.20.................  1.20................  1.20................  Interim.............  No.
                        probes ea spec.
88121................  Cytp urine 3-5      1.00.................  1.00................  1.00................  Interim.............  No.
                        probes cmptr.
88312................  Special stains      0.54.................  0.54................  0.54................  Agree...............  No.
                        group 1.
88365................  Insitu              1.20.................  N/A.................  1.20................  Interim.............  N/A.
                        hybridization
                        (fish).
88367................  Insitu              1.30.................  N/A.................  1.30................  Interim.............  N/A.
                        hybridization
                        auto.
88368................  Insitu              1.40.................  N/A.................  1.40................  Interim.............  N/A.
                        hybridization
                        manual.
88375................  Optical             New..................  Contractor Priced...  Contractor Priced...  N/A.................  N/A.
                        endomicroscpy
                        interp.
G0416................  Sat biopsy 10-20..  3.09.................  N/A.................  3.09................  N/A.................  N/A.
90785................  Psytx complex       New..................  Contractor Priced...  0.11................  Interim.............  N/A.
                        interactive.
90791................  Psych diagnostic    New..................  3.00................  2.80................  Interim.............  No.
                        evaluation.
90792................  Psych diag eval w/  New..................  3.25................  2.96................  Interim.............  No.
                        med srvcs.
90832................  Psytx pt&/family    New..................  1.50................  1.25................  Interim.............  No.
                        30 minutes.
90833................  Psytx pt&/fam w/    New..................  1.50................  0.98................  Interim.............  No.
                        e&m 30 min.
90834................  Psytx pt&/family    New..................  2.00................  1.89................  Interim.............  No.
                        45 minutes.
90836................  Psytx pt&/fam w/    New..................  1.90................  1.60................  Interim.............  No.
                        e&m 45 min.

[[Page 69038]]

 
90837................  Psytx pt&/family    New..................  3.00................  2.83................  Interim.............  No.
                        60 minutes.
90838................  Psytx pt&/fam w/    New..................  2.50................  2.56................  Interim.............  No.
                        e&m 60 min.
90839................  Psytx crisis        New..................  Contractor Priced...  Contractor Priced...  N/A.................  N/A.
                        initial 60 min.
90840................  Psytx crisis ea     New..................  Contractor Priced...  Contractor Priced...  N/A.................  N/A.
                        addl 30 min.
90845................  Psychoanalysis....  1.79.................  2.10................  1.79................  Interim.............  Yes.
90846................  Family psytx w/o    1.83.................  2.40................  1.83................  Interim.............  Yes.
                        patient.
90847................  Family psytx w/     2.21.................  2.50................  2.21................  Interim.............  Yes.
                        patient.
90853................  Group               0.59.................  0.59................  0.59................  Interim.............  Yes.
                        psychotherapy.
90863................  Pharmacologic mgmt  New..................  Contractor Priced...  Invalid.............  N/A.................  N/A.
                        w/psytx.
91112................  Gi wireless         New..................  2.10................  2.10................  Agree...............  No.
                        capsule measure.
92083................  Visual field        0.50.................  0.50................  0.50................  Agree...............  No.
                        examination(s).
92100................  Serial tonometry    0.92.................  0.61................  0.61................  Agree...............  No.
                        exam(s).
92235................  Eye exam with       0.81.................  0.81................  0.81................  Agree...............  No.
                        photos.
92286................  Internal eye        0.66.................  0.40................  0.40................  Agree...............  No.
                        photography.
92920................  Prq cardiac         New..................  9.00................  10.10...............  Disagree............  Yes.
                        angioplast 1 art.
92921................  Prq cardiac angio   New..................  4.00................  Bundled.............  N/A.................  N/A.
                        addl art.
92924................  Prq card angio/     New..................  11.00...............  11.99...............  Disagree............  Yes.
                        athrect 1 art.
92925................  Prq card angio/     New..................  5.00................  Bundled.............  N/A.................  N/A.
                        athrect addl.
92928................  Prq card stent w/   New..................  10.49...............  11.21...............  Disagree............  Yes.
                        angio 1 vsl.
92929................  Prq card stent w/   New..................  4.44................  Bundled.............  N/A.................  N/A.
                        angio addl.
92933................  Prq card stent/ath/ New..................  12.32...............  12.54...............  Disagree............  Yes.
                        angio.
92934................  Prq card stent/ath/ New..................  5.50................  Bundled.............  N/A.................  N/A.
                        angio.
92937................  Prq revasc byp      New..................  10.49...............  11.20...............  Disagree............  Yes.
                        graft 1 vsl.
92938................  Prq revasc byp      New..................  6.00................  Bundled.............  N/A.................  N/A.
                        graft addl.
92941................  Prq card revasc mi  New..................  12.32...............  12.56...............  Disagree............  No.
                        1 vsl.
92943................  Prq card revasc     New..................  12.32...............  12.56...............  Disagree............  Yes.
                        chronic 1vsl.
92944................  Prq card revasc     New..................  6.00................  Bundled.............  N/A.................  N/A.
                        chronic addl.
93015................  Cardiovascular      0.75.................  0.75................  0.75................  Agree...............  No.
                        stress test.
93016................  Cardiovascular      0.45.................  0.45................  0.45................  Agree...............  No.
                        stress test.
93018................  Cardiovascular      0.30.................  0.30................  0.30................  Agree...............  No.
                        stress test.
93308................  Tte f-up or lmtd..  0.53.................  0.53................  0.53................  Agree...............  No.
93653................  Ep & ablate         New..................  15.00...............  15.00...............  Agree...............  No.
                        supravent arrhyt.
93654................  Ep & ablate         New..................  20.00...............  20.00...............  Agree...............  No.
                        ventric tachy.
93655................  Ablate arrhythmia   New..................  9.00................  7.50................  Disagree............  No.
                        add on.
93656................  Tx atrial fib pulm  New..................  20.02...............  20.02...............  Agree...............  No.
                        vein isol.
93657................  Tx l/r atrial fib   New..................  10.00...............  7.50................  Disagree............  No.
                        addl.
93925................  Lower extremity     0.58.................  0.90................  0.80................  Disagree............  Yes.
                        study.
93926................  Lower extremity     0.39.................  0.70................  0.50................  Disagree............  Yes.
                        study.
93970................  Extremity study...  0.68.................  0.70................  0.70................  Agree...............  No.
93971................  Extremity study...  0.45.................  0.45................  0.45................  Agree...............  No.
95017................  Perq & icut allg    New..................  0.07................  0.07................  Agree...............  No.
                        test venoms.
95018................  Perq⁣ allg test   New..................  0.14................  0.14................  Agree...............  No.
                        drugs/boil.
95076................  Ingest challenge    New..................  1.50................  1.50................  Agree...............  No.
                        ini 120 min.
95079................  Ingest challenge    New..................  1.38................  1.38................  Agree...............  No.
                        addl 60 min.
95782................  Polysom <6 yrs 4/>  New..................  3.00................  2.60................  Disagree............  No.
                        paramtrs.
95783................  Polysom <6 yrs      New..................  3.20................  2.83................  Disagree............  No.
                        cpap/bilvl.
95860................  Muscle test one     0.96.................  0.96................  0.96................  Agree...............  No.
                        limb.
95861................  Muscle test 2       1.54.................  1.54................  1.54................  Agree...............  No.
                        limbs.
95863................  Muscle test 3       1.87.................  1.87................  1.87................  Agree...............  No.
                        limbs.
95864................  Muscle test 4       1.99.................  1.99................  1.99................  Agree...............  No.
                        limbs.
95865................  Muscle test larynx  1.57.................  1.57................  1.57................  Agree...............  No.
95866................  Muscle test         1.25.................  1.25................  1.25................  Agree...............  No.
                        hemidiaphragm.
95867................  Muscle test cran    0.79.................  0.79................  0.79................  Agree...............  No.
                        nerv unilat.
95868................  Muscle test cran    1.18.................  1.18................  1.18................  Agree...............  No.
                        nerve bilat.
95869................  Muscle test thor    0.37.................  0.37................  0.37................  Agree...............  No.
                        paraspinal.
95870................  Muscle test         0.37.................  0.37................  0.37................  Agree...............  No.
                        nonparaspinal.
95885................  Musc tst done w/    0.35.................  0.35................  0.35................  Agree...............  No.
                        nerv tst lim.
95886................  Musc test done w/n  0.92.................  0.92................  0.70................  Disagree............  No.
                        test comp.
95887................  Musc tst done w/n   0.73.................  0.73................  0.47................  Disagree............  No.
                        tst nonext.
95905................  Motor &/sens nrve   0.05.................  0.05................  0.05................  Agree...............  No.
                        cndj test.
95907................  Motor&/sens 1-2     New..................  1.00................  1.00................  Agree...............  No.
                        nrv cndj tst.
95908................  Motor&/sens 3-4     New..................  1.37................  1.25................  Disagree............  Yes.
                        nrv cndj tst.
95909................  Motor&/sens 5-6     New..................  1.77................  1.50................  Disagree............  Yes.
                        nrv cndj tst.
95910................  Motor&sens 7-8 nrv  New..................  2.80................  2.00................  Disagree............  No.
                        cndj test.
95911................  Motor&sen 9-10 nrv  New..................  3.34................  2.50................  Disagree............  No.
                        cndj test.

[[Page 69039]]

 
95912................  Motor&sen 11-12     New..................  4.00................  3.00................  Disagree............  No.
                        nrv cnd test.
95913................  Motor&sens 13/>     New..................  4.20................  3.56................  Disagree............  No.
                        nrv cnd test.
95921................  Autonomic nrv       0.90.................  0.90................  0.90................  Agree...............  No.
                        parasym inervj.
95922................  Autonomic nrv       0.96.................  0.96................  0.96................  Agree...............  No.
                        adrenrg inervj.
95923................  Autonomic nrv syst  0.90.................  0.90................  0.90................  Agree...............  No.
                        funj test.
95924................  Ans parasymp &      New..................  1.73................  1.73................  Agree...............  No.
                        symp w/tilt.
95925................  Somatosensory       0.54.................  N/A.................  0.54................  Interim.............  N/A.
                        testing.
95926................  Somatosensory       0.54.................  N/A.................  0.54................  Interim.............  N/A.
                        testing.
95928................  C motor evoked      1.50.................  N/A.................  1.50................  Interim.............  N/A.
                        uppr limbs.
95929................  C motor evoked lwr  1.50.................  N/A.................  1.50................  Interim.............  N/A.
                        limbs.
95938................  Somatosensory       0.86.................  0.86................  0.86................  Interim.............  No.
                        testing.
95939................  C motor evoked      2.25.................  2.25................  2.25................  Interim.............  No.
                        upr&lwr limbs.
95940................  Ionm in operatng    New..................  0.60................  0.60................  Agree...............  No.
                        room 15 min.
95941................  Ionm remote/>1 pt   New..................  2.00................  Invalid.............  N/A.................  N/A.
                        or per hr.
G0453................  Cont intraop neuro  New..................  N/A.................  0.50................  N/A.................  N/A.
                        monitor.
95943................  Parasymp&symp hrt   New..................  Contractor Priced...  Contractor Priced...  N/A.................  N/A.
                        rate test.
96920................  Laser tx skin <     1.15.................  1.15................  1.15................  Agree...............  No.
                        250 sq cm.
96921................  Laser tx skin 250-  1.17.................  1.30................  1.30................  Agree...............  No.
                        500 sq cm.
96922................  Laser tx skin >500  2.10.................  2.10................  2.10................  Agree...............  No.
                        sq cm.
97150................  Group therapeutic   0.27.................  0.29................  0.29................  Agree...............  No.
                        procedures.
G0456................  Neg pre wound <=50  New..................  N/A.................  Contractor Priced...  N/A.................  N/A.
                        sq cm.
G0457................  Neg pres wound >50  New..................  N/A.................  Contractor Priced...  N/A.................  N/A.
                        sq cm.
99485................  Suprv interfacilty  New..................  1.50................  Bundled.............  N/A.................  N/A.
                        transport.
99486................  Suprv interfac      New..................  1.30................  Bundled.............  N/A.................  N/A.
                        trnsport addl.
99487................  Cmplx chron care w/ New..................  1.00................  Bundled.............  N/A.................  N/A.
                        o pt vsit.
99488................  Cmplx chron care w/ New..................  2.50................  Bundled.............  N/A.................  N/A.
                        pt vsit.
99489................  Complx chron care   New..................  0.50................  Bundled.............  N/A.................  N/A.
                        addl30 min.
99495................  Trans care mgmt 14  New..................  2.11................  2.11................  Agree...............  No.
                        day disch.
99496................  Trans care mgmt 7   New..................  3.05................  3.05................  Agree...............  Yes.
                        day disch.
G0454................  MD document visit   New..................  N/A.................  0.18................  N/A.................  N/A.
                        by NPP.
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Some of the CPT codes in this table were first reviewed for CY2011 and/or CY2012 and we held them interim pending the receipt of additional
  information. As a result, for some CPT codes, the AMA RUC/HCPAC recommendation reflects the CY2011 or CY2012 AMA RUC/HCPAC recommendation. For the
  majority of CPT codes in this table, the values reflect the CY 2013 AMA RUC/HCPAC recommendation. Where N/A is listed, either we did not receive a
  recommendation from the AMA RUC/HCPAC, the code is not nationally priced, or the code is not separately payable/payable.

(1) Integumentary System: Skin, Subcutaneous, and Accessory Structures

                                      Table 31--Integumentary System: Skin, Subcutaneous, and Accessory Structures
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work      AMA  RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
10120................  Remove foreign      1.25.................  1.25................  1.22................  Disagree............  Yes.
                        body.
11055................  Trim skin lesion..  0.43.................  0.43................  0.35................  Disagree............  Yes.
11056................  Trim skin lesions   0.50.................  0.50................  0.50................  Agree...............  No.
                        2 to 4.
11057................  Trim skin lesions   0.79.................  0.79................  0.65................  Disagree............  Yes.
                        over 4.
11300................  Shave skin lesion   0.51.................  0.60................  0.60................  Agree...............  No.
                        0.5 cm/<.
11301................  Shave skin lesion   0.85.................  0.90................  0.90................  Agree...............  No.
                        0.6-1.0 cm.
11302................  Shave skin lesion   1.05.................  1.16................  1.05................  Disagree............  No.
                        1.1-2.0 cm.
11303................  Shave skin lesion   1.24.................  1.25................  1.25................  Agree...............  No.
                        >2.0 cm.
11305................  Shave skin lesion   0.67.................  0.80................  0.80................  Agree...............  No.
                        0.5 cm/<.
11306................  Shave skin lesion   0.99.................  1.18................  0.96................  Disagree............  No.
                        0.6-1.0 cm.
11307................  Shave skin lesion   1.14.................  1.20................  1.20................  Agree...............  No.
                        1.1-2.0 cm.
11308................  Shave skin lesion   1.41.................  1.46................  1.46................  Agree...............  No.
                        >2.0 cm.
11310................  Shave skin lesion   0.73.................  1.19................  0.80................  Disagree............  No.
                        0.5 cm/<.
11311................  Shave skin lesion   1.05.................  1.43................  1.10................  Disagree............  No.
                        0.6-1.0 cm.
11312................  Shave skin lesion   1.20.................  1.80................  1.30................  Disagree............  No.
                        1.1-2.0 cm.
11313................  Shave skin lesion   1.62.................  2.00................  1.68................  Disagree............  No.
                        >2.0 cm.
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 69040]]

    CPT code 10120 was identified as potentially misvalued using the 
Harvard-valued--Utilization over 30,000 screen.
    After clinical review of CPT code 10120 (Incision and removal of 
foreign body, subcutaneous tissues; simple) we believe that the 
specialty society survey 25th percentile work RVU of 1.22 accurately 
reflects the work of this service. Medicare claims data from 2011 
indicate that this service is typically furnished to the beneficiary by 
the provider on the same day as an E/M visit. We believe that some of 
the activities furnished during the pre- and post-service period of the 
procedure code and the E/M visit overlap. After review, we believe that 
the AMA RUC appropriately accounted for this overlap in its 
recommendation of pre-service time, but failed to account for the 
overlap in post-service time. To account for this overlap, we reduced 
the AMA RUC-recommended post-service time for this procedure by one-
third, from 5 minutes to 3 minutes. We believe that 3 minutes 
accurately reflects the post-service time involved in furnishing this 
procedure and is more in line with similar services. Because we reduced 
the AMA RUC-recommended procedure time for this code by 2 minutes, 
given a standard post-service work intensity of .0224 RVUs per minute, 
we believe that the specialty society survey 25th percentile work RVU 
of 1.22 is more appropriate for this service than the AMA RUC-
recommended work RVU of 1.25. In sum, on an interim final basis for CY 
2013, we are assigning a work RVU of 1.22 to CPT code 10120, with a 
refinement to the AMA RUC-recommended time. A complete list of the 
interim final times associated with this procedure is available on the 
CMS Web site at www.cms.gov/physicianfeesched/.
    CPT code 11056 was identified for review because it is on the 
multispecialty points of comparison (MPC) list--a list of CPT codes 
commonly used as reference codes in the valuation of other codes.
    We reviewed CPT code 11056 (Paring or cutting of benign 
hyperkeratotic lesion (eg, corn or callus); 2 to 4 lesions) in CY 2012, 
and accepted the HCPAC-recommended work RVU of 0.50, the specialty 
society survey 25th percentile value, on an interim basis for CY 2012. 
At that time, we requested that the specialty society re-review CPT 
code 11056 along with related CPT codes 11055 (Paring or cutting of 
benign hyperkeratotic lesion (eg, corn or callus); single lesion) and 
11057 (Paring or cutting of benign hyperkeratotic lesion (eg, corn or 
callus); more than 4 lesions) to ensure appropriate relativity between 
the three services (76 FR 73190). The specialty society declined to 
survey CPT codes 11055 or 11057, and, in its recommendations to CMS, 
the AMA RUC noted that there are no apparent rank order anomalies among 
the three services.
    For CY 2013, we reviewed CPT codes 11055, 11056, and 11057 
together. After clinical review, we did not have evidence that the 
relativity of the services to each other had changed over time, and 
since the HCPAC and CMS agreed that the work associated with CPT code 
11056 had decreased, we believe it is appropriate to reduce the work of 
CPT codes 11055 and 11057 relative to the decrease in work of CPT code 
11056. In CY 2012, the HCPAC recommended that CPT code 11056 be reduced 
from a CY 2011 work RVU of 0.61 to a CY 2012 work RVU of 0.50. 
Therefore, to maintain relativity, we are reducing CPT code 11055 from 
a work RVU of 0.43 to a work RVU of 0.35, and we are reducing CPT code 
11057 from a work RVU of 0.79 to a work RVU of 0.65 on an interim final 
basis for CY 2013.
    Regarding physician time, CPT codes 11055 and 11057 currently (CY 
2012) are assigned 2 minutes of pre-service time and 5 minutes of post-
service time. Before it was reviewed by the HCPAC for CY 2012, CPT code 
11056 was also assigned 2 minutes of pre-service time and 5 minutes of 
post service time. Through its review, the HCPAC recommended adjusting 
the time of CPT code to include 7 minutes of pre-service time and 2 
minutes of post-service time, and we agreed. We believe that these are 
also the appropriate pre- and post- service times for CPT codes 11055 
and 11057. On an interim final basis for CY 2013, we are refining the 
times of CPT codes 11055 and 11057 to 7 minutes of pre-service time and 
2 minutes of post-service time. We believe the current intra-service 
times of 4 minutes for CPT code 11055 and 15 minutes for CPT code 11057 
remain appropriate. A complete list of the interim final times 
associated with these procedures is available on the CMS Web site at 
www.cms.gov/physicianfeesched/.
    For CY 2013 CPT codes 11300 through 11313, which describe 
procedures related to the shaving of epidermal or dermal lesions, were 
surveyed by their related specialty society to establish current 
relative values for these procedures. The specialty society and the AMA 
RUC reviewed the survey results for CPT codes 11300 through 11313 and 
recommended the survey 25th percentile work RVU for nearly all the 
codes in the family. After clinical review, we believe that the survey 
25th percentile for all the codes in the family reflects the 
appropriate relativity of the services both within the family, as well 
as relative to other services on the PFS. On an interim final basis for 
CY 2013 we are assigning a work RVU of 0.60 for CPT code 11300 (Shaving 
of epidermal or dermal lesion, single lesion, trunk, arms or legs; 
lesion diameter 0.5 cm or less); a work RVU of 0.90 for CPT code 11301 
(Shaving of epidermal or dermal lesion, single lesion, trunk, arms or 
legs; lesion diameter 0.6 to 1.0 cm); a work RVU of 1.05 for CPT code 
11302 (Shaving of epidermal or dermal lesion, single lesion, trunk, 
arms or legs; lesion diameter 1.1 to 2.0 cm); a work RVU of 1.25 for 
CPT code 11303 (Shaving of epidermal or dermal lesion, single lesion, 
trunk, arms or legs; lesion diameter over 2.0 cm); a work RVU of 0.80 
for CPT code 11305 (Shaving of epidermal or dermal lesion, single 
lesion, scalp, neck, hands, feet, genitalia; lesion diameter 0.5 cm or 
less); a work RVU of 0.96 for CPT code 11306 (Shaving of epidermal or 
dermal lesion, single lesion, scalp, neck, hands, feet, genitalia; 
lesion diameter 0.6 to 1.0 cm); a work RVU of 1.20 for CPT code 11307 
(Shaving of epidermal or dermal lesion, single lesion, scalp, neck, 
hands, feet, genitalia; lesion diameter 1.1 to 2.0 cm); a work RVU of 
1.46 for CPT code 11308 (Shaving of epidermal or dermal lesion, single 
lesion, scalp, neck, hands, feet, genitalia; lesion diameter over 2.0 
cm); a work RVU of 0.80 for CPT code 11310 (Shaving of epidermal or 
dermal lesion, single lesion, face, ears, eyelids, nose, lips, mucous 
membrane; lesion diameter 0.5 cm or less); a work RVU of 1.10 for CPT 
code 11311 (Shaving of epidermal or dermal lesion, single lesion, face, 
ears, eyelids, nose, lips, mucous membrane; lesion diameter 0.6 to 1.0 
cm); a work RVU of 1.30 for CPT code 11312 (Shaving of epidermal or 
dermal lesion, single lesion, face, ears, eyelids, nose, lips, mucous 
membrane; lesion diameter 1.1 to 2.0 cm); and a work RVU of 1.68 for 
CPT code 11313 (Shaving of epidermal or dermal lesion, single lesion, 
face, ears, eyelids, nose, lips, mucous membrane; lesion diameter over 
2.0 cm).
(2) Integumentary System: Repair (Closure)

[[Page 69041]]



                                                    Table 32--Integumentary System: Repair (Closure)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                               Agree/disagree with
                                                                      AMA RUC/HCPAC       CY 2013  interim/       AMA RUC/HCPAC      CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU    recommended work RVU   interim final work     recommended  work         AMA/HCPAC
                                                                                                 RVU                   RVU            recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
12035................  Intmd wnd repair s/ 3.50.................  3.60................  3.50................  Disagree............  No.
                        a/t/ext.
12036................  Intmd wnd repair s/ 4.23.................  4.50................  4.23................  Disagree............  Yes.
                        a/t/ext.
12037................  Intmd wnd repair s/ 5.00.................  5.25................  5.00................  Disagree............  No.
                        tr/ext.
12045................  Intmd wnd repair n- 3.75.................  3.90................  3.75................  Disagree............  Yes.
                        hf/genit.
12046................  Intmd wnd repair n- 4.30.................  4.60................  4.30................  Disagree............  Yes.
                        hf/genit.
12047................  Intmd wnd repair n- 4.95.................  5.50................  4.95................  Disagree............  Yes.
                        hf/genit.
12055................  Intmd wnd repair    4.50.................  4.65................  4.50................  Disagree............  Yes.
                        face/mm.
12056................  Intmd wnd repair    5.30.................  5.50................  5.30................  Disagree............  Yes.
                        face/mm.
12057................  Intmd wnd repair    6.00.................  6.20................  6.00................  Disagree............  Yes.
                        face/mm.
13100................  Cmplx rpr trunk     3.17.................  3.00................  3.00................  Agree...............  Yes.
                        1.1-2.5 cm.
13101................  Cmplx rpr trunk     3.96.................  3.50................  3.50................  Agree...............  Yes.
                        2.6-7.5 cm.
13102................  Cmplx rpr trunk     1.24.................  1.24................  1.24................  Agree...............  No.
                        addl 5cm/<.
13120................  Cmplx rpr s/a/l     3.35.................  3.23................  3.23................  Agree...............  Yes.
                        1.1-2.5 cm.
13121................  Cmplx rpr s/a/l     4.42.................  4.00................  4.00................  Agree...............  Yes.
                        2.6-7.5 cm.
13122................  Cmplx rpr s/a/l     1.44.................  1.44................  1.44................  Agree...............  No.
                        addl 5 cm/>.
13131................  Cmplx rpr f/c/c/m/  3.83.................  3.73................  3.73................  Agree...............  Yes.
                        n/ax/g/h/f.
13132................  Cmplx rpr f/c/c/m/  6.58.................  4.78................  4.78................  Agree...............  Yes.
                        n/ax/g/h/f.
13133................  Cmplx rpr f/c/c/m/  2.19.................  2.19................  2.19................  Agree...............  No.
                        n/ax/g/h/f.
13150................  Cmplx rpr e/n/e/l   3.85.................  N/A.................  3.58................  N/A.................  N/A.
                        1.0 cm/<.
13151................  Cmplx rpr e/n/e/l   4.49.................  4.34................  4.34................  Agree...............  Yes.
                        1.1-2.5 cm.
13152................  Cmplx rpr e/n/e/l   6.37.................  5.34................  4.90................  Disagree............  Yes.
                        2.6-7.5 cm.
13153................  Cmplx rpr e/n/e/l   2.38.................  2.38................  2.38................  Agree...............  No.
                        addl 5cm/<.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    CPT codes 12031, 12051, and 13101 were identified as potentially 
misvalued using the Harvard-valued--Utilization over 30,000 screen. As 
a result of this screen, in the Fourth Five-Year Review of Work, we 
reviewed the family of intermediate wound repair CPT codes (12031 
through 12057), along with two complex wound repair codes (13100 and 
13101).
    In the Fourth Five-Year Review, we disagreed with the AMA RUC-
recommended work RVUs for the larger of the intermediate wound repair 
codes: CPT codes 12035 (Repair, intermediate, wounds of scalp, axillae, 
trunk and/or extremities (excluding hands and feet); 12.6 cm to 20.0 
cm), 12036 (Repair, intermediate, wounds of scalp, axillae, trunk and/
or extremities (excluding hands and feet); 20.1 cm to 30.0 cm), 12037 
(Repair, intermediate, wounds of scalp, axillae, trunk and/or 
extremities (excluding hands and feet); over 30.0 cm), 12045 (Repair, 
intermediate, wounds of neck, hands, feet and/or external genitalia; 
12.6 cm to 20.0 cm), 12046 (Repair, intermediate, wounds of neck, 
hands, feet and/or external genitalia; 20.1 cm to 30.0 cm), 12047 
(Repair, intermediate, wounds of neck, hands, feet and/or external 
genitalia; over 30.0 cm), 12055 (Repair, intermediate, wounds of face, 
ears, eyelids, nose, lips and/or mucous membranes; 12.6 cm to 20.0 cm), 
12056 (Repair, intermediate, wounds of face, ears, eyelids, nose, lips 
and/or mucous membranes; 20.1 cm to 30.0 cm) and 12057 (Repair, 
intermediate, wounds of face, ears, eyelids, nose, lips and/or mucous 
membranes; over 30.0 cm) (76 FR 32431 through 32432). As discussed in 
the CY 2012 PFS final rule with comment period, after review by the 
refinement panel, we maintained the proposed RVUs published in the 
Fourth Five-Year Review of Work (76 FR 73113 through 73114). We stated 
that we would hold these codes interim for another year rather than 
finalizing the codes, so that we could review these larger intermediate 
wound repair codes alongside the family complex wound repair codes, 
which we anticipated reviewing for CY 2013.
    In the Fourth Five-Year Review of Work, we stated that we would 
maintain the current (CY 2011) work RVUs and times for complex wound 
repair CPT codes 13100 (Repair, complex, trunk; 1.1 cm to 2.5 cm) and 
13101 (Repair, complex, trunk; 2.6 cm to 7.5 cm), and requested that 
the AMA RUC review the entire set of codes in the complex wound repair 
family together to assess the appropriate gradation of the work RVUs in 
the family (76 FR 32434 through 32435). For CY 2013, we received new 
recommendations from the AMA RUC on CPT codes 13100 and 13101, as well 
as recommendations on the rest of the CPT codes in the complex wound 
repair family CPT codes 13100 through 13102, 13120 through 13122, 13131 
through 13133, and 13150 through 13153, excluding CPT code 13150 
(Repair, complex, eyelids, nose, ears and/or lips; 1.0 cm or less), 
which the AMA RUC referred to the CPT Editorial Panel for deletion in 
CY 2014. We agree with the AMA RUC recommendations for all the codes in 
the complex wound repair family, except one. After reviewing CPT code 
13152 (Repair, complex, eyelids, nose, ears and/or lips; 2.6 cm to 7.5 
cm), we believe that the AMA RUC-recommended work RVU of 5.34 is too 
high relative to similar CPT code 13132 (Repair, complex, forehead, 
cheeks, chin, mouth, neck, axillae, genitalia, hands and/or feet; 2.6 
cm to 7.5 cm), which has an AMA RUC-recommended work RVU of 4.78, and 
CPT code 13151 (Repair, complex, eyelids, nose, ears and/or lips; 1.1 
cm to 2.5 cm), which has an AMA RUC-recommended work RVU of 4.34. We 
believe that the specialty society 25th percentile work RVU of 4.90 
more appropriately reflects the relative work involved in furnishing 
this service. On an interim final basis for CY 2013, we are assigning a 
work RVU of 4.90 to CPT code 13152.
    The AMA RUC referred CPT code 13150 to the CPT Editorial Panel for 
deletion in CY 2014. Because of this, the AMA RUC did not review this 
service with the other codes in this family. For CY 2013, we believe it 
is appropriate to reduce the work RVU of CPT code 13150 proportionate 
to the other services in the family, so that the value of CPT code 
13150 maintains appropriate proportionate rank order for CY 2013. For 
CY 2013, the work RVUs

[[Page 69042]]

for the 12 other CPT codes in this family are being reduced, on 
average, to 93 percent of their CY 2012 value. Applying that reduction 
to CPT code 13150 results in a CY 2013 work RVU of 3.58, which we 
believe appropriately reflects the work associated with this procedure. 
Therefore, on an interim final basis for CY 2013, we are assigning a 
work RVU of 3.58 to CPT code 13150. In addition to these work RVU 
changes, we made small refinements to the AMA RUC-recommended times for 
many of the CPT codes in this family to ensure consistency between 
congruent services. A list of the interim final times associated with 
these procedures is available on the CMS Web site at www.cms.gov/
physicianfeesched/.
    After reviewing the family of complex wound repair CPT codes for CY 
2013, we re-reviewed the larger intermediate wound repair codes that we 
had been holding interim since the Fourth Five-Year Review of Work. We 
reviewed CPT codes 12035 through 12037, 12045 through 12047, and 12055 
through 12057 in relation to each other, the other intermediate wound 
repair CPT codes (12031 through 12034, 12041 through 12044, and 12051 
through 12054), the complex wound repair CPT codes, and other PFS 
services, and we continue to believe that the current interim values 
are appropriate relative to the other services. Therefore, on an 
interim final basis for CY 2013, are maintaining the following current 
(CY 2012) work values: A work RVU of 3.50 for CPT code 12035; a work 
RVU of 4.23 for CPT code 12036; a work RVU of 5.00 for CPT code 12037; 
a work RVU of 3.75 for CPT code 12045; a work RVU of 4.30 for CPT code 
12046; a work RVU of 4.95 for CPT code 12047; a work RVU of 4.50 for 
CPT code 12055; a work RVU of 5.30 for CPT code 12056, and a work RVU 
of 6.00 for CPT code 12057.
    We also believe that it is appropriate to maintain the current (CY 
2012) times for these procedures, as we believe that they reflect the 
time involved in furnishing these procedures and that they are well-
aligned with each other and with the simple and complex wound repair 
CPT codes. One exception to this is CPT code 12045 (Repair, 
intermediate, wounds of neck, hands, feet and/or external genitalia; 
12.6 cm to 20.0 cm), which includes 10 minutes of pre-service 
evaluation time, while CPT codes 12046 (Repair, intermediate, wounds of 
neck, hands, feet and/or external genitalia; 20.1 cm to 30.0 cm) and 
12047 (Repair, intermediate, wounds of neck, hands, feet and/or 
external genitalia; over 30.0 cm) both include 9 minutes of pre-service 
evaluation time. We believe it is appropriate to reduce the pre-service 
evaluation time of CPT code 12045 to match the pre-service evaluation 
time of CPT codes 12046 and 12047. Therefore, for CY 2013, we are 
assigning an interim final pre-service evaluation time of 9 minutes to 
CPT 12045. A complete list of the interim final times associated with 
these procedures is available on the CMS Web site at www.cms.gov/
physicianfeesched/.
(3) Musculoskeletal System: Spine (Vertebral Column)

                                               Table 33--Musculoskeletal System: Spine (Vertebral Column)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                      Agree/disagree
                                                                                AMA RUC/HCPAC    CY 2013  Interim/    with AMA RUC/     CMS  refinement
          HCPCS code                Short descriptor        CY 2012 work RVU   recommended work    interim final          HCPAC          to  AMA/HCPAC
                                                                                     RVU              work RVU      recommended  work   recommended time
                                                                                                                           RVU
--------------------------------------------------------------------------------------------------------------------------------------------------------
22586........................  Prescrl fuse w/instr l5/s1               New                N/A              28.12                N/A               N/A.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    For CY 2013, the CPT Editorial Panel created CPT code 22586 
(Arthrodesis, pre-sacral interbody technique, including disc space 
preparation, discectomy, with posterior instrumentation, with image 
guidance, includes bone graft when performed, l5-s1 interspace). The 
specialty societies related to this CPT code that participate in the 
AMA RUC declined to survey this new CPT code and the AMA RUC issued no 
work RVU recommendation to us for this service for CY 2013. A related 
specialty society that does not participate in the AMA RUC conducted a 
survey of its members regarding the physician work and time associated 
with this procedure and submitted a recommendation to CMS. In 
determining the appropriate value for this CPT code, we reviewed the 
survey results and recommendations submitted to us, literature on the 
procedure, and the Medicare claims data. Ultimately, we used a building 
block approach based on Medicare 2011 same day billing combinations to 
develop the interim final value for this procedure.
    New CPT code 22586 is a bundled lumbar arthrodesis procedure that 
includes grafting, posterior instrumentation, and fixation. To value 
this service we used CPT code 22558 (Arthrodesis, anterior interbody 
technique, including minimal discectomy to prepare interspace (other 
than for decompression); lumbar) as a reference service, as it is a 
similar procedure but it does not include additional grafting, 
instrumentation, and fixation. To assess the appropriate relative work 
increase from unbundled CPT code 22558 to the new bundled CPT code 
22586, we used Medicare claims data to assess which grafting, 
instrumentation, and fixation services are commonly billed with CPT 
code 22558 and how often. We used those data to create a utilization 
weighted work RVU for the grafting component of CPT code 22586, the 
instrumentation component of the 22586, and the fixation component of 
22586. We added those components to the base service of CPT code 22558 
to create a work RVU of 28.12. We believe this work RVU reflects the 
appropriate incremental difference in work between the base reference 
CPT code 22558 and new CPT code 22586. For CY 2013 we are assigning a 
work RVU of 28.12 to CPT code 22586 for CY 2013, and we request 
additional public input on the appropriate valuation of this service.
    We assigned CPT code 22586 a global period of 90 days, which is 
consistent with similar service. Regarding physician time for CPT code 
22586, after reviewing the physician time and post-operative visits for 
similar services, we believe this service includes 40 minutes of pre-
service evaluation time, 20 minutes of pre-service positioning time, 20 
minutes of pre-service scrub, dress and wait time, 180 minutes of 
intra-service time, and 30 minutes of immediate post-service time. In 
the post-operative period, we believe the typical case for this service 
includes 2 CPT code 99231 visits, 1 CPT code

[[Page 69043]]

99323 visit, 1 CPT code 99238 visit, and 4 CPT code 99213 visits. A 
list of the interim final times associated with this procedure is 
available on the CMS Web site at www.cms.gov/ physicianfeesched/.
(4) Musculoskeletal System: Shoulder


                                                       Table 34--Musculoskeletal System: Shoulder
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work      AMA  RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
23350................  Injection for       1.00.................  1.00................  1.00................  Agree...............  No.
                        shoulder x-ray.
23331................  Remove shoulder     7.63.................  7.63................  7.63................  Interim.............  No.
                        foreign body.
23332................  Remove shoulder     12.37................  12.37...............  12.37...............  Interim.............  No.
                        foreign body.
23472................  Reconstruct         22.65................  22.13...............  22.13...............  Interim.............  No.
                        shoulder joint.
23473................  Revis reconst       New..................  25.00...............  25.00...............  Interim.............  No.
                        shoulder joint.
23474................  Revis reconst       New..................  27.21...............  27.21...............  Interim.............  No.
                        shoulder joint.
23600................  Treat humerus       3.11.................  3.00................  3.00................  Agree...............  No.
                        fracture.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    For CY 2013, the CPT Editorial Panel created two new CPT codes for 
total shoulder revision, CPT code 23473 (Revision of total shoulder 
arthroplasty, including allograft when performed; humeral or glenoid 
component) and 23474 (Revision of total shoulder arthroplasty, 
including allograft when performed; humeral and glenoid component). The 
specialty society surveyed these codes along with the other codes in 
this family, which include CPT codes 23331 (Removal of foreign body, 
shoulder; deep (eg, neer hemiarthroplasty removal)), 23332 (Removal of 
foreign body, shoulder; complicated (eg, total shoulder)), and 23472 
(Arthroplasty, glenohumeral joint; total shoulder (glenoid and proximal 
humeral replacement (eg, total shoulder))). After reviewing the survey 
responses, the AMA RUC concluded that the descriptors for CPT codes 
23331 and 23332 needed revision. The AMA RUC referred CPT codes 23331 
and 23332 to the CPT Editorial Panel for further clarification and 
recommended that we maintain the current (CY 2012) work RVUs of 7.63 
for CPT code 23331, and 12.37 for CPT code 23332 for CY 2013. The AMA 
RUC recommended the survey 25th percentile work RVU for the three other 
services in this family: A work RVU of 22.13 for CPT code 23472; a work 
RVU of 25.00 for CPT code 23473; and a work RVU of 27.21 for CPT code 
23474. We are accepting these work RVUs on an interim basis for CY 
2013, and will review CPT codes 23472, 23473, and 23474 alongside CPT 
codes 23331 and 23332 after the codes descriptors are changed, to 
ensure consistency within this family of CPT codes.
(5) Musculoskeletal System: Humerus (Upper Arm) and Elbow

                                             Table 35--Musculoskeletal System: Humerus (Upper Arm) and Elbow
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work      AMA  RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
24160................  Remove elbow joint  8.00.................  8.00................  8.00................  Interim.............  No.
                        implant.
24363................  Replace elbow       22.65................  22.00...............  22.00...............  Interim.............  Yes.
                        joint.
24370................  Revise reconst      New..................  23.55...............  23.55...............  Interim.............  No.
                        elbow joint.
24371................  Revise reconst      New..................  27.50...............  27.50...............  Interim.............  No.
                        elbow joint.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    For CY 2013, the CPT Editorial Panel created two new CPT codes for 
revision of a total elbow arthroplasty, CPT code 24370 (Revision of 
total elbow arthroplasty, including allograft when performed; humeral 
or ulnar component) and CPT code 24371 (Revision of total elbow 
arthroplasty, including allograft when performed; humeral and ulnar 
component). The specialty society surveyed these CPT codes along with 
component CPT codes 24160 (Implant removal; elbow joint) and 24363 
(Arthroplasty, elbow; with distal humerus and proximal ulnar prosthetic 
replacement (eg, total elbow)). After reviewing the survey responses, 
the AMA RUC concluded that the descriptor for CPT code 24160 needs 
revision. The AMA RUC referred CPT code 24160 to the CPT Editorial 
Panel for revision of the descriptor and recommended that we maintain 
the current (CY 2012) work RVU of 8.00 for CPT code 24160 for CY 2013. 
The AMA RUC recommended the survey 25th percentile work RVU for the 
three other services in this family: a work RVU of 22.00 for CPT code 
24363; a work RVU of 23.55 for CPT code 24370; and a work RVU of 27.50 
for CPT code 24371. We are accepting these work RVUs on an interim 
basis for CY 2013, and will review CPT codes 24363, 24370, and 24371 
alongside CPT code 24160 after the code descriptor is changed, to 
ensure consistency within this family of CPT codes. For CY 2013, we are 
refining the AMA RUC-recommended post-service time of CPT code 24363 to 
20 minutes, from 30 minutes, to match the post-service times of CPT 
code 24370 and 24371. A complete list of the interim final times 
associated with these procedures is available on the CMS Web site at 
www.cms.gov/physicianfeesched/.
(6) Musculoskeletal System: Application of Casts and Strapping

[[Page 69044]]



                                          Table 36--Musculoskeletal System: Application of Casts and Strapping
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
29075................  Application of      0.77.................  0.77................  0.77................  Agree...............  No.
                        forearm cast.
29581................  Apply multlay       0.25.................  0.60................  0.25................  Disagree............  No.
                        comprs lwr leg.
29582................  Apply multlay       0.35.................  0.35................  0.35................  Agree...............  No.
                        comprs upr leg.
29583................  Apply multlay       0.25.................  0.25................  0.25................  Agree...............  No.
                        comprs upr arm.
29584................  Appl multlay        0.35.................  0.35................  0.35................  Agree...............  No.
                        comprs arm/hand.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    For CY 2013, the CPT Editorial Panel revised the descriptor of CPT 
code 29581, and created CPT codes 29582, 29583, and 29584 to describe 
the application of multi-layer compression to the upper and lower 
extremities. The CPT Editorial Panel and AMA RUC concluded that the 
revisions to the descriptor for CPT code 29581 were editorial only, and 
the AMA RUC related specialty society (Society for Vascular Surgery) 
believed that resurveying CPT code 29581 was not necessary. As such, 
the AMA RUC recommended ``No Change'' for CPT code 29581. For CY 2012, 
CPT codes 29582, 29583, and 29584 were surveyed through the American 
Physical Therapy Association (the expected dominant providers of the 
services), and the HCPAC reviewed the results and issued 
recommendations to CMS for these three CPT codes.
    We discussed CPT codes 29581 (Application of multi-layer 
compression system; leg (below knee), including ankle and foot), 29582 
(Application of multi-layer compression system; thigh and leg, 
including ankle and foot, when performed), 29583 (Application of multi-
layer compression system; upper arm and forearm), and 29584 
(Application of multi-layer compression system; upper arm, forearm, 
hand, and fingers) in the CY 2012 final rule with comment period (76 FR 
73192 through 73193). In the CY 2012 PFS final rule with comment 
period, we stated that after clinical review, we believed that CPT code 
29581, in relation to CPT codes 29582 through 29584, described a 
similar service from a resource perspective and should be valued 
similarly to those codes. We stated that we believed a work RVU of 0.60 
for CPT code 29581 is inappropriately high in relation to the HCPAC-
reviewed codes 29582, 29583, and 29584. We believed that the HCPAC-
recommended work RVUs of 0.35 for CPT code 29682, 0.25 for CPT code 
29583, and 0.35 for CPT code 29584 accurately reflected the work 
associated with these services. Additionally, we stated that we 
believed that the clinical conditions treated by CPT codes 29581 and 
29583 are essentially the same, namely the treatment of venous ulcers 
and lymphedema. We stated that we recognized that there would be mild 
differences and variation in the application of a multi-layer 
compression system to the upper extremity versus the lower extremity, 
which is accounted for in the intra-service times of the codes. As 
such, we believed that a work RVU of 0.25 appropriately accounts for 
the work associated with CPT code 29581.
    Ultimately, we stated that we believed that a survey that addressed 
all 4 CPT codes together as a family and gathers responses from all 
clinicians who furnish the services described by CPT codes 29581 
through 29584 would help us to further consider the appropriate 
gradation in valuation of these 4 services. We assigned a work RVU of 
0.25 to CPT code 29581 on an interim basis for CY 2012, and anticipated 
reviewing CPT code 29581 along with CPT codes 29582, 29583, and 29584 
with new survey data for CY 2013.
    In response to the CY 2012 PFS final rule with comment period, 
commenters stated that they believe the CPT Editorial Panel revisions 
to CPT code 29581 were editorial only and resurveying CPT code 29581 
was unnecessary, and no changes should be made to the work RVU for this 
code. Commenters disagreed with our methodology to value CPT code 29581 
similar to HCPAC-reviewed codes 29582, 29583, and 29584, stating that 
the beneficiaries who receive services under CPT code 29581 are more 
complex. Commenters noted that the work descriptor for CPT code 29581 
includes evaluation and cleansing of the venous ulcer, while there is 
no such parallel service for CPT codes 29582, 29583, and 29584. 
Commenters argued that CPT code 29581 was reviewed by the AMA RUC in 
April 2009 and those survey results should not be invalided by 
crosswalking CPT code 29581 to HCPAC-reviewed codes 29582, 29583, and 
29584. Commenters noted that no completed RUC survey data was submitted 
to the HCPAC for CPT codes 29582, 29583 or 29584--a single specialty 
presented crosswalk values to the HCPAC, and they were accepted. 
Commenters recommended we maintain the 2009 valued AMA RUC work RVU of 
0.60 for CPT code 29581.
    In response to our assertion that a survey that addressed all 4 CPT 
codes together as a family and gathers responses from all clinicians 
who furnish the services described by CPT codes 29581 through 29584 
would help assure the appropriate gradation in valuation of these 4 
services, the AMA RUC noted that when CPT codes 29582, 29583, and 29584 
were created no physician (MD/DO) specialty societies had an interest 
in surveying the codes, so they were surveyed and reviewed by only the 
HCPAC. The AMA RUC noted that another survey process would not mean 
that these codes would be surveyed together as we had requested.
    In response to comments received, we referred CPT code 29581 to the 
CY 2012 multi-specialty refinement panel for further review. The 
refinement panel median work RVU for CPT code 29581 was 0.50. 
Typically, we finalize the work values for CPT codes after reviewing 
the results of the refinement panel. However, for CY 2012 we assigned 
interim RVUs for CPT codes 29581, 29582, 29583, and 29584 and requested 
additional information, with the intention of re-reviewing the services 
for CY 2013 with the new information we had received, and setting 
interim final values at that time. We recognize that CPT code 29581 
received only editorial changes; however, we continue to believe the 
HCPAC-reviewed codes 29582, 29583, and 29584 describe similar services. 
While the services are performed by different specialties, they do 
involve similar work. For example, prior to the application of the 
compression bandage, CPT code 29581 includes the work furnishing a 
physical exam to assesses adequate arterial flow, the presence of 
infection, the degree of swelling, and the size/depth of the lower 
extremity ulcer, while CPT code 29583 includes

[[Page 69045]]

the work of furnishing a physical exam to assesses skin integrity, 
cardiopulmonary status, and peripheral vascular status. We believe 
these services involve the same amount of physician work. Therefore, 
after consideration of the public comments, refinement panel results, 
and our clinical review we continue to believe that the crosswalk 
methodology is appropriate to value CPT code 29581 and the resulting 
work RVU accurately reflects the work associated with this service. 
Accordingly, on an interim final basis for CY 2012, we are assigning a 
work RVU of 0.25 to CPT code 29581; a work RVU of 0.35 to CPT code 
29582; a work RVU of 0.25 to CPT code 29583; and a work RVU of 0.35 to 
CPT code 29584.
(7) Musculoskeletal System: Endoscopy/Arthroscopy

                                                 Table 37--Musculoskeletal System: Endoscopy/Arthroscopy
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
29824................  Shoulder            8.98.................  8.98................  8.98................  Interim.............  No.
                        arthroscopy/
                        surgery.
29826................  Shoulder            3.00.................  3.00................  3.00................  Interim.............  No.
                        arthroscopy/
                        surgery.
29827................  Arthroscop rotator  15.59................  15.59...............  15.59...............  Interim.............  No.
                        cuff repr.
29828................  Arthroscopy biceps  13.16................  13.16...............  13.16...............  Interim.............  No.
                        tenodesis.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    CPT codes 29824, 29826, 29827, and 29828 were identified as 
potentially misvalued through the Codes Reported Together 75 percent or 
More screen. CPT code 29826 was also identified as potentially 
misvalued through the Harvard-valued--Utilization over 30,000 screen, 
and CPT code 29828 was also identified for additional review because it 
was on the New Technology list.
    We reviewed CPT code 29826 (Arthroscopy, shoulder, surgical; 
decompression of subacromial space with partial acromioplasty, with 
coracoacromial ligament (ie, arch) release, when performed (list 
separately in addition to code for primary procedure)) for CY 2012 and 
agreed with the AMA RUC recommended work RVU of 3.00, which was the 
specialty society survey 25th percentile work RVU (76 FR 73193). For CY 
2013, the AMA RUC reviewed CPT codes 29824 (Arthroscopy, shoulder, 
surgical; distal claviculectomy including distal articular surface 
(mumford procedure)) and 29827 (Arthroscopy, shoulder, surgical; with 
rotator cuff repair), however the specialty society did not survey 
these CPT codes. Without survey information, the AMA RUC affirmed that 
the current work RVU of 8.82 for CPT code 29824 and the current work 
RVU of 15.59 for CPT code 29827 are correct and not overlapping with 
CPT code 29826. For CY 2013, the AMA RUC also reviewed CPT code 29828 
(Arthroscopy, shoulder, surgical; biceps tenodesis), which, as stated 
above, was on the New Technology list. The specialty society surveyed 
CPT code 29828, and the AMA RUC recommended the current a work RVU of 
13.16, which was between the survey 25th percentile and median work 
RVU. As we have stated many times, we believe families of services 
should be reviewed together to ensure relativity between the services 
and consistency in inputs. We do not find the AMA RUC's affirmation 
that the work RVUs of CPT codes 29824 and 29827 have not changed to be 
sufficient evidence that the current RVUs continue to accurately 
reflect the work associated with furnishing those services. We request 
additional information from commenters on the appropriate values for 
these services. To clarify, we do not believe the specialty society 
needs to resurvey CPT codes 29826 and 29828, however we would welcome 
data on the valuation of CPT codes 29824 and 29827. We anticipate re-
reviewing this family of services together for CY 2014. On an interim 
basis for CY 2013, we are assigning the current (CY 2012) work RVUs to 
these four services: A work RVU of 8.98 to CPT code 29824; a work RVU 
of 3.00 to CPT code 29826; a work RVU of 15.59 to CPT code 29827; and a 
work RVU of 13.16 to CPT code 29828.
(8) Respiratory System: Accessory Sinuses

                                                     Table 38--Respiratory System: Accessory Sinuses
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
31231................  Nasal endoscopy dx  1.10.................  1.10................  1.10................  Agree...............  Yes.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    CPT code 31231 was identified for review because it is on the MPC 
list. After clinical review of CPT code 31231 (Nasal endoscopy, 
diagnostic, unilateral or bilateral (separate procedure)) we believe 
that the current work RVU of 1.10, the survey 25th percentile value and 
the AMA RUC recommendation accurately reflects the work associated with 
this procedure. Medicare claims data from 2011 indicate that this 
service is typically furnished to the beneficiary on the same day as an 
E/M visit. We believe that some of the activities furnished during the 
pre- and post-service period of the procedure code and the E/M visit 
overlap. After review, we believe that the AMA RUC appropriately 
accounted for this overlap in its recommendation of pre-service time, 
but failed to account for the overlap in post-service time. To account 
for this overlap, we reduced the AMA RUC-recommended post-service time 
for this procedure by one-third, from 5 minutes to 3 minutes. We 
believe 3 minutes accurately reflects the post-service time involved in 
furnishing this procedure, and is more in line with similar services. A 
complete list of the

[[Page 69046]]

interim final times associated with this procedure is available on the 
CMS Web site at www.cms.gov/physicianfeesched/.
(9) Respiratory System: Trachea and Bronchi

                                                    Table 39--Respiratory System: Trachea and Bronchi
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
31647................  Bronchial valve     New..................  4.40................  4.40................  Agree...............  No.
                        init insert.
31648................  Bronchial valve     New..................  4.20................  4.20................  Agree...............  No.
                        addl insert.
31649................  Bronchial valve     New..................  2.00................  1.44................  Disagree............  No.
                        remov init.
31651................  Bronchial valve     New..................  1.58................  1.58................  Agree...............  No.
                        remov addl.
31660................  Bronch thermoplsty  New..................  4.50................  4.25................  Disagree............  No.
                        1 lobe.
31661................  Bronch thermoplsty  New..................  5.00................  4.50................  Disagree............  No.
                        2/> lobes.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    For CY 2013, the CPT Editorial Panel created CPT codes 31647, 
31648, 31649, and 31651 to replace 0250T, 0251T and 0252T; as well as 
CPT codes 31660 and 31661 to replace 0276T and 0277T.
    After clinical review, we agree with the AMA RUC-recommended work 
RVU of 4.40 for CPT code 31647 (Bronchoscopy, rigid or flexible, 
including fluoroscopic guidance, when performed; with balloon 
occlusion, when performed, assessment of air leak, airway sizing, and 
insertion of bronchial valve(s), initial lobe) and the AMA RUC 
recommended work RVU of 1.58 for CPT code 31651 (Bronchoscopy, rigid or 
flexible, including fluoroscopic guidance, when performed; with balloon 
occlusion, when performed, assessment of air leak, airway sizing, and 
insertion of bronchial valve(s), each additional lobe (list separately 
in addition to code for primary procedure[s])) which is the associated 
add-on code for CPT code 31647. We also agree with the AMA RUC-
recommended RVU of 4.20 for CPT code 31648 (Bronchoscopy, rigid or 
flexible, including fluoroscopic guidance, when performed; with removal 
of bronchial valve(s), initial lobe), which is somewhat less work than 
CPT code 31647. We do not agree with the AMA RUC-recommended work RVU 
of 2.00 for CPT code 31649 (Bronchoscopy, rigid or flexible, including 
fluoroscopic guidance, when performed; with removal of bronchial 
valve(s), each additional lobe (list separately in addition to code for 
primary procedure)). CPT code 31647 has a higher work RVU than CPT code 
31648, so to maintain the appropriate relativity between these 
services, we believe that the add-on code associated with CPT code 
31647 (which is CPT code 31651) should have a higher RVU than the add-
on code associated with CPT code 31648 (which is CPT code 31649). As 
such, we believe that the survey 25th percentile work RVU of 1.44 for 
CPT code 31649 places these services in the appropriate rank-order. On 
an interim final basis for CY 2013 we are assigning a work RVU of 4.40 
to CPT code 31647; a work RVU of 4.20 to CPT code 31648; a work RVU of 
1.44 to CPT code 31649; and a work RVU of 1.58 to CPT code 31651.
    After reviewing CPT codes 31660 (Bronchoscopy, rigid or flexible, 
including fluoroscopic guidance, when performed; with bronchial 
thermoplasty, 1 lobe) and 31661 (Bronchoscopy, rigid or flexible, 
including fluoroscopic guidance, when performed; with bronchial 
thermoplasty, 2 or more lobes) we believe that the specialty society 
survey 25th percentile work RVUs of 4.25 for CPT code 31660 and 4.50 
for CPT code 31661 appropriately reflect the relativity of these 
services to each other and to other fee schedule services. The AMA RUC 
recommended the specialty society survey median work RVUs of 4.50 for 
CPT code 31660 and 5.00 for CPT code 31661. On an interim final basis 
for CY 2013, we are assigning a work RVU of 4.25 for CPT code 31660 and 
a work RVU of 4.50 to CPT code 31661.
(10a) Respiratory System: Lungs and Pleura

                                                     Table 40--Respiratory System: Lungs and Pleura
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
32551................  Insertion of chest  3.29.................  3.50................  3.29................  Disagree............  No.
                        tube.
32554................  Aspirate pleura w/  New..................  1.82................  1.82................  Agree...............  No.
                        o imaging.
32555................  Aspirate pleura w/  New..................  2.27................  2.27................  Agree...............  Yes.
                        imaging.
32556................  Insert cath pleura  New..................  2.50................  2.50................  Agree...............  No.
                        w/o image.
32557................  Insert cath pleura  New..................  3.62................  3.12................  Disagree............  Yes.
                        w/image.
32701................  Thorax stereo rad   New..................  4.18................  4.18................  Agree...............  No.
                        targetw/tx.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    CPT codes 32420, 32421, 32422, and 32551 were identified as 
potentially misvalued through the Harvard-valued--Utilization over 
30,000 screen. For CY 2013, the CPT Editorial Panel deleted CPT codes 
32420, 32421, and 32422 and replaced them with CPT codes 32554, 32555, 
32556, and 32557.
    After clinical review of CPT code 32551 (Tube thoracostomy, 
includes connection to drainage system (eg, water seal), when 
performed, open (separate procedure)), we believe that the current work 
RVU of 3.29 appropriately reflects the work associated with service. 
The AMA RUC recommended the specialty society survey 25th percentile 
work RVU of 3.50, however we believe that an increase in work RVU is 
not warranted for this service, especially considering

[[Page 69047]]

the substantial drops in recommended physician time. Additionally, we 
believe that a work RVU of 3.29 places this service in the appropriate 
rank order with the other similar CPT codes reviewed for CY 2013. On an 
interim final basis for CY 2013, we are assigning a work RVU of 3.29 
for CPT code 32551.
    After clinical review of CPT codes 32554 (Thoracentesis, needle or 
catheter, aspiration of the pleural space; without imaging guidance), 
32555 (Thoracentesis, needle or catheter, aspiration of the pleural 
space; with imaging guidance), and 32556 (Pleural drainage, 
percutaneous, with insertion of indwelling catheter; without imaging 
guidance) we agree with the AMA RUC-recommended work RVUs. On an 
interim final basis for CY 2013, we are assigning a work RVU of 1.82 to 
CPT code 32554; a work RVU of 2.27 to CPT code 32555, and a work RVU of 
2.50 to CPT code 32556.
    After clinical review of CPT code 32557 (Pleural drainage, 
percutaneous, with insertion of indwelling catheter; with imaging 
guidance), we believe that a work RVU of 3.12 appropriately reflects 
the work of this service. The AMA RUC recommended a work RVU of 2.50 
for CPT code 32556 and a work RVU of 3.62 for CPT code 32557. We 
believe the AMA RUC-recommended work RVU of 3.62 overstates the 
difference between CPT codes 32556 and 32557. The specialty societies 
that surveyed CPT code 32556 recommended to the AMA RUC a work RVU of 
3.00 for CPT code 32556 and a work RVU of 3.62 for CPT code 32557. We 
believe this difference in work RVU of 0.62 more accurately captures 
the relative difference between these two services. Therefore, since we 
assigned CPT code 32556 an interim final work RVU of 2.50, we believe a 
work RVU of 3.12 appropriately reflects the work of CPT code 32557. On 
an interim final basis for CY 2013, we are assigning a work RVU of 3.12 
to CPT code 32557.
    Additionally, on an interim final basis for CY 2013, we are 
refining the AMA RUC recommended pre-service evaluation time to 13 
minutes from 15 minutes for CPT codes 32555 and 32557 to match the pre-
service evaluation times of CPT codes 32554 and 32556. A complete list 
of the times associated with these procedures is available on the CMS 
Web site at www.cms.gov/physicianfeesched/.
(10b) Respiratory System: Lungs and Pleura

                                                     Table 41--Respiratory System: Lungs and Pleura
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
32440................  Remove lung         27.28................  N/A.................  27.28...............  Interim.............  N/A.
                        pneumonectomy.
32480................  Partial removal of  25.82................  N/A.................  25.82...............  Interim.............  N/A.
                        lung.
32482................  Bilobectomy.......  27.44................  N/A.................  27.44...............  Interim.............  N/A.
32491................  Lung volume         25.24................  N/A.................  25.24...............  Interim.............  N/A.
                        reduction.
32663................  Thoracoscopy w/     24.64................  24.64...............  24.64...............  Interim.............  No.
                        lobectomy.
32668................  Thoracoscopy w/w    3.00.................  4.00................  3.00................  Interim.............  No.
                        resect diag.
32669................  Thoracoscopy        23.53................  23.53...............  23.53...............  Interim.............  No.
                        remove segment.
32670................  Thoracoscopy        28.52................  28.52...............  28.52...............  Interim.............  No.
                        bilobectomy.
32671................  Thoracoscopy        31.92................  31.92...............  31.92...............  Interim.............  No.
                        pneumonectomy.
32672................  Thoracoscopy for    27.00................  27.00...............  27.00...............  Interim.............  No.
                        lvrs.
32673................  Thoracoscopy w/     21.13................  21.13...............  21.13...............  Interim.............  No.
                        thymus resect.
60520................  Removal of thymus   17.16................  N/A.................  17.16...............  Interim.............  N/A.
                        gland.
60521................  Removal of thymus   19.18................  N/A.................  19.18...............  Interim.............  N/A.
                        gland.
60522................  Removal of thymus   23.48................  N/A.................  23.48...............  Interim.............  N/A.
                        gland.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The CPT Editorial Panel reviewed the lung resection family of codes 
and deleted 8 codes, revised 5 codes, and created 18 new codes for CY 
2012. During our clinical review for the CY 2012 PFS final rule with 
comment period, we were concerned with the varying differentials in the 
AMA RUC-recommended work RVUs and times between some of the open 
surgery lung resection codes and their endoscopic analogs. Rather than 
assign alternate interim final RVUs and times in this large 
restructured family of codes, we accepted the AMA RUC recommendations 
on an interim basis and requested that the AMA RUC re-review the 
surgical services along with their endoscopic analogs.
    In the CY 2012 PFS final rule with comment period we made this 
request on a code-by-code basis. However, there was an inadvertent 
typographical error in our request--we referred to ``open heart surgery 
analogs'', instead of just ``open surgery analogs''. For example, we 
stated, ``For CPT code 32663 (Thoracoscopy, surgical; with lobectomy 
(single lobe)), the AMA RUC recommended a work RVU of 24.64. Upon 
clinical review, we have determined that it is most appropriate to 
accept the AMA RUC recommended work RVU of 24.64 on a provisional 
basis, pending review of the open heart surgery analogs, in this case 
CPT code 32480. We are requesting the AMA RUC look at the incremental 
difference in RVUs and times between the open and laparoscopic 
surgeries and recommend a consistent valuation of RVUs and time for CPT 
code 32663 and other services within this family with this same issue. 
Accordingly, we are assigning a work RVU of 24.64 for CPT code 32663 on 
an interim basis for CY 2012'' (76 FR 73195).
    In response to this request, the specialty society noted that these 
are not open heart surgery codes and therefore are not relevant. The 
AMA RUC requested further information from CMS on why these services 
should be reviewed as part of a family. We understand that our request 
would have been more clear if we had referred to ``open surgery codes'' 
instead of ``open heart surgery codes'' and if we had written 
``endoscopic procedures'' instead of ``laparoscopic surgeries''. With 
this clarification, we re-request public comment on the appropriate 
work RVU and time values for the interim codes in the table above. 
These codes are discussed in greater detail in the CY 2012 PFS final 
rule with comment period, pages 73193 through 73195. For CY 2013, we 
are maintaining the current (CY 2012) values for these services on an 
interim basis. We intend

[[Page 69048]]

to review these CPT codes in CY 2013 and set interim final values for 
CY 2014.
(11) Cardiovascular System: Heart and Pericardium

                                                 Table 42--Cardiovascular System: Heart and Pericardium
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
33361................  Replace aortic      New..................  29.50...............  25.13...............  Disagree............  Yes.
                        valve perq.
33362................  Replace aortic      New..................  32.00...............  27.52...............  Disagree............  Yes.
                        valve open.
33363................  Replace aortic      New..................  33.00...............  28.50...............  Disagree............  Yes.
                        valve open.
33364................  Replace aortic      New..................  34.87...............  30.00...............  Disagree............  Yes.
                        valve open.
33365................  Replace aortic      New..................  37.50...............  33.12...............  Disagree............  No.
                        valve open.
33367................  Replace aortic      New..................  11.88...............  11.88...............  Agree...............  No.
                        valve w/byp.
33368................  Replace aortic      New..................  14.39...............  14.39...............  Agree...............  No.
                        valve w/byp.
33369................  Replace aortic      New..................  19.00...............  19.00...............  Agree...............  No.
                        valve w/byp.
33405................  Replacement of      41.32................  41.32...............  41.32...............  Interim.............  No.
                        aortic valve.
33430................  Replacement of      50.93................  50.93...............  50.93...............  Interim.............  No.
                        mitral valve.
33533................  Cabg arterial       33.75................  34.98...............  33.75...............  Interim.............  No.
                        single.
33990................  Insert vad artery   New..................  8.15................  8.15................  Agree...............  No.
                        access.
33991................  Insert vad          New..................  11.88...............  11.88...............  Agree...............  No.
                        art&vein access.
33992................  Remove vad          New..................  4.00................  4.00................  Agree...............  No.
                        different session.
33993................  Reposition vad      New..................  4.17................  3.51................  Disagree............  No.
                        diff session.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The CPT Editorial Panel deleted four Category III codes (0256T 
through 0259T) and approved nine CPT codes (33361 through 33369) to 
report transcatheter aortic valve replacement (TAVR) procedures for CY 
2012.
    On May 1, 2012, CMS issued a National Coverage Determination (NCD) 
covering TAVR under Coverage with Evidence Development (CED). The NCD 
identifies numerous detailed requirements, including that covered TAVR 
requires a cardiothoracic surgeon and an interventional cardiologist. 
Under this CED, coverage is limited to services furnished under 
specific conditions targeted to developing data on the safety and 
efficacy of the service for Medicare beneficiaries. Like their 
predecessor Category III codes (0256T through 0259T), the new Category 
I CPT codes 33361 through 33365 require the work of an interventional 
cardiologist and cardiothoracic surgeon to jointly participate in the 
intra-operative technical aspects of TAVR as co-surgeons. Claims 
processing instructions for the CED (CR 7897 transmittal 2552) require 
each physician to bill with modifier-62 indicating that co-surgery 
payment applies. Medicare pays each co-surgeon 62.5 percent of the fee 
schedule amount. The three add-on cardiopulmonary bypass support 
services (CPT codes 33367 through 33369) are only reported by the 
cardiothoracic surgeon; therefore the AMA RUC-recommended work RVUs for 
those services reflect only the work of one physician. The AMA RUC-
recommended work RVUs for each of the co-surgery CPT codes (33361 
through 33365) reflect the combined work of both physicians, 
irrespective of the co-surgery payment policy. We debated whether it 
was appropriate to continue our co-surgery payment policy at 62.5 
percent of the physician fee schedule amount for each physician for 
these codes if the work value reflected 100 percent of the work for two 
physicians. Ultimately, we decided to set work RVU values to reflect 
the total physician work of the procedures, and to continue to follow 
our co-surgery payment policy allowing the services to be billed by two 
physicians, in part because co-surgery is a requirement under Medicare 
policy for these services. We are not sure this is the appropriate 
long-term payment policy. We intend to reassess payment for this family 
of codes when we review national coverage for TAVR. For the time 
package, the AMA RUC accounted for the time each physician separately 
spends obtaining consent and reviewing the procedure with the patient. 
We are concerned that time for each physician to obtain consent and 
review the procedure with the patient is inconsistent with a framework 
for valuing the service as a single service.
    After clinical review of CPT code 33361 (Transcatheter aortic valve 
replacement (TAVR/TAVI) with prosthetic valve; percutaneous femoral 
artery approach), we believe that the specialty society survey 25th 
percentile work RVU of 25.13 appropriately captures the total work of 
the service. The AMA RUC recommended the survey median work RVU of 
29.50. Regarding physician time, for CPT 33361, as well as CPT codes 
33362 through 33364, we believe 45 minutes of pre-service evaluation 
time, which is the survey median time, is more consistent with the work 
of this service than the AMA RUC-recommended pre-service evaluation 
time of 50 minutes. Accordingly, we are assigning a work RVU of 25.13 
to CPT code 33361, with a refinement of 45 minutes of pre-service 
evaluation time, on an interim basis for CY 2013. A complete listing of 
the times associated with this code is available on the CMS Web site 
at: www.cms.gov/PhysicianFeeSched/.
    After clinical review of CPT code 33362 (Transcatheter aortic valve 
replacement (TAVR/TAVI) with prosthetic valve; open femoral artery 
approach), we believe that the specialty society survey 25th percentile 
work RVU of 27.52 appropriately captures the total work of the service. 
The AMA RUC recommended the survey median work RVU of 32.00. Like CPT 
code 33361, we also believe 45 minutes of pre-service evaluation time 
is more appropriate for this service than the AMA RUC-recommended pre-
service evaluation time of 50 minutes. Accordingly, we are assigning a 
work RVU of 27.52 to CPT code 33362, with a refinement to 45 minutes of 
pre-service evaluation time, on an interim basis for CY 2013. A 
complete listing of the times associated with this code is available on 
the CMS Web site at www.cms.gov/PhysicianFeeSched/.
    After clinical review of CPT code 33363 (Transcatheter aortic valve 
replacement (TAVR/TAVI) with prosthetic valve; open axillary artery 
approach), we believe that the specialty society survey 25th percentile 
work RVU of 28.50 appropriately captures the

[[Page 69049]]

total work of the service. The AMA RUC reviewed the survey results and 
recommended the survey median work RVU of 33.00. Like CPT codes 33361 
and 33362, we also believe 45 minutes of pre-service evaluation time is 
more appropriate for this service than the AMA RUC-recommended time of 
50 minutes. Accordingly, we are assigning a work RVU of 28.50 to CPT 
code 33363, with a refinement to 45 minutes of pre-service evaluation 
time, on an interim basis for CY 2013. A complete listing of the times 
associated with this code is available on the CMS Web site at 
www.cms.gov/PhysicianFeeSched/.
    After clinical review of CPT code 33364 (Transcatheter aortic valve 
replacement (TAVR/TAVI) with prosthetic valve; open iliac artery 
approach), we believe that the specialty society survey 25th percentile 
work RVU of 30.00 more appropriately captures the total work of the 
service. The AMA RUC reviewed the survey results and recommended the 
survey median work RVU of 34.87. Like CPT codes 33361 through 33363, we 
also believe 45 minutes of pre-service evaluation time is more 
appropriate for this service than the AMA RUC-recommended time of 50 
minutes. Accordingly, we are assigning a work RVU of 30.00 to CPT code 
33364, with a refinement to 45 minutes of pre-service evaluation time, 
on an interim basis for CY 2013. A complete listing of the times 
associated with this code is available on the CMS Web site at: 
www.cms.gov/PhysicianFeeSched/.
    After clinical review of CPT code 33365 (Transcatheter aortic valve 
replacement (TAVR/TAVI) with prosthetic valve; transaortic approach 
(eg, median sternotomy, mediastinotomy), we believe a work RVU of 33.12 
accurately reflects the work associated with this service. The AMA RUC 
reviewed the survey results and recommended the survey median work RVU 
of 37.50. After clinical review, we determined that the work associated 
with this service is very similar to reference CPT code 33410 
(Replacement, aortic valve, with cardiopulmonary bypass; with stentless 
tissue valve) (work RVU = 46.41), which has a 90-day global period that 
includes inpatient hospital and office visits. Because CPT code 33365 
has a 0-day global period that does not include post-operative visits, 
we calculated the value of the pre-operative and post-operative visits 
in the global period of CPT code 33410, which totaled 13.29 work RVUs, 
and subtracted that from the total work RVU of 46.41 for CPT code 33410 
to determine the appropriate work RVU for CPT code 33365. With regard 
to time, we decided to maintain the 50 minutes of pre-service 
evaluation time because we believe that the procedure described by CPT 
code 33365 involves more pre-service evaluation time since it is 
performed by surgically opening the chest via median sternotomy. 
Accordingly, we are assigning a work RVU of 33.12 for CPT code 33365 on 
an interim basis for CY 2013.
    CPT codes 33405, 33430, and 33533 were identified as potentially 
misvalued through the High Expenditure Procedure Code screen.
    When reviewing these services, the specialty society utilized data 
from the Society of Thoracic Surgeons (STS) National Adult Cardiac 
Database in developing recommended times and RVUs for CPT codes 33405 
(Replacement, aortic valve, with cardiopulmonary bypass; with 
prosthetic valve other than homograft or stentless valve), 33430 
(Replacement, mitral valve, with cardiopulmonary bypass), and 33533 
(Coronary artery bypass, using arterial graft(s); single arterial 
graft), and did not conduct a survey of physician work and time. After 
reviewing the mean procedure times for these services in the STS 
database alongside other information relating to the value of these 
services, the specialty society and AMA RUC concluded that CPT codes 
33405 and 33430 are valued appropriately and that the current work RVUs 
of 41.32 for CPT code 33405, and 50.93 for CPT code 33430 should be 
maintained. After reviewing the mean procedure time for CPT code 33533 
in the STS database alongside other information relating to the value 
of the service, the specialty society and AMA RUC concluded that the 
work associated with CPT code 33553 had increased since this service 
was last reviewed. The AMA RUC recommended a work RVU of 34.98 for CPT 
code 33533, which is a direct crosswalk to CPT code 33510 (Coronary 
artery bypass, vein only; single coronary venous graft).
    We believe the STS database, which captures outcome data in 
addition to time and visit data, is a useful resource in the valuation 
of PFS services. However, the AMA RUC recommendations on these services 
show only the STS database mean time for CPT codes 33405, 33430, and 
33533. We are interested in seeing the distribution of times, including 
the 25th percentile, median, and 75th percentile values (which are the 
data points reported on the specialty society surveys), in addition to 
any other information STS believes would be relevant to the valuation 
of the services, such as case-mix, or time data for similar services. 
The STS database is a robust source of information and we believe it 
would be helpful to review additional data points for these three 
services beyond the mean time provided by the AMA RUC. In order to 
complete our clinical review of these services, we would like to see 
the distribution of procedure times for CPT codes 33405, 33430, and 
33533. We are also interested in more information on the methodology 
used to develop the recommended work RVUs based on the time data, and, 
using that methodology, the different RVUs that correspond to the 25th 
percentile, median, and 75th percentile time data. We previously have 
expressed our concerns regarding the manner in which data derived from 
the STS database was used (71 FR 37224 through 37225). We are committed 
to reviewing and evaluating all services using an approach that 
maintains the appropriate relativity among fee schedule services. For 
CY 2013 we are maintaining the current work RVUs for these services on 
an interim basis. We will consider additional time and other data 
submitted in response to comments on this final rule with comment 
period in the CY 2014 PFS final rule with comment period. Specifically, 
we are maintaining a work RVU of 41.32 for CPT code 33405; a work RVU 
of 50.93 for CPT code 33430; and a work RVU of 33.75 for CPT code 
33533.
(12) Cardiovascular System: Arteries and Veins

                                                   Table 43--Cardiovascular System: Arteries and Veins
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC      CMS  refinement to
                                                                  recommended work RVU           RVU          recommended work RVU     AMA/HCPAC  time
--------------------------------------------------------------------------------------------------------------------------------------------------------
35475................  Repair arterial     9.48.................  6.60................  5.75................  Disgaree............  No.
                        blockage.

[[Page 69050]]

 
35476................  Repair venous       6.03.................  5.10................  4.71................  Disagree............  No.
                        blockage.
36221................  Place cath          New..................  4.51................  4.17................  Disagree............  Yes.
                        thoracic aorta.
36222................  Place cath carotid/ New..................  6.00................  5.53................  Disagree............  Yes.
                        inom art.
36223................  Place cath carotid/ New..................  6.50................  6.00................  Disagree............  Yes.
                        inom art.
36224................  Place cath carotd   New..................  7.55................  6.50................  Disagree............  Yes.
                        art.
36225................  Place cath          New..................  6.50................  6.00................  Disagree............  Yes.
                        subclavian art.
36226................  Place cath          New..................  7.55................  6.50................  Disagree............  Yes.
                        vertebral art.
36227................  Place cath xtrnl    New..................  2.32................  2.09................  Disagree............  No.
                        carotid.
36228................  Place cath          New..................  4.25................  4.25................  Agree...............  No.
                        intracranial art.
37197................  Remove intrvas      New..................  6.72................  6.29................  Disagree............  No.
                        foreign body.
37211................  Thrombolytic art    New..................  8.00................  8.00................  Agree...............  No.
                        therapy.
37212................  Thrombolytic        New..................  7.06................  7.06................  Agree...............  No.
                        venous therapy.
37213................  Thromblytic art/    New..................  5.00................  5.00................  Agree...............  No.
                        ven therapy.
37214................  Cessj therapy cath  New..................  3.04................  2.74................  Disagree............  No.
                        removal.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    In CY 2011, CPT codes 35475 and 35476 were identified in the CMS 
High Expenditure Procedure Codes Screen.
    After clinical review of CPT code 35475 (Transluminal balloon 
angioplasty, percutaneous; brachiocephalic trunk or branches, each 
vessel), we believe a work RVU of 5.75 appropriately captures the work 
of the service. To develop a recommended value for this service, the 
AMA RUC started with the work RVU of CPT code 37224 (Revascularization, 
endovascular, open or percutaneous, femoral, popliteal artery(s), 
unilateral; with transluminal angioplasty) (work RVU of 9.00), which 
the AMA RUC believed was a comperable service to CPT code 35475, then 
removed RVUs to account for overlap in work resulting from same day 
billing with CPT codes 36147 (Introduction of needle and/or catheter, 
arteriovenous shunt created for dialysis (graft/fistula); initial 
access with complete radiological evaluation of dialysis access, 
including fluoroscopy, image documentation and report (includes access 
of shunt, injection[s] of contrast, and all necessary imaging from the 
arterial anastomosis and adjacent artery through entire venous outflow 
including the inferior or superior vena cava)) and 75962 (Transluminal 
balloon angioplasty, peripheral artery other than renal, or other 
visceral artery, iliac or lower extremity, radiological supervision and 
interpretation). Using these calculations, the AMA RUC recommended a 
work RVU of 6.60 for CPT code 35475. We agree with this approach, but 
believe that CPT code 37220 (Revascularization, endovascular, open or 
percutaneous, iliac artery, unilateral, initial vessel; with 
transluminal angioplasty) (work RVU 8.15) is more similar to CPT code 
35475 and therefore a better starting point for the reductions. After 
accounting for overlap with other services typically reported with CPT 
code 35475, we determined that a work RVU of 5.75 is appropriate for 
this service. Accordingly, we are assigning a work RVU of 5.75 to CPT 
code 35475 on an interim final basis for CY 2013.
    After clinical review of CPT code 35476 (Transluminal balloon 
angioplasty, percutaneous; venous), we believe a work RVU of 4.71 more 
appropriately captures the work of the service. The AMA RUC reviewed 
the survey results and recommended a work RVU of 5.50, the survey 25th 
percentile value. We determined that the work associated with CPT code 
35476 was similar in terms of physician time and intensity to CPT code 
37191 (Insertion of intravascular vena cava filter, endovascular 
approach including vascular access, vessel selection, and radiological 
supervision and interpretation, intraprocedural roadmapping, and 
imaging guidance (ultrasound and fluoroscopy), when performed), which 
has a work RVU of 4.71. We believe the work RVU of 4.71 appropriately 
captures the relative difference between this service and CPT code 
35475. Therefore, we are assigning a work RVU of 4.71 for CPT code 
35476 on an interim final basis for CY 2013.
    CPT codes 36221 through 32668 were identified as potentially 
misvalued through the Codes Reported Together 75 percent or More 
screen. For CY 2012, the AMA RUC requested that CPT Editorial Panel 
create eight new codes to bundle selective catheter placement with 
radiological supervision and interpretation, including angiography. 
Additionally, the specialty society recognized that non-invasive 
vascular imaging has replaced diagnostic angiography as a screening 
test.
    After clinical review of CPT code 36221(Non-selective catheter 
placement, thoracic aorta, with angiography of the extracranial 
carotid, vertebral, and/or intracranial vessels, unilateral or 
bilateral, and all associated radiological supervision and 
interpretation, includes angiography of the cervicocerebral arch, when 
performed), we believe a work RVU of 4.17 more appropriately captures 
the work of the service, with refinement of 30 minutes to the post-
service time. The AMA RUC reviewed the survey results, and after a 
comparison to similar CPT codes, recommended a value of 4.51 work RVUs 
and a post-service time of 40 minutes. The AMA RUC used a direct 
crosswalk to the two component codes being bundled, CPT code 32600 
(Introduction of catheter, aorta) (work RVU = 3.02) and CPT code 75650 
(Angiography, cerviocerebral, catheter, including vessel origin, 
radiological supervision and interpretation) (work RVU = 1.49) and the 
recommended value of 4.51 is the sum of the RVUs for these component 
codes. We believe that that there are efficiencies gained when services 
are bundled. We believe crosswalking to the work RVU of CPT code 32550 
(Insertion of indwelling tunneled pleural catheter with cuff), which 
has a work RVU of 4.17, appropriately accounts for the physician time 
and intensity with CPT code 36221. Additionally, we believe that the 
survey post-service time of 30 minutes more accurately accounts for the 
time involved in furnishing this service than the AMA RUC-recommended 
post-service time of 40 minutes. Therefore, we are assigning a work RVU 
of 4.17 with refinement to time for CPT code

[[Page 69051]]

36221 on an interim final basis for CY 2013. A complete listing of the 
times associated with this code is available on the CMS Web site at 
www.cms.gov/PhysicianFeeSched/.
    After clinical review of CPT code 36222 ((Non-selective catheter 
placement, thoracic aorta, with angiography of the extracranial 
carotid, vertebral, and/or intracranial vessels, unilateral or 
bilateral, and all associated radiological supervision and 
interpretation, includes angiography of the cervicocerebral arch, when 
performed).), we believe the survey 25th percentile work RVU of 5.53 
appropriately captures the work of this service, particularly the 
efficiencies when two services are bundled together. The AMA RUC 
recommended the survey median work RVU of 6.00. Like CPT code 36221, we 
believe the survey post-service time of 30 minutes is more appropriate 
than the AMA RUC-recommended post-service time of 40 minutes. We are 
assigning a work RVU of 5.53 with refinement to time for CPT code 36222 
as interim final for CY 2013. A complete listing of the times 
associated with this code is available on the CMS Web site at: 
www.cms.gov/PhysicianFeeSched/.
    After clinical review of CPT code 36223 (Selective catheter 
placement, common carotid or innominate artery, unilateral, any 
approach, with angiography of the ipsilateral intracranial carotid 
circulation and all associated radiological supervision and 
interpretation, includes angiography of the extracranial carotid and 
cervicocerebral arch, when performed), we believe a work RVU value of 
6.00, the survey 25th percentile value, appropriately captures the work 
of the service, particularly efficiencies when two services are bundled 
together. The AMA RUC reviewed the survey results, and after a 
comparison to similar CPT codes, recommended a work RVU of 6.50. Like 
many of the other CPT codes in this family, we believe the survey post-
service time of 30 minutes is more appropriate than the AMA RUC-
recommended time of 40 minutes. We are assigning a work RVU of 6.00 
with refinement to time for CPT code 36223 as interim final for CY 
2013. A complete listing of the times associated with this code is 
available on the CMS Web site at: www.cms.gov/PhysicianFeeSched/.
    After clinical review of CPT code 36224 (Selective catheter 
placement, internal carotid artery, unilateral, with angiography of the 
ipsilateral intracranial carotid circulation and all associated 
radiological supervision and interpretation, includes angiography of 
the extracranial carotid and cervicocerebral arch, when performed), we 
believe a work RVU of 6.50, the survey 25th percentile value, 
appropriately captures the work of the service, particularly 
efficiencies when two services are bundled together. We believe 30 
minutes of post-service times more appropriately accounts for the work 
of this service. The AMA RUC reviewed the survey results, and after a 
comparison to similar CPT codes, recommended a value of 7.55 and a 
post-service time of 40 minutes for CPPT code 36224. Accordingly, we 
are assigning a work RVU of 6.50 with refinement to time for CPT code 
36224 as interim final for CY 2013. A complete listing of the times 
associated with this code is available on the CMS Web site at: 
www.cms.gov/PhysicianFeeSched/.
    After clinical review of CPT code 36225 (Selective catheter 
placement, subclavian or innominate artery, unilateral, with 
angiography of the ipsilateral vertebral circulation and all associated 
radiological supervision and interpretation, includes angiography of 
the cervicocerebral arch, when performed), we believe that this code 
should be valued the same as the CPT code 36223, to which we are 
assigning a work RVU of 6.00. Comparable to CPT code 36223, we also 
believe 30 minutes of post-service times more appropriately accounts 
for the work of this service. The AMA RUC reviewed the survey results 
and recommended the survey median work RVU of 6.50 and a post-service 
time of 40 minutes for CPT code 36225. We are assigning a work RVU of 
6.00 with refinement to time for CPT code 36225 as interim final for CY 
2013. A complete listing of the times associated with this code is 
available on the CMS Web site at: www.cms.gov/PhysicianFeeSched/.
    After clinical review of CPT code 36226 (Selective catheter 
placement, vertebral artery, unilateral, with angiography of the 
ipsilateral vertebral circulation and all associated radiological 
supervision and interpretation, includes angiography of the 
cervicocerebral arch, when performed), we believe that this CPT code 
should be valued the same as CPT code 36224, which has a work RVU as 
6.50. Comparable to CPT code 36224, we also believe 30 minutes of post-
service times more appropriately accounts for the work of this service. 
The AMA RUC reviewed the survey results, and after a comparison to 
similar CPT codes, recommended a value of 7.55 and a post-service time 
of 40 minutes for CPT code 36226. We are assigning a work RVU of 6.50 
with refinement to time for CPT code 36226 as interim final for CY 
2013.
    After clinical review of CPT code 36227 (Selective catheter 
placement, external carotid artery, unilateral, with angiography of the 
ipsilateral external carotid circulation and all associated 
radiological supervision and interpretation (list separately in 
addition to code for primary procedure)), we determined that there are 
efficiencies gained when services are bundled, and identified a work 
RVU of 2.09 for this service. This work RVU reflects the application of 
a very conservative estimate of 10 percent for the work efficiencies 
that we would expect to occur when multiple component codes are bundled 
together to the sum of the work RVUs for the component codes. The AMA 
RUC reviewed the survey results, and after a comparison to similar CPT 
codes, recommended a value of 2.32 for CPT code 36227. The AMA RUC used 
a direct crosswalk to the two component codes being bundled, CPT code 
36218 (Selective catheter placement, arterial system; additional second 
order, third order, and beyond, thoracic or brachiocephalic branch, 
within a vascular family (list in addition to code for initial second 
or third order vessel as appropriate) (work RVU= 1.01) and CPT code 
75660 (Angiography, external carotid, unilateral, selective, 
radiological supervision and interpretation) (work RVU = 1.31). We are 
assigning a work RVU of 2.09 as the interim final value of CPT code 
36227 for CY 2013.
(13) Hemic and Lymphatic System: General

[[Page 69052]]



                                                      Table 44--Hemic and Lymphatic System: General
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
38240................  Transplt allo hct/  2.24.................  4.00................  3.00................  Disagree............  No.
                        donor.
38241................  Transplt autol hct/ 2.24.................  3.00................  3.00................  Agree...............  No.
                        donor.
38242................  Transplt allo       1.71.................  2.11................  2.11................  Agree...............  No.
                        lymphocytes.
38243................  Transplj            New..................  2.13................  2.13................  Agree...............  No.
                        hematopoietic
                        boost.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    CPT codes 38240, 38241, 38242, and 38243 were revised by the CPT 
Editorial Panel for CY 2013.
    After clinical review, we agree with the AMA RUC-recommended work 
RVUs for CPT codes 38241 (Hematopoietic progenitor cell (hpc); 
autologous transplantation), 38242 (Allogeneic lymphocyte infusions), 
and 38243 (Hematopoietic progenitor cell (hpc); hpc boost). On an 
interim final basis for CY 2013 we are assigning a work RVU of 3.00 to 
CPT code 38241; a work RVU of 2.11 to CPT code 38242; and a work RVU of 
2.13 to CPT code 38243.
    After clinical review, we believe CPT code 38240 should have the 
same work RVU as CPT code 38241, because we believe the two services 
involve the same amount of work. The AMA RUC recommended a work RVU of 
4.00 for CPT code 38240. On an interim final basis for CY 2013 we are 
assigning CPT code 38240 a work RVU of 3.00.
(14) Digestive System: Intestines (Except Rectum)

                                                 Table 45--Digestive System: Intestines (Except Rectum)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
44705................  Prepare fecal       New..................  1.42................  Invalid.............  N/A.................  N/A.
                        microbiota.
G0455................  Fecal microbiota    New..................  N/A.................  0.97................  N/A.................  N/A.
                        prep instill.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The CPT Editorial Panel created CPT code 44705 (Preparation of 
fecal microbiota for instillation, including assessment of donor 
specimen) for CY 2013. The AMA RUC recommended a work RVU of 1.42, 
which is a direct crosswalk to CPT code 99203 (Level 3 office or other 
outpatient visit, new patient). This service is currently (CY 2012) 
reported under CPT code 44799 (Unlisted procedure, intestine), as is 
the instillation of the microbiota. Within Medicare, payment for the 
preparation of the donor specimen would only be made if the specimen is 
ultimately used for the treatment of a beneficiary as Medicare is not 
authorized to pay for any costs not directly related to the diagnosis 
and treatment of a beneficiary. Because of this policy, we believe it 
is appropriate to bundle the preparation and instillation into one 
payable HCPCS code. For CY 2013, we have created HCPCS code G0455 
(Preparation with instillation of fecal microbiota by any method, 
including assessment of donor specimen). HCPCS code G0455 will replace 
new CPT code 44705 (Preparation of fecal microbiota for instillation, 
including assessment of donor specimen) which will have a PFS procedure 
status indicator of I (Not valid for Medicare purposes), and includes 
both the work of preparation and instillation of the microbiota.
    After reviewing the preparation and instillation work associated 
with this procedure, we believe that CPT code 99213 (Level 3 office or 
other outpatient visit, established patient) is an appropriate 
crosswalk for the work and time of HCPCS code G0455. Therefore, on an 
interim final basis for CY 2013, we are assigning a work RVU of 0.97 to 
HCPCS code G0455. A list of the interim final times associated with 
this procedure is available on the CMS Web site at www.cms.gov/
physicianfeesched/.
(15) Digestive System: Biliary Tract

                                                        Table 46--Digestive System: Biliary Tract
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
47562................  Laparoscopic        11.76................  11.76...............  10.47...............  Disagree............  Yes.
                        cholecystectomy.
47563................  Laparo              11.47................  11.47...............  11.47...............  Agree...............  No.
                        cholecystectomy/
                        graph.
47600................  Removal of          17.48................  20.00...............  17.48...............  Disagree............  No.
                        gallbladder.
47605................  Removal of          15.98................  21.00...............  18.48...............  Disagree............  No.
                        gallbladder.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    In CY 2011, we received comments regarding a potential relativity 
problem between CPT codes 47600 (Cholecystectomy;) and 47605 
(Cholecystectomy; with cholangiography), as CPT code 47600

[[Page 69053]]

has a higher work RVU and more post-operative visits than CPT code 
47605. In the CY 2012 PFS proposed rule, we requested that the AMA RUC 
review these two CPT codes and thanked commenters for bringing this to 
our attention (76 FR 42796). Currently (CY 2012), CPT code 47600 has a 
work RVU of 17.48, and CPT code 47605 has a work RVU of 15.98, which is 
clearly an anomalous relationship. For CY 2013, the related specialty 
societies resurveyed these two CPT codes. After review, we believe that 
the work RVU of 17.48 appropriately reflects the work of CPT code 
47600, and that the work RVU of CPT code 47605 should be increased to 
reflect the increase in work related to the addition of 
cholangiography. After clinical review, we agree with the AMA RUC and 
specialty societies that a work RVU of 1.00 is the correct difference 
between CPT code 47600 and 47605. Therefore, we believe a work RVU of 
18.48 accurately accounts for the work associated with CPT code 47605. 
We do not believe that the work of CPT code 47600 has increased over 
time. The AMA RUC recommended a work RVU of 20.00 for CPT code 47600 
and a work RVU of 21.00 for CPT code 47605. Both values are the 
specialty society survey median work RVUs. On an interim final basis 
for CY 2013, we are assigning a work RVU of 17.48 to CPT code 47600 and 
a work RVU of 18.48 to CPT code 47605.
    In their review of these CPT codes, the specialty societies 
indicated and the AMA RUC agreed that the typical patient undergoing an 
open cholecystectomy is scheduled and started with a laparoscopic 
approach and is then converted to the open procedure. We are concerned 
that the vignettes associated with these procedures imply that the work 
of the failed laparoscopic approach is included in the work of the 
cholecystectomy. We request that the AMA RUC review the vignettes for 
these services.
    CPT codes 47562 and 47563 were identified as potentially misvalued 
through the High Expenditure Procedure Code screen.
    Though these service were identified by CMS as potentially 
misvalued, the related specialty societies declined to survey CPT codes 
47562 (Laparoscopy, surgical; cholecystectomy) and 47563 (Laparoscopy, 
surgical; cholecystectomy with cholangiography), because, they said, 
the codes had been resurveyed many times, with CPT code 47563 last 
surveyed and reviewed as recently as the Fourth Five-Year Review (CY 
2011). The AMA RUC Relativity Assessment Workgroup concluded that these 
services have not changed since last reviewed and that resurveying the 
codes would not produce different values. The AMA RUC reaffirmed the 
current (CY 2012) work RVU of 11.76 for CPT code 47562 and the current 
(CY 2012) work RVU of 11.47 for CPT code 47563.
    After clinical review, we noticed a rank-order anomaly in these 
services similar to the rank-order problem discussed above for CPT 
codes 47600 and 47605. CPT code 47563, which includes cholangiography, 
is currently (CY 2012) valued lower than CPT code 47562 which describes 
the same procedure without cholangiography. After reviewing these two 
services, we agree with the AMA RUC that the recently-reviewed current 
work RVU of 11.47 for CPT code 47563 continues to accurately reflect 
the work of this service. As discussed above, we believe that a work 
RVU of 1.00 reflects the incremental difference between cholecystectomy 
with cholangiography and cholecystectomy alone. Therefore, we believe 
that CPT code 47562 should be valued 1.00 RVU lower than CPT code 
47563. On an interim final basis for CY 2013, we are assigning a work 
RVU of 10.47 to CPT code 47562 and a work RVU of 11.47 to CPT code 
47563.
    Regarding physician time, we changed the pre-service time of CPT 
code 47562 to match the pre-service time of CPT code 47563, leading to 
small increase in pre-service time for the service. A complete listing 
of the interim final times assigned to these services is available on 
the CMS Web site at www.cms.gov/ physicianfeesched/.
(16) Urinary System: Bladder

                                                            Table 47--Urinary System: Bladder
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
52214................  Cystoscopy and      3.70.................  3.50................  3.50................  Agree...............  No.
                        treatment.
52224................  Cystoscopy and      3.14.................  4.05................  4.05................  Agree...............  Yes.
                        treatment.
52234................  Cystoscopy and      4.62.................  4.62................  4.62................  Agree...............  No.
                        treatment.
52235................  Cystoscopy and      5.44.................  5.44................  5.44................  Agree...............  No.
                        treatment.
52240................  Cystoscopy and      9.71.................  8.75................  7.50................  Disagree............  No.
                        treatment.
52287................  Cystoscopy          New..................  3.20................  3.20................  Agree...............  No.
                        chemodenervation.
52351................  Cystouretero & or   5.85.................  5.75................  5.75................  Agree...............  No.
                        pyeloscope.
52352................  Cystouretero w/     6.87.................  6.75................  6.75................  Agree...............  No.
                        stone remove.
52353................  Cystouretero w/     7.96.................  7.88................  7.50................  Disagree............  No.
                        lithotripsy.
52354................  Cystouretero w/     7.33.................  8.58................  8.00................  Disagree............  No.
                        biopsy.
52355................  Cystouretero w/     8.81.................  10.00...............  9.00................  Disagree............  No.
                        excise tumor.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    CPT code 52235 was identified as potentially misvalued under the 
Harvard-valued--Utilization over 30,000 screen. CPT codes 52234, 52240, 
and 52351 through 52355 were identified as a part of this family for 
review.
    After clinical review, we agreed with the AMA RUC-recommended work 
RVUs for the majority of codes in this family. However, we disagreed 
with the AMA RUC-recommended work RVUs for CPT codes 52353 
(Cystourethroscopy, with ureteroscopy and/or pyeloscopy; with 
lithotripsy (ureteral catheterization is included)), 52354 
(Cystourethroscopy, with ureteroscopy and/or pyeloscopy; with biopsy 
and/or fulguration of ureteral or renal pelvic lesion), 52355 
(Cystourethroscopy, with ureteroscopy and/or pyeloscopy; with resection 
of ureteral or renal pelvic tumor), and 52240 (Cystourethroscopy, with 
fulguration (including cryosurgery or laser surgery) and/or resection 
of; large bladder tumor(s)). For CPT codes,

[[Page 69054]]

52353, 52354, and 52355, we believe that the survey 25th percentile 
work RVUs represent a more appropriate incremental difference over the 
base code, CPT code 52351 (Cystourethroscopy, with ureteroscopy and/or 
pyeloscopy; diagnostic), to which we are assigning an interim final 
work RVU of 5.75, than the AMA RUC recommended work RVUs of 7.88, 8.58, 
10.00, respectively. Additionally, we believe the survey 25th 
percentile work RVUs more appropriately account for the significant 
reduction in intra-service time of these three CPT codes. Therefore, on 
an interim final basis for CY 2013, we are assigning a work RVU of 7.50 
for CPT 52353; a work RVU of 8.00 for CPT code 52354; and a work RVU of 
9.00 for CPT code 52355.
    After reviewing CPT code 52240, we believe this service should be 
valued the same as CPT code 52353, as the services have the same times 
and describe very similar procedures. Therefore, on an interim final 
basis for CY 2013, we are assigning a work RVU of 7.50 to CPT code 
52240.
    Regarding physician time, we refined the AMA RUC-recommended pre-
service time for CPT code 52224 (Cystourethroscopy, with fulguration 
(including cryosurgery or laser surgery) or treatment of minor (less 
than 0.5 cm) lesion(s) with or without biopsy) from 32 minutes to 29 
minutes to match the pre-service time of CPT code 52214 
(Cystourethroscopy, with fulguration (including cryosurgery or laser 
surgery) of trigone, bladder neck, prostatic fossa, urethra, or 
periurethral glands) which has very similar pre-service work. A 
complete list of the interim final times associated with these 
procedures is available on the CMS Web site at www.cms.gov/
physicianfeesched/.
(17) Nervous System: Extracranial Nerves, Peripheral Nerves, and 
Autonomic Nervous System

                             Table 48--Nervous System: Extracranial Nerves, Peripheral Nerves, and Autonomic Nervous System
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
64450................  N block other       1.27.................  0.75................  0.75................  Agree...............  No.
                        peripheral.
64612................  Destroy nerve face  2.01.................  1.41................  1.41................  Interim.............  No.
                        muscle.
64613................  Destroy nerve neck  2.01.................  N/A.................  2.01................  Interim.............  N/A.
                        muscle.
64614................  Destroy nerve       2.20.................  N/A.................  2.20................  Interim.............  N/A.
                        extrem musc.
64615................  Chemodenerv musc    New..................  1.85................  1.85................  Interim.............  No.
                        migraine.
64640................  Injection           2.81.................  1.23................  1.23................  Agree...............  No.
                        treatment of
                        nerve.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The CPT Editorial Panel created CPT code 64615 and revised CPT 
codes 64612, 64613, and 64614 for CY 2013.
    When the AMA RUC and related specialty societies reviewed CPT codes 
64613 (Chemodenervation of muscle(s); neck muscle(s) (eg, for spasmodic 
torticollis, spasmodic dysphonia)) and 64614 (Chemodenervation of 
muscle(s); extremity and/or trunk muscle(s) (eg, for dystonia, cerebral 
palsy, multiple sclerosis)), they determined that both CPT codes should 
be divided into additional codes, and referred CPT codes 64613 and 
64614 to the CPT Editorial Panel. The AMA RUC recommended the survey 
median work RVU of 1.41 for CPT code 64612 (Chemodenervation of 
muscle(s); muscle(s) innervated by facial nerve, unilateral (eg, for 
blepharospasm, hemifacial spasm)), a decrease from the current work RVU 
of 2.01, and recommended the survey median work RVU of 1.85 for new CPT 
code 64615 (Chemodenervation of muscle(s); muscle(s) innervated by 
facial, trigeminal, cervical spinal and accessory nerves, bilateral 
(eg, for chronic migraine)). We are accepting the AMA RUC-recommended 
work RVUs for CPT codes 64612 and 64615 on an interim basis, and will 
review these services alongside CPT codes 64613 and 64614 (or their 
successor CPT codes) after they are reviewed by the CPT Editorial 
Panel.
    The AMA RUC requested a change in the global period of CPT code 
64615 from 10 days to 0 days. We believe that a global period of 10 
days is most appropriate for this service, and maintains consistency 
within this family of CPT codes, as the other services in this family 
also have 10-day global periods.
(18) Eye and Ocular Adnexa: Eyeball

                                                        Table 49--Eye and Ocular Adnexa: Eyeball
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
65222................  Remove foreign      0.93.................  0.93................  0.84................  Disagree............  Yes.
                        body from eye.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    CPT code 65222 was identified as potentially misvalued under the 
Harvard-valued--Utilization over 30,000 screen.
    Medicare claims data from 2011 indicate that CPT code 65222 
(Removal of foreign body, external eye; corneal, with slit lamp) is 
typically furnished to the beneficiary on the same day as an E/M visit. 
We believe that some of the activities furnished during the pre- and 
post-service period of the procedure code and the E/M visit overlap. 
After review, we do not believe that the AMA RUC appropriately 
accounted for this overlap in its recommendation of pre- and post-
service time. To account for this overlap, we reduced the AMA RUC-
recommended pre-service evaluation time by one-third, from 7 minutes to 
5 minutes, and the AMA RUC-recommended post-service time by one-third, 
from 5 minutes to 3 minutes. We believe that 5 minutes of pre-service 
evaluation time and 3 minutes of post-service time accurately reflect 
the time involved in furnishing the pre- and

[[Page 69055]]

post-service work of this procedure, and that these times are well-
aligned with similar services. Because we reduced the AMA RUC-
recommended procedure time for this code by 4 minutes, at a standard 
work intensity of .0224 RVUs per minute, we believe that it is also 
appropriate to remove 0.09 RVUs from the current/AMA RUC-recommended 
RVU of 0.93. In sum, on an interim final basis for CY 2013, we are 
assigning a work RVU of 0.84 to CPT code 65222, with a refinement to 
the AMA RUC recommended time. A complete list of the interim final 
times associated with this procedure is available on the CMS Web site 
at www.cms.gov/physicianfeesched/.
(19) Eye and Ocular Adnexa: Ocular Adnexa

                                                     Table 50--Eye and Ocular Adnexa: Ocular Adnexa
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
67810................  Biopsy eyelid &     1.48.................  1.18................  1.18................  Agree...............  Yes.
                        lid margin.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    CPT code 67810 was identified as potentially misvalued under the 
Harvard-valued--Utilization over 30,000 screen.
    Medicare claims data from 2011 indicate that CPT code 67810 
(Incisional biopsy of eyelid skin including lid margin) is typically 
furnished to the beneficiary on the same day as an E/M visit. We 
believe that some of the activities furnished during the pre- and post-
service period of the procedure code and the E/M visit overlap. After 
review, we believe that the AMA RUC appropriately accounted for this 
overlap in its recommendation of pre-service time, but that the AMA 
RUC-recommended post-service time, while reduced from the survey time, 
is still high relative to similar services performed on the same day as 
an E/M service. To better account for this overlap, and to value this 
service relative to similar services, we reduced the AMA RUC-
recommended post-service time for this procedure by one-third, from 5 
minutes to 3 minutes.
    After reviewing CPT code 67810 and assessing the overlap in time 
and work, we agree with the AMA RUC-recommended work RVU of 1.18 for 
this service, which is a decrease from the CY 2012 work RVU of 1.48. In 
sum, on an interim final basis for CY 2013, we are assigning a work RVU 
of 1.18 to CPT code 67810, with a refinement to the AMA RUC recommended 
time. A complete list of the interim final times associated with this 
procedure is available on the CMS Web site at www.cms.gov/
physicianfeesched/.
(20) Eye and Ocular Adnexa: Conjunctiva

                                                      Table 51--Eye and Ocular Adnexa: Conjunctiva
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                    AMA RUC/HCPAC    CY 2013  interim/  Agree/disagree with AMA
       HCPCS code            Short descriptor      CY 2012 work    recommended work    interim final     RUC/HCPAC  recommended  CMS  refinement to  AMA/
                                                       RVU               RVU              work RVU              work RVU         HCPAC  recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
68200...................  Treat eyelid by                  0.49               0.49               0.49   Agree..................  Yes.
                           injection.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    CPT code 68200 was identified as potentially misvalued under the 
Harvard-valued--Utilization over 30,000 screen.
    Medicare claims data from 2011 indicate that CPT code 68200 
(Subconjunctival injection) is typically furnished to the beneficiary 
on the same day as an E/M visit. We believe that some of the activities 
furnished during the pre- and post-service period of the procedure code 
and the E/M visit overlap. After review, we believe that the AMA RUC 
appropriately accounted for this overlap in its recommendation of pre-
service time, but that the AMA RUC did not adequately account for the 
overlap in the post-service time. To better account for the overlap in 
post-service time, we reduced the AMA RUC-recommended post-service time 
for this procedure by one-third, from 5 minutes to 3 minutes.
    After reviewing CPT code 68200 and assessing the overlap in time 
and work, we agree with the AMA RUC-recommended work RVU of 0.49 for 
this service. In sum, on an interim final basis for CY 2013, we are 
assigning a work RVU of 0.49 to CPT code 68200, with a refinement to 
the AMA RUC recommended time. A complete list of the interim final 
times associated with this procedure is available on the CMS Web site 
at www.cms.gov/physicianfeesched/.
(21) Auditory System: External Ear

                                                         Table 52--Auditory System: External Ear
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
69200................  Clear outer ear     0.77.................  0.77................  0.77................  Agree...............  Yes.
                        canal.
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 69056]]

    CPT code 69200 was identified as potentially misvalued under the 
Harvard-valued--Utilization over 30,000 screen.
    Medicare claims data from 2011 indicate that CPT code 69200 
(Removal foreign body from external auditory canal; without general 
anesthesia) is typically furnished to the beneficiary on the same day 
as an E/M visit. We believe that some of the activities furnished 
during the pre- and post-service period of the procedure code and the 
E/M visit overlap. To account for this overlap, we removed one-third of 
the pre-service evaluation time from the pre-service time package, 
reducing the pre-service evaluation time from 7 minutes to 5 minutes. 
Additionally, we reduced the AMA RUC-recommended post-service time for 
this procedure by one-third, from 5 minutes to 3 minutes.
    After reviewing CPT code 69200 and assessing the overlap in time 
and work, we agree with the AMA RUC-recommended work RVU of 0.77 for 
this service. In sum, on an interim final basis for CY 2013, we are 
assigning a work RVU of 0.77 to CPT code 69200, with a refinement to 
the AMA RUC recommended time. A complete list of the interim final 
times associated with this procedure is available on the CMS Web site 
at www.cms.gov/physicianfeesched/.
(22) Diagnostic Radiology (Diagnostic Imaging)

                                                   Table 53--Diagnostic Radiology (Diagnostic Imaging)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
72040................  X-ray exam neck     0.22.................  0.22................  0.22................  Agree...............  No.
                        spine 3  New..................  3.00................  2.60................  Disagree............  No.
                        paramtrs.
95783................  Polysom <6 yrs      New..................  3.20................  2.83................  Disagree............  No.
                        cpap/bilvl.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The CPT Editorial Panel created CPT codes 95782 and 95783 for CY 
2013 to describe the physician work involved in pediatric 
polysomnography for children 5 years of age or younger.
    We reviewed CPT codes 95782 and 95783 and determined that the 
specialty society survey 25th percentile work RVUs of 2.60 for CPT code 
95782 (Polysomnography; younger than 6 years, sleep staging with 4 or 
more additional parameters of sleep, attended by a technologist) and 
2.83 for CPT code 95783 (Polysomnography; younger than 6 years, sleep 
staging with 4 or more additional parameters of sleep, with initiation 
of continuous positive airway pressure therapy or bi-level ventilation, 
attended by a technologist) appropriately reflect the work involved in 
furnishing these services. CPT codes 95782 and 95783 were previously 
reported under CPT codes 95810 (Polysomnography; age 6 years or older, 
sleep staging with 4 or more additional parameters of sleep, attended 
by a technologist) and 95811 (Polysomnography; age 6 years or older, 
sleep staging with 4 or more additional parameters of sleep, with 
initiation of continuous positive airway pressure therapy or bilevel 
ventilation, attended by a technologist). These CPT codes (95810 and 
95811) have revised descriptors for CY 2013 indicating age 6 years and 
older. CPT code 95810 has a CY 2012 work RVU of 2.50, and CPT code 
95811 has a CY 2012 work RVU of 2.60. We believe the increase from 
these current work RVUs to the CY 2013 work RVUs of 2.60 for CPT code 
95782 and 2.83 for CPT code 95783 reflect the incremental difference in 
work between the existing services for ages 6 years and older and new 
services for younger than 6 years. The AMA RUC recommended the 
specialty society survey median work RVUs of 3.00 for CPT code 95782 
and 3.20 for CPT code 95783. We are assigning a work RVU of 2.60 to CPT 
code 95782 and a work RVU of 2.83 to CPT code 95783 on an interim final 
basis for CY 2013.
(34) Neurology and Neuromuscular Procedures: Electromyography and Nerve 
Conduction Tests

                                      Table 65--Neurology and Neuromuscular Procedures: Electromyography and Nerve
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work      AMA  RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
95860................  Muscle test one     0.96.................  0.96................  0.96................  Agree...............  No.
                        limb.
95861................  Muscle test 2       1.54.................  1.54................  1.54................  Agree...............  No.
                        limbs.
95863................  Muscle test 3       1.87.................  1.87................  1.87................  Agree...............  No.
                        limbs.
95864................  Muscle test 4       1.99.................  1.99................  1.99................  Agree...............  No.
                        limbs.
95865................  Muscle test larynx  1.57.................  1.57................  1.57................  Agree...............  No.
95866................  Muscle test         1.25.................  1.25................  1.25................  Agree...............  No.
                        hemidiaphragm.
95867................  Muscle test cran    0.79.................  0.79................  0.79................  Agree...............  No.
                        nerv unilat.
95868................  Muscle test cran    1.18.................  1.18................  1.18................  Agree...............  No.
                        nerve bilat.
95869................  Muscle test thor    0.37.................  0.37................  0.37................  Agree...............  No.
                        paraspinal.
95870................  Muscle test         0.37.................  0.37................  0.37................  Agree...............  No.
                        nonparaspinal.
95885................  Musc tst done w/    0.35.................  0.35................  0.35................  Agree...............  No.
                        nerv tst lim.
95886................  Musc test done w/n  0.92.................  0.92................  0.70................  Disagree............  No.
                        test comp.
95887................  Musc tst done w/n   0.73.................  0.73................  0.47................  Disagree............  No.
                        tst nonext.
95905................  Motor &/sens nrve   0.05.................  0.05................  0.05................  Agree...............  No.
                        cndj test.
95907................  Motor&/sens 1-2     New..................  1.00................  1.00................  Agree...............  No.
                        nrv cndj tst.
95908................  Motor&/sens 3-4     New..................  1.37................  1.25................  Disagree............  Yes.
                        nrv cndj tst.
95909................  Motor&/sens 5-6     New..................  1.77................  1.50................  Disagree............  Yes.
                        nrv cndj tst.
95910................  Motor&sens 7-8 nrv  New..................  2.80................  2.00................  Disagree............  No.
                        cndj test.
95911................  Motor&sen 9-10 nrv  New..................  3.34................  2.50................  Disagree............  No.
                        cndj test.
95912................  Motor&sen 11-12     New..................  4.00................  3.00................  Disagree............  No.
                        nrv cnd test.

[[Page 69067]]

 
95913................  Motor&sens 13/>     New..................  4.20................  3.56................  Disagree............  No.
                        nrv cnd test.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    CPT codes 95860, 95861, 95863, and 95864 were identified as 
potentially misvalued through the Codes Reported Together 75 percent or 
More screen. The related specialty societies submitted a code change 
proposal to the CPT Editorial Panel to bundle the services commonly 
reported together. In response, for CY 2012, the CPT Panel created 
three add-on codes (CPT codes 95885 through 95887), and for CY 2013, 
the Panel created seven new codes (CPT codes 95907 through 95913) that 
bundle the work of multiple nerve conduction studies into each 
individual code.
    We first reviewed CPT codes 95885 (Needle electromyography, each 
extremity, with related paraspinal areas, when performed, done with 
nerve conduction, amplitude and latency/velocity study; limited (list 
separately in addition to code for primary procedure)), 95886 (Needle 
electromyography, each extremity, with related paraspinal areas, when 
performed, done with nerve conduction, amplitude and latency/velocity 
study; complete, five or more muscles studied, innervated by three or 
more nerves or four or more spinal levels (list separately in addition 
to code for primary procedure)), and 95887 (Needle electromyography, 
non-extremity (cranial nerve supplied or axial) muscle(s) done with 
nerve conduction, amplitude and latency/velocity study (list separately 
in addition to code for primary procedure)) for the CY 2012 PFS final 
rule with comment period. We stated that we were accepting the AMA RUC-
recommended work RVUs and times on an interim basis, pending review of 
the other electromyography services (76 FR 73207). For CY 2013 we were 
able to review these services alongside the related electromyography 
services and nerve conduction tests. After reviewing these services, we 
agree with the AMA RUC-recommended times and RVUs for needle 
electromyography CPT codes 95860 through 95870 (all listed in the table 
above). We also agree with the AMA RUC-recommendations for the CY 2012 
needle electromyography add-on CPT code 95885, however we do not agree 
with the AMA RUC recommendations for the other two CY 2012 needle 
electromyography add-on CPT codes 95886 and 95887.
    After review, we determined that the AMA RUC-recommended work RVU 
of 0.35 for CPT code 95885 was appropriate and was well-aligned with 
CPT code 95870 (Needle electromyography; limited study of muscles in 1 
extremity or non-limb (axial) muscles (unilateral or bilateral), other 
than thoracic paraspinal, cranial nerve supplied muscles, or 
sphincters), to which we are assigning a work RVU of 0.37; the services 
involve similar work and both include 15 minutes of intra-service time. 
We believe that CPT codes 95886 and 95887 involve the same level of 
work intensity as CPT code 95885. To determine the appropriate RVU for 
CPT codes 95886 and 95887 relative to 95885, we increased the work RVU 
in proportion to the increase in time for the services. Under this 
methodology, because we are assigning a work RVU of 0.35 and 15 minutes 
of intra-service time to CPT code 95885, we believe it is appropriate 
to assign a work RVU of 0.70 to CPT code 95886, which has an intra-
service time of 30 minutes; and a work RVU of 0.47 to CPT code 95887, 
which has an intra-service time of 20 minutes. The AMA RUC recommended 
a work RVU of 0.92 for CPT code 95886 and a work RVU of 0.73 for CPT 
code 95887. We are assigning a work RVU of 0.70 to CPT code 95886 and a 
work RVU of 0.47 to CPT code 95887 on an interim final basis for CY 
2013.
    We reviewed new CPT codes 95907 (Nerve conduction studies; 1-2 
studies), 95908 (Nerve conduction studies; 3-4 studies), 95909 (Nerve 
conduction studies; 5-6 studies), 95910 (Nerve conduction studies; 7-8 
studies), 95911 (Nerve conduction studies; 9-10 studies), 95912 (Nerve 
conduction studies; 11-12 studies), and 95913 (Nerve conduction 
studies; 13 or more studies) and found that the progression of the 
survey 25th percentile work RVUs and survey median times appropriately 
reflect the relativity of these services. The two CPT codes in the 
nerve conduction studies series that describe the fewest nerve 
conduction studies, 95907 and 95908, are the exception to this trend, 
as the survey 25th percentile work RVUs are too low relative to other 
fee schedule services. For CPT code 95907, the survey 25th percentile 
work RVU is 0.48, but we believe that the survey median and AMA RUC 
recommended work RVU of 1.00 is more appropriate for this service. For 
CPT code 95908, the survey 25th percentile work RVU is 1.00, however 
CPT code 95908 should be valued between CPT code 95907 and 95909, which 
has a survey 25th percentile work RVU of 1.50. We believe a work RVU of 
1.25, half-way between the work RVU of CPT codes 95907 and 95909, 
accurately reflects the work of this service relative to other services 
in this series. The AMA RUC recommended the survey median values for 
most of the services in the series, and used a crosswalk methodology to 
develop a work RVU recommendation for CPT codes 95908 and 95909. In 
sum, on an interim final basis for CY 2013, we are assigning a work RVU 
of 1.00 to CPT code 95907; a work RVU of 1.25 to CPT code 95908; a work 
RVU of 1.50 to CPT codes 95909; a work RVU of 2.00 to CPT codes 95910; 
a work RVU of 2.50 to CPT code 95911; a work RVU of 3.00 to CPT code 
95912; and a work RVU of 3.56 to CPT code 95913. We are refining the 
AMA RUC-recommended intra-service time for CPT code 95908 from 25 
minutes to the survey median time of 22 minutes, and for CPT code 95909 
from 35 minutes to the survey median time of 30 minutes, so that all 
the CPT codes in this series are valued using the survey median intra-
service time. A complete list of the interim final times assigned to 
these procedures is available on the CMS Web site at www.cms.gov/
physicianfeesched/.
(35) Neurology and Neuromuscular Procedures: Evoked Potentials and 
Reflex Tests

[[Page 69068]]



                                  Table 66--Neurology and Neuromuscular Procedures: Evoked Potentials and Reflex Tests
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
95925................  Somatosensory       0.54.................  N/A.................  0.54................  Interim.............  N/A.
                        testing.
95926................  Somatosensory       0.54.................  N/A.................  0.54................  Interim.............  N/A.
                        testing.
95928................  C motor evoked      1.50.................  N/A.................  1.50................  Interim.............  N/A.
                        uppr limbs.
95929................  C motor evoked lwr  1.50.................  N/A.................  1.50................  Interim.............  N/A.
                        limbs.
95938................  Somatosensory       0.86.................  0.86................  0.86................  Interim.............  No.
                        testing.
95939................  C motor evoked      2.25.................  2.25................  2.25................  Interim.............  No.
                        upr&lwr limbs.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    CPT code pairs 95925 with 95926, and 95928 with 95929, were 
identified as potentially misvalued through the Codes Reported Together 
75 percent or More screen. For CY 2012, the CPT Editorial Panel created 
CPT code 95938 to capture the reporting of CPT codes 95925 and 95926 
together, and CPT codes 95939 to capture the reporting of CPT codes 
95928 with 95929. The related specialty societies surveyed CPT codes 
95938 and 95939 and the AMA RUC sent us recommendations on those 
services for the CY 2012 PFS final rule with comment period.
    We reviewed CPT codes 95938 (Short-latency somatosensory evoked 
potential study, stimulation of any/all peripheral nerves or skin 
sites, recording from the central nervous system; in upper and lower 
limbs) and 95939 (Central motor evoked potential study (transcranial 
motor stimulation); in upper and lower limbs) for the CY 2012 PFS final 
rule with comment period. In that rule, we stated that we were 
accepting the AMA RUC-recommended values on an interim basis, and 
requested that the AMA RUC review the component CPT codes 95925 (Short-
latency somatosensory evoked potential study, stimulation of any/all 
peripheral nerves or skin sites, recording from the central nervous 
system; in upper limbs), 95926 (Short-latency somatosensory evoked 
potential study, stimulation of any/all peripheral nerves or skin 
sites, recording from the central nervous system; in lower limbs), 
95928 (Central motor evoked potential study (transcranial motor 
stimulation); upper limbs), and 95929 (Central motor evoked potential 
study (transcranial motor stimulation); lower limbs) (76 FR 73207 
through 73208).
    In response to this request, the AMA RUC Relativity Assessment 
Workgroup referred component CPT codes 95925, 95926, 95928, and 95929 
to the PE Subcommittee of the AMA RUC to review the direct practice 
expense inputs, but the AMA RUC decided not to review the physician 
work or time.
    When reviewing the physician work and time for the two new bundled 
CPT codes and their component codes, we saw unlikely relationships 
between the physician times assigned to these services, especially CPT 
codes 95928, 95929, and 95939. Given these time anomalies, we are also 
concerned the current (CY 2012) work RVUs do not reflect the 
appropriate relativity of the services. CPT code 95939 describes an 
evoked potential study in both the upper and lower limbs together, and 
is assigned 30 minutes of intra-service time. CPT code 95928 describes 
an evoked potential study in the upper limbs only, and is assigned 60 
minutes of intra-service time. CPT code 95929 describes an evoked 
potential study in the lower limbs, and is assigned 55 minutes of 
intra-service time. We do not believe that an evoked potential study on 
the upper or lower limbs alone takes twice as long as an evoked 
potential study on both the upper and lower limbs.
    Additionally, CPT code 95938 describes an evoked potential study in 
both the upper and lower limbs together, and is assigned 30 minutes of 
intra-service time. CPT code 95925 describes an evoked potential study 
in the upper limbs only and is assigned 15 minutes of intra-service 
time. CPT code 95926 describes an evoked potential study in the lower 
limbs and is assigned 15 minutes of intra-service time. We note that 
the intra-service times of CPT codes 95925 and 95926 are significantly 
different from the intra-service times of CPT codes 95928 and 95929 for 
very similar procedures, but somehow the new bundled procedure codes 
for both have 30 minutes of intra-service time. We conclude that there 
are valuation and time inaccuracies, both across the evoked potential 
study codes and relative to the new bundled codes. For example, for CPT 
codes 95925 and 95926, we do not believe that the correct intra-service 
time for CPT code 95938 can be the sum of the intra-service times of 
CPT codes 95925 and 95926, as we are confident that there efficiencies 
to be recognized when performing these services together.
    Given these anomalous relationships, we request public comments on 
the appropriate work and time values for these services. We are 
maintaining the current (CY 2012) work RVUs and times for CPT codes 
95925, 95926, 95928, 95929, 95938, and 95939 on an interim basis for CY 
2013, and anticipate re-reviewing these services for CY 2014.
(36) Neurology and Neuromuscular Procedures: Intraoperative 
Neurophysiology


                                    Table 67--Neurology and Neuromuscular Procedures: Intraoperative Neurophysiology
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
95940................  Ionm in operatng    New..................  0.60................  0.60................  Agree...............  No.
                        room 15 min.
95941................  Ionm remote/>1 pt   New..................  2.00................  Invalid.............  N/A.................  N/A.
                        or per hr.
G0453................  Cont intraop neuro  New..................  N/A.................  0.50................  N/A.................  N/A.
                        monitor.
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 69069]]

    Effective January 1, 2013, the CPT Editorial Panel is deleting CPT 
code 95920 (Intraoperative neurophysiology testing, per hour (List 
separately in addition to code for primary procedure)), and is 
replacing it with CPT codes 95940 (Continuous intraoperative 
neurophysiology monitoring in the operating room, one on one monitoring 
requiring personal attendance, each 15 minutes) and CPT code 95941 
(Continuous intraoperative neurophysiology monitoring, from outside the 
operating room (remote or nearby) or for monitoring of more than one 
case while in the operating room, per hour). Currently remote 
monitoring is billed under the PFS using CPT code 95920, though the 
code does not specify whether the physician is present in the same room 
with a patient or monitoring from a remote location, nor does the code 
descriptor indicate whether the code may be billed for the monitoring 
of one patient or more than one simultaneously. Some carriers have 
established local coverage determinations (LCDs) to address these 
issues and more tightly define the circumstances under which CPT code 
95920 may be billed.
    The CPT prefatory language for CPT code 95941 states: ``* * * One 
or more simultaneous cases may be reported * * * Report 95941 for all 
remote or non-one on one monitoring time connected to each case 
regardless of overlap with other cases.'' Given this language, we are 
concerned that CPT code 95941 allows a practitioner to bill individual 
beneficiaries for monitoring more than one beneficiary for the same 
work during the same time interval. To resolve this concern, we have 
created HCPCS code G0453 (Continuous intraoperative neurophysiology 
monitoring, from outside the operating room (remote or nearby), per 
patient, (attention directed exclusively to one patient) each 15 
minutes (list in addition to primary procedure)), effective January 1, 
2013. HCPCS code G0453 may be billed only for undivided attention by 
the monitoring physician to a single beneficiary, not for simultaneous 
attention by the monitoring physician to more than one patient. HCPCS 
code G0453 may be billed in multiple units to account for the 
cumulative time spent monitoring, that is, 15 minutes of continuous 
attendance followed by another 15 minutes later in the procedure would 
constitute one half hour of monitoring, and CPT code G0453 would be 
billed with a unit of 2. HCPCS code G0453 will replace CPT code 95941, 
which will have a PFS procedure status indicator of I (Not valid for 
Medicare purposes. Medicare uses another code for the reporting of and 
the payment for these services) for CY 2013. CPT code 95940, which 
describes continuous intraoperative neurophysiology monitoring in the 
operating room for one patient at a time, will be payable on the PFS 
for CY 2013, with a PFS procedure status indicator of A (Active).
    After reviewing CPT code 95940, we agree with the AMA RUC that a 
work RVU of 0.60 accurately accounts for the work involved in 
furnishing this procedure. We are assigning a work RVU of 0.60 to CPT 
code 95940 on an interim final basis for CY 2013. Also, we agree with 
the AMA RUC that a work RVU of 2.00 accurately accounts for the work 
for involved in furnishing 60 minutes of continuous intraoperative 
neurophysiology monitoring from outside the operating room. 
Accordingly, we are assigning a work RVU of 0.50 to HCPCS code G0453, 
which describes 15 minutes of monitoring from outside the operating 
room, on an interim final basis for CY 2013.
(37) Physical Medicine and Rehabilitation: Active Wound Care Management


                                      Table 68--Physical Medicine and Rehabilitation: Active Wound Care Management
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
G0456................  Neg pre wound <=50  New..................  N/A.................  Contractor Priced...  N/A.................  N/A.
                        sq cm.
G0457................  Neg pres wound >50  New..................  N/A.................  Contractor Priced...  N/A.................  N/A.
                        sq cm.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    For CY 2013, we are creating two HCPCS codes in order to provide a 
payment mechanism for negative pressure wound therapy services 
furnished to beneficiaries through means unrelated to the durable 
medical equipment benefit: G0456 (Negative pressure wound therapy. 
(e.g. vacuum assisted drainage collection) using a mechanically-powered 
device, not durable medical equipment, including provision of cartridge 
and dressing(s), topical application(s), wound assessment, and 
instructions for ongoing care, per session; total wound(s) surface area 
less than or equal to 50 square centimeters) and G0457 (Negative 
pressure wound therapy. (e.g. vacuum assisted drainage collection) 
using a mechanically-powered device, not durable medical equipment, 
including provision of cartridge and dressing(s), topical 
application(s), wound assessment, and instructions for ongoing care, 
per session; total wound(s) surface area greater than 50 sq cm). The 
two new codes will be contractor priced on an interim basis for CY 
2013. We request comments on the appropriate value for this service.
(38) Inpatient Neonatal Intensive Care Services and Pediatric and 
Neonatal Critical Care Services: Pediatric Critical Care Patient 
Transport

[[Page 69070]]



    Table 69--Inpatient Neonatal Intensive Care Services and Pediatric and Neonatal Critical Care Services: Pediatric Critical Care Patient Transport
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
99485................  Suprv interfacilty  New..................  1.50................  Bundled.............  N/A.................  N/A.
                        transport.
99486................  Suprv interfac      New..................  1.30................  Bundled.............  N/A.................  N/A.
                        trnsport addl.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The CPT editorial panel created CPT codes 99485 and 99486 for CY 
2013, to describe the non-face-to-face services provided by physician 
to supervise interfacility care of critically ill or critically injured 
pediatric patients.
    We reviewed CPT codes 99485 (Supervision by a control physician of 
interfacility transport care of the critically ill or critically 
injured pediatric patient, 24 months of age or younger, includes two-
way communication with transport team before transport, at the 
referring facility and during the transport, including data 
interpretation and report; first 30 minutes) and 99486 (Supervision by 
a control physician of interfacility transport care of the critically 
ill or critically injured pediatric patient, 24 months of age or 
younger, includes two-way communication with transport team before 
transport, at the referring facility and during the transport, 
including data interpretation and report; each additional 30 minutes 
(list separately in addition to code for primary procedure)), and we 
believe these services are bundled into other services and are not 
separately payable. We believe these services are similar to CPT codes 
99288 (Physician or other qualified health care professional direction 
of emergency medical systems (ems) emergency care, advanced life 
support), which is also bundled on the PFS. The AMA RUC recommended a 
work RVU of 1.50 for CPT code 99485 and a work RVU of 1.30 for CPT code 
99486. On an interim final basis for CY 2013, we are assigning CPT 
codes 99485 and 99486 a PFS procedure status indicator of B (Payments 
for covered services are always bundled into payment for other 
services, which are not specified. If RVUs are shown, they are not used 
for Medicare payment. If these services are covered, payment for them 
is subsumed by the payment for the services to which they are bundled.
(39) Complex Chronic Care Coordination Services

                                                  Table 70--Complex Chronic Care Coordination Services
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
99487................  Cmplx chron care w/ New..................  1.00................  Bundled.............  N/A.................  N/A.
                        o pt vsit.
99488................  Cmplx chron care w/ New..................  2.50................  Bundled.............  N/A.................  N/A.
                        pt vsit.
99489................  Complx chron care   New..................  0.50................  Bundled.............  N/A.................  N/A.
                        addl30 min.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The CPT Editorial Panel created CPT codes 99487, 99488, and 99489 
for CY 2013 to describe complex chronic care coordination services that 
are patient-centered management and support services.
    In section II.H. of this CY 2013 PFS final rule with comment 
period, we discuss our broader HHS and CMS multi-year strategy to 
recognize and support primary care and care management under the PFS 
and commitment to exploring payment approaches and developing proposals 
to promote primary care within a fee-for-service payment structure. We 
intend to consider CPT codes 99487 (Complex chronic care coordination 
services; first hour of clinical staff time directed by a physician or 
other qualified health care professional with no face-to-face visit, 
per calendar month), 99488 (Complex chronic care coordination services; 
first hour of clinical staff time directed by a physician or other 
qualified health care professional with one face-to-face visit, per 
calendar month), and 99489 (Complex chronic care coordination services; 
each additional 30 minutes of clinical staff time directed by a 
physician or other qualified health care professional, per calendar 
month (list separately in addition to code for primary procedure)) as 
part of that larger discussion. At this time, we believe these services 
are bundled into the services to which they are incident and are not 
separately payable. The AMA RUC recommended a work RVU of 1.00 for CPT 
code 99487, a work RVU of 2.50 for CPT code 99488, and a work RVU of 
0.50 for CPT code 99489. On an interim final basis for CY 2013, we are 
assigning CPT codes 99487, 99488, and 99489 a PFS procedure status 
indicator of B (Payments for covered services are always bundled into 
payment for other services, which are not specified. If RVUs are shown, 
they are not used for Medicare payment. If these services are covered, 
payment for them is subsumed by the payment for the services to which 
they are bundled).
(40) Transitional Care Management Services

[[Page 69071]]



                                                     Table 71--Transitional Care Management Services
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
99495................  Trans care mgmt 14  New..................  2.11................  2.11................  Agree...............  No.
                        day disch.
99496................  Trans care mgmt 7   New..................  3.05................  3.05................  Agree...............  Yes.
                        day disch.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The CPT Editorial Panel created CPT codes 99495 and 99496 for CY 
2013 to describe transitional care provided to patients from an 
inpatient setting to a home setting over a 30-day period.
    CPT codes 99495 (Transitional care management services with the 
following required elements: Communication (direct contact, telephone, 
electronic) with the patient and/or caregiver within 2 business days of 
discharge medical decision making of at least moderate complexity 
during the service period face-to-face visit, within 14 calendar days 
of discharge) and 99496 (Transitional care management services with the 
following required elements: Communication (direct contact, telephone, 
electronic) with the patient and/or caregiver within 2 business days of 
discharge medical decision making of high complexity during the service 
period face-to-face Visit, within 7 calendar days of discharge) are 
discussed in detail in section III.H of this CY 2013 PFS final rule 
with comment period. In sum, after clinical review, we are assigning a 
work RVU of 2.11 with 40 minutes of intra-service time to CPT code 
99495, and a work RVU of 3.05 with 50 minutes of intra-service time to 
CPT codes 99496 on an interim final basis for CY 2013.
(41) Physician Documentation of Face-to-Face visit for Durable Medical 
Equipment (DME)

                               Table 72--Physician Documentation of Face-to-Face Visit for Durable Medical Equipment (DME)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                          CY 2013  interim/    Agree/disagree with   CMS  refinement to
      HCPCS code        Short descriptor      CY 2012 work RVU        AMA RUC/HCPAC      interim final work       AMA RUC/HCPAC           AMA/HCPAC
                                                                  recommended work RVU           RVU          recommended work RVU    recommended time
--------------------------------------------------------------------------------------------------------------------------------------------------------
G0454................  MD document visit   New..................  N/A.................  0.18................  N/A.................  N/A.
                        by NPP.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Effective January 1, 2013, we have created HCPCS code G0454 
(Physician documentation of face-to-face visit for Durable Medical 
Equipment determination performed by Nurse Practitioner, Physician 
Assistant or Clinical Nurse Specialist) for payment to a physician who 
documents that a PA, NP, or CNS practitioner has performed a face-to-
face encounter for the list of specified DME covered items. As 
discussed in section IV.C. of this CY 2013 PFS final rule with comment 
period, for HCPCS code G0454, we are finalizing a work RVU of 0.18, 
with 5 minutes of intra-service time and 2 minutes of post-service 
time, which is a crosswalk to CPT code 99211 (Level 1 office or other 
outpatient visit, established patient). We believe these values 
appropriately capture the work and time involved in furnishing this 
service.
(42) Other CY 2013 New, Revised, and Potentially Misvalued CPT Codes 
Not Specifically Discussed Previously
    For all other CY 2013 new, revised and potentially misvalued CPT 
codes not specifically discussed previously, we agree with the AMA RUC/
HCPAC recommended work RVUs and times and are setting as interim final 
the work RVUs listed in Table 30.
3. Establishing Interim and Interim Final Direct PE RVUs for CY 2013
b. Establishing Interim Final Direct PE RVUs for CY 2013
i. Background
    The AMA RUC provides CMS with recommendations regarding direct PE 
inputs, including clinical labor, supplies, and equipment, for new, 
revised, and potentially misvalued codes. We review the AMA RUC-
recommended direct PE inputs on a code-by-code basis, including the 
recommended facility PE inputs and/or nonfacility PE inputs, as 
clinically appropriate for the code. We determine whether we agree with 
the AMA RUC's recommended direct PE inputs for a service or, if we 
disagree, we refine the PE inputs to represent inputs that better 
reflect our estimate of the PE resources required to furnish the 
service in the facility and/or nonfacility settings. We also confirm 
that CPT codes should have facility and/or nonfacility direct PE inputs 
and make changes based on our clinical judgment and any PFS payment 
policies that would apply to the code.
ii. Methodology
    We have accepted for CY 2013, as interim and without refinement, 
the direct PE inputs based on the recommendations submitted by the AMA 
RUC for the codes listed in Table KK6. For the remainder of the AMA 
RUC's direct PE recommendations, we have accepted the PE 
recommendations submitted by the AMA RUC as interim, but with 
refinements. These codes and the refinements to their direct PE inputs 
are listed in Table KK7. In some cases, we have maintained the interim 
status of direct PE inputs for certain code beyond the year of the 
initial recommendation. In those cases, we address the associated 
direct PE inputs in this section, along with the interim direct PE 
inputs, established through our review of AMA RUC recommendations.
    We note that the final CY 2013 PFS direct PE input database 
reflects the refined direct PE inputs that we are adopting on an 
interim basis for CY 2013. That database is available under downloads 
for the CY 2013 PFS final rule with comment period on the CMS Web site 
at: http://www.cms.gov/PhysicianFeeSched/PFSFRN/list.asp#TopOfPage. We 
also note that the PE RVUs displayed in Addenda B and C reflect the 
interim values and policies described in this section. All codes 
adopted on an interim basis are

[[Page 69072]]

included in Addenda C and are open for comment.
iii. Common and Code-Specific Refinements
    While Table KK7 details the CY 2013 refinements of the AMA RUC's 
direct PE recommendations at the code-specific level, we discuss the 
general nature of some common refinements and the reasons for 
particular refinements in the following section.
(a) Changes in Physician Time
    Some direct PE inputs are directly affected by revisions in 
physician time described in section III.B.3. and III.M.3.a. of this 
final rule with comment period. Specifically, changes in the intra-
service portions of the physician time and changes in the number or 
level of postoperative visits associated with the global periods result 
in corresponding changes to direct PE inputs.
    Changes in Intra-service Physician Time in the Nonfacility Setting. 
For most codes valued in the nonfacility setting, a portion of the 
clinical labor time allocated to the intra-service period reflects 
minutes assigned for assisting the physician with the procedure. To the 
extent that we are refining the times associated with the intra-service 
portion of such procedures, we have adjusted the corresponding intra-
service clinical labor minutes in the nonfacility setting.
    For equipment associated with the intra-service period in the 
nonfacility setting, we generally allocate time based on the typical 
number of minutes a piece of equipment is being used and, therefore, 
not available for use with another patient during that period. In 
general, we allocate these minutes based on the description of typical 
clinical labor activities. To the extent that we are making changes in 
the clinical labor times associated with the intra-service portion of 
procedures, we have adjusted the corresponding equipment minutes 
associated with the codes.
    Changes in the Number or Level of Postoperative Office Visits in 
the Global Period. For codes valued with post-service physician office 
visits during a global period, most of the clinical labor time 
allocated to the post-service period reflects a standard number of 
minutes allocated for each of those visits. To the extent that we are 
refining the number or level of postoperative visits, we have modified 
the clinical staff time in the post-service period to reflect the 
change. For codes valued with post-service physician office visits 
during a global period, we allocate standard equipment for each of 
those visits. To the extent that we are making a change in the number 
or level of postoperative visits associated with a code, we have 
adjusted the corresponding equipment minutes. For codes valued with 
post-service physician office visits during a global period, a certain 
number of supply items are allocated for each of those office visits. 
To the extent that we are making a change in the number of 
postoperative visits, we have adjusted the corresponding supply item 
quantities associated with the codes. We note that many supply items 
associated with post-service physician office visits are allocated for 
each office visit (for example, a minimum multi-specialty visit pack 
(SA048) in the CY 2012 direct PE database). For these supply items, the 
quantities in the direct PE database should reflect the number of 
office visits associated with the code's global period. However, some 
supply items are associated with post-service physician office visits 
but are only allocated once during the global period because they are 
typically used during only one of the post-service office visits (for 
example, pack, post-op incision care (suture) (SA054) in the direct PE 
database). For these supply items, the quantities in the proposed 
notice direct PE database reflect that single quantity.
    These refinements are reflected in the final CY 2013 PFS direct PE 
input database and detailed in Table 73.
(b) Equipment Minutes
    In general, the equipment time inputs reflect the sum of the times 
within the intra-service period when a clinician is using the piece of 
equipment, plus any additional time the piece of equipment is not 
available for use for another patient due to its use during the 
designated procedure. While some services include equipment that is 
typically unavailable during the entire clinical labor service period, 
certain highly technical pieces of equipment and equipment rooms are 
less likely to be used by a clinician for all tasks associated with a 
service and therefore are typically available for other patients during 
the pre-service and post-service components of the service period. We 
adjust those equipment times accordingly. We refer interested 
stakeholders to our extensive discussion of these policies in the CY 
2012 PFS final rule (76 FR 73182-73183). We are refining the CY 2013 
AMA RUC direct PE recommendations to conform to these equipment time 
policies. These refinements are reflected in the final CY 2013 PFS 
direct PE database and detailed in Table 73.
(c) Moderate Sedation Inputs
    In the CY 2012 PFS final rule (76 FR 73043-73049), we finalized a 
standard package of direct PE inputs for services where moderate 
sedation is considered inherent in the procedure. We are refining the 
CY 2013 AMA RUC direct PE recommendations to conform to these policies. 
These refinements are reflected in the final CY 2013 PFS direct PE 
database and detailed in Table 73.
(d) Standard Minutes for Clinical Labor Tasks
    In general, the minutes associated with certain clinical labor 
tasks are standardized depending on the type of procedure, its typical 
setting, its global period, and the other procedures with which it is 
typically reported. In the case of some services, the RUC has 
recommended a numbers of minutes either greater or less than time 
typically allotted for certain tasks. In those cases, CMS clinical 
staff has reviewed the deviations from the standards to determine their 
clinical appropriateness. Where CMS clinical judgment considers that 
the standard number of minutes generally accommodates the range of 
minutes likely to be typical for such activities, the recommended 
exceptions have not been accepted, and we have refined the interim 
final direct PE inputs to match the standard times for those tasks. 
Each of those refinements appears in Table 73.
(e) Digestive System (CPT Code 44705 and HCPCS Code G0455)
    The CPT Editorial Panel created CPT code 44705 (Preparation of 
fecal microbiota for instillation, including assessment of donor 
specimen) and the AMA RUC recommended nonfacility direct PE inputs for 
this service for CY 2013. As discussed in section III.M.3.a. of this 
final rule, Medicare payment for the preparation of the donor specimen 
would only be made if the specimen is ultimately used for the treatment 
of a beneficiary. Because of this policy, we believe it is appropriate 
to bundle the preparation and instillation into one payable HCPCS code. 
For CY 2013, we have created HCPCS code G0455 (Preparation with 
instillation of fecal microbiota by any method, including assessment of 
donor specimen). HCPCS code G0455 will replace new CPT code 44705 
(Preparation of fecal microbiota for instillation, including assessment 
of donor specimen) which will have a PFS procedure status indicator of 
I (Not valid for Medicare purposes), and includes both the work of 
preparation and instillation of the microbiota.

[[Page 69073]]

    In order to establish direct PE inputs for this service that 
includes both the preparation and instillation, we examined the AMA RUC 
recommendations for CPT code 44705 and incorporated an additional 17 
minutes of clinical labor time in the service period to account for 
pre-service activities like greeting and gowning the beneficiary, 
obtaining the vital signs, providing pre-education/obtaining consent, 
preparing the room and equipment, and preparing the patient and post-
service activities like cleaning the room and providing home care 
instructions to the beneficiary, based on the amount of time allocated 
for those services in the direct PE inputs for evaluation and 
management services. We note that we have also included a minimum 
multi-specialty visit pack (SA048) as a supply input for the code and 
otherwise crosswalked the AMA RUC-recommended supply and equipment 
inputs from CPT code 44705.
(f) Diagnostic Radiology: Abdomen (CPT Codes 72191, 72192, 72193, 
72194, 74150, 74160, 74170, 74174, 74175, 74176, 74177, 74178)
    Generally, we only establish interim final direct PE inputs for 
services when the RUC has provided a new recommendation. However, in 
some cases, we believe it is necessary to establish new interim final 
direct PE inputs for codes not recently reviewed by the RUC in order to 
maintain appropriate relativity between the PE and work components of 
PFS payment or among those codes and other related codes. For example, 
this situation can occur when either the physician work of particular 
codes has been reviewed without parallel review of the direct PE inputs 
or when the direct PE inputs of certain codes have been reviewed 
without parallel review of the direct PE inputs of closely related 
codes. We addressed the issue in detail in the CY 2012 PFS final rule 
(76 FR 73212).
    Over the past several years, AMA CPT has created codes for 
diagnostic radiology services that describe CT and computed tomographic 
angiography (CTA) of the abdomen and pelvis combined while maintaining 
the current component codes that describe CT and CTA of each region 
separately. In reviewing both the physician work and the direct PE 
inputs for these services, we have consistently requested that 
recommendations for appropriate valuation of these services consider 
the whole code set at once.
    In response to this request, commenters contended that the AMA RUC 
operates under the premise that the values of all the services paid on 
the PFS are assumed to be accurate and therefore, our request to review 
component codes is unnecessary and that reviewing and possibly 
revaluing individual codes solely because they are bundled to create a 
new code, risks rank-order anomalies within families, which could 
threaten the relativity of the values of the PFS services. One 
commenter suggested that our requests would create an endless cycle of 
review.
    We continue to believe that code sets that include component and 
combined codes should be reviewed for appropriate revaluing as whole 
sets instead of in fragments. In fact, we believe that disjointed 
review, as opposed to comprehensive review, is itself the most likely 
cause of rank order anomalies and ``endless cycles of review.'' The Act 
requires CMS to conduct periodic reviews of PFS services 
[1848(c)(2)(B)] and make appropriate adjustments to misvalued codes 
[1848(c)(2)(K)]. In consideration of these obligations, we believe that 
the relative values for these codes must be considered as a whole set 
instead of in fragments. In the interest of examining the direct PE 
inputs of these services as a comprehensive set, we have reviewed the 
direct PE inputs for all of the abdomen and pelvis CT codes and all of 
the abdomen and pelvis CTA codes as two individual sets. We have 
started from the basis that the most recently developed AMA RUC 
recommendation represents the most current information regarding 
typical medical practice. For each set of codes, we have established a 
common set of disposable supplies and medical equipment. We established 
clinical labor minutes that reflect the fundamental assumption that the 
component codes should include a base number of minutes for particular 
tasks and that the number of minutes in the combined codes should 
reflect efficiencies that occur when the regions are examined together.
    We are establishing the direct PE input for each of these services 
on an interim basis for CY 2013, and we have displayed particular 
refinements to the most recent AMA RUC recommendations or current 
direct PE inputs for the codes in Table 73.
    Regarding the supply item called ``computer media, optical disk 
2.6gb'' (SK016), we note that the most recent AMA RUC recommendation 
included the item with a quantity of 1 as a disposable supply. When 
reviewing the item in the direct PE input database, we noted that its 
quantity for other similar codes is 0.1. We believe that quantity 
better reflects the resource costs of storing digital images for these 
services. We also note that the item is currently priced at $68.75 in 
the direct PE input database, and we believe that price may be 
significantly higher than typical prices. Therefore, we are seeking 
comment on the appropriate quantity and price for the item, which will 
be set at a quantity of 0.1 for these services on an interim basis for 
CY 2013.
    Finally, we note that the direct PE inputs for these services will 
not be finalized until the associated work RVUs are finalized, 
consistent with our established policies regarding the concurrent 
review of work and direct practice expense inputs.
(g) Nuclear Medicine: Diagnostic (CPT Code 78072)
    When clinically appropriate, the AMA RUC generally recommends the 
use of supply and equipment items that already exist in the direct PE 
database for new, revised, and potentially misvalued codes. Some 
recommendations include supply or equipment items that are not 
currently in the direct PE database. In these cases, the AMA RUC has 
historically recommended a new item be created and has facilitated CMS' 
pricing of that item by working with the specialty societies to provide 
sales invoices to us. We appreciate the contributions of the AMA RUC in 
that process.
    We received invoices for several new supply and equipment items for 
CY 2013. We have accepted the majority of these items and added them to 
the direct PE database. For CY 2013, we could not price the new 
equipment for CPT code 78072 (Parathyroid planar imaging (including 
subtraction, when performed); with tomographic (SPECT), and 
concurrently acquired computed tomography (CT) for anatomical 
localization). We received a recommendation to create a new equipment 
item in the direct PE database called ``gamma camera system, single-
dual head SPECT/CT'' for use in furnishing this service in the 
nonfacility setting. In order to facilitate pricing the new item, the 
AMA RUC forwarded information from the specialty society, but that 
information only included a letter from the device manufacturer that 
offered a price quote. While we recognize that the resource costs for 
the equipment is significant, we do not believe that a letter from the 
manufacturer is adequate documentation for establishing a price for a 
new equipment item. In many cases when we cannot adequately price a 
newly recommended item, we have included the item in the direct PE 
input database without an associated price. While doing so means that 
the item does not contribute to the calculation of the

[[Page 69074]]

PE RVU for particular services, it facilitates our ability to 
incorporate a price once we are able to do so. However, in the case of 
this new CPT code, because the cost of the item we cannot currently 
price is disproportionately large relative to the costs reflected by 
remainder of the recommended direct PE inputs, we are contractor 
pricing the technical component of the code for CY 2013, on an interim 
basis, until the newly recommended equipment item can be appropriately 
priced.
(h) Pathology and Laboratory: Chemistry (CPT Code 86153)
    The AMA RUC submitted direct PE input recommendations for CPT code 
86153 (Cell enumeration using immunologic selection and identification 
in fluid specimen (eg, circulating tumor cells in blood); physician 
interpretation and report, when required) that describes a laboratory 
physician interpretation code. As we discuss in section III.M.3.a. of 
this final rule with comment period, CPT code 86153 is a professional 
component-only CPT code that will be considered a ``clinical laboratory 
interpretation service,'' which is one of the current categories of PFS 
pathology services under the definition of physician pathology services 
at Sec.  415.130(b)(4). This code must be billed with the ``26'' 
modifier to be paid under the PFS. Therefore, CPT code 86153-26 should 
be valued exclusively without direct practice expense inputs. 
Therefore, we are not accepting the recommended direct PE inputs for 
CPT code 86153.
(i) Pathology and Laboratory: Surgical Pathology (CPT Codes 88300, 
88302, 88304, 88305, 88307, 88309)
    For surgical pathology CPT codes 88300, 88302, 88304, 88305, 88307, 
88309 (Surgical Pathology, Levels I through VI), the AMA RUC 
recommended creating several new supply and equipment items in direct 
PE input database that we will not incorporate for CY 2013 in addition 
to several new direct PE inputs that we are adopting on an interim 
basis. The new supply items that we will not incorporate were called 
``specimen, solvent, and formalin disposal cost,'' and ``courier 
transportation costs.'' We do not believe that specimen and supply 
disposal or courier costs for transporting specimens are appropriately 
considered as disposable medical supplies. Instead, we believe the 
costs described by these recommendations are incorporated into the PE 
RVUs for these services through the indirect PE allocation. We note 
that the current direct PE inputs for these and similar services across 
the PFS do not include these kinds of costs as disposable supplies.
    In addition to the recommendation to include these new supply 
items, the AMA RUC recommended that we create new equipment items 
called ``equipment maintenance cost,'' ``Copath System with maintenance 
contract,'' and ``Copath software'' as direct PE inputs for these 
codes. Our standard equipment cost per minute calculation includes a 
maintenance factor to incorporate costs related to maintenance in 
amortizing the cost of the equipment itself. Therefore, we will not 
incorporate separate maintenance costs for particular items. Regarding 
the ``Copath'' system and software equipment, the AMA RUC forwarded 
materials from a manufacturer that included a description of a computer 
system that is used to interface with other data systems to provide 
inbound demographic information and export laboratory results and 
billing information. Based on the way those functionalities were 
presented in this information, we believe that this computer system and 
associated software reflects an indirect practice expense since the 
clerical and other administrative functionality seem central to its 
purpose. We note that no similar equipment is currently included as a 
direct PE input for these services. All direct PE inputs for these 
services are interim for CY 2013 and open to comment. We would consider 
additional information regarding whether this computer system and 
associated software might be considered a direct cost as medical 
equipment associated with furnishing the technical component of these 
surgical pathology services for CY 2014 rulemaking. We are especially 
interested in understanding the clinical functionality of the equipment 
in relation to the services being furnished.
    In addition to this information, we are also seeking additional 
public comment regarding the appropriate assumptions regarding the 
direct PE inputs for these services. We note that the AMA RUC 
recommendations for these potentially misvalued codes were developed 
based on an underlying assumption regarding the typical number of 
blocks used each time a service is reported. The number of blocks 
assumed to be used has significant impact on the quantity of other 
supplies and the number of clinical labor and equipment minutes 
assigned as direct PE inputs to each code. After conducting an initial 
clinical review of these direct PE inputs, we are concerned that the 
number of blocks assumed for each code may be inaccurate. For 88300, no 
blocks are assumed. For 88302, one block is assumed. For 88304 and 
88305, the assumed number of blocks typically used is 2. For 88307, the 
assumed number of blocks is 12 and for 88309, the typical number of 
blocks is assumed to be 18. We are accepting the AMA RUC's recommended 
direct PE inputs that derive from these assumptions on an interim basis 
for CY 2013, but we are seeking independent evidence regarding the 
appropriate number of blocks to assume as typical for each of these 
services. We are requesting public comment regarding the appropriate 
number of blocks and urge the AMA RUC and interested medical specialty 
societies to provide corroborating, independent evidence that the 
number of blocks assumed in the current direct PE input recommendations 
is typical prior to finalizing the direct PE inputs for these services.
(j) Pathology and Laboratory: Cytopathology (CPT Codes 88120 and 88121)
    The CPT Editorial Panel created CPT codes 88120 (Cytopathology, in 
situ hybridization (eg, FISH), urinary tract specimen with morphometric 
analysis, 3-5 molecular probes, each specimen; manual) and 88121 
(Cytopathology, in situ hybridization (eg, FISH), urinary tract 
specimen with morphometric analysis, 3-5 molecular probes, each 
specimen; using computer-assisted technology) to describe in situ 
hybridization testing using urine samples, effective for CY 2011.
    As we explain in section III.M.3.a. of this final rule with comment 
period, we believe that the work and direct PE inputs for existing CPT 
codes 88365, 88367, and 88368 should be reviewed alongside CPT codes 
88120 and 88121 to ensure the appropriate relativity between these two 
sets of services (76 FR 73153 through 73154). The AMA RUC has stated 
that it intends to do so after CY 2012 utilization data are available 
to assess how these services are being billed. We agree with this 
approach, and are maintaining the interim status for the direct PE 
inputs for CPT code 88120 and 88121 until we review CPT codes 88120 and 
88121 alongside CPT codes 88365, 88367, and 88368 for CY 2014.
    Distinct from that forthcoming review, stakeholders have informed 
us of two separate issues related to the interim direct PE inputs for 
these services. Two stakeholders have examined the AMA RUC 
recommendations and found miscalculations in the recommended equipment 
minutes. The information we

[[Page 69075]]

reviewed suggested that that the recommended times of 107 minutes for 
the ThemoBrite equipment (EP088) for 88120 and 26.75 minutes for 88121 
were derived in error because the division for the typical batch sizes 
of 3 and 6, respectively, occurred twice. The stakeholders also 
presented information that the recommended minutes for the Olympus BX41 
Fluorescent Microscope (without filters or camera) (EP092) as a direct 
PE input for CPT code 88120 ought to have been 73 minutes, instead of 
1.33 minutes. Finally, the stakeholders provided information suggesting 
the minutes for the IkoniScope (EP090) and IkoniLan software (EP091) 
included as direct PE inputs for CPT code 88121 were intended to be 
29.7 minutes, instead of 2.97. Upon clinical review of this 
information, we agree with the stakeholders regarding the intention of 
these recommendations, and have refined the CY 2013 direct PE input 
database accordingly.
    These stakeholders also suggested that CMS should increase the 
price of the supply ``UroVysion test kit'' (SA105) by building in an 
``efficiency factor'' to account for the kits that are purchased by 
practitioners and used in tests that fail. The stakeholders provided 
documentation suggesting that a certain failure rate is inherent in the 
procedure.
    The prices associated with supply inputs in the direct PE input 
database reflect the price per unit of each supply. Since the current 
PE methodology relies on the inputs for each service reflecting the 
typical direct practice expense costs for each service, and the supply 
costs for the failed tests are not used in furnishing PFS services, we 
do not believe that the methodology accommodates a failure rate in 
allocating the cost of disposable medical supplies. Therefore, we are 
not adjusting the price input for ``UroVysion test kit'' (SA105) in the 
direct PE input database.
(j) Psychiatry (CPT Codes 90791, 90832, 90834, 90837)
    For CY 2013, the CPT Editorial Panel has replaced the current 
psychiatry/psychotherapy CPT codes with a new structure that allows for 
the separate reporting of E/M codes, eliminates the site-of-service 
differential, establishes CPT codes for crisis, and creates a series of 
add-on CPT codes to psychotherapy to describe interactive complexity 
and medication management. As we note in section III.M.3.a. of this 
final rule with commenter period, because related specialty societies 
have not yet surveyed some of the new CPT codes, namely, the new CPT 
codes for psychotherapy for crisis, interactive complexity, and 
pharmacologic management, we anticipate re-reviewing the values for all 
the codes in the family in the near future. For CY 2013, our general 
approach is to maintain the current values, or as close to the current 
values as possible, given the consolidation of multiple CY 2012 CPT 
codes into a single CY 2013 CPT code, for these service on an interim 
basis, pending re-review.
    The AMA RUC submitted direct PE input recommendations for codes in 
this family that included significant reductions in the direct PE costs 
associated with the predecessor codes. For most of the new codes, we 
believe that accepting these recommended reductions in direct practice 
expense conforms to our general approach of maintaining the current 
values for these services since many practitioners who furnish these 
services will now report concurrent medical evaluation and management 
services with PE values that will offset the differences in total PE 
values between the new and old psychotherapy codes. However, for 
practitioners who do not furnish medical evaluation and management 
services, there are no corresponding PE value increases to offset the 
recommended reductions in the direct PE inputs for these codes. 
Therefore, instead of accepting the recommended direct PE inputs for 
the new CPT codes that describe services primarily furnished by 
practitioners who do not also report medical evaluation and management 
services, we will crosswalk the PE RVUs from the CY 2012 codes that 
describe the same services. We believe this crosswalk will effectively 
maintain the total value of the services, pending a comprehensive 
review of the code family. The CPT codes with CY 2013 PE RVU crosswalks 
are: 90791 (Psychiatric diagnostic evaluation), 90832 (Psychotherapy, 
30 minutes with patient and/or family member), 90834 (Psychotherapy, 45 
minutes with patient and/or family member), and 90837 (Psychotherapy, 
60 minutes with patient and/or family member). For CY 2013, we are 
crosswalking the PE RVUs developed for the predecessor codes for CY 
2012. We note that the PE RVUs used for these services will correspond 
with the CY 2013 fully implemented values instead of the transition 
values since this interim policy is to maintain the current values 
relative to the new coding structure for the services, not exempt the 
services from the final year of the PPIS transition, as described in 
section III.A. of this final rule with comment period. The values in 
Addendum C reflect the interim PE RVUs for these codes.
(k) Medicine: Gastroenterology (CPT Code 91112)
    The AMA RUC submitted direct PE input recommendations for CPT code 
91112 (Gastrointestinal transit and pressure measurement, stomach 
through colon, wireless capsule, with interpretation and report). The 
recommendations reflect an assumption that the patient data receiver 
would be typically used for 7200 minutes, or 5 days, for each service. 
However, product information available on the device manufacturer's Web 
site specifies a 24 to 48 hour capsular passage time. Based on this 
information and CMS clinical review, we believe that assigning 2880 
minutes to the data receiver is appropriate based on the assumption 
that 2 days reflects the maximum typical time for passage of the 
capsule. We also note that while the AMA RUC's recommendation included 
the capsule and standardized meal as separate disposable items, the 
submitted invoice priced the items together, so the new supply item 
created in the direct PE input database reflects the combined items as 
a single disposable supply.
(l) Neurology and Neuromuscular Procedures: Intraoperative 
Neurophysiology (CPT Codes 95940, 95941 and HCPCS Code G0453)
    Effective January 1, 2013, the CPT Editorial Panel is deleting CPT 
code 95920 (Intraoperative neurophysiology testing, per hour (List 
separately in addition to code for primary procedure)), and is 
replacing it with CPT codes 95940 (Continuous intraoperative 
neurophysiology monitoring in the operating room, one on one monitoring 
requiring personal attendance, each 15 minutes) and CPT code 95941 
(Continuous intraoperative neurophysiology monitoring, from outside the 
operating room (remote or nearby) or for monitoring of more than one 
case while in the operating room, per hour).
    As we note in section III.M.3.a. of this final rule with comment 
period, we have created HCPCS code G0453 (Continuous intraoperative 
neurophysiology monitoring, from outside the operating room (remote or 
nearby), per patient, (attention directed exclusively to one patient) 
each 15 minutes (list in addition to primary procedure)), effective 
January 1, 2013 to replace CPT code 95941 for Medicare purposes. CPT 
code 95941 will have a PFS procedure status indicator of I (Not valid 
for Medicare purposes. Medicare uses another code for the reporting of

[[Page 69076]]

and the payment for these services) for CY 2013. CPT code 95940, which 
describes continuous intraoperative neurophysiology monitoring in the 
operating room for one patient at a time, will be payable on the PFS 
for CY 2013.
    The AMA RUC provided direct PE input recommendations for CPT codes 
95940 and 95941. However, we do not believe that these services are 
furnished to patients outside of facility settings. Medicare makes 
payment for technical inputs (labor, supplies, equipment, capital, and 
overhead) to the facility when services are performed in a facility 
setting. For these services, the patient would receive this service in 
the ASC or hospital setting and payment for any technical services, 
including those for remote monitoring, should be included in the 
facility payment. We do not believe it would be appropriate to 
incorporate nonfacility direct PE inputs or develop nonfacility PE RVUs 
for CPT code 95940 and newly created HCPCS code G0453 for CY 2013. We 
do not believe that these services incur PFS direct practice expense 
costs when furnished to patients in the facility setting. Therefore, we 
are developing facility PE RVUs for this service based on no direct PE 
inputs.
(m) Neurology and Neuromuscular Procedures: Sleep Medicine Testing CPT 
Codes 95782, 95783)
    The AMA RUC submitted direct PE input recommendations for new CPT 
codes describing pediatric polysomonography: 95782 (Polysomnography, 
younger than 6 years, 4 or more) and 95783 (Polysomnography, younger 
than 6 years, w/cpap). We note that in addition to refining minutes 
assigned to certain labor tasks based on CMS clinical judgment, we have 
not accepted the AMA RUC's recommendation to create a new equipment 
item `crib' for use in these services. We do not believe that a crib 
would typically be used in this service, and we have incorporated the 
bedroom furniture including a hospital bed and a reclining chair as 
typical equipment for this service.
(n) Special Dermatological Procedures (CPT Codes 96920, 96921, 96922)
    The AMA RUC provided new direct PE input recommendations for CPT 
codes 96920(Laser treatment for inflammatory skin disease (psoriasis); 
total area less than 250 sq cm), 96921 (Laser treatment for 
inflammatory skin disease, (psoriasis); between 250 sq cm to 500 sq 
cm), and 96922 (Laser treatment for inflammatory skin disease, 
(psoriasis); over 500 sq cm).
    Included in the new direct PE inputs for these services was a 
disposable laser tip (SF028). This disposable item, priced at $290 in 
the direct PE input database, was not previously included as a direct 
PE input for these services. The recommendation did not provide a 
rationale as to why this highly priced disposable should be included as 
a direct PE input for these existing services when the codes have not 
previously included this item or any similarly priced disposable 
supply. Therefore, we are refining the RUC recommendation by removing 
the supply item SF028 from 96920, 96921, and 96922. We note that the 
direct PE inputs for these codes are interim for CY 2013, and we will 
consider any additional information and public comments regarding the 
typical use of this supply in furnishing these services prior to 
finalizing the direct PE inputs for CY 2014.
(o) Transitional Care Management Services (CPT Codes 99495, 99496)
    The CPT Editorial Panel created CPT codes 99495 and 99496 for CY 
2013 to describe transitional care provided to patients from an 
inpatient setting to a home setting over a 30-day period. The AMA RUC 
submitted direct PE input recommendations for these services that we 
are accepting with the following refinements.
    As discussed in detail in section III.H of this CY 2013 PFS final 
rule with comment, we agree with the AMA RUC recommendation to include 
45 minutes of RN/LPN time for CPT code 99495 for dedicated to non-face-
to-face care management activities. However, for CPT code 99496, we are 
refining the 60 minutes of recommended clinical labor time for a RN/LPN 
nurse blend dedicated to non-face-to-face care management activities 
from 60 minutes to 70 minutes. We believe that the total clinical labor 
staff time and physician intra-service work time that the AMA RUC-
recommended for non-face-to-face care management activities was 
accurate for both codes, but that the proportionality between physician 
work and clinical staff time should be refined to reflect greater 
clinical staff time in 99496.
    We also note that we are refining the AMA RUC recommendation by 
incorporating the clinical labor inputs for dedicated to non-face-to-
face care management activities as facility inputs.

 Table 73--CPT Codes With Accepted Direct PE Recommendations for CY 2013
                              Interim Codes
------------------------------------------------------------------------
             CPT code                       CPT code description
------------------------------------------------------------------------
20985.............................  Cptr-asst dir ms px.
24160.............................  Remove elbow joint implant.
24371.............................  Revise reconst elbow joint.
29828.............................  Arthroscopy biceps tenodesis.
31648.............................  Bronchial valve addl insert.
31649.............................  Bronchial valve remov init.
31651.............................  Bronchial valve remov addl.
31660.............................  Bronch thermoplsty 1 lobe.
31661.............................  Bronch thermoplsty 2/> lobes.
33430.............................  Replacement of mitral valve.
33533.............................  Cabg arterial single.
36227.............................  Place cath xtrnl carotid.
37211.............................  Thrombolytic art therapy.
37212.............................  Thrombolytic venous therapy.
37213.............................  Thromblytic art/ven therapy.
37214.............................  Cessj therapy cath removal.
66982.............................  Cataract surgery complex.
66984.............................  Cataract surg w/iol 1 stage.
77082.............................  Dxa bone density vert fx.
90792.............................  Psych diag eval w/med srvcs.
90833.............................  Psytx pt&/fam w/e&m 30 min.
90837.............................  Psytx pt&/family 60 minutes.
90838.............................  Psytx pt&/fam w/e&m 60 min.
90845.............................  Psychoanalysis
90846.............................  Family psytx w/o patient.
90847.............................  Family psytx w/patient.
90853.............................  Group psychotherapy.
92286.............................  Internal eye photography.
93016.............................  Cardiovascular stress test.
93018.............................  Cardiovascular stress test.
95017.............................  Perq & icut allg test venoms.
95018.............................  Perq⁣ allg test drugs/biol.
95079.............................  Ingest challenge addl 60 min.
95860.............................  Muscle test one limb.
95866.............................  Muscle test hemidiaphragm.
95867.............................  Muscle test cran nerv unilat.
95869.............................  Muscle test thor paraspinal.
95870.............................  Muscle test nonparaspinal.
95925.............................  Somatosensory testing.
95926.............................  Somatosensory testing.
95928.............................  C motor evoked uppr limbs.
95929.............................  C motor evoked lwr limbs.
95938.............................  Somatosensory testing.
95939.............................  C motor evoked upr&lwr limbs.
------------------------------------------------------------------------


[[Page 69077]]


                                  Table 74--CPT Codes With Refined Direct PE Recommendations for CY 2013 Interim Codes
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                             AMA RUC
                                                                                                         recommendation        CMS
    CPT code         CPT code          CMS code         CMS code         Nonfactor/      Labor activity    or current      refinement        Comment
                    description                        description         factor       (if applicable)  value  (min or   (min or qty)
                                                                                                              qty)
--------------------------------------------------------------------------------------------------------------------------------------------------------
11300..........  Shave skin        ED004..........  camera, digital   NF..............  ...............              29              14  Refined
                  lesion 0.5 cm/<.                   (6 mexapixel).                                                                       equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF014..........  light, surgical.  NF..............  ...............              29              14  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............              29              14  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              29              14  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ110..........  electrocautery-   NF..............  ...............              29               0  CMS clinical
                                                     hyfrecator, up                                                                       review; not
                                                     to 45 watts.                                                                         described as
                                                                                                                                          typical in
                                                                                                                                          work vignette.
                                   EQ137..........  instrument pack,  NF..............  ...............              29              24  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              29              14  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Clean Surgical                1              10  Standardized
                                                                                         Instrument                                       time input.
                                                                                         Package.
                                   SB003..........  cover, probe      NF..............  ...............               1               0  CMS clinical
                                                     (cryosurgery).                                                                       review.
                                   SB027..........  gown, staff,      NF..............  ...............               2               1  Duplicative.
                                                     impervious.
                                   SB033..........  mask, surgical..  NF..............  ...............               2               1  Duplicative.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
11301..........  Shave skin        ED004..........  camera, digital   NF..............  ...............              32              17  Refined
                  lesion 0.6-1.0                     (6 mexapixel).                                                                       equipment time
                  cm.                                                                                                                     to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF014..........  light, surgical.  NF..............  ...............              32              17  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............              32              17  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              32              17  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ110..........  electrocautery-   NF..............  ...............              32               0  CMS clinical
                                                     hyfrecator, up                                                                       review; not
                                                     to 45 watts.                                                                         described as
                                                                                                                                          typical in
                                                                                                                                          work vignette.
                                   EQ137..........  instrument pack,  NF..............  ...............              32              27  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.

[[Page 69078]]

 
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              32              17  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Clean Surgical                1              10  Standardized
                                                                                         Instrument                                       time input.
                                                                                         Package.
                                   SB003..........  cover, probe      NF..............  ...............               1               0  CMS clinical
                                                     (cryosurgery).                                                                       review.
                                   SB027..........  gown, staff,      NF..............  ...............               2               1  Duplicative.
                                                     impervious.
                                   SB033..........  mask, surgical..  NF..............  ...............               2               1  Duplicative.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
11302..........  Shave skin        ED004..........  camera, digital   NF..............  ...............              37              20  Refined
                  lesion 1.1-2.0                     (6 mexapixel).                                                                       equipment time
                  cm.                                                                                                                     to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF014..........  light, surgical.  NF..............  ...............              37              20  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............              37              20  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              37              20  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ110..........  electrocautery-   NF..............  ...............              37               0  CMS clinical
                                                     hyfrecator, up                                                                       review; not
                                                     to 45 watts.                                                                         described as
                                                                                                                                          typical in
                                                                                                                                          work vignette.
                                   EQ137..........  instrument pack,  NF..............  ...............              37              30  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              37              20  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Clean Surgical                1              10  Standardized
                                                                                         Instrument                                       time input.
                                                                                         Package.
                                   SB003..........  cover, probe      NF..............  ...............               1               0  CMS clinical
                                                     (cryosurgery).                                                                       review.
                                   SB027..........  gown, staff,      NF..............  ...............               2               1  Duplicative.
                                                     impervious.
                                   SB033..........  mask, surgical..  NF..............  ...............               2               1  Duplicative.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
11303..........  Shave skin        ED004..........  camera, digital   NF..............  ...............              41              22  Refined
                  lesion >2.0 cm.                    (6 mexapixel).                                                                       equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF014..........  light, surgical.  NF..............  ...............              41              22  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............              41              22  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.

[[Page 69079]]

 
                                   EF031..........  table, power....  NF..............  ...............              41              22  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ110..........  electrocautery-   NF..............  ...............              41               0  CMS clinical
                                                     hyfrecator, up                                                                       review; not
                                                     to 45 watts.                                                                         described as
                                                                                                                                          typical in
                                                                                                                                          work vignette.
                                   EQ137..........  instrument pack,  NF..............  ...............              41              32  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              41              22  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Clean Surgical                1              10  Standardized
                                                                                         Instrument                                       time input.
                                                                                         Package.
                                   SB003..........  cover, probe      NF..............  ...............               1               0  CMS clinical
                                                     (cryosurgery).                                                                       review.
                                   SB027..........  gown, staff,      NF..............  ...............               2               1  Duplicative.
                                                     impervious.
                                   SB033..........  mask, surgical..  NF..............  ...............               2               1  Duplicative.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
11305..........  Shave skin        ED004..........  camera, digital   NF..............  ...............              29              17  Refined
                  lesion 0.5 cm/<.                   (6 mexapixel).                                                                       equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF014..........  light, surgical.  NF..............  ...............              29              17  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............              29              17  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              29              17  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ110..........  electrocautery-   NF..............  ...............              29               0  CMS clinical
                                                     hyfrecator, up                                                                       review; not
                                                     to 45 watts.                                                                         described as
                                                                                                                                          typical in
                                                                                                                                          work vignette.
                                   EQ137..........  instrument pack,  NF..............  ...............              29              27  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              29              17  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Clean Surgical                1              10  Standardized
                                                                                         Instrument                                       time input.
                                                                                         Package.
                                   SB003..........  cover, probe      NF..............  ...............               1               0  CMS clinical
                                                     (cryosurgery).                                                                       review.
                                   SB027..........  gown, staff,      NF..............  ...............               2               1  Duplicative.
                                                     impervious.
                                   SB033..........  mask, surgical..  NF..............  ...............               2               1  Duplicative.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.

[[Page 69080]]

 
11306..........  Shave skin        ED004..........  camera, digital   NF..............  ...............              31              17  Refined
                  lesion 0.6-1.0                     (6 mexapixel).                                                                       equipment time
                  cm.                                                                                                                     to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF014..........  light, surgical.  NF..............  ...............              31              17  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............              31              17  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              31              17  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ110..........  electrocautery-   NF..............  ...............              31               0  CMS clinical
                                                     hyfrecator, up                                                                       review; not
                                                     to 45 watts.                                                                         described as
                                                                                                                                          typical in
                                                                                                                                          work vignette.
                                   EQ137..........  instrument pack,  NF..............  ...............              31              27  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              31              17  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Assist                       10              18  Conforming to
                                                                                         physician in                                     physician
                                                                                         performing                                       time.
                                                                                         procedure.
                                   L037D..........  RN/LPN/MTA......  NF..............  Clean Surgical                1              10  Standardized
                                                                                         Instrument                                       time input.
                                                                                         Package.
                                   SB003..........  cover, probe      NF..............  ...............               1               0  CMS clinical
                                                     (cryosurgery).                                                                       review.
                                   SB027..........  gown, staff,      NF..............  ...............               2               1  Duplicative.
                                                     impervious.
                                   SB033..........  mask, surgical..  NF..............  ...............               2               1  Duplicative.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
11307..........  Shave skin        ED004..........  camera, digital   NF..............  ...............              37              21  Refined
                  lesion 1.1-2.0                     (6 mexapixel).                                                                       equipment time
                  cm.                                                                                                                     to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF014..........  light, surgical.  NF..............  ...............              37              21  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............              37              21  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              37              21  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ110..........  electrocautery-   NF..............  ...............              37               0  CMS clinical
                                                     hyfrecator, up                                                                       review; not
                                                     to 45 watts.                                                                         described as
                                                                                                                                          typical in
                                                                                                                                          work vignette.

[[Page 69081]]

 
                                   EQ137..........  instrument pack,  NF..............  ...............              37              31  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              37              21  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Clean Surgical                1              10  Standardized
                                                                                         Instrument                                       time input.
                                                                                         Package.
                                   SB003..........  cover, probe      NF..............  ...............               1               0  CMS clinical
                                                     (cryosurgery).                                                                       review.
                                   SB027..........  gown, staff,      NF..............  ...............               2               1  Duplicative.
                                                     impervious.
                                   SB033..........  mask, surgical..  NF..............  ...............               2               1  Duplicative.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
11308..........  Shave skin        ED004..........  camera, digital   NF..............  ...............              42              24  Refined
                  lesion >2.0 cm.                    (6 mexapixel).                                                                       equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF014..........  light, surgical.  NF..............  ...............              42              24  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............              42              24  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              42              24  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ110..........  electrocautery-   NF..............  ...............              42               0  CMS clinical
                                                     hyfrecator, up                                                                       review; not
                                                     to 45 watts.                                                                         described as
                                                                                                                                          typical in
                                                                                                                                          work vignette.
                                   EQ137..........  instrument pack,  NF..............  ...............              42              34  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              42              24  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Clean Surgical                1              10  Standardized
                                                                                         Instrument                                       time input.
                                                                                         Package.
                                   SB003..........  cover, probe      NF..............  ...............               1               0  CMS clinical
                                                     (cryosurgery).                                                                       review.
                                   SB027..........  gown, staff,      NF..............  ...............               2               1  Duplicative.
                                                     impervious.
                                   SB033..........  mask, surgical..  NF..............  ...............               2               1  Duplicative.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
11310..........  Shave skin        ED004..........  camera, digital   NF..............  ...............              34              20  Refined
                  lesion 0.5 cm/<.                   (6 mexapixel).                                                                       equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF014..........  light, surgical.  NF..............  ...............              34              20  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.

[[Page 69082]]

 
                                   EF015..........  mayo stand......  NF..............  ...............              34              20  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              34              20  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ110..........  electrocautery-   NF..............  ...............              34               0  CMS clinical
                                                     hyfrecator, up                                                                       review; not
                                                     to 45 watts.                                                                         described as
                                                                                                                                          typical in
                                                                                                                                          work vignette.
                                   EQ137..........  instrument pack,  NF..............  ...............              34              30  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              34              20  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Clean Surgical                1              10  Standardized
                                                                                         Instrument                                       time input.
                                                                                         Package.
                                   SB003..........  cover, probe      NF..............  ...............               1               0  CMS clinical
                                                     (cryosurgery).                                                                       review.
                                   SB027..........  gown, staff,      NF..............  ...............               2               1  Duplicative.
                                                     impervious.
                                   SB033..........  mask, surgical..  NF..............  ...............               2               1  Duplicative.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
11311..........  Shave skin        ED004..........  camera, digital   NF..............  ...............              34              18  Refined
                  lesion 0.6-1.0                     (6 mexapixel).                                                                       equipment time
                  cm.                                                                                                                     to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF014..........  light, surgical.  NF..............  ...............              34              18  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............              34              18  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              34              18  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ110..........  electrocautery-   NF..............  ...............              34               0  CMS clinical
                                                     hyfrecator, up                                                                       review; not
                                                     to 45 watts.                                                                         described as
                                                                                                                                          typical in
                                                                                                                                          work vignette.
                                   EQ137..........  instrument pack,  NF..............  ...............              34              28  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              34              18  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Assist                       11              17  Conforming to
                                                                                         physician in                                     physician
                                                                                         performing                                       time.
                                                                                         procedure.
                                   L037D..........  RN/LPN/MTA......  NF..............  Clean Surgical                1              10  Standardized
                                                                                         Instrument                                       time input.
                                                                                         Package.

[[Page 69083]]

 
                                   SB003..........  cover, probe      NF..............  ...............               1               0  CMS clinical
                                                     (cryosurgery).                                                                       review.
                                   SB027..........  gown, staff,      NF..............  ...............               2               1  Duplicative.
                                                     impervious.
                                   SB033..........  mask, surgical..  NF..............  ...............               2               1  Duplicative.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
11312..........  Shave skin        ED004..........  camera, digital   NF..............  ...............              43              17  Refined
                  lesion 1.1-2.0                     (6 mexapixel).                                                                       equipment time
                  cm.                                                                                                                     to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF014..........  light, surgical.  NF..............  ...............              43              17  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............              43              17  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              43              17  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ110..........  electrocautery-   NF..............  ...............              43               0  CMS clinical
                                                     hyfrecator, up                                                                       review; not
                                                     to 45 watts.                                                                         described as
                                                                                                                                          typical in
                                                                                                                                          work vignette.
                                   EQ137..........  instrument pack,  NF..............  ...............              43              37  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              43              17  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Clean Surgical                1              10  Standardized
                                                                                         Instrument                                       time input.
                                                                                         Package.
                                   SB003..........  cover, probe      NF..............  ...............               1               0  CMS clinical
                                                     (cryosurgery).                                                                       review.
                                   SB027..........  gown, staff,      NF..............  ...............               2               1  Duplicative.
                                                     impervious.
                                   SB033..........  mask, surgical..  NF..............  ...............               2               1  Duplicative.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
11313..........  Shave skin        ED004..........  camera, digital   NF..............  ...............              43              30  Refined
                  lesion >2.0 cm.                    (6 mexapixel).                                                                       equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF014..........  light, surgical.  NF..............  ...............              43              30  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............              43              30  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              43              30  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ110..........  electrocautery-   NF..............  ...............              43               0  CMS clinical
                                                     hyfrecator, up                                                                       review; not
                                                     to 45 watts.                                                                         described as
                                                                                                                                          typical in
                                                                                                                                          work vignette.

[[Page 69084]]

 
                                   EQ137..........  instrument pack,  NF..............  ...............              43              40  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              43              30  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Clean Surgical                1              10  Standardized
                                                                                         Instrument                                       time input.
                                                                                         Package.
                                   SB003..........  cover, probe      NF..............  ...............               1               0  CMS clinical
                                                     (cryosurgery).                                                                       review.
                                   SB027..........  gown, staff,      NF..............  ...............               2               1  Duplicative.
                                                     impervious.
                                   SB033..........  mask, surgical..  NF..............  ...............               2               1  Duplicative.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
11719..........  Trim nail(s) any  L037D..........  RN/LPN/MTA......  NF..............  Greet patient,                3               1  CMS clinical
                  number.                                                                provide                                          review.
                                                                                         gowning,
                                                                                         assure
                                                                                         appropriate
                                                                                         medical
                                                                                         records are
                                                                                         available.
                                   L037D..........  RN/LPN/MTA......  NF..............  Provide pre-                  2               1  CMS clinical
                                                                                         service                                          review.
                                                                                         education/
                                                                                         obtain consent.
                                   L037D..........  RN/LPN/MTA......  NF..............  Prepare room,                 2               1  CMS clinical
                                                                                         equipment,                                       review.
                                                                                         supplies.
                                   L037D..........  RN/LPN/MTA......  NF..............  Clean room/                   3               1  CMS clinical
                                                                                         equipment by                                     review.
                                                                                         physician
                                                                                         staff.
                                   SJ028..........  hydrogen          NF..............  ...............              10               0  CMS clinical
                                                     peroxide.                                                                            review.
                                   SJ053..........  swab-pad,         NF..............  ...............              10               0  CMS clinical
                                                     alcohol.                                                                             review.
13100..........  Cmplx rpr trunk   EF014..........  light, surgical.  NF..............  ...............              32              27  Refined
                  1.1-2.5 cm.                                                                                                             equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............              32              39  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF023..........  table, exam.....  NF..............  ...............              32              27  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              32              39  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ114..........  electrosurgical   NF..............  ...............              32              39  Refined
                                                     generator, up                                                                        equipment time
                                                     to 120 watts.                                                                        to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ137..........  instrument pack,  NF..............  ...............              32              46  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              32              39  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   SB016..........  drape-cover,      NF..............  ...............               2               1  CMS clinical
                                                     sterile, OR                                                                          review.
                                                     light handle.

[[Page 69085]]

 
                                   SB027..........  gown, staff,      NF..............  ...............               2               0  Duplicative.
                                                     impervious.
                                   SB034..........  mask, surgical,   NF..............  ...............               2               1  Duplicative.
                                                     with face
                                                     shield.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
                                   SF016..........  cautery,          NF..............  ...............               1               0  CMS clinical
                                                     monopolar,                                                                           review.
                                                     electrode tip.
                                   SJ041..........  povidone soln     NF..............  ...............               5               0  Duplicative.
                                                     (Betadine).
13101..........  Cmplx rpr trunk   EF014..........  light, surgical.  NF..............  ...............              45              27  Refined
                  2.6-7.5 cm.                                                                                                             equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............              45              47  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF023..........  table, exam.....  NF..............  ...............              45              27  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              45              47  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ114..........  electrosurgical   NF..............  ...............              45              47  Refined
                                                     generator, up                                                                        equipment time
                                                     to 120 watts.                                                                        to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ137..........  instrument pack,  NF..............  ...............              45              54  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              45              47  CMS clinical
                                                     (tubing,                                                                             review.
                                                     covering, etc.)
                                                     with stand.
                                   SB016..........  drape-cover,      NF..............  ...............               2               1  CMS clinical
                                                     sterile, OR                                                                          review.
                                                     light handle.
                                   SB027..........  gown, staff,      NF..............  ...............               2               0  Duplicative.
                                                     impervious.
                                   SB027..........  gown, staff,      F...............  ...............               2               0  CMS clinical
                                                     impervious.                                                                          review.
                                   SB034..........  mask, surgical,   NF..............  ...............               2               1  Duplicative.
                                                     with face
                                                     shield.
                                   SB034..........  mask, surgical,   F...............  ...............               2               1  CMS clinical
                                                     with face                                                                            review.
                                                     shield.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
                                   SF016..........  cautery,          NF..............  ...............               1               0  CMS clinical
                                                     monopolar,                                                                           review.
                                                     electrode tip.
                                   SJ041..........  povidone soln     NF..............  ...............              10               0  Duplicative.
                                                     (Betadine).
13102..........  Cmplx rpr trunk   EF015..........  mayo stand......  NF..............  ...............              30              20  Refined
                  addl 5 cm/<.                                                                                                            equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              30              20  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.

[[Page 69086]]

 
                                   EQ114..........  electrosurgical   NF..............  ...............              30              20  Refined
                                                     generator, up                                                                        equipment time
                                                     to 120 watts.                                                                        to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ137..........  instrument pack,  NF..............  ...............              30              20  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              30              20  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   SF016..........  cautery,          NF..............  ...............               1               0  CMS clinical
                                                     monopolar,                                                                           review.
                                                     electrode tip.
                                   SJ041..........  povidone soln     NF..............  ...............               5               0  Duplicative.
                                                     (Betadine).
13120..........  Cmplx rpr s/a/l   EF014..........  light, surgical.  NF..............  ...............              86              27  Refined
                  1.1-2.5 cm.                                                                                                             equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............              86              41  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF023..........  table, exam.....  NF..............  ...............              86              27  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              86              41  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ114..........  electrosurgical   NF..............  ...............              86              41  Refined
                                                     generator, up                                                                        equipment time
                                                     to 120 watts.                                                                        to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ137..........  instrument pack,  NF..............  ...............              86              48  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              86              41  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   SB016..........  drape-cover,      NF..............  ...............               2               1  CMS clinical
                                                     sterile, OR                                                                          review.
                                                     light handle.
                                   SB027..........  gown, staff,      NF..............  ...............               2               0  Duplicative.
                                                     impervious.
                                   SB027..........  gown, staff,      F...............  ...............               2               0  CMS clinical
                                                     impervious.                                                                          review.
                                   SB034..........  mask, surgical,   NF..............  ...............               2               1  Duplicative.
                                                     with face
                                                     shield.
                                   SB034..........  mask, surgical,   F...............  ...............               2               1  CMS clinical
                                                     with face                                                                            review.
                                                     shield.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
                                   SF016..........  cautery,          NF..............  ...............               1               0  CMS clinical
                                                     monopolar,                                                                           review.
                                                     electrode tip.
                                   SJ041..........  povidone soln     NF..............  ...............               5               0  Duplicative.
                                                     (Betadine).

[[Page 69087]]

 
13121..........  Cmplx rpr s/a/l   EF014..........  light, surgical.  NF..............  ...............             129              27  Refined
                  2.6-7.5 cm.                                                                                                             equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............             129              48  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF023..........  table, exam.....  NF..............  ...............             129              27  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............             129              48  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ114..........  electrosurgical   NF..............  ...............             129              48  Refined
                                                     generator, up                                                                        equipment time
                                                     to 120 watts.                                                                        to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ137..........  instrument pack,  NF..............  ...............             129              55  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............             129              48  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Clean Surgical               15              10  Standardized
                                                                                         Instrument                                       time input.
                                                                                         Package.
                                   SB016..........  drape-cover,      NF..............  ...............               2               1  CMS clinical
                                                     sterile, OR                                                                          review.
                                                     light handle.
                                   SB027..........  gown, staff,      NF..............  ...............               2               0  Duplicative.
                                                     impervious.
                                   SB034..........  mask, surgical,   NF..............  ...............               2               1  Duplicative.
                                                     with face
                                                     shield.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
                                   SF016..........  cautery,          NF..............  ...............               1               0  CMS clinical
                                                     monopolar,                                                                           review.
                                                     electrode tip.
                                   SJ041..........  povidone soln     NF..............  ...............              10               0  Duplicative.
                                                     (Betadine).
13122            Cmplx rpr s/a/l   EF015..........  mayo stand......  NF..............  ...............              30              20  Refined
                  addl 5 cm/>.                                                                                                            equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              30              20  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ114..........  electrosurgical   NF..............  ...............              30              20  Refined
                                                     generator, up                                                                        equipment time
                                                     to 120 watts.                                                                        to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ137..........  instrument pack,  NF..............  ...............              30              20  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              30              20  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.

[[Page 69088]]

 
                                   SF016..........  cautery,          NF..............  ...............               1               0  CMS clinical
                                                     monopolar,                                                                           review.
                                                     electrode tip.
                                   SJ041..........  povidone soln     NF..............  ...............               5               0  Duplicative.
                                                     (Betadine).
13131..........  Cmplx rpr f/c/c/  EF014..........  light, surgical.  NF..............  ...............              45              27  Refined
                  m/n/ax/g/h/f.                                                                                                           equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............              45              48  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF023..........  table, exam.....  NF..............  ...............              45              27  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              45              48  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ114..........  electrosurgical   NF..............  ...............              45              48  Refined
                                                     generator, up                                                                        equipment time
                                                     to 120 watts.                                                                        to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ137..........  instrument pack,  NF..............  ...............              45              55  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              45              48  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   SB016..........  drape-cover,      NF..............  ...............               2               1  CMS clinical
                                                     sterile, OR                                                                          review.
                                                     light handle.
                                   SB027..........  gown, staff,      NF..............  ...............               2               0  Duplicative.
                                                     impervious.
                                   SB034..........  mask, surgical,   NF..............  ...............               2               1  Duplicative.
                                                     with face
                                                     shield.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
                                   SF016..........  cautery,          NF..............  ...............               1               0  CMS clinical
                                                     monopolar,                                                                           review.
                                                     electrode tip.
                                   SJ041..........  povidone soln     NF..............  ...............               5               0  Duplicative.
                                                     (Betadine).
13132..........  Cmplx rpr f/c/c/  EF014..........  light, surgical.  NF..............  ...............              50              27  Refined
                  m/n/ax/g/h/f.                                                                                                           equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............              50              51  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF023..........  table, exam.....  NF..............  ...............              50              27  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              50              51  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.

[[Page 69089]]

 
                                   EQ114..........  electrosurgical   NF..............  ...............              50              51  Refined
                                                     generator, up                                                                        equipment time
                                                     to 120 watts.                                                                        to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ137..........  instrument pack,  NF..............  ...............              50              58  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              50              51  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   SB016..........  drape-cover,      NF..............  ...............               2               1  CMS clinical
                                                     sterile, OR                                                                          review.
                                                     light handle.
                                   SB027..........  gown, staff,      NF..............  ...............               2               0  Duplicative.
                                                     impervious.
                                   SB034..........  mask, surgical,   NF..............  ...............               2               1  Duplicative.
                                                     with face
                                                     shield.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
                                   SF016..........  cautery,          NF..............  ...............               1               0  CMS clinical
                                                     monopolar,                                                                           review.
                                                     electrode tip.
                                   SJ041..........  povidone soln     NF..............  ...............              10               0  Duplicative.
                                                     (Betadine).
13133..........  Cmplx rpr f/c/c/  EF015..........  mayo stand......  NF..............  ...............              35              23  Refined
                  m/n/ax/g/h/f.                                                                                                           equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              35              23  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ114..........  electrosurgical   NF..............  ...............              35              23  Refined
                                                     generator, up                                                                        equipment time
                                                     to 120 watts.                                                                        to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ137..........  instrument pack,  NF..............  ...............              35              23  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              35              23  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   SF016..........  cautery,          NF..............  ...............               1               0  CMS clinical
                                                     monopolar,                                                                           review.
                                                     electrode tip.
                                   SJ041..........  povidone soln     NF..............  ...............               5               0  Duplicative.
                                                     (Betadine).
13150..........  Cmplx rpr e/n/e/  EF014..........  light, surgical.  NF..............  ...............              30              27  Refined
                  l 1.0 cm/<.                                                                                                             equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............              30              44  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF023..........  table, exam.....  NF..............  ...............              30              27  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.

[[Page 69090]]

 
                                   EF031..........  table, power....  NF..............  ...............              30              44  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ114..........  electrosurgical   NF..............  ...............              30              44  Refined
                                                     generator, up                                                                        equipment time
                                                     to 120 watts.                                                                        to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ137..........  instrument pack,  NF..............  ...............              30              51  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              30              44  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Assist                       20              26  Conforming to
                                                                                         physician in                                     physician
                                                                                         performing                                       time.
                                                                                         procedure.
                                   SB016..........  drape-cover,      NF..............  ...............               2               1  CMS clinical
                                                     sterile, OR                                                                          review.
                                                     light handle.
                                   SB027..........  gown, staff,      NF..............  ...............               2               0  Duplicative.
                                                     impervious.
                                   SB034..........  mask, surgical,   NF..............  ...............               2               1  Duplicative.
                                                     with face
                                                     shield.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
                                   SF016..........  cautery,          NF..............  ...............               1               0  CMS clinical
                                                     monopolar,                                                                           review.
                                                     electrode tip.
                                   SJ041..........  povidone soln     NF..............  ...............               5               0  Duplicative.
                                                     (Betadine).
13151..........  Cmplx rpr e/n/e/  EF014..........  light, surgical.  NF..............  ...............              45              27  Refined
                  l 1.1-2.5 cm.                                                                                                           equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............              45              48  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF023..........  table, exam.....  NF..............  ...............              45              27  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              45              48  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ114..........  electrosurgical   NF..............  ...............              45              48  Refined
                                                     generator, up                                                                        equipment time
                                                     to 120 watts.                                                                        to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ137..........  instrument pack,  NF..............  ...............              45              55  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              45              48  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   SB016..........  drape-cover,      NF..............  ...............               2               1  CMS clinical
                                                     sterile, OR                                                                          review.
                                                     light handle.
                                   SB027..........  gown, staff,      NF..............  ...............               2               0  Duplicative.
                                                     impervious.

[[Page 69091]]

 
                                   SB034..........  mask, surgical,   NF..............  ...............               2               1  Duplicative.
                                                     with face
                                                     shield.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
                                   SF016..........  cautery,          NF..............  ...............               1               0  CMS clinical
                                                     monopolar,                                                                           review.
                                                     electrode tip.
                                   SJ041..........  povidone soln     NF..............  ...............               5               0  Duplicative.
                                                     (Betadine).
13152..........  Cmplx rpr e/n/e/  EF014..........  light, surgical.  NF..............  ...............              50              27  Refined
                  l 2.6-7.5 cm.                                                                                                           equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF015..........  mayo stand......  NF..............  ...............              50              51  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF023..........  table, exam.....  NF..............  ...............              50              27  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              50              51  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ114..........  electrosurgical   NF..............  ...............              50              51  Refined
                                                     generator, up                                                                        equipment time
                                                     to 120 watts.                                                                        to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ137..........  instrument pack,  NF..............  ...............              50              58  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              50              51  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  ...............              15              10  Standardized
                                                                                                                                          time input.
                                   SB016..........  drape-cover,      NF..............  ...............               2               1  CMS clinical
                                                     sterile, OR                                                                          review.
                                                     light handle.
                                   SB027..........  gown, staff,      NF..............  ...............               2               0  Duplicative.
                                                     impervious.
                                   SB034..........  mask, surgical,   NF..............  ...............               2               1  Duplicative.
                                                     with face
                                                     shield.
                                   SF016..........  cautery,          NF..............  ...............               1               0  CMS clinical
                                                     monopolar,                                                                           review.
                                                     electrode tip.
                                   SJ041..........  povidone soln     NF..............  ...............              10               0  Duplicative.
                                                     (Betadine).
13153..........  Cmplx rpr e/n/e/  EF015..........  mayo stand......  NF..............  ...............              45              30  Refined
                  l addl 5cm/<.                                                                                                           equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              45              30  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ114..........  electrosurgical   NF..............  ...............              45              30  Refined
                                                     generator, up                                                                        equipment time
                                                     to 120 watts.                                                                        to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.

[[Page 69092]]

 
                                   EQ137..........  instrument pack,  NF..............  ...............              45              30  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ351..........  Smoke Evacuator   NF..............  ...............              45              30  Refined
                                                     (tubing,                                                                             equipment time
                                                     covering, etc.)                                                                      to reflect
                                                     with stand.                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               2               0  CMS clinical
                                                                                                                                          review.
                                   SF016..........  cautery,          NF..............  ...............               1               0  CMS clinical
                                                     monopolar,                                                                           review.
                                                     electrode tip.
                                   SJ041..........  povidone soln     NF..............  ...............               5               0  Duplicative.
                                                     (Betadine).
20600..........  Drain/inject      EF023..........  table, exam.....  NF..............  ...............              19              16  Refined
                  joint/bursa.                                                                                                            equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ168..........  light, exam.....  NF..............  ...............              19              16  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  F...............  Discharge day                 6               0  CMS clinical
                                                                                         management.                                      review.
                                   L037D..........  RN/LPN/MTA......  F...............  Conduct phone                 0               3  CMS clinical
                                                                                         calls/call in                                    review.
                                                                                         prescriptions.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               4               2  CMS clinical
                                                                                                                                          review.
                                   SC055..........  syringe 3ml.....  NF..............  ...............               2               1  CMS clinical
                                                                                                                                          review.
20605..........  Drain/inject      EF023..........  table, exam.....  NF..............  ...............              19              16  Refined
                  joint/bursa.                                                                                                            equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ168..........  light, exam.....  NF..............  ...............              19              16  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  F...............  Discharge day                 6               0  CMS clinical
                                                                                         management.                                      review.
                                   L037D..........  RN/LPN/MTA......  F...............  Conduct phone                 0               3  CMS clinical
                                                                                         calls/call in                                    review.
                                                                                         prescriptions.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               4               2  CMS clinical
                                                                                                                                          review.
                                   SC055..........  syringe 3ml.....  NF..............  ...............               2               1  CMS clinical
                                                                                                                                          review.
20610..........  Drain/inject      EF023..........  table, exam.....  NF..............  ...............              19              16  Refined
                  joint/bursa.                                                                                                            equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ168..........  light, exam.....  NF..............  ...............              19              16  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  F...............  Discharge day                 6               0  CMS clinical
                                                                                         management.                                      review.
                                   L037D..........  RN/LPN/MTA......  F...............  Conduct phone                 0               3  CMS clinical
                                                                                         calls/call in                                    review.
                                                                                         prescriptions.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               4               2  CMS clinical
                                                                                                                                          review.
                                   SC057..........  syringe 5-6ml...  NF..............  ...............               2               1  CMS clinical
                                                                                                                                          review.
23472..........  Reconstruct       SA052..........  pack, post-op     F...............  ...............               0               1  CMS clinical
                  shoulder joint.                    incision care                                                                        review.
                                                     (staple).

[[Page 69093]]

 
                                   SA053..........  pack, post-op     F...............  ...............               1               0  CMS clinical
                                                     incision care                                                                        review.
                                                     (suture &
                                                     staple).
23473..........  Revis reconst     SA052..........  pack, post-op     F...............  ...............               0               1  CMS clinical
                  shoulder joint.                    incision care                                                                        review.
                                                     (staple).
                                   SA053..........  pack, post-op     F...............  ...............               1               0  CMS clinical
                                                     incision care                                                                        review.
                                                     (suture &
                                                     staple).
23474..........  Revis reconst     SA052..........  pack, post-op     F...............  ...............               0               1  CMS clinical
                  shoulder joint.                    incision care                                                                        review.
                                                     (staple).
                                   SA053..........  pack, post-op     F...............  ...............               1               0  CMS clinical
                                                     incision care                                                                        review.
                                                     (suture &
                                                     staple).
24363..........  Replace elbow     SA052..........  pack, post-op     F...............  ...............               0               1  CMS clinical
                  joint.                             incision care                                                                        review.
                                                     (staple).
                                   SA053..........  pack, post-op     F...............  ...............               1               0  CMS clinical
                                                     incision care                                                                        review.
                                                     (suture &
                                                     staple).
24370..........  Revise reconst    SA052..........  pack, post-op     F...............  ...............               0               1  CMS clinical
                  elbow joint.                       incision care                                                                        review.
                                                     (staple).
                                   SA052..........  pack, post-op     F...............  ...............               0               1  CMS clinical
                                                     incision care                                                                        review.
                                                     (staple).
                                   SA053..........  pack, post-op     F...............  ...............               1               0  CMS clinical
                                                     incision care                                                                        review.
                                                     (suture &
                                                     staple).
                                   SA053..........  pack, post-op     F...............  ...............               1               0  CMS clinical
                                                     incision care                                                                        review.
                                                     (suture &
                                                     staple).
31231..........  Nasal endoscopy   EF008..........  chair with        NF..............  ...............              43              35  Refined
                  dx.                                headrest, exam,                                                                      equipment time
                                                     reclining.                                                                           to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ138..........  instrument pack,  NF..............  ...............               0              47  Refined
                                                     medium ($1500                                                                        equipment time
                                                     and up).                                                                             to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ167..........  light source,     NF..............  ...............              43              35  Refined
                                                     xenon.                                                                               equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ170..........  light,            NF..............  ...............              43              35  Refined
                                                     fiberoptic                                                                           equipment time
                                                     headlight w-                                                                         to reflect
                                                     source.                                                                              typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ234..........  suction and       NF..............  ...............              43              35  Refined
                                                     pressure                                                                             equipment time
                                                     cabinet, ENT                                                                         to reflect
                                                     (SMR).                                                                               typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ES013..........  endoscope,        NF..............  ...............              63              42  Refined
                                                     rigid,                                                                               equipment time
                                                     sinoscopy.                                                                           to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ES013..........  endoscope,        NF..............  ...............              63               0  CMS clinical
                                                     rigid,                                                                               review.
                                                     sinoscopy.
                                   ES031..........  video system,     NF..............  ...............              43              35  Refined
                                                     endoscopy                                                                            equipment time
                                                     (processor,                                                                          to reflect
                                                     digital                                                                              typical use
                                                     capture,                                                                             exclusive to
                                                     monitor,                                                                             patient.
                                                     printer, cart).

[[Page 69094]]

 
                                   ES032..........  video system,     NF..............  ...............              43              35  Refined
                                                     stroboscopy                                                                          equipment time
                                                     (strobing                                                                            to reflect
                                                     platform,                                                                            typical use
                                                     camera, digital                                                                      exclusive to
                                                     recorder,                                                                            patient.
                                                     monitor,
                                                     printer, cart).
                                   ES036..........  Nasal Endoscopy   NF..............  ...............              63               0  Non-standard
                                                     Instrument                                                                           direct
                                                     Package.                                                                             practice
                                                                                                                                          expense input.
                                   L037D..........  RN/LPN/MTA......  NF..............  Greet patient,                2               0  CMS clinical
                                                                                         provide                                          review.
                                                                                         gowning,
                                                                                         assure
                                                                                         appropriate
                                                                                         medical
                                                                                         records are
                                                                                         available.
                                   L037D..........  RN/LPN/MTA......  NF..............  Obtain vital                  1               0  CMS clinical
                                                                                         signs.                                           review.
                                   L037D..........  RN/LPN/MTA......  NF..............  Clean Surgical               10              15  Standardized
                                                                                         Instrument                                       time input.
                                                                                         Package.
                                   L037D..........  RN/LPN/MTA......  NF..............  Review/read X-                5               0  CMS clinical
                                                                                         ray, lab, and                                    review.
                                                                                         pathology
                                                                                         reports.
                                   SB027..........  gown, staff,      NF..............  ...............               2               1  Duplicative.
                                                     impervious.
                                   SB034..........  mask, surgical,   NF..............  ...............               2               1  Duplicative.
                                                     with face
                                                     shield.
31647..........  Bronchial valve   L047C..........  RN/Respiratory    F...............  Complete pre-                 3               5  CMS clinical
                  init insert.                       Therapist.                          service                                          review.
                                                                                         diagnostic &
                                                                                         referral forms.
                                   L047C..........  RN/Respiratory    F...............  Coordinate pre-               5               3  CMS clinical
                                                     Therapist.                          surgery                                          review.
                                                                                         services.
32554..........  Aspirate pleura.  EF023..........  table, exam.....  NF..............  ...............              56              52  Refined
                 w/o imaging.....                                                                                                         equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ168..........  light, exam.....  NF..............  ...............               0              52  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Complete pre-                 5               0  CMS clinical
                                                                                         service                                          review.
                                                                                         diagnostic &
                                                                                         referral forms.
                                   L037D..........  RN/LPN/MTA......  NF..............  Coordinate pre-               3               1  CMS clinical
                                                                                         surgery                                          review.
                                                                                         services.
                                   L037D..........  RN/LPN/MTA......  NF..............  Monitor pt.                   5              10  CMS clinical
                                                                                         following                                        review.
                                                                                         service/check
                                                                                         tubes,
                                                                                         monitors,
                                                                                         drains.
                                   SA048..........  pack, minimum     NF..............  ...............               0               1  CMS clinical
                                                     multi-specialty                                                                      review.
                                                     visit.
                                   SA067..........  tray, shave prep  NF..............  ...............               0               1  CMS clinical
                                                                                                                                          review.
                                   SA077..........  kit, pleural      NF..............  ...............               0               1  CMS clinical
                                                     catheter                                                                             review.
                                                     insertion.
                                   SB001..........  cap, surgical...  NF..............  ...............               0               2  CMS clinical
                                                                                                                                          review.
                                   SB006..........  drape, non-       NF..............  ...............               1               0  CMS clinical
                                                     sterile, sheet                                                                       review.
                                                     40in x 60in.
                                   SB024..........  gloves, sterile.  NF..............  ...............               1               2  CMS clinical
                                                                                                                                          review.
                                   SB034..........  mask, surgical,   NF..............  ...............               0               2  CMS clinical
                                                     with face                                                                            review.
                                                     shield.
                                   SB039..........  shoe covers,      NF..............  ...............               0               2  CMS clinical
                                                     surgical.                                                                            review.
                                   SB044..........  underpad 2ft x    NF..............  ...............               0               1  CMS clinical
                                                     3ft (Chux).                                                                          review.

[[Page 69095]]

 
                                   SG056..........  gauze, sterile    NF..............  ...............               0               1  CMS clinical
                                                     4in x 4in (10                                                                        review.
                                                     pack uou).
32555..........  Aspirate pleura   ED024..........  film processor,   NF..............  ...............              58               7  Refined
                  w/imaging.                         dry, laser.                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF019..........  stretcher chair.  NF..............  ...............              15              10  CMS clinical
                                                                                                                                          review.
                                   EL015..........  room,             NF..............  ...............              33              35  Refined
                                                     ultrasound,                                                                          equipment time
                                                     general.                                                                             to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER029..........  film alternator   NF..............  ...............              58               7  Refined
                                                     (motorized film                                                                      equipment time
                                                     viewbox).                                                                            to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Complete pre-                 5               0  CMS clinical
                                                                                         service                                          review.
                                                                                         diagnostic &
                                                                                         referral forms.
                                   L037D..........  RN/LPN/MTA......  NF..............  Coordinate pre-               3               1  CMS clinical
                                                                                         surgery                                          review.
                                                                                         services.
                                   L037D..........  RN/LPN/MTA......  NF..............  Monitor pt.                  15              10  CMS clinical
                                                                                         following                                        review.
                                                                                         service/check
                                                                                         tubes,
                                                                                         monitors,
                                                                                         drains.
                                   L037D..........  RN/LPN/MTA......  NF..............  Process images,               5               2  CMS clinical
                                                                                         complete data                                    review.
                                                                                         sheet, present
                                                                                         images and
                                                                                         data to the
                                                                                         interpreting
                                                                                         physician.
                                   SA027..........  kit, scissors     NF..............  ...............               0               1  CMS clinical
                                                     and clamp.                                                                           review.
                                   SA077..........  kit, pleural      NF..............  ...............               0               1  CMS clinical
                                                     catheter                                                                             review.
                                                     insertion.
                                   SB001..........  cap, surgical...  NF..............  ...............               0               3  CMS clinical
                                                                                                                                          review.
                                   SB027..........  gown, staff,      NF..............  ...............               0               1  CMS clinical
                                                     impervious.                                                                          review.
                                   SB039..........  shoe covers,      NF..............  ...............               0               3  CMS clinical
                                                     surgical.                                                                            review.
                                   SB044..........  underpad 2ft x    NF..............  ...............               0               1  CMS clinical
                                                     3ft (Chux).                                                                          review.
                                   SG078..........  tape, surgical    NF..............  ...............               0              15  CMS clinical
                                                     occlusive 1in                                                                        review.
                                                     (Blenderm).
                                   SM012..........  disinfectant      NF..............  ...............              10               0  CMS clinical
                                                     spray                                                                                review.
                                                     (Transeptic).
                                   SM021..........  sanitizing cloth- NF..............  ...............               2               0  CMS clinical
                                                     wipe (patient).                                                                      review.
32556..........  Insert cath       EQ168..........  light, exam.....  NF..............  ...............               0              76  Refined
                  pleura w/o                                                                                                              equipment time
                  image.                                                                                                                  to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Complete pre-                 5               0  CMS clinical
                                                                                         service                                          review.
                                                                                         diagnostic &
                                                                                         referral forms.
                                   L037D..........  RN/LPN/MTA......  NF..............  Coordinate pre-               3               1  CMS clinical
                                                                                         surgery                                          review.
                                                                                         services.
                                   SA044..........  pack, moderate    NF..............  ...............               0               1  CMS clinical
                                                     sedation.                                                                            review.
                                   SA048..........  pack, minimum     NF..............  ...............               0               1  CMS clinical
                                                     multi-specialty                                                                      review.
                                                     visit.
                                   SA067..........  tray, shave prep  NF..............  ...............               0               1  CMS clinical
                                                                                                                                          review.
                                   SB001..........  cap, surgical...  NF..............  ...............               0               2  CMS clinical
                                                                                                                                          review.

[[Page 69096]]

 
                                   SB006..........  drape, non-       NF..............  ...............               1               0  CMS clinical
                                                     sterile, sheet                                                                       review.
                                                     40in x 60in.
                                   SB034..........  mask, surgical,   NF..............  ...............               0               2  CMS clinical
                                                     with face                                                                            review.
                                                     shield.
                                   SB039..........  shoe covers,      NF..............  ...............               0               2  CMS clinical
                                                     surgical.                                                                            review.
                                   SB044..........  underpad 2ft x    NF..............  ...............               0               1  CMS clinical
                                                     3ft (Chux).                                                                          review.
                                   SC010..........  closed flush      NF..............  ...............               0               1  CMS clinical
                                                     system,                                                                              review.
                                                     angiography.
                                   SG056..........  gauze, sterile    NF..............  ...............               1               0  CMS clinical
                                                     4in x 4in (10                                                                        review.
                                                     pack uou).
                                   SH065..........  sodium chloride   NF..............  ...............               0               1  CMS clinical
                                                     0.9% flush                                                                           review.
                                                     syringe.
                                   SH069..........  sodium chloride   NF..............  ...............               0               1  CMS clinical
                                                     0.9% irrigation                                                                      review.
                                                     (500-1000ml
                                                     uou).
                                   SL157..........  cup, sterile, 8   NF..............  ...............               0               1  CMS clinical
                                                     oz.                                                                                  review.
32557..........  Insert cath       ED024..........  film processor,   NF..............  ...............              58               7  CMS clinical
                  pleura w/image.                    dry, laser.                                                                          review.
                                   EF019..........  stretcher chair.  NF..............  ...............              15              10  CMS clinical
                                                                                                                                          review.
                                   EL007..........  room, CT........  NF..............  ...............              43              40  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ168..........  light, exam.....  NF..............  ...............              60              40  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER029..........  film alternator   NF..............  ...............              58               7  CMS clinical
                                                     (motorized film                                                                      review.
                                                     viewbox).
                                   L037D..........  RN/LPN/MTA......  NF..............  Complete pre-                 5               0  CMS clinical
                                                                                         service                                          review.
                                                                                         diagnostic &
                                                                                         referral forms.
                                   L037D..........  RN/LPN/MTA......  NF..............  Coordinate pre-               3               1  CMS clinical
                                                                                         surgery                                          review.
                                                                                         services.
                                   L037D..........  RN/LPN/MTA......  NF..............  Check dressings               3               5  CMS clinical
                                                                                         & wound/home                                     review.
                                                                                         care
                                                                                         instructions/
                                                                                         coordinate
                                                                                         office visits/
                                                                                         prescriptions.
                                   L046A..........  CT Technologist.  NF..............  Assist                       28              30  Conforming to
                                                                                         physician in                                     physician
                                                                                         performing                                       time.
                                                                                         procedure.
                                   SA044..........  pack, moderate    NF..............  ...............               0               1  CMS clinical
                                                     sedation.                                                                            review.
                                   SA071..........  kit, AccuStick    NF..............  ...............               1               0  CMS clinical
                                                     II Introducer                                                                        review.
                                                     System with RO
                                                     Marker.
                                   SA077..........  kit, pleural      NF..............  ...............               0               1  CMS clinical
                                                     catheter                                                                             review.
                                                     insertion.
                                   SB001..........  cap, surgical...  NF..............  ...............               2               3  CMS clinical
                                                                                                                                          review.
                                   SB011..........  drape, sterile,   NF..............  ...............               1               0  CMS clinical
                                                     fenestrated                                                                          review.
                                                     16in x 29in.
                                   SB014..........  drape, sterile,   NF..............  ...............               1               0  CMS clinical
                                                     three-quarter                                                                        review.
                                                     sheet.
                                   SB019..........  drape-towel,      NF..............  ...............               4               0  CMS clinical
                                                     sterile 18in x                                                                       review.
                                                     26in.
                                   SB024..........  gloves, sterile.  NF..............  ...............               2               1  CMS clinical
                                                                                                                                          review.
                                   SB027..........  gown, staff,      NF..............  ...............               0               1  CMS clinical
                                                     impervious.                                                                          review.

[[Page 69097]]

 
                                   SB039..........  shoe covers,      NF..............  ...............               2               3  CMS clinical
                                                     surgical.                                                                            review.
                                   SC049..........  stop cock, 3-way  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
                                   SC056..........  syringe 50-60ml.  NF..............  ...............               2               0  CMS clinical
                                                                                                                                          review.
                                   SC058..........  syringe w-        NF..............  ...............               1               0  CMS clinical
                                                     needle, OSHA                                                                         review.
                                                     compliant
                                                     (SafetyGlide).
                                   SD043..........  dilator, vessel,  NF..............  ...............               1               0  CMS clinical
                                                     angiographic.                                                                        review.
                                   SD088..........  guidewire.......  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
                                   SD146..........  catheter          NF..............  ...............               1               0  CMS clinical
                                                     percutaneous                                                                         review.
                                                     fastener (Percu-
                                                     Stay).
                                   SD161..........  drainage          NF..............  ...............               1               0  CMS clinical
                                                     catheter, all                                                                        review.
                                                     purpose.
                                   SD163..........  drainage pouch,   NF..............  ...............               1               0  CMS clinical
                                                     nephrostomy-                                                                         review.
                                                     biliary.
                                   SF007..........  blade, surgical   NF..............  ...............               1               0  CMS clinical
                                                     (Bard-Parker).                                                                       review.
                                   SG009..........  applicator,       NF..............  ...............               4               0  CMS clinical
                                                     sponge-tipped.                                                                       review.
                                   SG078..........  tape, surgical    NF..............  ...............               0              25  CMS clinical
                                                     occlusive 1in                                                                        review.
                                                     (Blenderm).
                                   SH047..........  lidocaine 1%-2%   NF..............  ...............              10               0  CMS clinical
                                                     inj (Xylocaine).                                                                     review.
                                   SJ041..........  povidone soln     NF..............  ...............              60               0  CMS clinical
                                                     (Betadine).                                                                          review.
                                   SL036..........  cup, biopsy-      NF..............  ...............               1               0  CMS clinical
                                                     specimen                                                                             review.
                                                     sterile 4oz.
                                   SL156..........  cup, sterile, 12- NF..............  ...............               1               0  CMS clinical
                                                     16 oz.                                                                               review.
33361..........  Replace aortic    L037D..........  RN/LPN/MTA......  F...............  Coordinate pre-              40              10  Standardized
                  valve perq.                                                            surgery                                          time input.
                                                                                         services.
                                   L037D..........  RN/LPN/MTA......  F...............  Schedule space                8               5  Standardized
                                                                                         and equipment                                    time input.
                                                                                         in facility.
                                   L037D..........  RN/LPN/MTA......  F...............  Provide pre-                 20               7  Standardized
                                                                                         service                                          time input.
                                                                                         education/
                                                                                         obtain consent.
                                   L037D..........  RN/LPN/MTA......  F...............  Follow-up phone               7               3  Standardized
                                                                                         calls &                                          time input.
                                                                                         prescriptions.
33362..........  Replace aortic    L037D..........  RN/LPN/MTA......  F...............  Coordinate pre-              40              10  Standardized
                  valve open.                                                            surgery                                          time input.
                                                                                         services.
                                   L037D..........  RN/LPN/MTA......  F...............  Schedule space                8               5  Standardized
                                                                                         and equipment                                    time input.
                                                                                         in facility.
                                   L037D..........  RN/LPN/MTA......  F...............  Provide pre-                 20               7  Standardized
                                                                                         service                                          time input.
                                                                                         education/
                                                                                         obtain consent.
                                   L037D..........  RN/LPN/MTA......  F...............  Follow-up phone               7               3  Standardized
                                                                                         calls &                                          time input.
                                                                                         prescriptions.
33363..........  Replace aortic    L037D..........  RN/LPN/MTA......  F...............  Coordinate pre-              40              10  Standardized
                  valve open.                                                            surgery                                          time input.
                                                                                         services.
                                   L037D..........  RN/LPN/MTA......  F...............  Schedule space                8               5  Standardized
                                                                                         and equipment                                    time input.
                                                                                         in facility.
                                   L037D..........  RN/LPN/MTA......  F...............  Provide pre-                 20               7  Standardized
                                                                                         service                                          time input.
                                                                                         education/
                                                                                         obtain consent.
                                   L037D..........  RN/LPN/MTA......  F...............  Follow-up phone               7               3  Standardized
                                                                                         calls &                                          time input.
                                                                                         prescriptions.
33364..........  Replace aortic    L037D..........  RN/LPN/MTA......  F...............  Coordinate pre-              40              10  Standardized
                  valve open.                                                            surgery                                          time input.
                                                                                         services.
                                   L037D..........  RN/LPN/MTA......  F...............  Schedule space                8               5  Standardized
                                                                                         and equipment                                    time input.
                                                                                         in facility.

[[Page 69098]]

 
                                   L037D..........  RN/LPN/MTA......  F...............  Provide pre-                 20               7  Standardized
                                                                                         service                                          time input.
                                                                                         education/
                                                                                         obtain consent.
                                   L037D..........  RN/LPN/MTA......  F...............  Follow-up phone               7               3  Standardized
                                                                                         calls &                                          time input.
                                                                                         prescriptions.
33365..........  Replace aortic    L037D..........  RN/LPN/MTA......  F...............  Coordinate pre-              40              10  Standardized
                  valve open.                                                            surgery                                          time input.
                                                                                         services.
                                   L037D..........  RN/LPN/MTA......  F...............  Schedule space                8               5  Standardized
                                                                                         and equipment                                    time input.
                                                                                         in facility.
                                   L037D..........  RN/LPN/MTA......  F...............  Provide pre-                 20               7  Standardized
                                                                                         service                                          time input.
                                                                                         education/
                                                                                         obtain consent.
                                   L037D..........  RN/LPN/MTA......  F...............  Follow-up phone               7               3  Standardized
                                                                                         calls &                                          time input.
                                                                                         prescriptions.
33405..........  Replacement of    L051A..........  RN..............  F...............  Other Clinical               15               0  CMS clinical
                  aortic valve.                                                          Activity--spec                                   review.
                                                                                         ify: For
                                                                                         reference code
                                                                                         33406 and
                                                                                         codes 33405
                                                                                         and 33430:
                                                                                         Additional
                                                                                         coordination
                                                                                         between
                                                                                         multiple
                                                                                         specialties
                                                                                         for complex
                                                                                         procedures
                                                                                         (tests, meds,
                                                                                         scheduling,
                                                                                         etc) prior to
                                                                                         patient
                                                                                         arrival at
                                                                                         site of
                                                                                         service.
                                   L051A..........  RN..............  F...............  Other Clinical               15               0  CMS clinical
                                                                                         Activity--spec                                   review.
                                                                                         ify: For
                                                                                         reference code
                                                                                         33406 and
                                                                                         codes 33405
                                                                                         and 33430:
                                                                                         Additional
                                                                                         coordination
                                                                                         between
                                                                                         multiple
                                                                                         specialties
                                                                                         for complex
                                                                                         procedures
                                                                                         (tests, meds,
                                                                                         scheduling,
                                                                                         etc) prior to
                                                                                         patient
                                                                                         arrival at
                                                                                         site of
                                                                                         service.
35475..........  Repair arterial   EL011..........  room,             NF..............  ...............              51              52  Refined
                  blockage.                          angiography.                                                                         equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ011..........  ECG, 3-channel    NF..............  ...............             212             285  Moderate
                                                     (with SpO2,                                                                          Sedation
                                                     NIBP, temp,                                                                          equipment--Tim
                                                     resp).                                                                               e includes
                                                                                                                                          administering
                                                                                                                                          anesthesia,
                                                                                                                                          procedure
                                                                                                                                          time, and
                                                                                                                                          monitoring
                                                                                                                                          patient.
                                   EQ032..........  IV infusion pump  NF..............  ...............             212             285  Moderate
                                                                                                                                          Sedation
                                                                                                                                          equipment--Tim
                                                                                                                                          e includes
                                                                                                                                          administering
                                                                                                                                          anesthesia,
                                                                                                                                          procedure
                                                                                                                                          time, and
                                                                                                                                          monitoring
                                                                                                                                          patient.
                                   EQ168..........  light, exam.....  NF..............  ...............             120              52  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.

[[Page 69099]]

 
                                   L037D..........  RN/LPN/MTA......  F...............  Complete pre-                 5               3  CMS clinical
                                                                                         service                                          review.
                                                                                         diagnostic &
                                                                                         referral forms.
                                   L037D..........  RN/LPN/MTA......  NF..............  Obtain vital                  5               3  CMS clinical
                                                                                         signs.                                           review.
                                   L041B..........  Radiologic        NF..............  Prepare room,                 4               2  Standardized
                                                     Technologist.                       equipment,                                       time input.
                                                                                         supplies.
                                   SB019..........  drape-towel,      NF..............  ...............               4               2  CMS clinical
                                                     sterile 18in x                                                                       review.
                                                     26in.
35476..........  Repair venous     Ef027..........  table,            NF..............  ...............             302             277  Moderate
                  blockage.                          instrument,                                                                          Sedation
                                                     mobile.                                                                              equipment--Tim
                                                                                                                                          e includes
                                                                                                                                          administering
                                                                                                                                          anesthesia,
                                                                                                                                          procedure
                                                                                                                                          time, and
                                                                                                                                          monitoring
                                                                                                                                          patient.
                                   EL011..........  room,             NF..............  ...............              43              44  Refined
                                                     angiography.                                                                         equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ011..........  ECG, 3-channel    NF..............  ...............             137             277  Moderate
                                                     (with SpO2,                                                                          Sedation
                                                     NIBP, temp,                                                                          equipment--Tim
                                                     resp).                                                                               e includes
                                                                                                                                          administering
                                                                                                                                          anesthesia,
                                                                                                                                          procedure
                                                                                                                                          time, and
                                                                                                                                          monitoring
                                                                                                                                          patient.
                                   EQ032..........  IV infusion pump  NF..............  ...............             137             277  Moderate
                                                                                                                                          Sedation
                                                                                                                                          equipment--Tim
                                                                                                                                          e includes
                                                                                                                                          administering
                                                                                                                                          anesthesia,
                                                                                                                                          procedure
                                                                                                                                          time, and
                                                                                                                                          monitoring
                                                                                                                                          patient.
                                   EQ168..........  light, exam.....  NF..............  ...............             120              44  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  F...............  Schedule space                3               5  CMS clinical
                                                                                         and equipment                                    review.
                                                                                         in facility.
                                   L037D..........  RN/LPN/MTA......  NF..............  Obtain vital                  5               3  CMS clinical
                                                                                         signs.                                           review.
                                   L041B..........  Radiologic        NF..............  Prepare room,                 4               2  Standardized
                                                     Technologist.                       equipment,                                       time input.
                                                                                         supplies.
                                   SB019..........  drape-towel,      NF..............  ...............               4               2  CMS clinical
                                                     sterile 18in x                                                                       review.
                                                     26in.
36221..........  Place cath        EF018..........  stretcher.......  NF..............  ...............             272               0  CMS Code
                  thoracic aorta.                                                                                                         correction.
                                   EF027..........  table,            NF..............  ...............               0             272  CMS Code
                                                     instrument,                                                                          correction.
                                                     mobile.
                                   EL011..........  room,             NF..............  ...............              49              39  Refined
                                                     angiography.                                                                         equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ088..........  contrast media    NF..............  ...............              49              39  Refined
                                                     warmer.                                                                              equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER029..........  film alternator   NF..............  ...............              49              39  Refined
                                                     (motorized film                                                                      equipment time
                                                     viewbox).                                                                            to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.

[[Page 69100]]

 
                                   L037D..........  RN/LPN/MTA......  NF..............  Greet patient,                5               3  Standardized
                                                                                         provide                                          time input.
                                                                                         gowning,
                                                                                         assure
                                                                                         appropriate
                                                                                         medical
                                                                                         records are
                                                                                         available.
                                   L037D..........  RN/LPN/MTA......  NF..............  Obtain vital                  5               3  CMS clinical
                                                                                         signs.                                           review.
                                   L041A..........  Angio Technician  NF..............  Image Post                    5               0  CMS clinical
                                                                                         Processing.                                      review.
                                   L041B..........  Radiologic        NF..............  Prepare room,                 2               7  CMS clinical
                                                     Technologist.                       equipment,                                       review.
                                                                                         supplies.
                                   L041B..........  Radiologic        NF..............  Prepare and                   2               7  CMS clinical
                                                     Technologist.                       position                                         review.
                                                                                         patient/
                                                                                         monitor
                                                                                         patient/set up
                                                                                         IV.
                                   SD249..........  Sterile Radio-    NF..............  ...............               1               0  CMS clinical
                                                     opaque ruler                                                                         review.
                                                     (le Maitre,
                                                     documentation
                                                     available).
36222..........  Place cath        EF018..........  stretcher.......  NF..............  ...............             282               0  CMS Code
                  carotid/inom                                                                                                            correction.
                  art.
                                   EF027..........  table,            NF..............  ...............               0             282  CMS Code
                                                     instrument,                                                                          correction.
                                                     mobile.
                                   EL011..........  room,             NF..............  ...............              59              49  Refined
                                                     angiography.                                                                         equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ088..........  contrast media    NF..............  ...............              59              49  Refined
                                                     warmer.                                                                              equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER029..........  film alternator   NF..............  ...............              59              49  Refined
                                                     (motorized film                                                                      equipment time
                                                     viewbox).                                                                            to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Greet patient,                5               3  Standardized
                                                                                         provide                                          time input.
                                                                                         gowning,
                                                                                         assure
                                                                                         appropriate
                                                                                         medical
                                                                                         records are
                                                                                         available.
                                   L037D..........  RN/LPN/MTA......  NF..............  Obtain vital                  5               3  CMS clinical
                                                                                         signs.                                           review.
                                   SD147..........  catheter,         NF..............  ...............               1               0  CMS clinical
                                                     (Glide).                                                                             review.
                                   SD249..........  Sterile Radio-    NF..............  ...............               1               0  CMS clinical
                                                     opaque ruler                                                                         review.
                                                     (le Maitre,
                                                     documentation
                                                     available).
36223..........  Place cath        EF018..........  stretcher.......  NF..............  ...............             287               0  CMS Code
                  carotid/inom                                                                                                            correction.
                  art.
                                   EF027..........  table,            NF..............  ...............               0             287  CMS Code
                                                     instrument,                                                                          correction.
                                                     mobile.
                                   EL011..........  room,             NF..............  ...............              64              54  Refined
                                                     angiography.                                                                         equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ088..........  contrast media    NF..............  ...............              64              54  Refined
                                                     warmer.                                                                              equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER029..........  film alternator   NF..............  ...............              64              54  Refined
                                                     (motorized film                                                                      equipment time
                                                     viewbox).                                                                            to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.

[[Page 69101]]

 
                                   L037D..........  RN/LPN/MTA......  NF..............  Greet patient,                5               3  Standardized
                                                                                         provide                                          time input.
                                                                                         gowning,
                                                                                         assure
                                                                                         appropriate
                                                                                         medical
                                                                                         records are
                                                                                         available.
                                   L037D..........  RN/LPN/MTA......  NF..............  Obtain vital                  5               3  CMS clinical
                                                                                         signs.                                           review.
                                   SD249..........  Sterile Radio-    NF..............  ...............               1               0  CMS clinical
                                                     opaque ruler                                                                         review.
                                                     (le Maitre,
                                                     documentation
                                                     available).
36224..........  Place cath        EF018..........  stretcher.......  NF..............  ...............             292               0  CMS Code
                  carotd art.                                                                                                             correction.
                                   EF027..........  table,            NF..............  ...............               0             292  CMS Code
                                                     instrument,                                                                          correction.
                                                     mobile.
                                   EL011..........  room,             NF..............  ...............              69              59  Refined
                                                     angiography.                                                                         equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ088..........  contrast media    NF..............  ...............              69              59  Refined
                                                     warmer.                                                                              equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER029..........  film alternator   NF..............  ...............              69              59  Refined
                                                     (motorized film                                                                      equipment time
                                                     viewbox).                                                                            to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Greet patient,                5               3  Standardized
                                                                                         provide                                          time input.
                                                                                         gowning,
                                                                                         assure
                                                                                         appropriate
                                                                                         medical
                                                                                         records are
                                                                                         available.
                                   L037D..........  RN/LPN/MTA......  NF..............  Obtain vital                  5               3  CMS clinical
                                                                                         signs.                                           review.
36225..........  Place cath        EF018..........  stretcher.......  NF..............  ...............             287               0  CMS Code
                  subclavian art.                                                                                                         correction.
                                   EF027..........  table,            NF..............  ...............               0             287  CMS Code
                                                     instrument,                                                                          correction.
                                                     mobile.
                                   EL011..........  room,             NF..............  ...............              64              54  Refined
                                                     angiography.                                                                         equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ088..........  contrast media    NF..............  ...............              64              54  Refined
                                                     warmer.                                                                              equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER029..........  film alternator   NF..............  ...............              64              54  Refined
                                                     (motorized film                                                                      equipment time
                                                     viewbox).                                                                            to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Greet patient,                5               3  Standardized
                                                                                         provide                                          time input.
                                                                                         gowning,
                                                                                         assure
                                                                                         appropriate
                                                                                         medical
                                                                                         records are
                                                                                         available.
                                   L037D..........  RN/LPN/MTA......  NF..............  Obtain vital                  5               3  CMS clinical
                                                                                         signs.                                           review.
36226..........  Place cath        EF018..........  stretcher.......  NF..............  ...............             292               0  CMS Code
                  vertebral art.                                                                                                          correction.
                                   EF027..........  table,            NF..............  ...............               0             292  CMS Code
                                                     instrument,                                                                          correction.
                                                     mobile.
                                   EL011..........  room,             NF..............  ...............              69              59  Refined
                                                     angiography.                                                                         equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.

[[Page 69102]]

 
                                   EQ088..........  contrast media    NF..............  ...............              69              59  Refined
                                                     warmer.                                                                              equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER029..........  film alternator   NF..............  ...............              69              59  Refined
                                                     (motorized film                                                                      equipment time
                                                     viewbox).                                                                            to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Greet patient,                5               3  Standardized
                                                                                         provide                                          time input.
                                                                                         gowning,
                                                                                         assure
                                                                                         appropriate
                                                                                         medical
                                                                                         records are
                                                                                         available.
                                   L037D..........  RN/LPN/MTA......  NF..............  Obtain vital                  5               3  CMS clinical
                                                                                         signs.                                           review.
36228..........  Place cath        L041B..........  Radiologic        NF..............  Prepare room,                 1               0  CMS clinical
                  intracranial                       Technologist.                       equipment,                                       review.
                  art.                                                                   supplies.
                                   L041B..........  Radiologic        NF..............  Assisting with               23              22  CMS clinical
                                                     Technologist.                       flouroscopy/                                     review.
                                                                                         image
                                                                                         acquisition
                                                                                         (75%).
                                   SC057..........  syringe 5-6ml...  NF..............  ...............               4               0  CMS clinical
                                                                                                                                          review.
37197..........  Remove intrvas    EF027..........  table,            NF..............  ...............             305             302  Moderate
                  foreign body.                      instrument,                                                                          Sedation
                                                     mobile.                                                                              equipment--Tim
                                                                                                                                          e includes
                                                                                                                                          administering
                                                                                                                                          anesthesia,
                                                                                                                                          procedure
                                                                                                                                          time, and
                                                                                                                                          monitoring
                                                                                                                                          patient.
                                   EL011..........  room,             NF..............  ...............              77              72  Refined
                                                     angiography.                                                                         equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ011..........  ECG, 3-channel    NF..............  ...............             305             302  Moderate
                                                     (with SpO2,                                                                          Sedation
                                                     NIBP, temp,                                                                          equipment--Tim
                                                     resp).                                                                               e includes
                                                                                                                                          administering
                                                                                                                                          anesthesia,
                                                                                                                                          procedure
                                                                                                                                          time, and
                                                                                                                                          monitoring
                                                                                                                                          patient.
                                   EQ032..........  IV infusion pump  NF..............  ...............             305             302  Moderate
                                                                                                                                          Sedation
                                                                                                                                          equipment--Tim
                                                                                                                                          e includes
                                                                                                                                          administering
                                                                                                                                          anesthesia,
                                                                                                                                          procedure
                                                                                                                                          time, and
                                                                                                                                          monitoring
                                                                                                                                          patient.
                                   EQ088..........  contrast media    NF..............  ...............              77               0  CMS clinical
                                                     warmer.                                                                              review.
                                   EQ250..........  ultrasound unit,  NF..............  ...............              77               0  CMS clinical
                                                     portable.                                                                            review.
                                   ER029..........  film alternator   NF..............  ...............              77              72  Refined
                                                     (motorized film                                                                      equipment time
                                                     viewbox).                                                                            to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Greet patient,                5               3  Standardized
                                                                                         provide                                          time input.
                                                                                         gowning,
                                                                                         assure
                                                                                         appropriate
                                                                                         medical
                                                                                         records are
                                                                                         available.
                                   L037D..........  RN/LPN/MTA......  NF..............  Obtain vital                  5               3  CMS clinical
                                                                                         signs.                                           review.

[[Page 69103]]

 
                                   L041B..........  Radiologic        NF..............  Prepare room,                 7               5  CMS clinical
                                                     Technologist.                       equipment,                                       review.
                                                                                         supplies
                                                                                         (including
                                                                                         imaging
                                                                                         equipment).
                                   L041B..........  Radiologic        NF..............  Prepare and                   5               2  Standardized
                                                     Technologist.                       position                                         time input.
                                                                                         patient/
                                                                                         monitor
                                                                                         patient/set up
                                                                                         IV.
                                   SB048..........  sheath-cover,     NF..............  ...............               1               0  CMS clinical
                                                     sterile, 96in x                                                                      review.
                                                     6in
                                                     (transducer).
                                   SB048..........  sheath-cover,     NF..............  ...............               1               0  CMS clinical
                                                     sterile, 96in x                                                                      review.
                                                     6in
                                                     (transducer).
                                   SD147..........  catheter,         NF..............  ...............               1               0  CMS clinical
                                                     (Glide).                                                                             review.
                                   SD252..........  guidewire,        NF..............  ...............               1               0  CMS clinical
                                                     Amplatz wire                                                                         review.
                                                     260 cm.
                                   SH065..........  sodium chloride   NF..............  ...............               2               0  CMS clinical
                                                     0.9% flush                                                                           review.
                                                     syringe.
47600..........  Removal of        SA053..........  pack, post-op     F...............  ...............               1               0  CMS clinical
                  gallbladder.                       incision care                                                                        review.
                                                     (suture &
                                                     staple).
                                   SA054..........  pack, post-op     F...............  ...............               0               1  CMS clinical
                                                     incision care                                                                        review.
                                                     (suture).
47605..........  Removal of        SA053..........  pack, post-op     F...............  ...............               1               0  CMS clinical
                  gallbladder.                       incision care                                                                        review.
                                                     (suture &
                                                     staple).
                                   SA054..........  pack, post-op     F...............  ...............               0               1  CMS clinical
                                                     incision care                                                                        review.
                                                     (suture).
50590..........  Fragmenting of    EL014..........  room,             NF..............  ...............              86               0  Consistent with
                  kidney stone.                      radiographic-                                                                        the AMA RUC's
                                                     fluoroscopic.                                                                        CY2011
                                                                                                                                          recommendation
                                                                                                                                          .
                                   EQ175..........  lithotriptor,     NF..............  ...............              86              67  Refined
                                                     with C-arm                                                                           equipment time
                                                     (ESWL).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
52214..........  Cystoscopy and    EF027..........  table,            NF..............  ...............             100              65  Refined
                  treatment.                         instrument,                                                                          equipment time
                                                     mobile.                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............             100              65  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ137..........  instrument pack,  NF..............  ...............             100              65  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ153..........  laser (gs, uro,   NF..............  ...............             100              65  Refined
                                                     obg, ge)                                                                             equipment time
                                                     (Indigo Optima).                                                                     to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ167..........  light source,     NF..............  ...............             100              65  Refined
                                                     xenon.                                                                               equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ES006..........  endoscope         NF..............  ...............             100              65  Refined
                                                     forceps, biopsy.                                                                     equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.

[[Page 69104]]

 
                                   ES007..........  endoscope         NF..............  ...............             100              65  Refined
                                                     forceps,                                                                             equipment time
                                                     grasping.                                                                            to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ES018..........  fiberscope,       NF..............  ...............             100              92  Refined
                                                     flexible,                                                                            equipment time
                                                     cystoscopy.                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ES031..........  video system,     NF..............  ...............             100              65  Refined
                                                     endoscopy                                                                            equipment time
                                                     (processor,                                                                          to reflect
                                                     digital                                                                              typical use
                                                     capture,                                                                             exclusive to
                                                     monitor,                                                                             patient.
                                                     printer, cart).
                                   L037D..........  RN/LPN/MTA......  NF..............  Review Chart...               3               0  CMS clinical
                                                                                                                                          review.
                                   SB019..........  drape-towel,      NF..............  ...............               1               0  Duplicative.
                                                     sterile 18in x
                                                     26in.
                                   SB024..........  gloves, sterile.  NF..............  ...............               0               1  CMS clinical
                                                                                                                                          review.
                                   SD270..........  Penis clamp.....  NF..............  ...............               1               0  Not a
                                                                                                                                          disposable
                                                                                                                                          supply.
                                   SH047..........  lidocaine 1%-2%   NF..............  ...............              50               0  Duplicative.
                                                     inj (Xylocaine).
52224..........  Cystoscopy and    EF027..........  table,            NF..............  ...............             105              67  Refined
                  treatment.                         instrument,                                                                          equipment time
                                                     mobile.                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............             105              67  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ137..........  instrument pack,  NF..............  ...............             105              67  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ153..........  laser (gs, uro,   NF..............  ...............             105              67  Refined
                                                     obg, ge)                                                                             equipment time
                                                     (Indigo Optima).                                                                     to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ167..........  light source,     NF..............  ...............             105              67  Refined
                                                     xenon.                                                                               equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ES006..........  endoscope         NF..............  ...............             105              67  Refined
                                                     forceps, biopsy.                                                                     equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ES007..........  endoscope         NF..............  ...............             105              67  Refined
                                                     forceps,                                                                             equipment time
                                                     grasping.                                                                            to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ES018..........  fiberscope,       NF..............  ...............             105              94  Refined
                                                     flexible,                                                                            equipment time
                                                     cystoscopy.                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ES031..........  video system,     NF..............  ...............             105              67  Refined
                                                     endoscopy                                                                            equipment time
                                                     (processor,                                                                          to reflect
                                                     digital                                                                              typical use
                                                     capture,                                                                             exclusive to
                                                     monitor,                                                                             patient.
                                                     printer, cart).
                                   L037D..........  RN/LPN/MTA......  NF..............  Review Chart...               3               0  CMS clinical
                                                                                                                                          review.
                                   L037D..........  RN/LPN/MTA......  NF..............  Prepare biopsy                5               2  CMS clinical
                                                                                         Specimen.                                        review.

[[Page 69105]]

 
                                   SB019..........  drape-towel,      NF..............  ...............               1               0  Duplicative.
                                                     sterile 18in x
                                                     26in.
                                   SB024..........  gloves, sterile.  NF..............  ...............               3               1  CMS clinical
                                                                                                                                          review.
                                   SD270..........  Penis clamp.....  NF..............  ...............               1               0  Not a
                                                                                                                                          disposable
                                                                                                                                          according to
                                                                                                                                          submitted
                                                                                                                                          invoice.
                                   SH047..........  lidocaine 1%-2%   NF..............  ...............              50               0  Duplicative.
                                                     inj (Xylocaine).
                                   SL036..........  cup, biopsy-      NF..............  ...............               6               3  CMS clinical
                                                     specimen                                                                             review.
                                                     sterile 4oz.
52287..........  Cystoscopy        EF027..........  table,            NF..............  ...............              78              49  Refined
                  chemodenervatio                    instrument,                                                                          equipment time
                  n.                                 mobile.                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              78              49  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ170..........  light,            NF..............  ...............              78              49  Refined
                                                     fiberoptic                                                                           equipment time
                                                     headlight w-                                                                         to reflect
                                                     source.                                                                              typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ES018..........  fiberscope,       NF..............  ...............              78              76  Refined
                                                     flexible,                                                                            equipment time
                                                     cystoscopy.                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ES031..........  video system,     NF..............  ...............              78              49  Refined
                                                     endoscopy                                                                            equipment time
                                                     (processor,                                                                          to reflect
                                                     digital                                                                              typical use
                                                     capture,                                                                             exclusive to
                                                     monitor,                                                                             patient.
                                                     printer, cart).
                                   L037D..........  RN/LPN/MTA......  NF..............  Assist                       20              21  Conforming to
                                                                                         physician in                                     physician
                                                                                         performing                                       time.
                                                                                         procedure.
                                   SH048..........  lidocaine 2%      NF..............  ...............              10               0  Duplicative.
                                                     jelly, topical
                                                     (Xylocaine).
53850..........  Prostatic         EF020..........  stretcher,        NF..............  ...............              99              85  Refined
                  microwave                          endoscopy.                                                                           equipment time
                  thermotx.                                                                                                               to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF027..........  table,            NF..............  ...............              99              85  Refined
                                                     instrument,                                                                          equipment time
                                                     mobile.                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............             169             152  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ037..........  TUMT system       NF..............  ...............              99              85  Refined
                                                     control unit.                                                                        equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ168..........  light, exam.....  NF..............  ...............             169             152  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ168..........  light, exam.....  F...............  ...............             169             152  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.

[[Page 69106]]

 
                                   EQ250..........  ultrasound unit,  NF..............  ...............              99              85  Refined
                                                     portable.                                                                            equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Prepare room,                 2               4  CMS clinical
                                                                                         equipment,                                       review.
                                                                                         supplies.
                                   L037D..........  RN/LPN/MTA......  NF..............  Setup                         5               0  CMS clinical
                                                                                         ultrasound                                       review.
                                                                                         probe.
                                   L037D..........  RN/LPN/MTA......  NF..............  Setup TUMT                    5               0  CMS clinical
                                                                                         machine.                                         review.
                                   L037D..........  RN/LPN/MTA......  NF..............  Clean TUMT                    3               0  CMS clinical
                                                                                         machine.                                         review.
                                   SB022..........  gloves, non-      NF..............  ...............               3               2  CMS clinical
                                                     sterile.                                                                             review.
                                   SB024..........  gloves, sterile.  NF..............  ...............               3               2  CMS clinical
                                                                                                                                          review.
                                   SH047..........  lidocaine 1%-2%   NF..............  ...............               3              30  CMS clinical
                                                     inj (Xylocaine).                                                                     review.
64612..........  Destroy nerve     EL006..........  lane, screening   F...............  ...............              39              27  Refined
                  face muscle.                       (oph).                                                                               equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EL006..........  lane, screening   NF..............  ...............              48              45  Refined
                                                     (oph).                                                                               equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   SC031..........  needle, 30g.....  F...............  ...............               0               1  CMS clinical
                                                                                                                                          review.
64615..........  Chemodenerv musc  EF023..........  table, exam.....  NF..............  ...............              24              18  Refined
                  migraine.                                                                                                               equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
65800..........  Drainage of eye.  E7111..........  Lane, Screening.  NF..............  ...............              21              22  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ137..........  instrument pack,  NF..............  ...............              21              22  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
67810..........  Biopsy eyelid &   EF014..........  light, surgical.  NF..............  ...............              20              22  Refined
                  lid margin.                                                                                                             equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF031..........  table, power....  NF..............  ...............              20              22  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ110..........  electrocautery-   NF..............  ...............               1              22  Refined
                                                     hyfrecator, up                                                                       equipment time
                                                     to 45 watts.                                                                         to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ137..........  instrument pack,  NF..............  ...............               1              30  Refined
                                                     basic ($500-                                                                         equipment time
                                                     $1499).                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   SB011..........  drape, sterile,   NF..............  ...............               0               1  CMS clinical
                                                     fenestrated                                                                          review.
                                                     16in x 29in.
                                   SB019..........  drape-towel,      NF..............  ...............               4               1  CMS clinical
                                                     sterile 18in x                                                                       review.
                                                     26in.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  Standardized
                                                                                                                                          time input.

[[Page 69107]]

 
72040..........  X-ray exam neck   ED025..........  film processor,   NF..............  ...............              20               4  Refined
                  spine 3/vws.                      wet.                                                                                 equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EL012..........  room, basic       NF..............  ...............              36              25  Refined
                                                     radiology.                                                                           equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER029..........  film alternator   NF..............  ...............              36               8  Refined
                                                     (motorized film                                                                      equipment time
                                                     viewbox).                                                                            to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                                    Film jacket or    NF..............  ...............               1               0  Non-standard
                                                     jacket insert.                                                                       direct
                                                                                                                                          practice
                                                                                                                                          expense input.
72191..........  Ct angiograph     EL007..........  room, CT........  NF..............  ...............             101              40  Refined
                  pelv w/o&w/dye.                                                                                                         equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L041B..........  Radiologic        NF..............  --Retrieve                    0               5  CMS Clinical
                                                     Technologist.                       prior                                            Review.
                                                                                         appropriate
                                                                                         imaging exams
                                                                                         and hang for
                                                                                         MD review,
                                                                                         verify orders,
                                                                                         review the
                                                                                         chart to
                                                                                         incorporate
                                                                                         relevant
                                                                                         clinical
                                                                                         information.
                                   L041B..........  Radiologic        NF..............  Greet patient,                0               3  CMS Clinical
                                                     Technologist.                       provide                                          Review.
                                                                                         gowning,
                                                                                         assure
                                                                                         appropriate
                                                                                         medical
                                                                                         records are
                                                                                         available.

[[Page 69108]]

 
                                   L041B..........  Radiologic        NF..............  Education/                    0               2  CMS Clinical
                                                     Technologist.                       instruction/                                     Review.
                                                                                         counseling/
                                                                                         obtain consent.
                                   L041B..........  Radiologic        NF..............  Prepare room,                 0               2  Standardized
                                                     Technologist.                       equipment,                                       time input.
                                                                                         supplies.
                                   L041B..........  Radiologic        NF..............  Prepare and                   0               7  CMS Clinical
                                                     Technologist.                       position                                         Review.
                                                                                         patient/
                                                                                         monitor
                                                                                         patient/set up
                                                                                         IV.
                                   L041B..........  Radiologic        NF..............  Aquire images..               0              28  CMS Clinical
                                                     Technologist.                                                                        Review.
                                   L041B..........  Radiologic        NF..............  Clean room/                   0               3  CMS Clinical
                                                     Technologist.                       equipment by                                     Review.
                                                                                         physician
                                                                                         staff.
                                   L046A..........  CT Technologist.  NF..............  --Retrieve                    5               0  CMS Clinical
                                                                                         prior                                            Review.
                                                                                         appropriate
                                                                                         imaging exams
                                                                                         and hang for
                                                                                         MD review,
                                                                                         verify orders,
                                                                                         review the
                                                                                         chart to
                                                                                         incorporate
                                                                                         relevant
                                                                                         clinical
                                                                                         information.
                                   L046A..........  CT Technologist.  NF..............  Greet patient,                3               0  CMS Clinical
                                                                                         provide                                          Review.
                                                                                         gowning,
                                                                                         assure
                                                                                         appropriate
                                                                                         medical
                                                                                         records are
                                                                                         available.
                                   L046A..........  CT Technologist.  NF..............  Education/                    2               0  CMS Clinical
                                                                                         instruction/                                     Review.
                                                                                         counseling/
                                                                                         obtain consent.
                                   L046A..........  CT Technologist.  NF..............  Prepare room,                 5               0  CMS Clinical
                                                                                         equipment,                                       Review.
                                                                                         supplies.
                                   L046A..........  CT Technologist.  NF..............  Prepare and                   7               0  CMS Clinical
                                                                                         position                                         Review.
                                                                                         patient/
                                                                                         monitor
                                                                                         patient/set up
                                                                                         IV.
                                   L046A..........  CT Technologist.  NF..............  Aquire images..              28               0  CMS Clinical
                                                                                                                                          Review.
                                   L046A..........  CT Technologist.  NF..............  Clean room/                   3               0  CMS Clinical
                                                                                         equipment by                                     Review.
                                                                                         physician
                                                                                         staff.
                                   SK016..........  computer media,   NF..............  ...............               1             0.1  CMS clinical
                                                     optical disk                                                                         review.
                                                     2.6gb.
72192..........  Ct pelvis w/o     ED024..........  film processor,   NF..............  ...............               5               0  CMS clinical
                  dye.                               dry, laser.                                                                          review.
                                   ED032..........  printer, laser,   NF..............  ...............               0               5  CMS clinical
                                                     paper.                                                                               review.
                                   EL007..........  room, CT........  NF..............  ...............              45              22  CMS clinical
                                                                                                                                          review.
                                   L046A..........  CT Technologist.  NF..............  Pre-Service                   6               4  CMS clinical
                                                                                         Period.                                          review.
                                   SK013..........  computer media,   NF..............  ...............               1               0  CMS clinical
                                                     dvd.                                                                                 review.
                                   SK016..........  computer media,   NF..............  ...............               0             0.1  CMS clinical
                                                     optical disk                                                                         review.
                                                     2.6gb.
                                   SK076..........  slide sleeve      NF..............  ...............               0               1  CMS clinical
                                                     (photo slides).                                                                      review.
                                   SK091..........  x-ray envelope..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
                                   SK098..........  film, x-ray,      NF..............  ...............               4               8  CMS clinical
                                                     laser print.                                                                         review.
72193..........  Ct pelvis w/dye.  ED024..........  film processor,   NF..............  ...............               5               0  CMS clinical
                                                     dry, laser.                                                                          review.
                                   ED032..........  printer, laser,   NF..............  ...............               0               5  CMS clinical
                                                     paper.                                                                               review.
                                   EL007..........  room, CT........  NF..............  ...............              40              32  CMS clinical
                                                                                                                                          review.
                                   L046A..........  CT Technologist.  NF..............  Pre-Service                   7               4  CMS clinical
                                                                                         Period.                                          review.
                                   L046A..........  CT Technologist.  NF..............  Service Period.              40              43  CMS clinical
                                                                                                                                          review.

[[Page 69109]]

 
                                   SB006..........  drape, non-       NF..............  ...............               1               0  CMS clinical
                                                     sterile, sheet                                                                       review.
                                                     40in x 60in.
                                   SB014..........  drape, sterile,   NF..............  ...............               0               1  CMS clinical
                                                     three-quarter                                                                        review.
                                                     sheet.
                                   SC001..........  angiocatheter     NF..............  ...............               1               0  CMS clinical
                                                     14g-24g.                                                                             review.
                                   SC002..........  angiocatheter     NF..............  ...............               0               1  CMS clinical
                                                     set.                                                                                 review.
                                   SC025..........  needle, 14-20g,   NF..............  ...............               0               1  CMS clinical
                                                     biopsy.                                                                              review.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
                                   SC059..........  syringe, 25ml     NF..............  ...............               0               1  CMS clinical
                                                     (MRI power                                                                           review.
                                                     injector).
                                   SG059..........  oto-wick........  NF..............  ...............               0               6  CMS clinical
                                                                                                                                          review.
                                   SG068..........  plaster bandage   NF..............  ...............               1               0  CMS clinical
                                                     (4in x 5yd uou).                                                                     review.
                                   SG079..........  tape, surgical    NF..............  ...............               6               0  CMS clinical
                                                     paper 1in                                                                            review.
                                                     (Micropore).
                                   SH065..........  sodium chloride   NF..............  ...............               0              15  CMS clinical
                                                     0.9% flush                                                                           review.
                                                     syringe.
                                   SK013..........  computer media,   NF..............  ...............               1               0  CMS clinical
                                                     dvd.                                                                                 review.
                                   SK016..........  computer media,   NF..............  ...............               0             0.1  CMS clinical
                                                     optical disk                                                                         review.
                                                     2.6gb.
                                   SK076..........  slide sleeve      NF..............  ...............               0               1  CMS clinical
                                                     (photo slides).                                                                      review.
                                   SK091..........  x-ray envelope..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
72194..........  Ct pelvis w/o &   ED024..........  film processor,   NF..............  ...............              10               7  CMS clinical
                  w/dye.                             dry, laser.                                                                          review.
                                   EL007..........  room, CT........  NF..............  ...............              54              39  CMS clinical
                                                                                                                                          review.
                                   ER029..........  film alternator   NF..............  ...............              10               7  CMS clinical
                                                     (motorized film                                                                      review.
                                                     viewbox).
                                   L046A..........  CT Technologist.  NF..............  Pre-Service                   7               4  CMS clinical
                                                                                         Period.                                          review.
                                   L046A..........  CT Technologist.  NF..............  Service Period.              54              52  CMS clinical
                                                                                                                                          review.
                                   SC025..........  needle, 14-20g,   NF..............  ...............               0               1  CMS clinical
                                                     biopsy.                                                                              review.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
                                   SK013..........  computer media,   NF..............  ...............               1               0  CMS clinical
                                                     dvd.                                                                                 review.
                                   SK016..........  computer media,   NF..............  ...............               0             0.1  CMS clinical
                                                     optical disk                                                                         review.
                                                     2.6gb.
                                   SK076..........  slide sleeve      NF..............  ...............               0               1  CMS clinical
                                                     (photo slides).                                                                      review.
                                   SK091..........  x-ray envelope..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
                                   SK098..........  film, x-ray,      NF..............  ...............               0               8  CMS clinical
                                                     laser print.                                                                         review.
73221..........  Mri joint upr     ED024..........  film processor,   NF..............  ...............              63              33  Refined
                  extrem w/o dye.                    dry, laser.                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EL008..........  room, MR........  NF..............  ...............              63              33  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER029..........  film alternator   NF..............  ...............              63              33  Refined
                                                     (motorized film                                                                      equipment time
                                                     viewbox).                                                                            to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.

[[Page 69110]]

 
                                   L047A..........  MRI Technologist  NF..............  Prepare room,                 5               3  CMS clinical
                                                                                         equipment,                                       review.
                                                                                         supplies.
                                   L047A..........  MRI Technologist  NF..............  Prepare and                   3               2  Standardized
                                                                                         position                                         time input.
                                                                                         patient/
                                                                                         monitor
                                                                                         patient/set up
                                                                                         IV.
                                   L047A..........  MRI Technologist  NF..............  Escort patient                2               0  Non-standard
                                                                                         from exam room                                   direct
                                                                                         due to                                           practice
                                                                                         magnetic                                         expense input.
                                                                                         sensitivity.
                                                    Insert folder...  NF..............  ...............               1               0  Non-standard
                                                                                                                                          direct
                                                                                                                                          practice
                                                                                                                                          expense input.
73721..........  Mri jnt of lwr    ED024..........  film processor,   NF..............  ...............              63              33  Refined
                  extre w/o dye.                     dry, laser.                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EL008..........  room, MR........  NF..............  ...............              63              33  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER029..........  film alternator   NF..............  ...............              63              33  Refined
                                                     (motorized film                                                                      equipment time
                                                     viewbox).                                                                            to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L047A..........  MRI Technologist  NF..............  Prepare room,                 5               3  CMS clinical
                                                                                         equipment,                                       review.
                                                                                         supplies.
                                   L047A..........  MRI Technologist  NF..............  Prepare and                   3               2  Standardized
                                                                                         position                                         time input.
                                                                                         patient/
                                                                                         monitor
                                                                                         patient/set up
                                                                                         IV.
                                   L047A..........  MRI Technologist  NF..............  Escort patient                2               0  Non-standard
                                                                                         from exam room                                   direct
                                                                                         due to                                           practice
                                                                                         magnetic                                         expense input.
                                                                                         sensitivity.
                                                    Insert folder...  NF..............  ...............               1               0  Non-standard
                                                                                                                                          direct
                                                                                                                                          practice
                                                                                                                                          expense input.
74150..........  Ct abdomen w/o    ED024..........  film processor,   NF..............  ...............               5               0  CMS clinical
                  dye.                               dry, laser.                                                                          review.
                                   ED032..........  printer, laser,   NF..............  ...............               0               5  CMS clinical
                                                     paper.                                                                               review.
                                   EL007..........  room, CT........  NF..............  ...............              32              22  CMS clinical
                                                                                                                                          review.
                                   L046A..........  CT Technologist.  NF..............  Pre-Service                   6               4  CMS clinical
                                                                                         Period.                                          review.
                                   SK013..........  computer media,   NF..............  ...............               1               0  CMS clinical
                                                     dvd.                                                                                 review.
                                   SK016..........  computer media,   NF..............  ...............               0             0.1  CMS clinical
                                                     optical disk                                                                         review.
                                                     2.6gb.
                                   SK076..........  slide sleeve      NF..............  ...............               0               1  CMS clinical
                                                     (photo slides).                                                                      review.
                                   SK091..........  x-ray envelope..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
                                   SK098..........  film, x-ray,      NF..............  ...............               4               8  CMS clinical
                                                     laser print.                                                                         review.
74160..........  Ct abdomen w/dye  ED024..........  film processor,   NF..............  ...............               7               0  CMS clinical
                                                     dry, laser.                                                                          review.
                                   ED032..........  printer, laser,   NF..............  ...............               0               5  CMS clinical
                                                     paper.                                                                               review.
                                   EL007..........  room, CT........  NF..............  ...............              47              32  CMS clinical
                                                                                                                                          review.
                                   ER029..........  film alternator   NF..............  ...............               7               5  CMS clinical
                                                     (motorized film                                                                      review.
                                                     viewbox).
                                   L046A..........  CT Technologist.  NF..............  Pre-Service                   7               4  CMS clinical
                                                                                         Period.                                          review.
                                   L046A..........  CT Technologist.  NF..............  Service Period.              47              43  CMS clinical
                                                                                                                                          review.

[[Page 69111]]

 
                                   SB006..........  drape, non-       NF..............  ...............               1               0  CMS clinical
                                                     sterile, sheet                                                                       review.
                                                     40in x 60in.
                                   SB014..........  drape, sterile,   NF..............  ...............               0               1  CMS clinical
                                                     three-quarter                                                                        review.
                                                     sheet.
                                   SC001..........  angiocatheter     NF..............  ...............               1               0  CMS clinical
                                                     14g-24g.                                                                             review.
                                   SC002..........  angiocatheter     NF..............  ...............               0               1  CMS clinical
                                                     set.                                                                                 review.
                                   SC025..........  needle, 14-20g,   NF..............  ...............               0               1  CMS clinical
                                                     biopsy.                                                                              review.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
                                   SC059..........  syringe, 25ml     NF..............  ...............               0               1  CMS clinical
                                                     (MRI power                                                                           review.
                                                     injector).
                                   SG059..........  oto-wick........  NF..............  ...............               0               1  CMS clinical
                                                                                                                                          review.
                                   SG075..........  tape, elastic,    NF..............  ...............               0               6  CMS clinical
                                                     1in                                                                                  review.
                                                     (Elastoplast,
                                                     Elasticon) (5yd
                                                     uou).
                                   SG079..........  tape, surgical    NF..............  ...............               6               0  CMS clinical
                                                     paper 1in                                                                            review.
                                                     (Micropore).
                                   SH065..........  sodium chloride   NF..............  ...............               0              15  CMS clinical
                                                     0.9% flush                                                                           review.
                                                     syringe.
                                   SH068..........  sodium chloride   NF..............  ...............               1               0  CMS clinical
                                                     0.9% inj                                                                             review.
                                                     bacteriostatic
                                                     (30ml uou).
                                   SK013..........  computer media,   NF..............  ...............               1               0  CMS clinical
                                                     dvd.                                                                                 review.
                                   SK016..........  computer media,   NF..............  ...............               0             0.1  CMS clinical
                                                     optical disk                                                                         review.
                                                     2.6gb.
                                   SK076..........  slide sleeve      NF..............  ...............               0               1  CMS clinical
                                                     (photo slides).                                                                      review.
                                   SK091..........  x-ray envelope..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
                                   SK098..........  film, x-ray,      NF..............  ...............               6               4  CMS clinical
                                                     laser print.                                                                         review.
74170..........  Ct abdomen w/o &  ED024..........  film processor,   NF..............  ...............              15               7  Refined
                  w/dye.                             dry, laser.                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EL007..........  room, CT........  NF..............  ...............              65              39  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER029..........  film alternator   NF..............  ...............              15               7  Refined
                                                     (motorized film                                                                      equipment time
                                                     viewbox).                                                                            to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L046A..........  CT Technologist.  NF..............  --Retrieve                    7               4  CMS clinical
                                                                                         prior                                            review.
                                                                                         appropriate
                                                                                         imaging exams
                                                                                         and hang for
                                                                                         MD review,
                                                                                         verify orders,
                                                                                         review the
                                                                                         chart to
                                                                                         incorporate
                                                                                         relevant
                                                                                         clinical
                                                                                         information
                                                                                         and confirm
                                                                                         contrast
                                                                                         protocol with
                                                                                         interpreting
                                                                                         MD.
                                   L046A..........  CT Technologist.  NF..............  Assist                       32              27  CMS clinical
                                                                                         physician in                                     review.
                                                                                         performing
                                                                                         procedure.
                                   L046A..........  CT Technologist.  NF..............  Image Post                   15               7  CMS clinical
                                                                                         Processing.                                      review.

[[Page 69112]]

 
                                   SB006..........  drape, non-       NF..............  ...............               1               0  CMS clinical
                                                     sterile, sheet                                                                       review.
                                                     40in x 60in.
                                   SB014..........  drape, sterile,   NF..............  ...............               0               1  CMS clinical
                                                     three-quarter                                                                        review.
                                                     sheet.
                                   SC001..........  angiocatheter     NF..............  ...............               1               0  CMS clinical
                                                     14g-24g.                                                                             review.
                                   SC002..........  angiocatheter     NF..............  ...............               0               1  CMS clinical
                                                     set.                                                                                 review.
                                   SC025..........  needle, 14-20g,   NF..............  ...............               0               1  CMS clinical
                                                     biopsy.                                                                              review.
                                   SC029..........  needle, 18-27g..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
                                   SC059..........  syringe, 25ml     NF..............  ...............               0               1  CMS clinical
                                                     (MRI power                                                                           review.
                                                     injector).
                                   SG075..........  tape, elastic,    NF..............  ...............               0               6  CMS clinical
                                                     1in                                                                                  review.
                                                     (Elastoplast,
                                                     Elasticon) (5yd
                                                     uou).
                                   SG079..........  tape, surgical    NF..............  ...............               6               0  CMS clinical
                                                     paper 1in                                                                            review.
                                                     (Micropore).
                                   SH016..........  barium            NF..............  ...............             900               0  CMS clinical
                                                     suspension                                                                           review.
                                                     (Polibar).
                                   SH065..........  sodium chloride   NF..............  ...............               0              15  CMS clinical
                                                     0.9% flush                                                                           review.
                                                     syringe.
                                   SH068..........  sodium chloride   NF..............  ...............               1               0  CMS clinical
                                                     0.9% inj                                                                             review.
                                                     bacteriostatic
                                                     (30ml uou).
                                   SK013..........  computer media,   NF..............  ...............               1               0  CMS clinical
                                                     dvd.                                                                                 review.
                                   SK016..........  computer media,   NF..............  ...............               0             0.1  CMS clinical
                                                     optical disk                                                                         review.
                                                     2.6gb.
                                   SK050..........  neurobehavioral   NF..............  ...............               0               1  CMS clinical
                                                     status forms,                                                                        review.
                                                     average.
                                   SK076..........  slide sleeve      NF..............  ...............               0               1  CMS clinical
                                                     (photo slides).                                                                      review.
                                   SK091..........  x-ray envelope..  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
                                   SK098..........  film, x-ray,      NF..............  ...............              14               8  CMS clinical
                                                     laser print.                                                                         review.
74175..........  Ct angio abdom w/ EL007..........  room, CT........  NF..............  ...............             101              40  Refined
                  o & w/dye.                                                                                                              equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L041B..........  Radiologic        NF..............  --Retrieve                    0               5  CMS clinical
                                                     Technologist.                       prior                                            review.
                                                                                         appropriate
                                                                                         imaging exams
                                                                                         and hang for
                                                                                         MD review,
                                                                                         verify orders,
                                                                                         review the
                                                                                         chart to
                                                                                         incorporate
                                                                                         relevant
                                                                                         clinical
                                                                                         information.
                                   L041B..........  Radiologic        NF..............  Greet patient,                0               3  CMS clinical
                                                     Technologist.                       provide                                          review.
                                                                                         gowning,
                                                                                         assure
                                                                                         appropriate
                                                                                         medical
                                                                                         records are
                                                                                         available.
                                   L041B..........  Radiologic        NF..............  Education/                    0               2  CMS clinical
                                                     Technologist.                       instruction/                                     review.
                                                                                         counseling/
                                                                                         obtain consent.
                                   L041B..........  Radiologic        NF..............  Prepare room,                 0               2  Standardized
                                                     Technologist.                       equipment,                                       time input.
                                                                                         supplies.

[[Page 69113]]

 
                                   L041B..........  Radiologic        NF..............  Prepare and                   0               7  CMS clinical
                                                     Technologist.                       position                                         review.
                                                                                         patient/
                                                                                         monitor
                                                                                         patient/set up
                                                                                         IV.
                                   L041B..........  Radiologic        NF..............  Aquire images..               0              28  CMS clinical
                                                     Technologist.                                                                        review.
                                   L041B..........  Radiologic        NF..............  Clean room/                   0               3  CMS clinical
                                                     Technologist.                       equipment by                                     review.
                                                                                         physician
                                                                                         staff.
                                   L046A..........  CT Technologist.  NF..............  --Retrieve                    5               0  CMS clinical
                                                                                         prior                                            review.
                                                                                         appropriate
                                                                                         imaging exams
                                                                                         and hang for
                                                                                         MD review,
                                                                                         verify orders,
                                                                                         review the
                                                                                         chart to
                                                                                         incorporate
                                                                                         relevant
                                                                                         clinical
                                                                                         information.
                                   L046A..........  CT Technologist.  NF..............  Greet patient,                3               0  CMS clinical
                                                                                         provide                                          review.
                                                                                         gowning,
                                                                                         assure
                                                                                         appropriate
                                                                                         medical
                                                                                         records are
                                                                                         available.
                                   L046A..........  CT Technologist.  NF..............  Education/                    2               0  CMS clinical
                                                                                         instruction/                                     review.
                                                                                         counseling/
                                                                                         obtain consent.
                                   L046A..........  CT Technologist.  NF..............  Prepare room,                 5               0  CMS clinical
                                                                                         equipment,                                       review.
                                                                                         supplies.
                                   L046A..........  CT Technologist.  NF..............  Prepare and                   7               0  CMS clinical
                                                                                         position                                         review.
                                                                                         patient/
                                                                                         monitor
                                                                                         patient/set up
                                                                                         IV.
                                   L046A..........  CT Technologist.  NF..............  Aquire images..              28               0  CMS clinical
                                                                                                                                          review.
                                   L046A..........  CT Technologist.  NF..............  Clean room/                   3               0  CMS clinical
                                                                                         equipment by                                     review.
                                                                                         physician
                                                                                         staff.
                                   SK016..........  computer media,   NF..............  ...............               1             0.1  CMS clinical
                                                     optical disk                                                                         review.
                                                     2.6gb.
74176..........  Ct abd & pelvis.  ED032..........  printer, laser,   NF..............  ...............               8               7  CMS clinical
                                                     paper.                                                                               review.
                                   ER029..........  film alternator   NF..............  ...............              27               7  CMS clinical
                                                     (motorized film                                                                      review.
                                                     viewbox).
                                   L046A..........  CT Technologist.  NF..............  Service Period.              40              39  CMS clinical
                                                                                                                                          review.
                                   SK016..........  computer media,   NF..............  ...............               0             0.1  CMS clinical
                                                     optical disk                                                                         review.
                                                     2.6gb.
                                   SK076..........  slide sleeve      NF..............  ...............               0               1  CMS clinical
                                                     (photo slides).                                                                      review.
74177..........  Ct abd & pelv w/  ED032..........  printer, laser,   NF..............  ...............              10               7  CMS clinical
                  contrast.                          paper.                                                                               review.
                                   EL007..........  room, CT........  NF..............  ...............              42              39  CMS clinical
                                                                                                                                          review.
                                   ER029..........  film alternator   NF..............  ...............              42               7  CMS clinical
                                                     (motorized film                                                                      review.
                                                     viewbox).
                                   L046A..........  CT Technologist.  NF..............  Pre-Service                   7               6  CMS clinical
                                                                                         Period.                                          review.
                                   L046A..........  CT Technologist.  NF..............  Service Period.              58              52  CMS clinical
                                                                                                                                          review.
                                   SK016..........  computer media,   NF..............  ...............               0             0.1  CMS clinical
                                                     optical disk                                                                         review.
                                                     2.6gb.
                                   SK076..........  slide sleeve      NF..............  ...............               0               1  CMS clinical
                                                     (photo slides).                                                                      review.
                                   SK098..........  film, x-ray,      NF..............  ...............              10               8  CMS clinical
                                                     laser print.                                                                         review.
74178..........  Ct abd & pelv 1/  ED032..........  printer, laser,   NF..............  ...............              20              10  CMS clinical
                  > regns.                           paper.                                                                               review.
                                   EL007..........  room, CT........  NF..............  ...............              57              48  CMS clinical
                                                                                                                                          review.

[[Page 69114]]

 
                                   ER029..........  film alternator   NF..............  ...............              57              10  CMS clinical
                                                     (motorized film                                                                      review.
                                                     viewbox).
                                   L046A..........  CT Technologist.  NF..............  Pre-Service                   7               6  CMS clinical
                                                                                         Period.                                          review.
                                   L046A..........  CT Technologist.  NF..............  Service Period.              83              64  CMS clinical
                                                                                                                                          review.
                                   SK016..........  computer media,   NF..............  ...............               0             0.1  CMS clinical
                                                     optical disk                                                                         review.
                                                     2.6gb.
                                   SK076..........  slide sleeve      NF..............  ...............               0               1  CMS clinical
                                                     (photo slides).                                                                      review.
                                   SK098..........  film, x-ray,      NF..............  ...............              23              16  CMS clinical
                                                     laser print.                                                                         review.
76830..........  Transvaginal us   ED024..........  film processor,   NF..............  ...............               5               0  CMS clinical
                  non-ob.                            dry, laser.                                                                          review.
                                   ED032..........  printer, laser,   NF..............  ...............               1               0  CMS clinical
                                                     paper.                                                                               review.
                                   EF027..........  table,            NF..............  ...............               0              36  Refined
                                                     instrument,                                                                          equipment time
                                                     mobile.                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF034..........  table,            NF..............  ...............               0              36  Refined
                                                     ultrasound.                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EL015..........  room,             NF..............  ...............              37               0  CMS clinical
                                                     ultrasound,                                                                          review.
                                                     general.
                                   EQ250..........  ultrasound unit,  NF..............  ...............               0              36  Refined
                                                     portable.                                                                            equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER029..........  film alternator   NF..............  ...............              10               0  CMS clinical
                                                     (motorized film                                                                      review.
                                                     viewbox).
                                   ER086..........  ultrasound probe  NF..............  ...............               0              37  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L051B..........  RN/Diagnostic     NF..............  Clean room/                   3               2  CMS clinical
                                                     Medical                             equipment by                                     review.
                                                     Sonographer.                        physician
                                                                                         staff.
                                   SB026..........  gown, patient...  NF..............  ...............               0               1  CMS clinical
                                                                                                                                          review.
                                   SJ033..........  lubricating       NF..............  ...............               1               0  CMS clinical
                                                     jelly                                                                                review.
                                                     (Surgilube).
76872..........  Us transrectal..  EF027..........  table,            NF..............  ...............              68              34  Refined
                                                     instrument,                                                                          equipment time
                                                     mobile.                                                                              to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF034..........  table,            NF..............  ...............              68              34  Refined
                                                     ultrasound.                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ250..........  ultrasound unit,  NF..............  ...............              68              34  Refined
                                                     portable.                                                                            equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER086..........  ultrasound probe  NF..............  ...............              68              35  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L051B..........  RN/Diagnostic     NF..............  Retrieve prior                0               3  CMS clinical
                                                     Medical                             images for                                       review.
                                                     Sonographer.                        comparison:
                                   L051B..........  RN/Diagnostic     NF..............  Review Chart...               3               0  CMS clinical
                                                     Medical                                                                              review.
                                                     Sonographer.

[[Page 69115]]

 
                                   L051B..........  RN/Diagnostic     NF..............  Obtain vital                  3               0  CMS clinical
                                                     Medical                             signs.                                           review.
                                                     Sonographer.
                                   L051B..........  RN/Diagnostic     NF..............  Prepare room,                 2               3  CMS clinical
                                                     Medical                             equipment,                                       review.
                                                     Sonographer.                        supplies.
                                   L051B..........  RN/Diagnostic     NF..............  Prepare                       5               0  CMS clinical
                                                     Medical                             ultrasound                                       review.
                                                     Sonographer.                        probe.
                                   L051B..........  RN/Diagnostic     NF..............  Obtain vital                  3               0  CMS clinical
                                                     Medical                             signs.                                           review.
                                                     Sonographer.
                                   L051B..........  RN/Diagnostic     NF..............  Clean room/                   3               2  CMS clinical
                                                     Medical                             equipment by                                     review.
                                                     Sonographer.                        physician
                                                                                         staff.
                                   SB012..........  drape, sterile,   NF..............  ...............               1               0  CMS clinical
                                                     for Mayo stand.                                                                      review.
                                   SC019..........  iv tubing         NF..............  ...............               1               0  CMS clinical
                                                     (extension).                                                                         review.
                                   SH048..........  lidocaine 2%      NF..............  ...............              10               0  CMS clinical
                                                     jelly, topical                                                                       review.
                                                     (Xylocaine).
                                   SJ001..........  alcohol           NF..............  ...............               5               0  CMS clinical
                                                     isopropyl 70%.                                                                       review.
                                   SJ032..........  lubricating       NF..............  ...............               2               0  CMS clinical
                                                     jelly (K-Y)                                                                          review.
                                                     (5gm uou).
                                   SM018..........  glutaraldehyde    NF..............  ...............              32               0  CMS clinical
                                                     3.4% (Cidex,                                                                         review.
                                                     Maxicide,
                                                     Wavicide).
                                   SM019..........  glutaraldehyde    NF..............  ...............               1               0  CMS clinical
                                                     test strips                                                                          review.
                                                     (Cidex, Metrex).
                                   SM022..........  sanitizing cloth- NF..............  ...............               2               0  CMS clinical
                                                     wipe (surface,                                                                       review.
                                                     instruments,
                                                     equipment).
77003..........  Fluoroguide for   ED025..........  film processor,   NF..............  ...............               3               2  Refined
                  spine inject.                      wet.                                                                                 equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EL014..........  room,             NF..............  ...............               9              18  Refined
                                                     radiographic-                                                                        equipment time
                                                     fluoroscopic.                                                                        to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER029..........  film alternator   NF..............  ...............               3               2  Refined
                                                     (motorized film                                                                      equipment time
                                                     viewbox).                                                                            to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L041B..........  Radiologic        NF..............  Clean room/                   2               1  CMS clinical
                                                     Technologist.                       equipment by                                     review.
                                                                                         physician
                                                                                         staff.
                                   L041B..........  Radiologic        NF..............  Process films,                3               2  CMS clinical
                                                     Technologist.                       hang films and                                   review.
                                                                                         review study
                                                                                         with
                                                                                         interpreting
                                                                                         MD prior to
                                                                                         patient
                                                                                         discharge.
77080..........  Dxa bone density  ER078..........  phantom, spine,   NF..............  ...............               1               2  Refined
                  axial.                             DXA calibration                                                                      equipment time
                                                     check.                                                                               to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
77301..........  Radiotherapy      ED011..........  computer system,  NF..............  ...............              20               0  CMS clinical
                  dose plan imrt.                    record and                                                                           review.
                                                     verify.
                                   ED033..........  treatment         NF..............  ...............             376             330  CMS clinical
                                                     planning                                                                             review.
                                                     system, IMRT
                                                     (Corvus w-
                                                     Peregrine 3D
                                                     Monte Carlo).
                                   ER005..........  IMRT CT-based     NF..............  ...............              58              47  CMS clinical
                                                     simulator.                                                                           review.

[[Page 69116]]

 
                                   ER014..........  chamber, Farmer-  NF..............  ...............              45              47  Refined
                                                     type.                                                                                equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER028..........  electrometer, PC- NF..............  ...............              45              47  Refined
                                                     based, dual                                                                          equipment time
                                                     channel.                                                                             to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER050..........  phantom, solid    NF..............  ...............              45              47  Refined
                                                     water                                                                                equipment time
                                                     calibration                                                                          to reflect
                                                     check.                                                                               typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER089..........  IMRT accelerator  NF..............  ...............              45              47  CMS clinical
                                                                                                                                          review.
                                   L037D..........  RN/LPN/MTA......  NF..............  Obtain vital                  3               0  CMS clinical
                                                                                         signs.                                           review.
78012..........  Thyroid uptake    EF010..........  chair, thyroid    NF..............  ...............              40              30  Refined
                  measurement.                       imaging.                                                                             equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER063..........  thyroid uptake    NF..............  ...............              40              30  Refined
                                                     system.                                                                              equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
78013..........  Thyroid imaging   ER032..........  gamma camera      NF..............  ...............              48              38  Refined
                  w/blood flow.                      system, single-                                                                      equipment time
                                                     dual head.                                                                           to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
78014..........  Thyroid imaging   EF010..........  chair, thyroid    NF..............  ...............              65              55  Refined
                  w/blood flow.                      imaging.                                                                             equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER032..........  gamma camera      NF..............  ...............              65              50  Refined
                                                     system, single-                                                                      equipment time
                                                     dual head.                                                                           to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER063..........  thyroid uptake    NF..............  ...............              65              55  Refined
                                                     system.                                                                              equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
78070..........  Parathyroid       ER032..........  gamma camera      NF..............  ...............              73              68  Refined
                  planar imaging.                    system, single-                                                                      equipment time
                                                     dual head.                                                                           to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
78071..........  Parathyrd planar  ER032..........  gamma camera      NF..............  ...............              86              81  Refined
                  w/wo subtrj.                       system, single-                                                                      equipment time
                                                     dual head.                                                                           to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
86153..........  Cell enumeration  EP106..........  CELLSEARCH        NF..............  ...............              16               0  Laboratory
                  phys interp.                       system.                                                                              Physician
                                                                                                                                          Interpretation
                                                                                                                                          Code.
                                   EP107..........  Laboratory        NF..............  ...............               4               0  Laboratory
                                                     Information                                                                          Physician
                                                     System.                                                                              Interpretation
                                                                                                                                          Code.
                                   L045A..........  Cytotechnologist  NF..............  Collate images                5               0  Laboratory
                                                                                         and review                                       Physician
                                                                                         with                                             Interpretation
                                                                                         Pathologist.                                     Code.
88120..........  Cytp urne 3-5     EP088..........  ThermoBrite.....  NF..............  ...............             107             321  CMS clinical
                  probes ea spec.                                                                                                         review.
                                   EP092..........  Olympus BX41      NF..............  ...............            1.33              73  CMS clinical
                                                     Fluorescent                                                                          review.
                                                     Microscope
                                                     (without
                                                     filters or
                                                     camera).
88121..........  Cytp urine 3-5    EP088..........  ThermoBrite.....  NF..............  ...............           26.75           160.5  CMS clinical
                  probes cmptr.                                                                                                           review.

[[Page 69117]]

 
                                   EP090..........  IkoniScope......  NF..............  ...............            2.97            29.7  CMS clinical
                                                                                                                                          review.
                                   EP091..........  IkoniLan          NF..............  ...............            2.97            29.7  CMS clinical
                                                     software.                                                                            review.
88300..........  Surgical path     ...............  courier           NF..............  ...............            2.02               0  Indirect
                  gross.                             transportation                                                                       Practice
                                                     cost.                                                                                Expense.
                                                    Copath System     NF..............  ...............               3               0  Indirect
                                                     with                                                                                 Practice
                                                     maintenance                                                                          Expense.
                                                     contract.
                                                    Copath software.  NF..............  ...............               3               0  Indirect
                                                                                                                                          Practice
                                                                                                                                          Expense.
88302..........  Tissue exam by    ...............  specimen,         NF..............  ...............            0.18               0  Indirect
                  pathologist.                       solvent, and                                                                         Practice
                                                     formalin                                                                             Expense.
                                                     disposal cost.
                                                    courier           NF..............  ...............            2.02               0  Indirect
                                                     transportation                                                                       Practice
                                                     cost.                                                                                Expense.
                                                    equipment         NF..............  ...............            0.61               0  Included in
                                                     maintenance                                                                          equipment cost
                                                     cost.                                                                                per minute
                                                                                                                                          calculation.
                                                    Copath System     NF..............  ...............               3               0  Indirect
                                                     with                                                                                 Practice
                                                     maintenance                                                                          Expense.
                                                     contract.
                                                    Copath software.  NF..............  ...............               3               0  Indirect
                                                                                                                                          Practice
                                                                                                                                          Expense.
88304..........  Tissue exam by    ...............  specimen,         NF..............  ...............            0.35               0  Indirect
                  pathologist.                       solvent, and                                                                         Practice
                                                     formalin                                                                             Expense.
                                                     disposal cost.
                                                    courier           NF..............  ...............            2.02               0  Indirect
                                                     transportation                                                                       Practice
                                                     cost.                                                                                Expense.
                                                    equipment         NF..............  ...............            0.61               0  Included in
                                                     maintenance                                                                          equipment cost
                                                     cost.                                                                                per minute
                                                                                                                                          calculation.
                                                    Copath System     NF..............  ...............               5               0  Indirect
                                                     with                                                                                 Practice
                                                     maintenance                                                                          Expense.
                                                     contract.
                                                    Copath software.  NF..............  ...............               5               0  Indirect
                                                                                                                                          Practice
                                                                                                                                          Expense.
88305..........  Tissue exam by    ...............  specimen,         NF..............  ...............            0.35               0  Indirect
                  pathologist.                       solvent, and                                                                         Practice
                                                     formalin                                                                             Expense.
                                                     disposal cost.
                                                    courier           NF..............  ...............            2.02               0  Indirect
                                                     transportation                                                                       Practice
                                                     cost.                                                                                Expense.
                                                    equipment         NF..............  ...............            0.61               0  Included in
                                                     maintenance                                                                          equipment cost
                                                     cost.                                                                                per minute
                                                                                                                                          calculation.
                                                    Copath System     NF..............  ...............               4               0  Indirect
                                                     with                                                                                 Practice
                                                     maintenance                                                                          Expense.
                                                     contract.
                                                    Copath software.  NF..............  ...............               4               0  Indirect
                                                                                                                                          Practice
                                                                                                                                          Expense.
88307..........  Tissue exam by    ...............  specimen,         NF..............  ...............            1.85               0  Indirect
                  pathologist.                       solvent, and                                                                         Practice
                                                     formalin                                                                             Expense.
                                                     disposal cost.
                                                    courier           NF..............  ...............            2.02               0  Indirect
                                                     transportation                                                                       Practice
                                                     cost.                                                                                Expense.
                                                    equipment         NF..............  ...............            0.61               0  Included in
                                                     maintenance                                                                          equipment cost
                                                     cost.                                                                                per minute
                                                                                                                                          calculation.
                                                    Copath System     NF..............  ...............              10               0  Indirect
                                                     with                                                                                 Practice
                                                     maintenance                                                                          Expense.
                                                     contract.
                                                    Copath software.  NF..............  ...............              10               0  Indirect
                                                                                                                                          Practice
                                                                                                                                          Expense.
88309..........  Tissue exam by    ...............  specimen,         NF..............  ...............            1.85               0  Indirect
                  pathologist.                       solvent, and                                                                         Practice
                                                     formalin                                                                             Expense.
                                                     disposal cost.
                                                    courier           NF..............  ...............            2.02               0  Indirect
                                                     transportation                                                                       Practice
                                                     cost.                                                                                Expense.
                                                    equipment         NF..............  ...............            0.61               0  Included in
                                                     maintenance                                                                          equipment cost
                                                     cost.                                                                                per minute
                                                                                                                                          calculation.

[[Page 69118]]

 
                                                    Copath System     NF..............  ...............              12               0  Indirect
                                                     with                                                                                 Practice
                                                     maintenance                                                                          Expense.
                                                     contract.
                                                    Copath software.  NF..............  ...............              12               0  Indirect
                                                                                                                                          Practice
                                                                                                                                          Expense.
90791..........  Psych diagnostic  ...............  ................  NF..............  ...............  ..............  ..............  2012 Fully
                  evaluation.                                                                                                             Implemented PE
                                                                                                                                          RVUs
                                                                                                                                          maintained.
90832..........  Psytx pt&/family  ...............  ................  NF..............  ...............  ..............  ..............  2012 Fully
                  30 minutes.                                                                                                             Implemented PE
                                                                                                                                          RVUs
                                                                                                                                          maintained.
90834..........  Psytx pt&/family  ...............  ................  NF..............  ...............  ..............  ..............  2012 Fully
                  45 minutes.                                                                                                             Implemented PE
                                                                                                                                          RVUs
                                                                                                                                          maintained.
90836..........  Psytx pt&/fam w/  ...............  ................  NF..............  ...............  ..............  ..............  2012 Fully
                  e&m 45 min.                                                                                                             Implemented PE
                                                                                                                                          RVUs
                                                                                                                                          maintained.
91112..........  Gi wireless       EQ352..........  Data receiver...  NF..............  ...............            7220            2880  CMS clinical
                  capsule measure.                                                                                                        review.
                                   SA048..........  pack, minimum     NF..............  ...............               1               0  CMS clinical
                                                     multi-specialty                                                                      review.
                                                     visit.
                                   SK116..........  SmartBar........  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
92081..........  Visual field      EL006..........  lane, screening   NF..............  ...............              12              17  Refined
                  examination(s).                    (oph).                                                                               equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
92082..........  Visual field      EL006..........  lane, screening   NF..............  ...............              22              27  Refined
                  examination(s).                    (oph).                                                                               equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
92083..........  Visual field      EL006..........  lane, screening   NF..............  ...............              32              37  Refined
                  examination(s).                    (oph).                                                                               equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
92235..........  Eye exam with     ED008..........  camera, retinal   NF..............  ...............              60              35  Refined
                  photos.                            (TRC 50IX, w-                                                                        equipment time
                                                     ICG, filters,                                                                        to reflect
                                                     motor drives).                                                                       typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EF030..........  table, motorized  NF..............  ...............              60              35  Refined
                                                     (for                                                                                 equipment time
                                                     instruments-                                                                         to reflect
                                                     equipment).                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EL005..........  lane, exam (oph)  NF..............  ...............              60              35  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L038A..........  COMT/COT/RN/CST.  NF..............  Monitor pt.                   5               2  CMS clinical
                                                                                         following                                        review.
                                                                                         service/check
                                                                                         tubes,
                                                                                         monitors,
                                                                                         drains.
                                   L039A..........  Certified         NF..............  Assist                       40              20  CMS clinical
                                                     Retinal Angio.                      physician in                                     review.
                                                                                         performing
                                                                                         procedure.
93015..........  Cardiovascular    EF023..........  table, exam.....  NF..............  ...............              58              46  Refined
                  stress test.                                                                                                            equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ078..........  cardiac monitor   NF..............  ...............              58              46  Refined
                                                     w-treadmill (12-                                                                     equipment time
                                                     lead PC-based                                                                        to reflect
                                                     ECG).                                                                                typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.

[[Page 69119]]

 
                                   L051A..........  RN..............  NF..............  Assist                       20              14  CMS clinical
                                                                                         physician in                                     review.
                                                                                         performing
                                                                                         procedure.
93017..........  Cardiovascular    EF023..........  table, exam.....  NF..............  ...............              58              46  Refined
                  stress test.                                                                                                            equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ078..........  cardiac monitor   NF..............  ...............              58              46  Refined
                                                     w-treadmill (12-                                                                     equipment time
                                                     lead PC-based                                                                        to reflect
                                                     ECG).                                                                                typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L051A..........  RN..............  NF..............  Assist                       20              14  CMS clinical
                                                                                         physician in                                     review.
                                                                                         performing
                                                                                         procedure.
                                   L051A..........  RN..............  NF..............  Complete                      0               4  CMS clinical
                                                                                         diagnostic                                       review.
                                                                                         forms, lab & X-
                                                                                         ray
                                                                                         requisitions.
93925..........  Lower extremity   ED011..........  computer system,  NF..............  ...............              10               0  CMS clinical
                  study.                             record and                                                                           review.
                                                     verify.
                                   ED021..........  computer,         NF..............  ...............              95               7  Refined
                                                     desktop, w-                                                                          equipment time
                                                     monitor.                                                                             to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ED025..........  film processor,   NF..............  ...............              10               7  Refined
                                                     wet.                                                                                 equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ED034..........  video SVHS VCR    NF..............  ...............              95               0  CMS clinical
                                                     (medical grade).                                                                     review.
                                   EL016..........  room,             NF..............  ...............              95              76  Refined
                                                     ultrasound,                                                                          equipment time
                                                     vascular.                                                                            to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER067..........  x-ray view box,   NF..............  ...............              10               7  Refined
                                                     4 panel.                                                                             equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L054A..........  Vascular          NF..............  Provide pre-                  3               2  CMS clinical
                                                     Technologist.                       service                                          review.
                                                                                         education/
                                                                                         obtain consent.
                                   L054A..........  Vascular          NF..............  Prepare room,                 3               2  Standardized
                                                     Technologist.                       equipment,                                       time input.
                                                                                         supplies.
                                   L054A..........  Vascular          NF..............  Prepare and                   3               2  Standardized
                                                     Technologist.                       position                                         time input.
                                                                                         patient.
                                   L054A..........  Vascular          NF..............  Other Clinical               10               7  CMS clinical
                                                     Technologist.                       Activity:                                        review.
                                                                                         Collate
                                                                                         preliminary
                                                                                         data, arrange
                                                                                         images,
                                                                                         archive.
                                   L054A..........  Vascular          NF..............  Other Clinical                1               0  CMS clinical
                                                     Technologist.                       Activity:                                        review.
                                                                                         Record patient
                                                                                         history.
                                   L054A..........  Vascular          NF..............  Other Clinical                4               0  CMS clinical
                                                     Technologist.                       Activity: QA                                     review.
                                                                                         documentation.
                                   SK086..........  video tape, VHS.  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
93926..........  Lower extremity   ED011..........  computer system,  NF..............  ...............              10               0  CMS clinical
                  study.                             record and                                                                           review.
                                                     verify.
                                   ED021..........  computer,         NF..............  ...............              59               4  Refined
                                                     desktop, w-                                                                          equipment time
                                                     monitor.                                                                             to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.

[[Page 69120]]

 
                                   ED025..........  film processor,   NF..............  ...............              10               4  Refined
                                                     wet.                                                                                 equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ED034..........  video SVHS VCR    NF..............  ...............              59               0  CMS clinical
                                                     (medical grade).                                                                     review.
                                   EL016..........  room,             NF..............  ...............              59              42  Refined
                                                     ultrasound,                                                                          equipment time
                                                     vascular.                                                                            to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER067..........  x-ray view box,   NF..............  ...............              10               4  Refined
                                                     4 panel.                                                                             equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L054A..........  Vascular          NF..............  Provide pre-                  3               2  CMS clinical
                                                     Technologist.                       service                                          review.
                                                                                         education/
                                                                                         obtain consent.
                                   L054A..........  Vascular          NF..............  Prepare room,                 3               2  Standardized
                                                     Technologist.                       equipment,                                       time input.
                                                                                         supplies.
                                   L054A..........  Vascular          NF..............  Prepare and                   3               2  Standardized
                                                     Technologist.                       position                                         time input.
                                                                                         patient.
                                   L054A..........  Vascular          NF..............  Other Clinical                8               4  CMS clinical
                                                     Technologist.                       Activity:                                        review.
                                                                                         Collate
                                                                                         preliminary
                                                                                         data, arrange
                                                                                         images,
                                                                                         archive.
                                   L054A..........  Vascular          NF..............  Other Clinical                1               0  CMS clinical
                                                     Technologist.                       Activity:                                        review.
                                                                                         Record patient
                                                                                         history.
                                   L054A..........  Vascular          NF..............  Other Clinical                4               0  CMS clinical
                                                     Technologist.                       Activity: QA                                     review.
                                                                                         documentation.
                                   SK086..........  video tape, VHS.  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
93970..........  Extremity study.  ED011..........  computer system,  NF..............  ...............              10               0  CMS clinical
                                                     record and                                                                           review.
                                                     verify.
                                   ED021..........  computer,         NF..............  ...............              71               7  Refined
                                                     desktop, w-                                                                          equipment time
                                                     monitor.                                                                             to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ED025..........  film processor,   NF..............  ...............              10               7  Refined
                                                     wet.                                                                                 equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ED034..........  video SVHS VCR    NF..............  ...............              71               0  CMS clinical
                                                     (medical grade).                                                                     review.
                                   EL016..........  room,             NF..............  ...............              71              52  Refined
                                                     ultrasound,                                                                          equipment time
                                                     vascular.                                                                            to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ER067..........  x-ray view box,   NF..............  ...............              10               7  Refined
                                                     4 panel.                                                                             equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L054A..........  Vascular          NF..............  Provide pre-                  3               2  CMS clinical
                                                     Technologist.                       service                                          review.
                                                                                         education/
                                                                                         obtain consent.
                                   L054A..........  Vascular          NF..............  Prepare room,                 3               2  Standardized
                                                     Technologist.                       equipment,                                       time input.
                                                                                         supplies.
                                   L054A..........  Vascular          NF..............  Prepare and                   3               2  Standardized
                                                     Technologist.                       position                                         time input.
                                                                                         patient.
                                   L054A..........  Vascular          NF..............  Other Clinical               10               7  CMS clinical
                                                     Technologist.                       Activity:                                        review.
                                                                                         Collate
                                                                                         preliminary
                                                                                         data, arrange
                                                                                         images,
                                                                                         archive.

[[Page 69121]]

 
                                   L054A..........  Vascular          NF..............  Other Clinical                1               0  CMS clinical
                                                     Technologist.                       Activity:                                        review.
                                                                                         Record patient
                                                                                         history.
                                   L054A..........  Vascular          NF..............  Other Clinical                4               0  CMS clinical
                                                     Technologist.                       Activity: QA                                     review.
                                                                                         documentation.
                                   SK086..........  video tape, VHS.  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
93971..........  Extremity study.  ED011..........  computer system,  NF..............  ...............              10               0  CMS clinical
                                                     record and                                                                           review.
                                                     verify.
                                   ED021..........  computer,         NF..............  ...............              45               4  Refined
                                                     desktop, w-                                                                          equipment time
                                                     monitor.                                                                             to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ED025..........  film processor,   NF..............  ...............              10               4  Refined
                                                     wet.                                                                                 equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   ED034..........  video SVHS VCR    NF..............  ...............              45               0  CMS clinical
                                                     (medical grade).                                                                     review.
                                   EL016..........  room,             NF..............  ...............              45              30  CMS clinical
                                                     ultrasound,                                                                          review.
                                                     vascular.
                                   ER067..........  x-ray view box,   NF..............  ...............              10               4  Refined
                                                     4 panel.                                                                             equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L054A..........  Vascular          NF..............  Provide pre-                  3               2  CMS clinical
                                                     Technologist.                       service                                          review.
                                                                                         education/
                                                                                         obtain consent.
                                   L054A..........  Vascular          NF..............  Prepare room,                 3               2  Standardized
                                                     Technologist.                       equipment,                                       time input.
                                                                                         supplies.
                                   L054A..........  Vascular          NF..............  Prepare and                   3               2  Standardized
                                                     Technologist.                       position                                         time input.
                                                                                         patient.
                                   L054A..........  Vascular          NF..............  Other Clinical                6               4  CMS clinical
                                                     Technologist.                       Activity:                                        review.
                                                                                         Collate
                                                                                         preliminary
                                                                                         data, arrange
                                                                                         images,
                                                                                         archive.
                                   L054A..........  Vascular          NF..............  Other Clinical                1               0  CMS clinical
                                                     Technologist.                       Activity:                                        review.
                                                                                         Record patient
                                                                                         history.
                                   L054A..........  Vascular          NF..............  Other Clinical                4               0  CMS clinical
                                                     Technologist.                       Activity: QA                                     review.
                                                                                         documentation.
                                   SB006..........  drape, non-       NF..............  ...............               2               1  CMS clinical
                                                     sterile, sheet                                                                       review.
                                                     40in x 60in.
                                   SK086..........  video tape, VHS.  NF..............  ...............               1               0  CMS clinical
                                                                                                                                          review.
95076..........  Ingest challenge  EF023..........  table, exam.....  NF..............  ...............             141             133  Refined
                  ini 120 min.                                                                                                            equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ168..........  light, exam.....  NF..............  ...............             141             133  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Prepare testing              15               7  CMS clinical
                                                                                         doses.                                           review.
95115..........  Immunotherapy     EF040..........  refrigerator,     NF..............  ...............              15               0  CMS clinical
                  one injection.                     vaccine,                                                                             review.
                                                     commercial
                                                     grade, w-alarm
                                                     lock.
95117..........  Immunotherapy     EF041..........  x-ray machine,    NF..............  ...............              17               0  CMS clinical
                  injections.                        portable.                                                                            review.
95782..........  Polysom <6 yrs 4/ EF003..........  bedroom           NF..............  ...............             660             602  Refined
                  > paramtrs.                        furniture                                                                            equipment time
                                                     (hospital bed,                                                                       to reflect
                                                     table,                                                                               typical use
                                                     reclining                                                                            exclusive to
                                                     chair).                                                                              patient.

[[Page 69122]]

 
                                   EF044..........  Crib............  NF..............  ...............             660               0  CMS clinical
                                                                                                                                          review.
                                   EQ134..........  impedance meter,  NF..............  ...............             660             602  Refined
                                                     32-channel.                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ272..........  sleep diagnostic  NF..............  ...............             660             662  Refined
                                                     system,                                                                              equipment time
                                                     attended (w-                                                                         to reflect
                                                     acquisition                                                                          typical use
                                                     station, review                                                                      exclusive to
                                                     master,                                                                              patient.
                                                     computer).
                                   EQ348..........  Capnograph......  NF..............  ...............             660               0  CMS clinical
                                                                                                                                          review.
                                   ER088..........  Infrared          NF..............  ...............             660             602  Refined
                                                     illuminator.                                                                         equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L047B..........  REEGT...........  NF..............  Provide pre-                  5               3  CMS clinical
                                                                                         service                                          review.
                                                                                         education/
                                                                                         obtain consent.
                                   L047B..........  REEGT...........  NF..............  Other Clinical                6               5  CMS clinical
                                                                                         Activity--spec                                   review.
                                                                                         ify: Set up
                                                                                         and calibrate
                                                                                         all monitoring
                                                                                         and recording
                                                                                         equipment
                                                                                         (initial),
                                                                                         including
                                                                                         capnograph
                                                                                         (for child).
                                   L047B..........  REEGT...........  NF..............  Other Clinical               30              20  CMS clinical
                                                                                         Activity--spec                                   review.
                                                                                         ify: Measure
                                                                                         and mark head
                                                                                         and face.
                                                                                         Apply and
                                                                                         secure
                                                                                         electrodes to
                                                                                         head and face.
                                                                                         Check
                                                                                         impedances.
                                                                                         Reapply
                                                                                         electrodes as
                                                                                         needed. (1.5
                                                                                         min per
                                                                                         electrode for
                                                                                         child, 1 min
                                                                                         per electrode
                                                                                         for adult).
                                   L047B..........  REEGT...........  NF..............  Other Clinical                0              15  CMS clinical
                                                                                         Activity--spec                                   review.
                                                                                         ify: Apply
                                                                                         recording
                                                                                         devices for
                                                                                         cardio-
                                                                                         respiratory,
                                                                                         leg movements,
                                                                                         body
                                                                                         positioning
                                                                                         and snoring.
                                   L047B..........  REEGT...........  NF..............  Other Clinical               20               0  CMS clinical
                                                                                         Activity--spec                                   review.
                                                                                         ify: Apply
                                                                                         recording
                                                                                         devices for
                                                                                         cardio-
                                                                                         respiratory,
                                                                                         leg movements,
                                                                                         body
                                                                                         positioning,
                                                                                         snoring and
                                                                                         capnography.

[[Page 69123]]

 
                                   L047B..........  REEGT...........  NF..............  Other Clinical              100              97  CMS clinical
                                                                                         Activity--spec                                   review.
                                                                                         ify: Daytime
                                                                                         tech reviews
                                                                                         and edits
                                                                                         recording,
                                                                                         marks
                                                                                         artifacts,
                                                                                         scores sleep
                                                                                         stages,
                                                                                         performs
                                                                                         evaluation of
                                                                                         physiological
                                                                                         changes.
95783..........  Polysom <6 yrs    EF003..........  bedroom           NF..............  ...............             660             647  Refined
                  cpap/bilvl.                        furniture                                                                            equipment time
                                                     (hospital bed,                                                                       to reflect
                                                     table,                                                                               typical use
                                                     reclining                                                                            exclusive to
                                                     chair).                                                                              patient.
                                   EF044..........  Crib............  NF..............  ...............             660               0  CMS clinical
                                                                                                                                          review.
                                   EQ134..........  impedance meter,  NF..............  ...............             660             647  Refined
                                                     32-channel.                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ272..........  sleep diagnostic  NF..............  ...............             660             707  Refined
                                                     system,                                                                              equipment time
                                                     attended (w-                                                                         to reflect
                                                     acquisition                                                                          typical use
                                                     station, review                                                                      exclusive to
                                                     master,                                                                              patient.
                                                     computer).
                                   EQ348..........  Capnograph......  NF..............  ...............             660               0  CMS clinical
                                                                                                                                          review.
                                   ER088..........  Infrared          NF..............  ...............             660             647  Refined
                                                     illuminator.                                                                         equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L047B..........  REEGT...........  NF..............  Provide pre-                  5               3  CMS clinical
                                                                                         service                                          review.
                                                                                         education/
                                                                                         obtain consent.
                                   L047B..........  REEGT...........  NF..............  Other Clinical                6               5  CMS clinical
                                                                                         Activity--spec                                   review.
                                                                                         ify: Set up
                                                                                         and calibrate
                                                                                         all monitoring
                                                                                         and recording
                                                                                         equipment
                                                                                         (initial),
                                                                                         including
                                                                                         capnograph
                                                                                         (for child).
                                   L047B..........  REEGT...........  NF..............  Other Clinical               30              20  CMS clinical
                                                                                         Activity--spec                                   review.
                                                                                         ify: Measure
                                                                                         and mark head
                                                                                         and face.
                                                                                         Apply and
                                                                                         secure
                                                                                         electrodes to
                                                                                         head and face.
                                                                                         Check
                                                                                         impedances.
                                                                                         Reapply
                                                                                         electrodes as
                                                                                         needed. (1.5
                                                                                         min per
                                                                                         electrode for
                                                                                         child, 1 min
                                                                                         per electrode
                                                                                         for adult).
                                   L047B..........  REEGT...........  NF..............  Other Clinical                0              15  CMS clinical
                                                                                         Activity--spec                                   review.
                                                                                         ify: Apply
                                                                                         recording
                                                                                         devices for
                                                                                         cardio-
                                                                                         respiratory,
                                                                                         leg movements,
                                                                                         body
                                                                                         positioning
                                                                                         and snoring.

[[Page 69124]]

 
                                   L047B..........  REEGT...........  NF..............  Other Clinical               20               0  CMS clinical
                                                                                         Activity--spec                                   review.
                                                                                         ify: Apply
                                                                                         recording
                                                                                         devices for
                                                                                         cardio-
                                                                                         respiratory,
                                                                                         leg movements,
                                                                                         body
                                                                                         positioning,
                                                                                         snoring and
                                                                                         capnography.
                                   L047B..........  REEGT...........  NF..............  Other Clinical              100              97  CMS clinical
                                                                                         Activity--spec                                   review.
                                                                                         ify: Daytime
                                                                                         tech reviews
                                                                                         and edits
                                                                                         recording,
                                                                                         marks
                                                                                         artifacts,
                                                                                         scores sleep
                                                                                         stages,
                                                                                         performs
                                                                                         evaluation of
                                                                                         physiological
                                                                                         changes.
95861..........  Muscle test 2     EF023..........  table, exam.....  NF..............  ...............              44              41  Refined
                  limbs.                                                                                                                  equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ024..........  EMG-NCV-EP        NF..............  ...............              44              41  Refined
                                                     system, 8                                                                            equipment time
                                                     channel.                                                                             to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Assist                       19              29  Conforming to
                                                                                         physician in                                     physician
                                                                                         performing                                       time.
                                                                                         procedure.
95863..........  Muscle test 3     EF023..........  table, exam.....  NF..............  ...............              58              52  Refined
                  limbs.                                                                                                                  equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ024..........  EMG-NCV-EP        NF..............  ...............              58              52  Refined
                                                     system, 8                                                                            equipment time
                                                     channel.                                                                             to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
95864..........  Muscle test 4     EF023..........  table, exam.....  NF..............  ...............              71              62  Refined
                  limbs.                                                                                                                  equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ024..........  EMG-NCV-EP        NF..............  ...............              71              62  Refined
                                                     system, 8                                                                            equipment time
                                                     channel.                                                                             to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
95865..........  Muscle test       EF023..........  table, exam.....  NF..............  ...............              27              22  Refined
                  larynx.                                                                                                                 equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ024..........  EMG-NCV-EP        NF..............  ...............              27              22  Refined
                                                     system, 8                                                                            equipment time
                                                     channel.                                                                             to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
95868..........  Muscle test cran  EF023..........  table, exam.....  NF..............  ...............              35              32  Refined
                  nerve bilat.                                                                                                            equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ024..........  EMG-NCV-EP        NF..............  ...............              35              32  Refined
                                                     system, 8                                                                            equipment time
                                                     channel.                                                                             to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
95907..........  Motor&/sens 1-2   SG051..........  gauze, non-       NF..............  ...............               0               4  CMS clinical
                  nrv cndj tst.                      sterile 4in x                                                                        review.
                                                     4in.

[[Page 69125]]

 
                                   SG055..........  gauze, sterile    NF..............  ...............               4               0  CMS clinical
                                                     4in x 4in.                                                                           review.
                                   SG079..........  tape, surgical    NF..............  ...............              12               0  CMS clinical
                                                     paper 1in                                                                            review.
                                                     (Micropore).
                                   SJ022..........  electrode skin    NF..............  ...............             100               0  CMS clinical
                                                     prep gel                                                                             review.
                                                     (NuPrep).
95908..........  Motor&/sens 3-4   SG051..........  gauze, non-       NF..............  ...............               0               8  CMS clinical
                  nrv cndj tst.                      sterile 4in x                                                                        review.
                                                     4in.
                                   SG055..........  gauze, sterile    NF..............  ...............               8               0  CMS clinical
                                                     4in x 4in.                                                                           review.
                                   SG079..........  tape, surgical    NF..............  ...............              24               0  CMS clinical
                                                     paper 1in                                                                            review.
                                                     (Micropore).
                                   SJ022..........  electrode skin    NF..............  ...............             100               0  CMS clinical
                                                     prep gel                                                                             review.
                                                     (NuPrep).
95909..........  Motor&/sens 5-6   SG051..........  gauze, non-       NF..............  ...............               0              12  CMS clinical
                  nrv cndj tst.                      sterile 4in x                                                                        review.
                                                     4in.
                                   SG055..........  gauze, sterile    NF..............  ...............              12               0  CMS clinical
                                                     4in x 4in.                                                                           review.
                                   SG079..........  tape, surgical    NF..............  ...............              36               0  CMS clinical
                                                     paper 1in                                                                            review.
                                                     (Micropore).
                                   SJ022..........  electrode skin    NF..............  ...............             100               0  CMS clinical
                                                     prep gel                                                                             review.
                                                     (NuPrep).
95910..........  Motor&sens 7-8    L037A..........  Electrodiagnosti  NF..............  ...............              50              40  Conforming to
                  nrv cndj test.                     c Technologist.                                                                      physician
                                                                                                                                          time.
                                   SG051..........  gauze, non-       NF..............  ...............               0              16  CMS clinical
                                                     sterile 4in x                                                                        review.
                                                     4in.
                                   SG055..........  gauze, sterile    NF..............  ...............              16               0  CMS clinical
                                                     4in x 4in.                                                                           review.
                                   SG079..........  tape, surgical    NF..............  ...............              48               0  CMS clinical
                                                     paper 1in                                                                            review.
                                                     (Micropore).
                                   SJ022..........  electrode skin    NF..............  ...............             100               0  CMS clinical
                                                     prep gel                                                                             review.
                                                     (NuPrep).
95911..........  Motor&sen 9-10    L037A..........  Electrodiagnosti  NF..............  ...............              64              50  Conforming to
                  nrv cndj test.                     c Technologist.                                                                      physician
                                                                                                                                          time.
                                   SG051..........  gauze, non-       NF..............  ...............               0              20  CMS clinical
                                                     sterile 4in x                                                                        review.
                                                     4in.
                                   SG055..........  gauze, sterile    NF..............  ...............              20               0  CMS clinical
                                                     4in x 4in.                                                                           review.
                                   SG079..........  tape, surgical    NF..............  ...............              60               0  CMS clinical
                                                     paper 1in                                                                            review.
                                                     (Micropore).
                                   SJ022..........  electrode skin    NF..............  ...............             100               0  CMS clinical
                                                     prep gel                                                                             review.
                                                     (NuPrep).
95912..........  Motor&sen 11-12   L037A..........  Electrodiagnosti  NF..............  ...............              77              60  Conforming to
                  nrv cnd test.                      c Technologist.                                                                      physician
                                                                                                                                          time.
                                   SG051..........  gauze, non-       NF..............  ...............               0              24  CMS clinical
                                                     sterile 4in x                                                                        review.
                                                     4in.
                                   SG055..........  gauze, sterile    NF..............  ...............              24               0  CMS clinical
                                                     4in x 4in.                                                                           review.
                                   SG079..........  tape, surgical    NF..............  ...............              72               0  CMS clinical
                                                     paper 1in                                                                            review.
                                                     (Micropore).
                                   SJ022..........  electrode skin    NF..............  ...............             100               0  CMS clinical
                                                     prep gel                                                                             review.
                                                     (NuPrep).
95913..........  Motor&sens 13/>   L037A..........  Electrodiagnosti  NF..............  ...............              87              70  Conforming to
                  nrv cnd test.                      c Technologist.                                                                      physician
                                                                                                                                          time.
                                   SG051..........  gauze, non-       NF..............  ...............               0              26  CMS clinical
                                                     sterile 4in x                                                                        review.
                                                     4in.
                                   SG055..........  gauze, sterile    NF..............  ...............              26               0  CMS clinical
                                                     4in x 4in.                                                                           review.
                                   SG079..........  tape, surgical    NF..............  ...............              78               0  CMS clinical
                                                     paper 1in                                                                            review.
                                                     (Micropore).
                                   SJ022..........  electrode skin    NF..............  ...............             100               0  CMS clinical
                                                     prep gel                                                                             review.
                                                     (NuPrep).

[[Page 69126]]

 
95921..........  Autonomic nrv     EF032..........  table, tilt (w-   NF..............  ...............              64              55  Refined
                  parasym inervj.                    trendelenberg).                                                                      equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ051..........  arterial          NF..............  ...............              64              55  Refined
                                                     tonometry                                                                            equipment time
                                                     acquisition                                                                          to reflect
                                                     system (WR                                                                           typical use
                                                     Testworks).                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ052..........  arterial          NF..............  ...............              64              55  Refined
                                                     tonometry                                                                            equipment time
                                                     monitor (Colin                                                                       to reflect
                                                     Pilot).                                                                              typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037A..........  Electrodiagnosti  NF..............  Greet patient,                3               0  CMS clinical
                                                     c Technologist.                     provide                                          review.
                                                                                         gowning,
                                                                                         assure
                                                                                         appropriate
                                                                                         medical
                                                                                         records are
                                                                                         available.
                                   L037A..........  Electrodiagnosti  NF..............  Obtain vital                  3               0  CMS clinical
                                                     c Technologist.                     signs.                                           review.
                                   L037A..........  Electrodiagnosti  NF..............  Monitor pt.                   5               2  CMS clinical
                                                     c Technologist.                     following                                        review.
                                                                                         service/check
                                                                                         tubes,
                                                                                         monitors,
                                                                                         drains.
95922..........  Autonomic nrv     EF032..........  table, tilt (w-   NF..............  ...............              79              70  Refined
                  adrenrg inervj.                    trendelenberg).                                                                      equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ051..........  arterial          NF..............  ...............              79              70  Refined
                                                     tonometry                                                                            equipment time
                                                     acquisition                                                                          to reflect
                                                     system (WR                                                                           typical use
                                                     Testworks).                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ052..........  arterial          NF..............  ...............              79              70  Refined
                                                     tonometry                                                                            equipment time
                                                     monitor (Colin                                                                       to reflect
                                                     Pilot).                                                                              typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037A..........  Electrodiagnosti  NF..............  Greet patient,                3               0  CMS clinical
                                                     c Technologist.                     provide                                          review.
                                                                                         gowning,
                                                                                         assure
                                                                                         appropriate
                                                                                         medical
                                                                                         records are
                                                                                         available.
                                   L037A..........  Electrodiagnosti  NF..............  Obtain vital                  3               0  CMS clinical
                                                     c Technologist.                     signs.                                           review.
                                   L037A..........  Electrodiagnosti  NF..............  Monitor pt.                   5               2  CMS clinical
                                                     c Technologist.                     following                                        review.
                                                                                         service/check
                                                                                         tubes,
                                                                                         monitors,
                                                                                         drains.
95923..........  Autonomic nrv     EQ035..........  QSART             NF..............  ...............              74              61  Refined
                  syst funj test.                    acquisition                                                                          equipment time
                                                     system (Q-                                                                           to reflect
                                                     Sweat).                                                                              typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ124..........  stimulator,       NF..............  ...............              74              61  Refined
                                                     constant                                                                             equipment time
                                                     current, w-                                                                          to reflect
                                                     stimulating and                                                                      typical use
                                                     grounding                                                                            exclusive to
                                                     electrodes                                                                           patient.
                                                     (Grass
                                                     Telefactor).
                                   EQ171..........  light, infra-     NF..............  ...............              74              61  Refined
                                                     red, ceiling                                                                         equipment time
                                                     mount.                                                                               to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037A..........  Electrodiagnosti  NF..............  Assist                       55              45  CMS clinical
                                                     c Technologist.                     physician in                                     review.
                                                                                         performing
                                                                                         procedure.
                                   L037A..........  Electrodiagnosti  NF..............  Monitor pt.                   5               2  CMS clinical
                                                     c Technologist.                     following                                        review.
                                                                                         service/check
                                                                                         tubes,
                                                                                         monitors,
                                                                                         drains.

[[Page 69127]]

 
                                   SJ020..........  electrode         NF..............  ...............               5               0  CMS clinical
                                                     conductive gel.                                                                      review.
95924..........  Ans parasymp &    EF032..........  table, tilt (w-   NF..............  ...............              79              76  Refined
                  symp w/tilt.                       trendelenberg).                                                                      equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ051..........  arterial          NF..............  ...............              79              76  Refined
                                                     tonometry                                                                            equipment time
                                                     acquisition                                                                          to reflect
                                                     system (WR                                                                           typical use
                                                     Testworks).                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ052..........  arterial          NF..............  ...............              79              76  Refined
                                                     tonometry                                                                            equipment time
                                                     monitor (Colin                                                                       to reflect
                                                     Pilot).                                                                              typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037A..........  Electrodiagnosti  NF..............  Monitor pt.                   5               2  CMS clinical
                                                     c Technologist.                     following                                        review.
                                                                                         service/check
                                                                                         tubes,
                                                                                         monitors,
                                                                                         drains.
96920..........  Laser tx skin <   EF031..........  table, power....  NF..............  ...............              20              26  Refined
                  250 sq cm.                                                                                                              equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ161..........  laser, excimer..  NF..............  ...............              20              26  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ168..........  light, exam.....  NF..............  ...............              17              26  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Monitor pt.                   3               1  CMS clinical
                                                                                         following                                        review.
                                                                                         service/check
                                                                                         tubes,
                                                                                         monitors,
                                                                                         drains.
                                   L037D..........  RN/LPN/MTA......  NF..............  Clean room/                   3               2  CMS clinical
                                                                                         equipment by                                     review.
                                                                                         physician
                                                                                         staff.
                                   SF028..........  laser tip         NF..............  ...............               1               0  CMS clinical
                                                     (single use).                                                                        review.
                                   SJ029..........  ice pack,         NF..............  ...............               4               1  CMS Code
                                                     instant.                                                                             correction.
96921..........  Laser tx skin     EF031..........  table, power....  NF..............  ...............              23              29  Refined
                  250-500 sq cm.                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ161..........  laser, excimer..  NF..............  ...............              23              29  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ168..........  light, exam.....  NF..............  ...............              23              29  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Monitor pt.                   3               1  CMS clinical
                                                                                         following                                        review.
                                                                                         service/check
                                                                                         tubes,
                                                                                         monitors,
                                                                                         drains.
                                   L037D..........  RN/LPN/MTA......  NF..............  Clean room/                   3               2  CMS clinical
                                                                                         equipment by                                     review.
                                                                                         physician
                                                                                         staff.
                                   SF028..........  laser tip         NF..............  ...............               1               0  CMS clinical
                                                     (single use).                                                                        review.
                                   SJ029..........  ice pack,         NF..............  ...............               4               2  CMS Code
                                                     instant.                                                                             correction.

[[Page 69128]]

 
96922..........  Laser tx skin     EF031..........  table, power....  NF..............  ...............              33              39  Refined
                  >500 sq cm.                                                                                                             equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ161..........  laser, excimer..  NF..............  ...............              33              39  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ168..........  light, exam.....  NF..............  ...............              30              39  Refined
                                                                                                                                          equipment time
                                                                                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   L037D..........  RN/LPN/MTA......  NF..............  Monitor pt.                   3               1  CMS clinical
                                                                                         following                                        review.
                                                                                         service/check
                                                                                         tubes,
                                                                                         monitors,
                                                                                         drains.
                                   L037D..........  RN/LPN/MTA......  NF..............  Clean room/                   3               2  CMS clinical
                                                                                         equipment by                                     review.
                                                                                         physician
                                                                                         staff.
                                   SF028..........  laser tip         NF..............  ...............               1               0  CMS clinical
                                                     (single use).                                                                        review.
97150..........  Group             EQ248..........  ultrasonic        NF..............  ...............              10               5  Refined
                  therapeutic                        biometry,                                                                            equipment time
                  procedures.                        pachymeter.                                                                          to reflect
                                                                                                                                          typical use
                                                                                                                                          exclusive to
                                                                                                                                          patient.
                                   EQ269..........  blood pressure    NF..............  ...............               1               0  CMS clinical
                                                     monitor,                                                                             review.
                                                     ambulatory, w-
                                                     battery charger.
                                   SA007..........  kit, cooking      NF..............  ...............               1               0  CMS clinical
                                                     activity                                                                             review.
                                                     ingredients
                                                     (mac-cheese).
99495..........  Trans care mgmt   L042A..........  RN/LPN..........  F...............  communication                 0              45  CMS clinical
                  14 day disch.                                                          (with patient,                                   review.
                                                                                         family
                                                                                         members,
                                                                                         guardian or
                                                                                         caretaker,
                                                                                         surrogate
                                                                                         decision
                                                                                         makers, and/or
                                                                                         other
                                                                                         professionals)
                                                                                         regarding
                                                                                         aspects of
                                                                                         care, etc.
99496..........  Trans care mgmt   L042A..........  RN/LPN..........  NF..............  communication                60              70  CMS clinical
                  7 day disch.                                                           (with patient,                                   review.
                                                                                         family
                                                                                         members,
                                                                                         guardian or
                                                                                         caretaker,
                                                                                         surrogate
                                                                                         decision
                                                                                         makers, and/or
                                                                                         other
                                                                                         professionals)
                                                                                         regarding
                                                                                         aspects of
                                                                                         care, etc.
                                                                      F...............  ...............               0              70  CMS clinical
                                                                                                                                          review
--------------------------------------------------------------------------------------------------------------------------------------------------------

c. Establishing CY 2013 Interim Final Malpractice Crosswalks
    According to our malpractice methodology discussed in section 
III.C.1 of this CY 2013 PFS final rule with comment period, we have 
assigned malpractice RVUs for CY 2013 new and revised codes by 
utilizing a crosswalk to a source code with a similar malpractice risk-
of-service. We have reviewed the AMA RUC-recommended malpractice source 
code crosswalks for CY 2013 new and revised codes, and we are accepting 
all of them on an interim final basis for CY 2013.
    For CY 2013, we created several HCPCS G-codes. HCPCS code G0452 
(Molecular pathology procedure; physician interpretation and report) 
was created to replace CPT code 83912 (Molecular diagnostics; 
interpretation and report), which is deleted effective January 1, 2013. 
We believe CPT code 83912 has a similar malpractice risk-of-service as 
HCPCS code G0452. Therefore, we are assigning an interim final 
malpractice crosswalk of CPT code 83912 to HCPCS code G0452 on an 
interim final basis for CY 2013.

[[Page 69129]]

    For CY 2013, we created HCPCS code G0453 (Continuous intraoperative 
neurophysiology monitoring, from outside the operating room (remote or 
nearby), per patient, (attention directed exclusively to one patient), 
each 15 minutes) to replace new CPT code 95941 (Continuous 
intraoperative neurophysiology monitoring, from outside the operating 
room (remote or nearby) or for monitoring of more than one case while 
in the operating room, per hour) which will have a PFS procedure status 
indicator of I (Not valid for Medicare purposes. Medicare uses another 
code for the reporting of and the payment for these services) for CY 
2013, as discussed in section III.M.3.a. of this CY 2013 PFS final rule 
with comment period. The AMA RUC recommended a malpractice crosswalk of 
CPT code 95920 (Intraoperative neurophysiology testing, per hour (List 
separately in addition to code for primary procedure)) for CPT code 
95941. We believe CPT code 95920 has a similar malpractice risk-of-
service as HCPCS code G0453. Therefore, we are assigning an interim 
final malpractice crosswalk of CPT code 95920 to HCPCS code G0453 for 
CY 2013.
    For CY 2013, we created HCPCS code G0454 (Physician documentation 
of face-to-face visit for Durable Medical Equipment determination 
performed by Nurse Practitioner, Physician Assistant or Clinical Nurse 
Specialist) for payment to a physician who documents that a PA, NP, or 
CNS practitioner has performed a face-to-face encounter for the list of 
specified DME covered items. As discussed in section IV.C. of this CY 
2013 PFS final rule with comment period, we have assigned HCPCS code 
G0454 a work RVU of 0.18, which is a crosswalk to CPT code 99211 (Level 
1 office or other outpatient visit, established patient). We believe 
CPT code 99211 has a similar malpractice risk-of-service as HCPCS code 
G0454. Therefore, we are assigning an interim final malpractice 
crosswalk of CPT code 99211 to HCPCS code G0454 for CY 2013.
    For CY 2013, we created HCPCS code G0455 (Preparation with 
instillation of fecal microbiota by any method, including assessment of 
donor specimen) to replace new CPT code 44705 (Preparation of fecal 
microbiota for instillation, including assessment of donor specimen) 
which will have a PFS procedure status indicator of I (Not valid for 
Medicare purposes. Medicare uses another code for the reporting of and 
the payment for these services) for CY 2013, as discussed in section 
III.M.3.a. of this CY 2013 PFS final rule with comment period. The AMA 
RUC recommended a malpractice crosswalk of CPT code 91065 (Breath 
hydrogen test (eg, for detection of lactase deficiency, fructose 
intolerance, bacterial overgrowth, or oro-cecal gastrointestinal 
transit) for CPT code 44705. We believe CPT code 91065 has a similar 
malpractice risk-of-service as HCPCS code G0455. Therefore, we are 
assigning an interim final malpractice crosswalk of CPT code 91065 to 
HCPCS code G0455 for CY 2013.
    In accordance with our malpractice methodology, we have adjusted 
the malpractice RVUs of the CY 2013 new/revised codes for the 
difference in work RVUs (or, if greater, the clinical labor portion of 
the fully implemented PE RVUs) between the source code and the new/
revised codes to reflect the specific risk-of-service for the new/
revised codes. Table 75 lists the CY 2012 new/revised HCPCS codes and 
their respective source codes used to set the interim final CY 2013 
malpractice RVUs. Revised CPT codes that are crosswalked to themselves 
(that is, CPT code 11300 to 11300) are not listed. The malpractice RVUs 
for these services are reflected in Addendum B of this CY 2013 PFS 
final rule with comment period.

        Table 75--Malpractice Crosswalks for CY 2013 New/Revised Codes Used To Establish Malpractice RVUs
----------------------------------------------------------------------------------------------------------------
 
----------------------------------------------------------------------------------------------------------------
   CY 2013 new, revised, or potentiallyMalpractice risk factor crosswalk HCPCS code
----------------------------------------------------------------------------------------------------------------
22586.............................  Prescrl fuse w/instr l5/s1  22558................  Lumbar spine fusion.
23473.............................  Revis reconst shoulder      23472................  Reconstruct shoulder
                                     joint.                                             joint.
23474.............................  Revis reconst shoulder      23210................  Resect scapula tumor.
                                     joint.
24370.............................  Revise reconst elbow joint  24363................  Replace elbow joint.
24371.............................  Revise reconst elbow joint  24363................  Replace elbow joint.
31647.............................  Bronchial valve init        31636................  Bronchoscopy bronch
                                     insert.                                            stents.
31648.............................  Bronchial valve addl        31638................  Bronchoscopy revise
                                     insert.                                            stent.
31649.............................  Bronchial valve remov init  31637................  Bronchoscopy stent add-
                                                                                        on.
31651.............................  Bronchial valve remov addl  31637................  Bronchoscopy stent add-
                                                                                        on.
31660.............................  Bronch thermoplsty 1 lobe.  31636................  Bronchoscopy bronch
                                                                                        stents.
31661.............................  Bronch thermoplsty 2/>      31638................  Bronchoscopy revise
                                     lobes.                                             stent.
32551.............................  Insertion of chest tube...  19260................  Removal of chest wall
                                                                                        lesion.
32554.............................  Aspirate pleura w/o         32421................  Thoracentesis for
                                     imaging.                                           aspiration.
32555.............................  Aspirate pleura w/imaging.  32422................  Thoracentesis w/tube
                                                                                        insert.
32556.............................  Insert cath pleura w/o      32422................  Thoracentesis w/tube
                                     image.                                             insert.
32557.............................  Insert cath pleura w/image  32551................  Insertion of chest tube.
32701.............................  Thorax stereo rad targetw/  33468................  Revision of tricuspid
                                     tx.                                                valve.
33361.............................  Replace aortic valve perq.  33880................  Endovasc taa repr incl
                                                                                        subcl.
33362.............................  Replace aortic valve open.  33880................  Endovasc taa repr incl
                                                                                        subcl.
33363.............................  Replace aortic valve open.  33880................  Endovasc taa repr incl
                                                                                        subcl.
33364.............................  Replace aortic valve open.  33880................  Endovasc taa repr incl
                                                                                        subcl.
33365.............................  Replace aortic valve open.  33979................  Insert intracorporeal
                                                                                        device.
33367.............................  Replace aortic valve w/byp  33979................  Insert intracorporeal
                                                                                        device.
33368.............................  Replace aortic valve w/byp  33979................  Insert intracorporeal
                                                                                        device.
33369.............................  Replace aortic valve w/byp  33305................  Repair of heart wound.
33990.............................  Insert vad artery access..  33240................  Insrt pulse gen w/singl
                                                                                        lead.
33991.............................  Insert vad art&vein access  33240................  Insrt pulse gen w/singl
                                                                                        lead.
33992.............................  Remove vad different        33240................  Insrt pulse gen w/singl
                                     session.                                           lead.
33993.............................  Reposition vad diff         33240................  Insrt pulse gen w/singl
                                     session.                                           lead.
36221.............................  Place cath thoracic aorta.  36200................  Place catheter in aorta.
36222.............................  Place cath carotid/inom     36216................  Place catheter in artery.
                                     art.
36223.............................  Place cath carotid/inom     36216................  Place catheter in artery.
                                     art.
36224.............................  Place cath carotd art.....  36217................  Place catheter in artery.

[[Page 69130]]

 
36225.............................  Place cath subclavian art.  36215................  Place catheter in artery.
36226.............................  Place cath vertebral art..  36217................  Place catheter in artery.
36227.............................  Place cath xtrnl carotid..  36218................  Place catheter in artery.
36228.............................  Place cath intracranial     36218................  Place catheter in artery.
                                     art.
37197.............................  Remove intrvas foreign      37183................  Remove hepatic shunt
                                     body.                                              (tips).
37211.............................  Thrombolytic art therapy..  37184................  Prim art mech
                                                                                        thrombectomy.
37212.............................  Thrombolytic venous         37184................  Prim art mech
                                     therapy.                                           thrombectomy.
37213.............................  Thromblytic art/ven         37184................  Prim art mech
                                     therapy.                                           thrombectomy.
37214.............................  Cessj therapy cath removal  37184................  Prim art mech
                                                                                        thrombectomy.
38243.............................  Transplj hematopoietic      38242................  Lymphocyte infuse
                                     boost.                                             transplant.
52287.............................  Cystoscopy                  51715................  Endoscopic injection/
                                     chemodenervation.                                  implant.
64615.............................  Chemodenerv musc migraine.  64612................  Destroy nerve face
                                                                                        muscle.
78012.............................  Thyroid uptake measurement  78000................  Thyroid single uptake.
78013.............................  Thyroid imaging w/blood     78010................  Thyroid imaging.
                                     flow.
78014.............................  Thyroid imaging w/blood     78007................  Thyroid image mult
                                     flow.                                              uptakes.
78071.............................  Parathyrd planar w/wo       78803................  Tumor imaging (3D).
                                     subtrj.
78072.............................  Parathyrd planar w/         78452................  Ht muscle image spect
                                     spect&ct.                                          mult.
86153.............................  Cell enumeration phys       88361................  Tumor immunohistochem/
                                     interp.                                            comput.
90785.............................  Psytx complex interactive.  90846................  Family psytx w/o patient.
90791.............................  Psych diagnostic            90846................  Family psytx w/o patient.
                                     evaluation.
90792.............................  Psych diag eval w/med       90846................  Family psytx w/o patient.
                                     srvcs.
90832.............................  Psytx pt&/family 30         90846................  Family psytx w/o patient.
                                     minutes.
90833.............................  Psytx pt&/fam w/e&m 30 min  90846................  Family psytx w/o patient.
90834.............................  Psytx pt&/family 45         90846................  Family psytx w/o patient.
                                     minutes.
90836.............................  Psytx pt&/fam w/e&m 45 min  90846................  Family psytx w/o patient.
90837.............................  Psytx pt&/family 60         90846................  Family psytx w/o patient.
                                     minutes.
90838.............................  Psytx pt&/fam w/e&m 60 min  90846................  Family psytx w/o patient.
91112.............................  Gi wireless capsule         91110................  Gi tract capsule
                                     measure.                                           endoscopy.
92920.............................  Prq cardiac angioplast 1    92982................  Coronary artery dilation.
                                     art.
92921.............................  Prq cardiac angio addl art  92984................  Coronary artery dilation.
92924.............................  Prq card angio/athrect 1    92995................  Coronary atherectomy.
                                     art.
92925.............................  Prq card angio/athrect      92995................  Coronary atherectomy.
                                     addl.
92928.............................  Prq card stent w/angio 1    92980................  Insert intracoronary
                                     vsl.                                               stent.
92929.............................  Prq card stent w/angio      92981................  Insert intracoronary
                                     addl.                                              stent.
92933.............................  Prq card stent/ath/angio..  92980................  Insert intracoronary
                                                                                        stent.
92934.............................  Prq card stent/ath/angio..  92981................  Insert intracoronary
                                                                                        stent.
92937.............................  Prq revasc byp graft 1 vsl  92980................  Insert intracoronary
                                                                                        stent.
92938.............................  Prq revasc byp graft addl.  92981................  Insert intracoronary
                                                                                        stent.
92941.............................  Prq card revasc mi 1 vsl..  92980................  Insert intracoronary
                                                                                        stent.
92943.............................  Prq card revasc chronic     92980................  Insert intracoronary
                                     1vsl.                                              stent.
92944.............................  Prq card revasc chronic     92981................  Insert intracoronary
                                     addl.                                              stent.
93653.............................  Ep & ablate supravent       93620................  Electrophysiology
                                     arrhyt.                                            evaluation.
93654.............................  Ep & ablate ventric tachy.  93620................  Electrophysiology
                                                                                        evaluation.
93655.............................  Ablate arrhythmia add on..  93620................  Electrophysiology
                                                                                        evaluation.
93656.............................  Tx atrial fib pulm vein     93620................  Electrophysiology
                                     isol.                                              evaluation.
93657.............................  Tx l/r atrial fib addl....  93620................  Electrophysiology
                                                                                        evaluation.
95017.............................  Perq & icut allg test       95010................  Percut allergy titrate
                                     venoms.                                            test.
95018.............................  Perq⁣ allg test drugs/    95010................  Percut allergy titrate
                                     biol.                                              test.
95076.............................  Ingest challenge ini 120    95180................  Rapid desensitization.
                                     min.
95079.............................  Ingest challenge addl 60    95180................  Rapid desensitization.
                                     min.
95782.............................  Polysom <6 yrs 4/>          95810................  Polysomnography 4 or
                                     paramtrs.                                          more.
95783.............................  Polysom <6 yrs cpap/bilvl.  95811................  Polysomnography w/cpap.
95907.............................  Motor&/sens 1-2 nrv cndj    95904................  Sense nerve conduction
                                     tst.                                               test.
95908.............................  Motor&/sens 3-4 nrv cndj    95904................  Sense nerve conduction
                                     tst.                                               test.
95909.............................  Motor&/sens 5-6 nrv cndj    95904................  Sense nerve conduction
                                     tst.                                               test.
95910.............................  Motor&sens 7-8 nrv cndj     95904................  Sense nerve conduction
                                     test.                                              test.
95911.............................  Motor&sen 9-10 nrv cndj     95904................  Sense nerve conduction
                                     test.                                              test.
95912.............................  Motor&sen 11-12 nrv cnd     95904................  Sense nerve conduction
                                     test.                                              test.
95913.............................  Motor&sens 13/> nrv cnd     95904................  Sense nerve conduction
                                     test.                                              test.
95921.............................  Autonomic nrv parasym       95923................  Autonomic nerv function
                                     inervj.                                            test.
95922.............................  Autonomic nrv adrenrg       95923................  Autonomic nerv function
                                     inervj.                                            test.
95924.............................  Ans parasymp & symp w/tilt  95923................  Autonomic nerv function
                                                                                        test.
95940.............................  Ionm in operatng room 15    95920................  Intraop nerve test add-
                                     min.                                               on.
99485.............................  Suprv interfacilty          99471................  Ped critical care
                                     transport.                                         initial.
99486.............................  Suprv interfac trnsport     99472................  Ped critical care subsq.
                                     addl.
99487.............................  Cmplx chron care w/o pt     99374................  Home health care
                                     vsit.                                              supervision.
99488.............................  Cmplx chron care w/pt vsit  99215................  Office/outpatient visit
                                                                                        est.
99489.............................  Complx chron care addl30    99374................  Home health care
                                     min.                                               supervision.
99495.............................  Trans care mgmt 14 day      99214................  Office/outpatient visit
                                     disch.                                             est.
99496.............................  Trans care mgmt 7 day       99215................  Office/outpatient visit
                                     disch.                                             est.
G0452.............................  Molecular pathology         83912................  Genetic examination.
                                     interpr.
G0453.............................  Cont intraop neuro monitor  95920................  Intraop nerve test add-
                                                                                        on.
G0454.............................  MD document visit by NPP..  99211................  Office/outpatient visit
                                                                                        est.

[[Page 69131]]

 
G0455.............................  Fecal microbiota prep       91065................  Breath hydrogen test.
                                     instil.
----------------------------------------------------------------------------------------------------------------

N. Allowed Expenditures for Physicians' Services and the Sustainable 
Growth Rate

1. Medicare Sustainable Growth Rate (SGR)
    The SGR is an annual growth rate that applies to physicians' 
services paid by Medicare. The use of the SGR is intended to control 
growth in aggregate Medicare expenditures for physicians' services. 
Payments for services are not withheld if the percentage increase in 
actual expenditures exceeds the SGR. Rather, the PFS update, as 
specified in section 1848(d)(4) of the Act, is adjusted based on a 
comparison of allowed expenditures (determined using the SGR) and 
actual expenditures. If actual expenditures exceed allowed 
expenditures, the update is reduced. If actual expenditures are less 
than allowed expenditures, the update is increased.
    Section 1848(f)(2) of the Act specifies that the SGR for a year 
(beginning with CY 2001) is equal to the product of the following four 
factors:
    (1) The estimated change in fees for physicians' services;
    (2) The estimated change in the average number of Medicare fee-for-
service beneficiaries;
    (3) The estimated projected growth in real GDP per capita; and
    (4) The estimated change in expenditures due to changes in statute 
or regulations.
    In general, section 1848(f)(3) of the Act requires us to publish 
SGRs for 3 different time periods, no later than November 1 of each 
year, using the best data available as of September 1 of each year. 
Under section 1848(f)(3)(C)(i) of the Act, the SGR is estimated and 
subsequently revised twice (beginning with the FY and CY 2000 SGRs) 
based on later data. (The Act also provides for adjustments to be made 
to the SGRs for FY 1998 and FY 1999. See the February 28, 2003 Federal 
Register (68 FR 9567) for a discussion of these SGRs). Under section 
1848(f)(3)(C)(ii) of the Act, there are no further revisions to the SGR 
once it has been estimated and subsequently revised in each of the 2 
years following the preliminary estimate. In this final rule with 
comment, we are making our preliminary estimate of the CY 2013 SGR, a 
revision to the CY 2012 SGR, and our final revision to the CY 2011 SGR.
a. Physicians' Services
    Section 1848(f)(4)(A) of the Act defines the scope of physicians' 
services covered by the SGR. The statute indicates that ``the term 
physicians' services includes other items and services (such as 
clinical diagnostic laboratory tests and radiology services), specified 
by the Secretary, that are commonly performed or furnished by a 
physician or in a physician's office, but does not include services 
furnished to a Medicare+Choice plan enrollee.''
    We published a definition of physicians' services for use in the 
SGR in the November 1, 2001 Federal Register (66 FR 55316). We defined 
physicians' services to include many of the medical and other health 
services listed in section 1861(s) of the Act. Since that time, the 
statute has been amended to add new Medicare benefits. As the statute 
changed, we modified the definition of physicians' services for the SGR 
to include the additional benefits added to the statute that meet the 
criteria specified in section 1848(f)(4)(A).
    As discussed in the CY 2010 PFS final rule with comment period (74 
FR 61961), the statute provides the Secretary with clear discretion to 
decide whether physician-administered drugs should be included or 
excluded from the definition of ``physicians' services.'' Accordingly, 
we removed physician-administered drugs from the definition of 
physicians' services in section 1848(f)(4)(A) of the Act for purposes 
of computing the SGR and the levels of allowed expenditures and actual 
expenditures beginning with CY 2010, and for all subsequent years. 
Furthermore, in order to effectuate fully the Secretary's policy 
decision to remove drugs from the definition of physicians' services, 
we removed physician-administered drugs from the calculation of allowed 
and actual expenditures for all prior years.
    Thus, for purposes of determining allowed expenditures, actual 
expenditures for all years, and SGRs beginning with CY 2010 and for all 
subsequent years, we specified that physicians' services include the 
following medical and other health services if bills for the items and 
services are processed and paid by Medicare carriers (and those paid 
through intermediaries where specified) or the equivalent services 
processed by the Medicare Administrative Contractors:
     Physicians' services.
     Services and supplies furnished incident to physicians' 
services, except for the expenditures for drugs and biologicals which 
are not usually self-administered by the patient.
     Outpatient physical therapy services and outpatient 
occupational therapy services.
     Services of PAs, certified registered nurse anesthetists, 
certified nurse midwives, clinical psychologists, clinical social 
workers, nurse practitioners, and certified nurse specialists.
     Screening tests for prostate cancer, colorectal cancer, 
and glaucoma.
     Screening mammography, screening pap smears, and screening 
pelvic exams.
     Diabetes outpatient self-management training (DSMT) 
services.
     MNT services.
     Diagnostic x-ray tests, diagnostic laboratory tests, and 
other diagnostic tests (including outpatient diagnostic laboratory 
tests paid through intermediaries).
     X-ray, radium, and radioactive isotope therapy.
     Surgical dressings, splints, casts, and other devices used 
for the reduction of fractures and dislocations.
     Bone mass measurements.
     An initial preventive physical exam.
     Cardiovascular screening blood tests.
     Diabetes screening tests.
     Telehealth services.
     Physician work and resources to establish and document the 
need for a power mobility device.
     Additional preventive services.
     Pulmonary rehabilitation.
     Cardiac rehabilitation.
     Intensive cardiac rehabilitation.
     Kidney disease education services.
     Personalized prevention plan services.
b. Preliminary Estimate of the SGR for 2013
    Our preliminary estimate of the CY 2013 SGR is--19.7 percent. We 
first estimated the CY 2013 SGR in March 2012, and we made the estimate 
available to the MedPAC and on our Web site. Table 76 shows the March 
2012 estimate and our current estimates of the factors included in the 
CY 2013

[[Page 69132]]

SGR. The majority of the difference between the March estimate and our 
current estimate of the CY 2013 SGR is explained by changes in 
estimated enrollment after our March estimate was prepared.

                                        Table 76--CY 2013 SGR Calculation
----------------------------------------------------------------------------------------------------------------
         Statutory factors                       March estimate                       Current estimate
----------------------------------------------------------------------------------------------------------------
Fees...............................  0.5 percent (1.005)..................  0.3 percent (1.003).
Enrollment.........................  5.1 percent (1.051)..................  3.6 percent (1.036).
Real Per Capita GDP................  0.7 percent (1.007)..................  0.7 percent (1.007).
Law and Regulation.................  -23.6 percent (0.764)................  -23.3 percent (0.767).
                                    ----------------------------------------------------------------------------
    Total..........................  -18.7 percent (0.813)................  -19.7 percent (0.803).
----------------------------------------------------------------------------------------------------------------
Note: Consistent with section 1848(f)(2) of the Act, the statutory factors are multiplied, not added, to produce
  the total (that is, 1.003 x 1.036 x 1.007 x 0.767.= 0.803). A more detailed explanation of each figure is
  provided below in this final rule with comment period.

c. Revised Sustainable Growth Rate for CY 2012
    Our current estimate of the CY 2012 SGR is 5.1 percent. Table 77 
shows our preliminary estimate of the CY 2012 SGR that was published in 
the CY 2012 PFS final rule with comment period (76 FR 73269) and our 
current estimate. The majority of the difference between the 
preliminary estimate and our current estimate of the CY 2012 SGR is 
explained by adjustments to reflect intervening legislative changes 
that have occurred since publication of the CY 2012 final rule with 
comment period.

                                        Table 77--CY 2012 SGR Calculation
----------------------------------------------------------------------------------------------------------------
         Statutory factors              Estimate from CY 2012 final rule              Current estimate
----------------------------------------------------------------------------------------------------------------
Fees...............................  0.6 percent (1.006)..................  0.6 percent (1.006).
Enrollment.........................  3.5 percent (1.035)..................  1.6 percent (1.016).
Real Per Capita GDP................  0.6 percent (1.006)..................  0.7 percent (1.007).
Law and Regulation.................  -20.7 percent (0.793)................  2.1 percent (1.021).
                                    ----------------------------------------------------------------------------
    Total..........................  -16.9 percent (0.831)................  5.1 percent (1.051).
----------------------------------------------------------------------------------------------------------------
Note: A more detailed explanation of each figure is provided in below in this final rule with comment period.

d. Final Sustainable Growth Rate for CY 2011
    The SGR for CY 2011 is 4.7 percent. Table 78 shows our preliminary 
estimate of the CY 2011 SGR from the CY 2011 PFS final rule with 
comment period, our revised estimate from the CY 2012 PFS final rule 
with comment period, and the final figures determined using the best 
available data as of September 1, 2012.

                                                             Table 78--2011 SGR Calculation
--------------------------------------------------------------------------------------------------------------------------------------------------------
         Statutory factors              Estimate from CY 2010 final rule       Estimate from CY 2011 final rule                    Final
--------------------------------------------------------------------------------------------------------------------------------------------------------
Fees...............................  0.2 percent (1.002)..................  0.2 percent (1.002)..................  0.2 percent (1.002).
Enrollment.........................  2.4 percent (1.024)..................  1.8 percent (1.018)..................  1.0 percent (1.010).
Real Per Capita GDP................  0.7 percent (1.007)..................  0.6 percent (1.006)..................  0.6 percent (1.006).
Law and Regulation.................  -16.2 percent (0.838)................  3.3 percent (1.033)..................  2.8 percent (1.028).
                                    --------------------------------------------------------------------------------------------------------------------
    Total..........................  -13.4 percent (0.866)................  6.0 percent (1.060)..................  4.7 percent (1.047).
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note: A more detailed explanation of each figure is provided below in this final rule with comment period.

e. Calculation of CYs 2013, 2012, and 2011 Sustainable Growth Rates
(1) Detail on the CY 2013 SGR
    All of the figures used to determine the CY 2013 SGR are estimates 
that will be revised based on subsequent data. Any differences between 
these estimates and the actual measurement of these figures will be 
included in future revisions of the SGR and allowed expenditures and 
incorporated into subsequent PFS updates.
(a) Factor 1--Changes in Fees for Physicians' Services (Before Applying 
Legislative Adjustments) for CY 2013
    This factor is calculated as a weighted average of the CY 2013 
changes in fees for the different types of services included in the 
definition of physicians' services for the SGR. Medical and other 
health services paid using the PFS are estimated to account for 
approximately 87.7 percent of total allowed charges included in the SGR 
in CY 2013 and are updated using the percent change in the MEI. As 
discussed in section C, the percent change in the MEI for CY 2013 is 
0.8 percent. Diagnostic laboratory tests are estimated to represent 
approximately 12.3 percent of Medicare allowed charges included in the 
SGR for CY 2013. Medicare payments for these tests are updated by the 
Consumer Price Index for Urban Areas (CPI-U), which is 1.7 percent for 
CY 2013. Section 1833(h)(2)(A)(iv(l) of the Act requires that the CPI-U 
update applied to clinical laboratory tests be reduced by a multi-
factor productivity adjustment (MFP adjustment) and, for each of years 
2011 through 2015, by 1.75 percentage

[[Page 69133]]

points (percentage adjustment). The MFP adjustment will not apply in a 
year where the CPI-U is zero or a percentage decrease. Further, the 
application of the MFP adjustment shall not result in an adjustment to 
the fee schedule of less than zero for a year. However, the application 
of the percentage adjustment may result in an adjustment to the fee 
schedule being less than zero for a year and may result in payment 
rates for a year being less than such payment rates for the preceding 
year. The applicable productivity adjustment for CY 2013 is -0.9 
percent. Adjusting the CPI-U update by the productivity adjustment 
results in a 0.8 percent (1.7 percent (CPI-U) -0.9 percent (MFP 
adjustment) update for CY 2013. Additionally, the percentage reduction 
of 1.75 percent is applied for CYs 2011 through 2015, as discussed 
previously, and an additional adjustment of -2.0 percent specified in 
the Middle Class Tax Relief and Job Creation Act. Therefore, for CY 
2013, diagnostic laboratory tests will receive an update of -3.0 
percent (rounded). Table 79 shows the weighted average of the MEI and 
laboratory price changes for CY 2013.

 Table 79--Weighted-Average of the MEI and Laboratory Price Changes for
                                 CY 2013
------------------------------------------------------------------------
                                                      Weight     Update
------------------------------------------------------------------------
Physician.........................................      0.877       0.8%
Laboratory........................................      0.123      -3.0%
Weighted-average..................................      1.000       0.3%
------------------------------------------------------------------------

    We estimate that the weighted average increase in fees for 
physicians' services in CY 2013 under the SGR (before applying any 
legislative adjustments) will be 0.3 percent.
(b) Factor 2--The Percentage Change in the Average Number of Part B 
Enrollees From CY 2012 to CY 2013
    This factor is our estimate of the percent change in the average 
number of fee-for-service enrollees from CY 2012 to CY 2013. Services 
furnished to Medicare Advantage (MA) plan enrollees are outside the 
scope of the SGR and are excluded from this estimate. We estimate that 
the average number of Medicare Part B fee-for-service enrollees will 
increase by 3.6 percent from CY 2012 to CY 2013. Table 80 illustrates 
how this figure was determined.

  Table 80--Average Number of Medicare Part B Fee-for-Service Enrollees
                         From CY 2012 to CY 2013
             [Excluding beneficiaries enrolled in MA plans]
------------------------------------------------------------------------
                                     CY 2012               CY 2013
------------------------------------------------------------------------
Overall.....................  46.560 million......  48.136 million.
Medicare Advantage (MA).....  13.545 million......  13.935 million.
Net.........................  33.016 million......  34.201 million.
Percent Increase............  ....................  3.6 percent.
------------------------------------------------------------------------

    An important factor affecting fee-for-service enrollment is 
beneficiary enrollment in MA plans. Because it is difficult to estimate 
the size of the MA enrollee population before the start of a CY, at 
this time we do not know how actual enrollment in MA plans will compare 
to current estimates. For this reason, the estimate may change 
substantially as actual Medicare fee-for-service enrollment for CY 2013 
becomes known.
(c) Factor 3--Estimated Real Gross Domestic Product Per Capita Growth 
in CY 2013
    We estimate that the growth in real GDP per capita from CY 2012 to 
CY 2013 will be 0.7 percent (based on the annual growth in the 10 year 
moving average of real GDP per capita (2004 through 2013)). Our past 
experience indicates that there have also been changes in estimates of 
real GDP per capita growth made before the year begins and the actual 
change in real GDP per capita growth computed after the year is 
complete. Thus, it is possible that this figure will change as actual 
information on economic performance becomes available to us in CY 2013.
(d) Factor 4--Percentage Change in Expenditures for Physicians' 
Services Resulting From Changes in Statute or Regulations in CY 2013 
Compared With CY 2012
    The statutory and regulatory provisions that will affect 
expenditures in CY 2013 relative to CY 2012 are estimated to have an 
impact on expenditures of -23.3 percent. The impact is primarily due to 
the expiration of the physician fee schedule update specified in 
statute for CY 2012 only.
(2) Detail on the CY 2012 SGR
    A more detailed discussion of our revised estimates of the four 
elements of the CY 2012 SGR follows.
(a) Factor 1--Changes in Fees for Physicians' Services (Before Applying 
Legislative Adjustments) for CY 2012
    This factor was calculated as a weighted-average of the CY 2012 
changes in fees that apply for the different types of services included 
in the definition of physicians' services for the SGR in CY 2012.
    We estimate that services paid using the PFS account for 
approximately 90.3 percent of total allowed charges included in the SGR 
in CY 2012. These services were updated using the CY 2012 percent 
change in the MEI of 0.6 percent. We estimate that diagnostic 
laboratory tests represent approximately 12.3 percent of total allowed 
charges included in the SGR in CY 2012. For CY 2012, diagnostic 
laboratory tests received an update of 0.7 percent.
    Table 81 shows the weighted-average of the MEI and laboratory price 
changes for CY 2011.

 Table 81--Weighted-Average of the MEI, and Laboratory Price Changes for
                                 CY 2012
------------------------------------------------------------------------
                                                      Weight     Update
------------------------------------------------------------------------
Physician.........................................      0.903        0.6
Laboratory........................................      0.097        0.7
Weighted-average..................................      1.000        0.6
------------------------------------------------------------------------


[[Page 69134]]

    After considering the elements described in Table 81, we estimate 
that the weighted-average increase in fees for physicians' services in 
CY 2012 under the SGR was 0.6 percent. Our estimate of this factor in 
the CY 2012 PFS final rule with comment period was 0.6 percent (76 FR 
73271).
(b) Factor 2--The Percentage Change in the Average Number of Part B 
Enrollees From CY 2011 to CY 2012
    We estimate that the average number of Medicare Part B fee-for-
service enrollees (excluding beneficiaries enrolled in Medicare 
Advantage plans) increased by 1.6 percent in CY 2012. Table 82 
illustrates how we determined this figure.

  Table 82--Average Number of Medicare Part B Fee-for-Service Enrollees
                         From CY 2011 to CY 2012
             [Excluding beneficiaries enrolled in MA plans]
------------------------------------------------------------------------
                                      2011                  2012
------------------------------------------------------------------------
Overall.....................  44.879 million......  46.560 million.
Medicare Advantage (MA).....  12.382 million......  13.545 million.
Net.........................  32.498 million......  33.016 million.
Percent Increase............  ....................  1.6 percent.
------------------------------------------------------------------------

    Our estimate of the 1.6 percent change in the number of fee-for-
service enrollees, net of Medicare Advantage enrollment for CY 2012 
compared to CY 2011, is different than our original estimate of an 
increase of 3.5 percent in the CY 2012 PFS final rule with comment 
period. (76 FR 73271). While our current projection based on data from 
8 months of CY 2012 differs from our original estimate of 3.5 percent 
when we had no actual data, it is still possible that our final 
estimate of this figure will be different once we have complete 
information on CY 2012 fee-for-service enrollment.
(c) Factor 3--Estimated Real Gross Domestic Product Per Capita Growth 
in CY 2012
    We estimate that the growth in real GDP per capita will be 0.7 
percent for CY 2012 (based on the annual growth in the 10-year moving 
average of real GDP per capita (2003 through 2012)). Our past 
experience indicates that there have also been differences between our 
estimates of real per capita GDP growth made prior to the year's end 
and the actual change in this factor. Thus, it is possible that this 
figure will change further as complete actual information on CY 2012 
economic performance becomes available to us in CY 2013.
(d) Factor 4--Percentage Change in Expenditures for Physicians' 
Services Resulting From Changes in Statute or Regulations in CY 2012 
Compared With CY 2011
    The statutory and regulatory provisions that affected expenditures 
in CY 2012 relative to CY 2011 are estimated to have an impact on 
expenditures of 2.8 percent. This is primarily an effect of the 
statutory requirements surrounding the temporary physician fee schedule 
update in CY 2012.
(3) Detail on the CY 2011 SGR
    A more detailed discussion of our final revised estimates of the 
four elements of the CY 2011 SGR follows.
(a) Factor 1--Changes in Fees for Physicians' Services for CY 2011
    This factor was calculated as a weighted average of the CY 2011 
changes in fees that apply for the different types of services included 
in the definition of physicians' services for the SGR in CY 2011.
    We estimate that services paid under the PFS account for 
approximately 90.7 percent of total allowed charges included in the SGR 
in CY 2011. These services were updated using the CY 2011 percent 
change in the MEI of 0.4 percent. We estimate that diagnostic 
laboratory tests represent approximately 9.3 percent of total allowed 
charges included in the SGR in CY 2011. For CY 2011, diagnostic 
laboratory tests received an update of -1.8 percent.
    Table 83 shows the weighted-average of the MEI and laboratory price 
changes for CY 2011.

    Table 83--Weighted-Average of the MEI, Laboratory, and Drug Price
                           Changes for CY 2011
------------------------------------------------------------------------
                                                      Weight     Update
------------------------------------------------------------------------
Physician.........................................      0.907        0.4
Laboratory........................................      0.093       -1.8
Weighted-average..................................       1.00        0.2
------------------------------------------------------------------------

    After considering the elements described in Table 83, we estimate 
that the weighted-average increase in fees for physicians' services in 
CY 2011 under the SGR (before applying any legislative adjustments) was 
0.2 percent. This figure is a final one based on complete data for CY 
2011.
(b) Factor 2--The Percentage Change in the Average Number of Part B 
Enrollees From CY 2010 to CY 2011
    We estimate the change in the number of fee-for-service enrollees 
(excluding beneficiaries enrolled in MA plans) from CY 2010 to CY 2011 
was 1.0 percent. Our calculation of this factor is based on complete 
data from CY 2011. Table 84 illustrates the calculation of this factor.

[[Page 69135]]



   Table 84--Average Number of Medicare Part B From CY 2010 to CY 2011
             [Excluding beneficiaries enrolled in MA plans]
------------------------------------------------------------------------
                                        2010               2011
------------------------------------------------------------------------
Overall...........................       43.871  44.879 million.
Medicare Advantage (MA)...........       11.692  12.382 million.
Net...............................       32.179  32.498 million.
Percent Change....................  ...........  1.0.
------------------------------------------------------------------------

(c) Factor 3--Estimated Real Gross Domestic Product Per Capita Growth 
in CY 2011
    We estimate that the growth in real per capita GDP was 0.6 percent 
in CY 2011 (based on the annual growth in the 10-year moving average of 
real GDP per capita (2002 through 2011)). This figure is a final one 
based on complete data for CY 2011.
(4) Factor 4--Percentage Change in Expenditures for Physicians' 
Services Resulting From Changes in Statute or Regulations in CY 2011 
Compared With CY 2010
    Our final estimate for the net impact on expenditures from the 
statutory and regulatory provisions that affect expenditures in CY 2011 
relative to CY 2010 is 2.8 percent. This is primarily an effect of the 
statutory requirements surrounding the temporary physician fee schedule 
update in CY 2011.
2. The Update Adjustment Factor (UAF)
    Section 1848(d) of the Act provides that the PFS update is equal to 
the product of the MEI and the UAF. The UAF is applied to make actual 
and target expenditures (referred to in the statute as ``allowed 
expenditures'') equal. As discussed previously, allowed expenditures 
are equal to actual expenditures in a base period updated each year by 
the SGR. The SGR sets the annual rate of growth in allowed expenditures 
and is determined by a formula specified in section 1848(f) of the Act.
a. Calculation Under Current Law
    Under section 1848(d)(4)(B) of the Act, the UAF for a year 
beginning with CY 2001 is equal to the sum of the following--
     Prior Year Adjustment Component. An amount determined by--
    + Computing the difference (which may be positive or negative) 
between the amount of the allowed expenditures for physicians' services 
for the prior year (the year prior to the year for which the update is 
being determined) and the amount of the actual expenditures for those 
services for that year;
    + Dividing that difference by the amount of the actual expenditures 
for those services for that year; and
    + Multiplying that quotient by 0.75.
     Cumulative Adjustment Component. An amount determined by--
    + Computing the difference (which may be positive or negative) 
between the amount of the allowed expenditures for physicians' services 
from April 1, 1996, through the end of the prior year and the amount of 
the actual expenditures for those services during that period;
    + Dividing that difference by actual expenditures for those 
services for the prior year as increased by the SGR for the year for 
which the UAF is to be determined; and
    + Multiplying that quotient by 0.33.
    Section 1848(d)(4)(E) of the Act requires the Secretary to 
recalculate allowed expenditures consistent with section 1848(f)(3) of 
the Act. As discussed previously, section 1848(f)(3) specifies that the 
SGR (and, in turn, allowed expenditures) for the upcoming CY (CY 2013 
in this case), the current CY (that is, CY 2012) and the preceding CY 
(that is, CY 2011) are to be determined on the basis of the best data 
available as of September 1 of the current year. Allowed expenditures 
for a year generally are estimated initially and subsequently revised 
twice. The second revision occurs after the CY has ended (that is, we 
are making the second revision to CY 2011 allowed expenditures in this 
final rule with comment).
    Table 85 shows the historical SGRs corresponding to each period 
through CY 2013. Note that these figures have been revised to reflect a 
correction to the historical clinical laboratory expenditure data.

   Table 85--Annual and Cumulative Allowed and Actual Expenditures for Physicians' Services From April 1, 1996
                                  Through the end of the Current Calendar Year
----------------------------------------------------------------------------------------------------------------
                                      Annual                        Cumulative      Cumulative
                                      allowed      Annual actual      allowed         actual
             Period                expenditures    expenditures    expenditures    expenditures     FY/CY SGR %
                                       ($ in           ($ in           ($ in           ($ in
                                     billions)       billions)       billions)       billions)
----------------------------------------------------------------------------------------------------------------
4/1/96-3/31/97..................            47.0            47.0            47.0            47.0  ..............
4/1/97-3/31/98..................            48.5            47.2            95.6            94.3             3.2
4/1/98-3/31/99..................            50.6            48.1           146.2           142.4             4.2
1/1/99-3/31/99..................            12.7            12.5           146.2           142.4  ..............
4/1/99-12/31/99.................            40.5            37.2           186.7           179.6             6.9
1/1/99-12/31/99.................            53.2            49.7           186.7           179.6  ..............
1/1/00-12/31/00.................            57.1            54.4           243.7           234.0             7.3
1/1/01-12/31/01.................            59.7            61.5           303.4           295.5             4.5
1/1/02-12/31/02.................            64.6            64.8           368.0           360.3             8.3
1/1/03-12/31/03.................            69.3            70.4           437.3           430.7             7.3
1/1/04-12/31/04.................            73.9            78.5           511.2           509.1             6.6
1/1/05-12/31/05.................            77.0            83.8           588.2           593.0             4.2
1/1/06-12/31/06.................            78.2            85.1           666.4           678.1             1.5
1/1/07-12/31/07.................            80.9            85.1           747.2           763.1             3.5
1/1/08-12/31/08.................            84.5            87.3           831.8           850.4             4.5
1/1/09-12/31/09.................            89.9            91.1           921.7           941.5             6.4

[[Page 69136]]

 
1/1/10-12/31/10.................            97.9            96.0         1,019.6         1,037.4             8.9
1/1/11-12/31/11.................           102.5            99.4         1,122.2         1,136.9             4.7
1/1/12-12/31/12.................           107.8           102.0         1,230.0         1,238.9             5.1
----------------------------------------------------------------------------------------------------------------
\1\ Allowed expenditures in the first year (April 1, 1996-March 31, 1997) are equal to actual expenditures. All
  subsequent figures are equal to quarterly allowed expenditure figures increased by the applicable SGR.
  Cumulative allowed expenditures are equal to the sum of annual allowed expenditures. We provide more detailed
  quarterly allowed and actual expenditure data on our Web site at the following address: http://www.cms.hhs.gov/SustainableGRatesConFact/ SustainableGRatesConFact/. We expect to update the Web site with the most current information later this
  month.
\2\ Allowed expenditures for the first quarter of 1999 are based on the FY 1999 SGR.
\3\ Allowed expenditures for the last three quarters of 1999 are based on the FY 2000 SGR.

    Consistent with section 1848(d)(4)(E) of the Act, Table 85 includes 
our second revision of allowed expenditures for CY 2011, a 
recalculation of allowed expenditures for CY 2012, and our initial 
estimate of allowed expenditures for CY 2013. To determine the UAF for 
CY 2013, the statute requires that we use allowed and actual 
expenditures from April 1, 1996 through December 31, 2012 and the CY 
2013 SGR. Consistent with section 1848(d)(4)(E) of the Act, we will be 
making further revisions to the CY 2012 and CY 2013 SGRs and CY 2012 
and CY 2013 allowed expenditures. Because we have incomplete actual 
expenditure data for CY 2012, we are using an estimate for this period. 
Any difference between current estimates and final figures will be 
taken into account in determining the UAF for future years.
    We are using figures from Table 85 in the following statutory 
formula:
[GRAPHIC] [TIFF OMITTED] TR16NO12.005


UAF13 = Update Adjustment Factor for CY 2013 = 0.6 
percent
Target12 = Allowed Expenditures for CY 2012 = $107.8 
billion
Actual12 = Estimated Actual Expenditures for CY 2012 = 
$102.0 billion
Target 4/96-12/12 = Allowed Expenditures from 4/1/1996-
12/31/2012 = $1230.0 billion
Actual 4/96-12/12 = Estimated Actual Expenditures from 4/
1/1996-12/31/2012 = $1238.9 billion
SGR13 = -19.7 percent (0.803)

[GRAPHIC] [TIFF OMITTED] TR16NO12.006

    Section 1848(d)(4)(D) of the Act indicates that the UAF determined 
under section 1848(d)(4)(B) of the Act for a year may not be less than 
-0.07 or greater than 0.03. Since 0.006 (0.6 percent) is between -0.07 
and 0.03, the UAF for CY 2013 will be 0.006.
    Section 1848(d)(4)(A)(ii) of the Act indicates that 1.0 should be 
added to the UAF determined under section 1848(d)(4)(B) of the Act. 
Thus, adding 1.0 to 0.006 yields 1.006.
3. The Percentage Change in the Medicare Economic Index (MEI)
    The Medicare Economic Index (MEI) is required by section the fourth 
sentence of 1842(b)(3) of the Act, which states that prevailing charge 
levels beginning after June 30, 1973 may not exceed the level from the 
previous year except to the extent that the Secretary finds, on the 
basis of appropriate economic index data, that the higher level is 
justified by year-to-year economic changes. The current form of the MEI 
was detailed in the CY 2011 PFS final rule with comment period (75 FR 
73262) which updated the cost structure of the index from a base year 
of 2000 to 2006.
    The MEI measures the weighted-average annual price change for 
various inputs needed to furnish physicians' services. The MEI is a 
fixed-weight input price index, with an adjustment for the change in 
economy-wide multifactor productivity. This index, which has CY 2006 
base year weights, is comprised of two broad categories: (1) 
Physician's own time; and (2) physician's practice expense (PE).
    The physician's compensation (own time) component represents the 
net income portion of business receipts and primarily reflects the 
input of the physician's own time into the production of physicians' 
services in physicians' offices. This category consists of two 
subcomponents: (1) Wages and salaries; and (2) fringe benefits.
    The physician's practice expense (PE) category represents 
nonphysician inputs used in the production of services in physicians' 
offices. This category consists of wages and salaries and fringe 
benefits for nonphysician staff and other nonlabor inputs. The 
physician's PE component also includes the following categories of 
nonlabor inputs: Office expenses; medical materials and supplies; 
professional liability insurance; medical equipment; medical materials 
and supplies; and other professional expenses.
    Table 86 presents a listing of the MEI cost categories with 
associated weights and percent changes for price proxies for the 2013 
update. The CY 2013 final MEI update is 1.8 percent and reflects a 1.9 
percent increase in physician's own time and a 1.7 percent increase in 
physician's PE. Within the physician's PE, the largest increase 
occurred in chemicals, which increased 7.1 percent,

[[Page 69137]]

and rubber and plastic products, which increased 6.1 percent.
    For CY 2013, the increase in the MEI is 0.8 percent, which reflects 
an increase in the non-productivity adjusted MEI of 1.8 percent and a 
productivity adjustment of 1.0 percent (which is based on the 10-year 
moving average of economy-wide private nonfarm business multifactor 
productivity). The Bureau of Labor Statistics (BLS) is the agency that 
publishes the official measure of private non-farm business multi-
factor productivity (MFP). Please see http://www.bls.gov/mfp/, which is 
the link to the BLS historical published data on the measure of MFP.

 Table 86--Annual Percent Change in the Revised and Rebased MEI CY 2013,
                             All Categories
------------------------------------------------------------------------
                                                               CY 2013
                Cost categories                 2006 weight    percent
                                                   \2\ %       changes
------------------------------------------------------------------------
MEI Total, productivity adjusted..............      100.000          0.8
Productivity: 10[dash]year moving average of        \5\ N/A          1.0
 MFP \1\......................................
MEI Total, without productivity adjustment....      100.000          1.8
    Physician Compensation (Own Time) \3\.....       48.266          1.9
        Wages and Salaries....................       43.880          1.8
        Benefits..............................        4.386          2.9
    Practice Expenses.........................       51.734          1.7
        Nonphysician Compensation.............       19.153          1.9
            Nonphysician Wages................       13.752          1.7
                P&T...........................        6.006          1.6
                Management....................        1.446          1.8
                Clerical......................        4.466          1.8
                Services......................        1.834          1.3
            Nonphysician Benefits.............        5.401          2.6
        Other Practice Expenses...............       26.308          1.6
            Office Expenses...................       20.035          2.0
                Utilities.....................        1.266          1.5
                Chemicals.....................        0.723          7.1
                Paper.........................        0.657          1.9
                Rubber & Plastics.............        0.598          6.1
                Telephone.....................        1.501         -0.3
                Postage.......................        0.898          3.6
                All Other Services............        3.582          1.5
                All Other Products............        0.500          2.1
                Fixed Capital.................        8.957          1.8
                Moveable Capital..............        1.353          1.5
            PLI \4\...........................        4.295          0.5
            Medical Equipment.................        1.978         -0.6
        Medical supplies......................        1.760          0.5
        Other Professional Expenses...........        4.513          2.1
------------------------------------------------------------------------
\1\ The forecasts are based upon the latest available Bureau of Labor
  Statistics data on the 10-year average of BLS private nonfarm business
  multifactor productivity published on June 26, 2012. (http://www.bls.gov/news.release/prod3.nr0.htm)
\2\ The weights shown for the MEI components are the 2006 base-year
  weights, which may not sum to subtotals or totals because of rounding.
  The MEI is a fixed-weight, Laspeyres-type input price index whose
  category weights indicate the distribution of expenditures among the
  inputs to physicians' services for CY 2006. To determine the MEI level
  for a given year, the price proxy level for each component is
  multiplied by its 2006 weight. The sum of these products (weights
  multiplied by the price index levels) overall cost categories yields
  the composite MEI level for a given year. The annual percent change in
  the MEI levels is an estimate of price change over time for a fixed
  market basket of inputs to physicians' services.
\3\ The measures of productivity, average hourly earnings, Employment
  Cost Indexes, as well as the various Producer and Consumer Price
  Indexes can be found on the Bureau of Labor Statistics Web site at
  http://stats.bls.gov.
\4\ Derived from a CMS survey of several major commercial insurers.
\5\ Productivity is factored into the MEI categories as an adjustment;
  therefore, no explicit weight exists for productivity in the MEI.

4. Medicare Economic Index Technical Advisory Panel
    From May 2012 through September 2012, the MEI Technical Advisory 
Panel conducted a technical review of the MEI, including analyses of 
the inputs, input weights, price-measurement proxies, and productivity 
adjustment. Details regarding the Panel's work and documents such as 
transcripts, meeting summaries, and presentations can be found at the 
following Web site: http://cms.gov/Regulations-and-Guidance/Guidance/FACA/MEITAP.html.
    The Panel concluded its public work on July 11, 2012 and submitted 
a final report complete with its recommendations to the Secretary of 
Health and Human Services on August 27, 2012.
    Comment: We received one comment requesting that CMS engage in 
dialogue with affected parties regarding the analyses and 
recommendations of the Technical Advisory Panel to the MEI prior to 
proposed rulemaking to implement any such findings.
    Response: The MEI Technical Advisory Panel was chartered according 
to the Federal Advisory Committee Act. As a result, all of the Panel's 
meetings were open to the public. In each meeting, including the final 
meeting where the Panel's findings and recommendations were finalized, 
time was allotted to allow for any public comment. As we find 
appropriate, any recommended changes to the MEI will be proposed via 
the rulemaking process. Given the time made available for public 
comment during the MEI Technical Advisory Panel's meetings, as well as 
the opportunity for public comment during rulemaking, we disagree with 
the commenter's request that we engage in further dialogue prior to 
proposing possible changes.

[[Page 69138]]

5. Physician and Anesthesia Fee Schedule Conversion Factors for CY 2013
    The CY 2013 PFS CF is $25.0008. The CY 2012 national average 
anesthesia CF is $15.93.
a. Physician Fee Schedule Update and Conversion Factor
(1) CY 2013 PFS Update
    The formula for calculating the PFS update is set forth in section 
1848(d)(4)(A) of the Act. In general, the PFS update is determined by 
multiplying the CF for the previous year by the percentage increase in 
the MEI less productivity times the UAF, which is calculated as 
specified under section 1848(d)(4)(B) of the Act.
(2) CY 2013 PFS Conversion Factor
    Generally, the PFS CF for a year is calculated in accordance with 
section 1848(d)(1)(A) of the Act by multiplying the previous year's CF 
by the PFS update.
    We note section 101 of the Medicare Improvements and Extension Act, 
Division B of the Tax Relief and Health Care Act of 2006 (MIEA-TRHCA) 
provided a 1-year increase in the CY 2007 CF and specified that the CF 
for CY 2008 must be computed as if the 1-year increase had never 
applied. Section 101 of the Medicare, Medicaid, and SCHIP Extension Act 
of 2007 (MMSEA) provided a 6-month increase in the CY 2008 CF, from 
January 1, 2008, through June 30, 2008, and specified that the CF for 
the remaining portion of CY 2008 and the CFs for CY 2009 and subsequent 
years must be computed as if the 6-month increase had never applied. 
Section 131 of the MIPPA extended the increase in the CY 2008 CF that 
applied during the first half of the year to the entire year, provided 
for a 1.1 percent increase to the CY 2009 CF, and specified that the 
CFs for CY 2010 and subsequent years must be computed as if the 
increases for CYs 2007, 2008, and 2009 had never applied. Section 
1011(a) of the DODAA and section 5 of the TEA specified a zero percent 
update for CY 2010, effective January 1, 2010 through March 31, 2010. 
Section 4 of the Continuing Extension Act of 2010 (CEA) extended the 
zero percent update for CY 2010 through May 31, 2010. Subsequently, 
section 101(a)(2) of the PACMBPRA provided for a 2.2 percent update to 
the CF, effective from June 1, 2010 to November 30, 2010. Section 2 of 
the Physician Payment and Therapy Relief Act of 2010 (Pub. L. 111-286) 
extended the 2.2 percent through the end of CY 2010. Section 101 of the 
MMEA provided a zero percent update for CY 2011, effective January 1, 
2011 through December 31, 2011, and specified that the CFs for CY 2012 
and subsequent years must be computed as if the increases in previous 
years had never applied. Section 301 of the Temporary Payroll Tax Cut 
Continuation Act of 2011 (TPTCCA) provided a zero percent update 
effective January 1, 2012 through February 29, 2012, and specified that 
the CFs for subsequent time periods must be computed as if the 
increases in previous years had never applied. Section 3003 of the 
Middle Class Tax Relief and Job Creation Act of 2012 (Job Creation Act) 
provided a zero percent update for effective March 1, 2012 through 
December 31, 2012, and specified that the CFs for subsequent time 
periods must be computed as if the increases in previous years had 
never applied. Therefore, under current law, the CF that would be in 
effect in CY 2012 had the prior increases specified above not applied 
is $24.6712.
    In addition, when calculating the PFS CF for a year, section 
1848(c)(2)(B)(ii)(II) of the Act requires that increases or decreases 
in RVUs may not cause the amount of expenditures for the year to differ 
by more than $20 million from what it would have been in the absence of 
these changes. If this threshold is exceeded, we must make adjustments 
to preserve budget neutrality. We estimate that CY 2012 RVU changes 
would result in an increase in Medicare physician expenditures of more 
than $20 million. Accordingly, we are decreasing the CF by -0.1% to 
offset the estimated increase in Medicare physician expenditures due to 
the CY 2012 RVU changes. We calculate the CY 2013 PFS CF to be 
$25.0008. This final rule with comment period announces a reduction to 
payment rates for physicians' services in CY 2013 under the SGR 
formula. These payment rates are currently scheduled to be reduced 
under the SGR system on January 1, 2013. The total reduction in the 
conversion factor between CY 2012 and CY 2013 under the SGR system will 
be -26.5 percent. By law, we are required to make these reductions in 
accordance with section 1848(d) and (f) of the Act, and these 
reductions can only be averted by an Act of Congress. While Congress 
has provided temporary relief from these reductions every year since 
2003, a long-term solution is critical. We will continue to work with 
Congress to fix this untenable situation so doctors and beneficiaries 
no longer have to worry about the stability and adequacy of their 
payments from Medicare under the Physician Fee Schedule.
    We illustrate the calculation of the CY 2013 PFS CF in Table 87.

               Table 87--Calculation of the CY 2013 PFS CF
------------------------------------------------------------------------
                --                           --                 --
------------------------------------------------------------------------
Conversion Factor in effect in CY   ....................        $34.0376
 2012.
CY 2012 Conversion Factor had       ....................        $24.6712
 statutory increases not applied.
CY 2013 Medicare Economic Index...  0.8 percent (1.008).  ..............
CY 2013 Update Adjustment Factor..  0.6 percent (1.006).  ..............
CY 2013 RVU Budget Neutrality       -0.1 percent          ..............
 Adjustment.                         (0.99932).
CY 2013 Conversion Factor.........  ....................        $25.0008
Percent Change from Conversion      ....................          -26.5%
 Factor in effect in CY 2012 to CY
 2013 Conversion Factor.
------------------------------------------------------------------------

    We note payment for services under the PFS will be calculated as 
follows:

Payment = [(RVU work x GPCI work) + (RVU PE x GPCI PE) + (RVU 
malpractice x GPCI malpractice)] x CF.
b. Anesthesia Conversion Factor
    We calculate the anesthesia CF as indicated in Table 88. Anesthesia 
services do not have RVUs like other PFS services. Therefore, we 
account for any necessary RVU adjustments through an adjustment to the 
anesthesia CF to simulate changes to RVUs. More specifically, if there 
is an adjustment to the work, PE, or malpractice RVUs, these 
adjustments are applied to the respective shares of the anesthesia CF 
as these shares are proxies for the work, PE, and malpractice RVUs for 
anesthesia services. Information regarding the anesthesia work, PE, and 
malpractice shares can be found at the following: https://www.cms.gov/center/anesth.asp.

[[Page 69139]]

    The anesthesia CF in effect in CY 2012 is $21.52. As explained 
previously, in order to calculate the CY 2013 PFS CF, the statute 
requires us to calculate the CFs for all previous years as if the 
various legislative changes to the CFs for those years had not 
occurred. Accordingly, under current law, the anesthesia CF in effect 
in CY 2012 had statutory increases not applied is $15.60. The percent 
change from the anesthesia CF in effect in CY 2012 to the CF for CY 
2013 is -26.0 percent. We illustrate the calculation of the CY 2013 
anesthesia CF in Table 88.

           Table 88--Calculation of the CY 2013 Anesthesia CF
------------------------------------------------------------------------
 
------------------------------------------------------------------------
2012 National Average Anesthesia    ....................          $21.52
 Conversion Factor in effect in CY
 2011.
2012 National Anesthesia            ....................          $15.60
 Conversion Factor had Statutory
 Increases Not Applied.
CY 2013 Medicare Economic Index...  0.8 percent (1.008).  ..............
CY 2013 Update Adjustment Factor..  0.6 percent (1.006).  ..............
CY 2013 Budget Neutrality Work and  -0.1 percent          ..............
 Malpractice Adjustment.             (0.99932).
CY 2013 Anesthesia Fee Schedule     0.8 percent (1.008).  ..............
 change due to Practice Expense.
CY 2013 Anesthesia Conversion       ....................          $15.93
 Factor.
Percent Change from 2012 to 2013..  ....................          -26.0%
------------------------------------------------------------------------

III. Other Provisions of the Final Rule With Comment Period

A. Ambulance Fee Schedule

1. Amendment to section 1834(l) (13) of the Act
    Section 146(a) of the Medicare Improvements for Patients and 
Providers Act of 2008 (Pub. L. 110-275) (MIPPA) amended section 
1834(l)(13)(A) of the Act to specify that, effective for ground 
ambulance services furnished on or after July 1, 2008 and before 
January 1, 2010, the ambulance fee schedule amounts for ground 
ambulance services shall be increased as follows:
     For covered ground ambulance transports that originate in 
a rural area or in a rural census tract of a metropolitan statistical 
area, the fee schedule amounts shall be increased by 3 percent.
     For covered ground ambulance transports that do not 
originate in a rural area or in a rural census tract of a metropolitan 
statistical area, the fee schedule amounts shall be increased by 2 
percent.
    Sections 3105(a) and 10311(a) of the Affordable Care Act further 
amended section 1834(l)(13)(A) of the Act to extend the payment add-ons 
described above for an additional year, such that these add-ons also 
applied to covered ground ambulance transports furnished on or after 
January 1, 2010 and before January 1, 2011. In the CY 2011 PFS final 
rule (75 FR 73385 and 73386, 73625), we revised Sec.  414.610(c)(1)(ii) 
to conform the regulations to this statutory requirement.
    Section 106(a) of the MMEA again amended section 1834(l)(13)(A) of 
the Act to extend the payment add-ons described above for an additional 
year, such that these add-ons also applied to covered ground ambulance 
transports furnished on or after January 1, 2011 and before January 1, 
2012. In the CY 2012 End-Stage Renal Disease Prospective Payment System 
(ESRD PPS) final rule (76 FR 70228, 70284 through 70285, 70315), we 
revised Sec.  414.610(c)(1)(ii) to conform the regulations to this 
statutory requirement. However, in doing so, paragraphs (c)(1)(ii)(A) 
and (B) were inadvertently deleted from the Code of Federal 
Regulations. Thus, in the proposed rule, we proposed to reinstate 
paragraphs (c)(1)(ii)(A) and (B) as further revised below. We did not 
receive any comments on this proposal. Therefore, we are finalizing our 
proposal to reinstate paragraphs (c)(1)(ii)(A) and (B), as further 
revised below to conform to subsequent legislation.
    Subsequently, section 306(a) of the Temporary Payroll Tax Cut 
Continuation Act of 2011 (Pub. L. 112-78) (TPTCCA) amended section 
1834(l)(13)(A) of the Act to extend the payment add-ons described above 
through February 29, 2012; and section 3007(a) of the Middle Class Tax 
Relief and Job Creation Act of 2012 (Pub. L. 112-96) (MCTRJCA) further 
amended section 1834(l)(13)(A) to extend these payment add-ons through 
December 31, 2012. Thus, these payment add-ons also apply to covered 
ground ambulance transports furnished on or after January 1, 2012 and 
before January 1, 2013. In the proposed rule, we proposed to revise 
Sec.  414.610(c)(1)(ii) to conform the regulations to these statutory 
requirements. We did not receive any comments on this proposal. 
Accordingly, we are finalizing our proposal to revise Sec.  
414.610(c)(1)(ii) to conform to the statutory requirements described 
above. These statutory requirements are self-implementing. A plain 
reading of the statute requires only a ministerial application of the 
mandated rate increase, and does not require any substantive exercise 
of discretion on the part of the Secretary.
2. Amendment to section 146(b)(1) of MIPPA
    Section 146(b)(1) of the MIPPA amended the designation of rural 
areas for payment of air ambulance services. This section originally 
specified that any area that was designated as a rural area for 
purposes of making payments under the ambulance fee schedule for air 
ambulance services furnished on December 31, 2006, must continue to be 
treated as a rural area for purposes of making payments under the 
ambulance fee schedule for air ambulance services furnished during the 
period July 1, 2008 through December 31, 2009.
    Sections 3105(b) and 10311(b) of the Affordable Care Act amended 
section 146(b)(1) of MIPPA to extend this provision for an additional 
year, through December 31, 2010. In the CY 2011 PFS final rule (75 FR 
73385 through 86, 73625 through 26), we revised Sec.  414.610(h) to 
conform the regulations to this statutory requirement.
    Section 106(b) of the MMEA amended section 146(b)(1) of MIPPA to 
extend this provision again through December 31, 2011. In the CY 2012 
ESRD PPS final rule (76 FR 70284 through 70285, 70315), we revised 
Sec.  414.610(h) to conform the regulations to this statutory 
requirement.
    Subsequently, section 306 (b) of the TPTCCA amended section 
146(b)(1) of MIPPA to extend this provision through February 29, 2012; 
and section 3007(b) of the MCTRJCA further amended section 146(b)(1) of 
MIPPA to extend this provision through December 31, 2012. Thus, we 
proposed to revise Sec.  414.610(h) to conform the regulations to these 
statutory requirements. We did not receive any comments on this 
proposal. Therefore, we are finalizing our proposal to revise Sec.  
414.610(h) to conform to the statutory requirements described above. 
These statutory requirements are self-implementing. A plain reading of 
the statute requires only

[[Page 69140]]

a ministerial application of a rural indicator, and does not require 
any substantive exercise of discretion on the part of the Secretary. 
Accordingly, for areas that were designated as rural on December 31, 
2006, and were subsequently re-designated as urban, we have re-
established the ``rural'' indicator on the ZIP Code file for air 
ambulance services through December 31, 2012.
3. Amendment to Section 1834(l)(12) of the Act
    Section 414 of the Medicare Prescription Drug, Improvement and 
Modernization Act of 2003 (MMA) added paragraph (12) to section 1834(l) 
of the Act, which specified that in the case of ground ambulance 
services furnished on or after July 1, 2004, and before January 1, 
2010, for which transportation originates in a qualified rural area (as 
described in the statute), the Secretary shall provide for a percent 
increase in the base rate of the fee schedule for such transports. The 
statute requires this percent increase to be based on the Secretary's 
estimate of the average cost per trip for such services (not taking 
into account mileage) in the lowest quartile of all rural county 
populations as compared to the average cost per trip for such services 
(not taking into account mileage) in the highest quartile of rural 
county populations. Using the methodology specified in the July 1, 2004 
interim final rule (69 FR 40288), we determined that this percent 
increase was equal to 22.6 percent. As required by the MMA, this 
payment increase was applied to ground ambulance transports that 
originated in a ``qualified rural area''; that is, to transports that 
originated in a rural area included in those areas comprising the 
lowest 25th percentile of all rural populations arrayed by population 
density. For this purpose, rural areas included Goldsmith areas (a type 
of rural census tract).
    Sections 3105(c) and 10311(c) of the Affordable Care Act amended 
section 1834(l)(12)(A) of the Act to extend this rural bonus for an 
additional year through December 31, 2010. In the CY 2011 PFS final 
rule (75 FR 73385 through 73386 and 73625), we revised Sec.  
414.610(c)(5)(ii) to conform the regulations to this statutory 
requirement.
    Section 106(c) of the MMEA again amended section 1834(l)(12)(A) of 
the Act to extend the rural bonus described above for an additional 
year, through December 31, 2011. Therefore, in the CY 2012 ESRD PPS 
final rule (76 FR 70284 through 70285, 70315), we revised Sec.  
414.610(c)(5)(ii) to conform the regulations to this statutory 
requirement.
    Subsequently, section 306 (c) of the TPTCCA amended section 
1834(l)(12)(A) of the Act to extend this rural bonus through February 
29, 2012; and section 3007(c) of the MCTRJCA further amended section 
1834(l)(12)(A) of the Act to extend this rural bonus through December 
31, 2012. Therefore, we are continuing to apply the 22.6 percent rural 
bonus described above (in the same manner as in previous years), to 
ground ambulance services with dates of service on or after January 1, 
2012 and before January 1, 2013 where transportation originates in a 
qualified rural area.
    This rural bonus is sometimes referred to as the ``Super Rural 
Bonus'' and the qualified rural areas (also known as ``super rural'' 
areas) are identified during the claims adjudicative process via the 
use of a data field included on the CMS-supplied ZIP Code File.
    In the proposed rule, we proposed to revise Sec.  414.610(c)(5)(ii) 
to conform the regulations to the statutory requirements set forth at 
section 306(c) of the TPTCCA and section 3007(c) of the MCTRJCA. We did 
not receive any comments on this proposal. Accordingly, we are 
finalizing our proposal to revise Sec.  414.610(c)(5)(ii) to conform 
the regulations to these statutory requirements. These statutory 
requirements are self-implementing. Together, these provisions require 
a one-year extension of the rural bonus (which was previously 
established by the Secretary) through December 31, 2012, and do not 
require any substantive exercise of discretion on the part of the 
Secretary.

B. Part B Drug Payment: Average Sales Price (ASP) Issues

    Section 1847A of the Act requires use of the average sales price 
(ASP) payment methodology for payment for drugs and biologicals 
described in section 1842(o)(1)(C) of the Act furnished on or after 
January 1, 2005. The ASP methodology applies to most drugs furnished 
incident to a physician's service, many drugs furnished under the DME 
benefit, certain oral anti-cancer drugs, and oral immunosuppressive 
drugs.
1. Widely Available Market Price (WAMP)/Average Manufacturer Price 
(AMP) Price Substitution
    If the ASP payment limit for a drug or biological exceeds the WAMP 
or AMP by a threshold percentage, section 1847A(d)(3)(C) of the Act 
authorizes the Secretary to substitute the lesser of the widely 
available market price for the drug or biological, or 103 percent of 
the average manufacturer price as determined under section 1927(k)(1) 
of the Act.
    The applicable threshold percentage is specified in section 
1847A(d)(3)(B)(i) of the Act as 5 percent for CY 2005. For CY 2006 and 
subsequent years, section 1847A(d)(3)(B)(ii) of the Act authorizes the 
Secretary to specify the threshold percentage for the WAMP or the AMP, 
or both. In the CY 2006 (70 FR 70222), CY 2007 (71 FR69680), CY 2008 
(72 FR 66258), CY 2009 (73 FR 69752), and CY 2010 (74 FR 61904) PFS 
final rules with comment period, we specified an applicable threshold 
percentage of 5 percent for both the WAMP and AMP. We based this 
decision on the fact that data was too limited to support an adjustment 
to the 5 percent threshold. Beginning in CY 2011, we treated the WAMP 
and AMP based adjustments to the applicable threshold percentages 
separately.
a. WAMP Threshold and Price Substitution
    After soliciting and reviewing comments, we finalized proposals to 
continue the 5 percent WAMP threshold for CY 2011 (75 FR 73469), and CY 
2012 (76 FR 73287). For CY 2013, we again had no additional information 
from OIG studies or other sources that led us to consider an 
alternative threshold. When making comparisons to the WAMP, we proposed 
that the applicable threshold percentage remain at 5 percent until such 
time that a change in the threshold amount is warranted, and we 
proposed to update Sec.  414.904(d)(3)(iv) accordingly. As mentioned 
above, the threshold has remained at 5 percent since 2005. Our proposal 
will eliminate the need for annual rulemaking until a change is 
warranted.
    For CY 2013, we did not propose any WAMP based price substitutions. 
As we noted in the CY 2011 PFS final rule with comment period (75 FR 
73470) and reiterated in CY 2012 PFS final rule with comment period (76 
FR 73287), we understand that there are complicated operational issues 
associated with the WAMP based substitution policy, and we continue to 
proceed cautiously in this area. We remain committed to providing 
stakeholders, including providers and manufacturers of drugs impacted 
by potential price substitutions with adequate notice of our 
intentions, including the opportunity to provide input with regard to 
the processes for substituting the WAMP for the ASP.
    Comment: Several commenters agreed with continuing a cautious 
approach

[[Page 69141]]

regarding WAMP-based price substitutions and agreed with maintaining a 
5 percent threshold. One commenter agreed with the elimination of 
annual rulemaking provided that access to drugs is not impacted and 
that the value can be modified with advance notice to stakeholders. One 
commenter suggested a higher threshold for the WAMP substitution due to 
concern about drug shortages and suggested that CMS study the threshold 
value issue further.
    Response: The majority of commenters agreed with maintaining a 5 
percent WAMP threshold. Because, as noted in the proposed rule and 
above, available data are limited, and we continue to have no 
information that would lead us to believe a different threshold is 
necessary, we disagree with implementing a higher threshold at this 
time. We also decline to actively study the matter further until such 
time as future study is warranted, for example, if better information 
were available for such study. The threshold can be reviewed as 
warranted and as WAMP-based price substitution policies develop and it 
can be modified as needed at a later time through rulemaking. 
Therefore, we are finalizing Sec.  414.904(d)(3)(iv) as proposed.
b. AMP Threshold
    The AMP threshold has remained at 5 percent since 2005. As with the 
WAMP threshold, we had no information that led us to believe that the 5 
percent threshold percentage for AMP-based price substitution is 
inappropriate or should be changed for CY 2013. We proposed that the 
applicable threshold percentage remain at 5 percent until such time 
that a change in the threshold amount is warranted, and we proposed to 
update Sec.  414.904(d)(3)(iii) accordingly. Our proposal eliminates 
the need for annual rulemaking until a change is warranted.
    Comment: Two commenters agreed with maintaining the 5 percent AMP 
price substitution threshold. One commenter suggested a higher 
threshold for the AMP substitution due to concern that a low threshold 
would trigger price substitution which would then affect the 
manufacture of drugs. The commenter suggested that CMS study the 
threshold value issue further.
    Response: We disagree with increasing the threshold or studying the 
threshold value further. Although we acknowledge that the definition of 
AMP is continuing to evolve, this threshold has been in place since 
2005 and we have no specific information that persuades us to believe 
that a change in the AMP threshold is necessary at this time. Also, as 
with the WAMP threshold discussed in the section above, the AMP 
threshold can be reviewed as warranted, as price substitution policies 
evolve, and the threshold can be modified as needed at a later time 
through rulemaking. Therefore, we are finalizing Sec.  
414.904(d)(3)(iii) as proposed.
c. AMP Price Substitution-Additional Conditions
    In the CY 2012 PFS rule, we specified that the substitution of AMP 
for ASP will be made only when the ASP exceeds the AMP by 5 percent in 
2 consecutive quarters immediately prior to the current pricing 
quarter, or three of the previous four quarters immediately prior to 
the current quarter, and that matching sets of NDCs had to be used in 
the comparison (76FR 73289 through 73295). The value of the AMP based 
price substitution must also be less than the ASP payment limit that is 
calculated for the quarter in which the substitution is applied. Also, 
the price substitution remains in effect for one quarter.
    We did not apply the price substitution policy in April 2012 
because access concerns led us to reconsider whether it was prudent to 
proceed with price substitution during a developing situation that was 
related to a drug shortage that had not met the definition of a public 
health emergency under section 1847A(e) of the Act. In light of recent 
concerns about drug shortages, the resulting impact on patient care, 
beneficiary and provider access, as well as the potential for shortages 
to suddenly affect drug prices for the provider, under the authority in 
section 1847A(d)(3)(C) of the Act, we proposed adding Sec.  
414.904(d)(3)(ii)(C), which would prevent the AMP price substitution 
policy from taking effect if the drug and dosage form represented by 
the HCPCS code are reported by the FDA on their Current Drug Shortage 
list (or other FDA reporting tool that identifies shortages of critical 
or medically necessary drugs) to be in short supply at the time that 
ASP payment limits are being finalized for the next quarter. Further, 
we also clarified that this proposal to add to the safeguards finalized 
in CY 2012 only applied to calculations under the AMP-based price 
substitution policy. Our proposal intended to continue the cautious 
approach described in previous rules and to strike a balance between 
operational requirements associated with receiving manufacturers' ASP 
reports, calculating the payment limits, and posting stable payment 
limits that will be used to pay claims. We believe that this approach 
also addresses concerns about access to care, known program issues 
identified by the OIG, and provides an opportunity for some modest 
program savings. However, we did not propose any other changes to the 
safeguards, timing, or notification that identifies the codes that will 
be substituted each quarter. We asked for comments on our approach as 
well as comments regarding additional specific safeguards for the AMP 
price substitution policy.
    Comment: In general, commenters supported implementation of a 
safeguard that would prevent AMP-based substitution of drugs that are 
known to be in short supply. Several commenters supported our proposal 
that prevents an AMP-based price substitution from taking effect for 
drugs that are reported to be in short supply. Two comments supported 
the use of the FDA's drug shortage list while another commenter 
suggested that the American Society of Health-System Pharmacists (ASHP) 
shortage list be used because it might better identify impending 
shortages. One commenter suggested that the provision be expanded to 
include drugs that are potentially in short supply, but did not provide 
additional detail. One commenter supported the proposed shortage 
safeguard if CMS does not further delay the implementation of the AMP 
substitution policy.
    Response: We understand the commenters' reasoning for suggesting 
that we use the ASHP list, which includes information about shortages 
that may not affect overall supply-for example the unavailability of a 
certain vial size from one manufacturer. We believe that such detailed 
information is very useful to clinicians and those who must procure 
drugs. Nevertheless, we believe that using the FDA list, which is 
compiled from information that is required to be reported by statute 
and represents shortages where overall demand is not being met, will 
provide us with a consistent standard that reflects national drug 
supply. Thus, we decline to include the ASHP list in our standard. 
Also, after consultation with the FDA, we are also deleting the phrase 
``critical or medically necessary'' from the proposed regulation text 
in order to make clear that CMS will not further interpret FDA's drug 
shortage list. In other words, we are clarifying that a drug's presence 
on the list will be sufficient to meet the standard in our final rule, 
and we will not be taking a position as to whether the drug is 
``critical or medically necessary'' for this purpose. We believe that 
this modification will also help maintain a consistent standard on 
which we base

[[Page 69142]]

our decisions. After reviewing the public comments, we are finalizing 
our proposal and corresponding regulation text at Sec.  
414.904(d)(3)(ii)(C) with the modification described in this paragraph.
    Comment: Although we did not receive any detailed suggestions for 
new safeguards, two commenters also suggested creating safeguards that 
address AMP data errors and calculations be implemented.
    Response: We are acknowledging these comments, but since no 
specific recommendations were made, we will not be addressing them at 
this time.
    Comment: Several commenters stated that implementation of the AMP-
based price substitution should be delayed until the AMP regulation is 
finalized and/or additional experience with calculating AMPs has been 
gained. Commenters expressed concerns about the differences in the 
calculation methodology for ASP and AMP and the uncertainty about how 
``5i'' drugs will be affected.
    Response: We appreciate these comments; however, delaying the AMP-
based substitution process is outside the scope of our proposals and we 
will not further delay implementation of the AMP-based price 
substitution policy at this time. In the proposed rule (77 FR 44793), 
we stated that we are not proposing any other changes to the 
safeguards, timing or notification procedures for the AMP-based price 
substitution. We have explained our reasons for proceeding with the 
AMP-based substitution in the CY 2012 PFS final rule (76 FR 73294-95), 
where we also discussed the evolving definition of AMP and ``5i'' 
drugs. In the CY 2012 PFS final rule we stated that we ``understand 
that the updated definition of AMP encompasses sales of injected, 
infused, instilled, inhaled, and implanted drugs that are not generally 
dispensed through a retail community pharmacy, including a wider range 
of customers and discounted sales to non-pharmacy entities, and 
commenters' concerns that implementation of the most recent definition 
could decrease AMP for certain drugs. However, we do not have any 
specific information from commenters that persuades us to believe that 
the AMP-based price substitution policy will be applied frequently or 
to high cost/high volume items, despite the changes to the definition 
of AMP.'' We also continue to believe that the safeguards finalized in 
the CY 2012 PFS rule and the additional safeguard finalized in this 
rule provide assurance that the price substitution policy will be 
applied only when appropriate. In summary, we appreciate the 
commenters' concerns, but our assessment of the overall situation has 
not changed.
    Additional Part B drug-related comments that are outside the scope 
of this rule are listed in section 3 below.
2. Billing for Part B Drugs Administered Incident to a Physician's 
Services.
    This section discusses payment policies regarding billing for 
certain drugs under Medicare Part B. In 2010 and 2011, we issued two 
change requests (CRs 7109 and 7397) that summarized a number of 
longstanding drug payment policy and billing requirements. We 
considered these CRs to be merely clarifying, rather than changing, our 
policy. However, one item in the CRs, which stated that pharmacies may 
not bill for drugs that are used incident to physician's service, has 
caused some concern. Specifically, we understood that some nonphysician 
suppliers--operating in part on the basis of erroneous guidance from a 
Medicare contractor--have been submitting claims for drugs that they 
have shipped to physicians' offices for use in refilling implanted 
intrathecal pumps. In light of concern over its potential effect on 
suppliers, we delayed implementation of the most recently updated CR 
(CR 7397 Transmittal 2437, April 4, 2012) until January 1, 2013 so that 
we could undertake rulemaking, evaluate public comments on this issue, 
and determine whether CR 7397 should be implemented as planned, 
revised, or rescinded.
    Implanted pumps may qualify as Durable Medical Equipment (DME); 
however, unlike external pumps used to administer drugs, implanted 
pumps are typically refilled in a physician's office. The implanted 
intrathecal pump is refilled by injecting the drug into a pump's 
reservoir, which lies below the patient's skin. The reservoir is 
connected to the pump, which delivers the drug to the intrathecal space 
through a tunneled catheter. The procedure of refilling an intrathecal 
pain pump is a service that is typically performed by the physician 
because of risk and complexity.
    To be covered by Medicare Part A or Part B, an item or service must 
fall within one or more benefit categories within such Parts, and must 
not be otherwise excluded from coverage. Drugs and biologicals paid 
under Medicare Part B drugs fall into three basic categories as 
follows:
     Drugs furnished ``incident to'' a physician's services. 
These are typically injectable drugs that are bought by the physician, 
administered in the physician's office, and then billed by the 
physician to the Medicare Administrative Contractor (MAC). By 
definition, ``incident to a physician's professional service'' requires 
the item or service to be billed by the physician.
     Drugs administered through a covered item of DME. These 
drugs are supplies necessary for the effective use of DME and are 
typically furnished to the beneficiary by suppliers that are pharmacies 
(or general DME suppliers that utilize licensed pharmacists) for 
administration in a setting other than the physician's office. Most DME 
drugs are billed to the DME MAC.
     Drugs specified by the statute. These include a variety of 
drugs, such as oral immunosuppressives and certain vaccines.
    Depending on the circumstances, drugs used to refill an implanted 
intrathecal pump can be paid under either the ``incident to'' or the 
DME benefit category or Medicare Part D. The CMS Benefit Policy Manual 
(100-02 Chapter 15 Section 50.3) states that drugs paid under the 
``incident to'' provision are of a form that is not usually self-
administered; are furnished by a physician; and are administered by the 
physician, or by auxiliary personnel employed by the physician and 
under the physician's personal supervision. Section 60.1 A requires 
that ``to be covered, supplies, including drugs and biologicals, must 
represent an expense to the physician or legal entity billing.'' In 
what we believe is a typical situation, when physicians' services are 
used to refill an intrathecal pump, the ``incident to'' requirements 
can be met because, consistent with our guidance and longstanding 
policy, the physician or other professional employed by his or her 
office performs a procedure to inject the drug into the implanted 
pump's reservoir (that is, the drug is not self-administered), and the 
drug represents a cost to the physician because he or she has purchased 
it.
    Conversely, we believe that in the typical situation, payment to a 
pharmacy or other nonphysician supplier under the DME benefit for a 
drug dispensed for use in the physician's office is both inappropriate 
and inconsistent with existing guidance. For example, DME prosthetics, 
orthotics, and supplies (POS) policy does not permit payment for 
prosthetics dispensed prior to the procedure that makes necessary the 
use of the device. Moreover, in the case of prescription drugs used in 
conjunction with DME, our guidance is clear that the entity that 
dispenses the drug needs to furnish it directly to the patient for whom 
a prescription is written. An arrangement whereby a pharmacy (or 
supplier) ships

[[Page 69143]]

a drug to a physician's office for administration to a patient does not 
constitute furnishing the drug directly to the patient.
    We note that payment to pharmacies (or suppliers) for drugs used to 
refill an implanted pump can be made under the DME benefit category 
where the drug is directly dispensed to a patient and the implanted 
pump is refilled without a physician's service. However, it is our 
understanding that implanted pumps are rarely refilled without 
utilizing the service of a physician.
    In the proposed rule, we stated our concern about stakeholders' 
reports that, due to incorrect guidance from a contractor, Medicare 
payment policy on this issue has been applied in an inconsistent 
manner. We stated that we consider the contractor's guidance to be 
erroneous. This inconsistency has permitted supplier claims for drugs 
dispensed by pharmacies to physicians' offices to be paid in some 
jurisdictions and denied in others. We understand that the inconsistent 
application of our payment policy has influenced the business and 
professional practices of pharmacies/DME suppliers that prepare drugs 
for implanted pumps. We stated that we do not believe that payment for 
drugs used to refill implanted DME should continue to be made because 
such action is not supported under long standing policy and, as 
discussed above, is not appropriate.
    We proposed to clarify that we consider drugs used by a physician 
to refill an implanted item of DME to be within the ``incident to'' 
benefit category and not the DME benefit category. Therefore, for the 
drug to be paid under Part B, the physician must buy and bill for the 
drug, and a non-physician supplier that has shipped the drug to the 
physician's office may not do so. We asked for comments on this 
proposal and its potential impact on beneficiaries and providers.
    Comment: One commenter questioned CMS's assumptions in proposing 
the policy clarification and contends that contrary to these 
assumptions, pharmacy billing for drugs used by a physician to refill 
an implanted pump under the DME benefit is appropriate. Specifically, 
the commenter questioned CMS's assertion that the physician refilling 
the implanted pump is ``administering'' the drug, contending instead 
that the pump administers the drug and that the physician does not 
exclusively administer the drug. Second, the commenter disagrees with 
CMS's statement that pharmacies' shipping drugs to physician offices 
are not furnishing drugs directly to the patient and contends that 
these medications are dispensed specifically to the patient at the 
physician's office.
    Response: We disagree with these comments. With respect to whether 
the physician is administering these drugs, we understand that the 
implanted pump serves to release the drug into a specific region of the 
patient's body over a prolonged time period. However, the process of 
refilling the implanted pump, determining the correct pump settings, 
and making adjustments to those settings as needed is usually carried 
out by a licensed healthcare provider, typically a physician. In our 
view, the pump's role is analogous to a drug with a sustained release 
rate (for example, leuprolide depot injection) that is injected or 
implanted into the body, which is similarly furnished incident to a 
physician's professional service. Further, the relevant inquiry is not 
whether a drug is ``exclusively'' administered by a physician, but 
rather whether the drug is ``not usually self-administered by the 
patient'' and furnished incident to a physician's professional service. 
Thus, even if the physician did not ``exclusively'' administer the drug 
because of the action of the pump, it does not follow that a more 
appropriate benefit category for such a drug would be the DME benefit 
category.
    Under the incident to provision, we associate payment for the drug 
with the physician's professional service, and the drug is a key 
component of the billable procedure that is paid incident to a 
physician's professional service. As we have described earlier, when an 
implanted article of DME is refilled in the physician's office, the 
drug required for the service must meet the three conditions of the 
incident to benefit described in the Claims Processing manual, Chapter 
15, Section 50.1, where the drug or biological must be of a form that 
is not usually self-administered; must be furnished by the physician; 
and must be administered by the physician, or by auxiliary personnel 
employed by the physician and under the physician's personal 
supervision. Based on discussion with stakeholders, it is our 
understanding that most refills of implanted DME that are done in the 
physician's office meet these conditions. In contrast, under the DME 
benefit category, a pharmacist dispenses the drug as a supply necessary 
for the effective use an item of DME (including, an implanted pump) and 
a physician's service is not utilized for the drug administration 
process.
    In addition, we disagree with the commenter's assertion that by 
sending a drug to the physician's office for a specific patient, it is 
furnishing the drug directly to the patient, because such delivery 
would not be made without the physician's being at the delivery 
location to administer the drug in his or her office. It is notable 
that the commenter neglected to describe what happens to the drug that 
it asserts is delivered ``directly'' to the patient at the physician's 
office if the patient cannot receive a pump refill at the time of such 
delivery. Presumably the physician's office or the pharmacy, rather 
than the patient, would be responsible for the storage of the drug 
until it could be safely used or for disposal or return of an unused 
and unopened dose, which would indicate that at no time did the patient 
take ``delivery'' of the drug. In any event, in light of the 
physician's integral role in receipt and administration of the drug, 
the DME benefit category does not appropriately apply to this 
situation. Moreover, the incident to benefit category does not permit 
pharmacy billing for the incident to drug. Pharmacy/DME supplier 
dispensed drugs that are to be used incident to a physician's service 
do not meet the ``incident to'' conditions because the pharmacist does 
not refill the implanted pump.
    However, we believe that it is important to preserve the potential 
for paying a pharmacy for a drug that is used to refill implanted pumps 
in certain limited instances where a physician's service is not used. 
Although patients and caregivers do not typically refill implanted 
pumps, it is our understanding that in rare situations persons other 
than a physician (as defined by section 1861(r) of the Act) could 
refill the pump, for example, when a patient cannot be transported to a 
physician's office, but a suitably trained individual is available at 
the home. We believe that this situation is very uncommon, but we also 
believe that in certain situations, for example in remote locations, it 
may facilitate the administration of refills of implanted durable 
medical equipment in situations where a beneficiary cannot be 
transported to the office, but a qualified individual is available to 
fill the pump and the drug is dispensed directly to the patient at 
home. In these situations, the drug is not being administered by the 
physician, and therefore the drug cannot be billed incident to a 
physician's service. As there is no service incident to a physician's 
service and the drug is being dispensed directly to the beneficiary in 
the home for use in an implanted item of DME, the pharmacy may bill and 
be paid for the drug.
    Comment: Several commenters note that the proposed rule describes 
the error as being associated with only one

[[Page 69144]]

contractor, but that several others since have allowed for and paid 
direct pharmacy claims for drugs used by physicians to refill implanted 
pumps. A comment from a group of pharmacies that compounds drugs for 
use in implanted pumps states that four contractors across 13 States 
have paid pharmacies directly in these instances. Commenters located in 
other states supported adoption of the erroneous approach in their 
states. One commenter stated that the majority of pharmacies in the 
country are in compliance with the buy and bill approach.
    Response: Although the proposed rule (77 FR 44793) stated that 
erroneous guidance came from ``one contractor,'' in the same paragraph 
we acknowledged that payments were made in some jurisdictions and 
denied in others. Thus, the proposed rule indicated that we understood 
that several contractors had paid pharmacies under the erroneous 
approach. Although we understand that the use of the erroneous approach 
has expanded, this does not persuade us to make a national policy 
decision that incorporates a payment policy that is based on contractor 
error simply because it has become utilized in some areas. Moreover, 
the commenters recommending adoption of the erroneous approach notably 
did not assert that the physician ``buy and bill'' method has been 
problematic in their states, and these comments, in our view, support 
our belief that the erroneous approach is not a widespread problem.
    Comment: Several comments mentioned that regulation text at Sec.  
424.57 permits pharmacy suppliers to be paid for drugs used with DME. 
One comment stated that administrative law judge (ALJ) decisions 
favorable to pharmacies that furnished drugs under the erroneous 
guidance were based on this regulation text.
    Response: We agree that pharmacy suppliers can be paid for drugs 
used as supplies for DME. This provision applies most frequently to 
situations like drugs used with nebulizers or external pumps where 
multiple doses of drugs are dispensed and delivered to a patient for 
use over a given time period. However, instances in which direct 
billing by a pharmacy or DME supplier for these drugs, which are self-
administered via an item of DME, are distinguishable from the situation 
here, where a licensed healthcare provider's professional service is 
required to ensure that the drug may be used with the item of DME. 
Physicians who refill these pumps in the office are generally not 
acting as DME suppliers.
    With respect to the assertion about ALJ decisions, we are persuaded 
only that they are evidence that our payment policy has been applied 
inconsistently, and do not consider them to be indicators of what the 
correct payment policy is or should be.
    Comment: Several commenters believe that our proposed clarification 
is in conflict with state and federal laws regarding the dispensing 
and/or distribution of controlled substances and Food and Drug 
Administration (FDA) guidance. Specifically, commenters asserted that 
our proposed clarification is inconsistent with Drug Enforcement 
Administration (DEA) rules that apply to dispensing of controlled 
substances and that operating under a distribution model would require 
them to register with the DEA as manufacturers, which would raise 
concerns under applicable state law. Further, two commenters suggested 
that our Part B drug billing policy instructs pharmacies to sell 
compounded products to physicians for resale to the patient in 
contravention of FDA guidance regarding pharmacy compounding 
compliance. Commenters noted that FDA's policy guidance delineates 
``acts of drug manufacturing'' that would apply to pharmacies complying 
with our proposed clarification because it would require them to sell 
compounded products to third parties who resell to individual patients, 
and it would cause them to fail to operate in conformance with 
applicable state law regulating the practice of pharmacy. Commenters, 
including one state board of pharmacy, also contended that with respect 
to compounded controlled substances used to refill implanted pumps, the 
procedures that would be required under our proposed clarification 
would not be allowable under state law.
    Response: We understand that the laws and regulations pertaining to 
how compounded doses of drugs used to refill implanted DME are obtained 
by the office are complex and may include requirements from a variety 
of sources, including the DEA, the FDA, and the states. This rule does 
not seek to interpret applicable laws, regulations, or guidance from 
these and other relevant sources, nor does it seek to distinguish among 
the varying uses of terms by these agencies, including terms such as 
compound, manufacture, distribute, or resell, which may have context-
dependent, specific definitions that are important, but also can 
confuse issues related to Medicare Part B payment policy. This rule 
pertains solely to Part B payment policy, and we take no position on 
any issue other than which party must bill for a drug used by a 
physician to refill an implanted item of DME. Thus, this rule does not 
address whether a pharmacy, for example, should be dispensing or 
distributing a drug used to refill implanted DME. Indeed, we do not 
have authority to interpret or apply FDA, DEA or state laws or 
regulations.
    That being said, we wish to respond to these comments as fully as 
we can, in the interest of transparency. We do not agree with the 
suggestions that the buy and bill approach for obtaining drugs used by 
physician for refilling implanted pumps in the office is strictly 
prohibited, because if it were, our payment policy for drugs used to 
refill implanted DME, with which the majority of physician offices and 
pharmacies already comply, would have raised concerns from stakeholders 
across the country long before we issued the two CRs last year.
    Further, we disagree that our policy is in conflict with laws 
pertaining to controlled substances. First, we note that our policy is 
not specific to controlled substances, and the comments do not persuade 
us to adopt a different policy for controlled substances used by a 
physician to refill an implanted item of DME from the Part B payment 
policy for all other controlled substances administered incident to a 
physician's professional service. It has long been our policy that 
drugs furnished incident to a physician's professional service must be 
purchased and billed by the physician, and in general physicians buy 
and bill for controlled substances furnished under the incident to 
benefit without being in violation of DEA requirements. We have 
consulted with DEA about the issue of controlled substances used in 
implanted DME, and they have confirmed our understanding of DEA rules 
as discussed below.
    It is our understanding from discussions with the DEA that it is a 
criminal violation of the law when a DEA-registered pharmacy dispenses 
a controlled substance and knowingly or intentionally delivers that 
substance to any person other than the patient or a member of the 
patient's household. We understand that the DEA provides for 
registration of entities, including pharmacies, as DEA registered 
manufacturer/distributors that may distribute controlled substances to 
providers under conditions outlined by the DEA. We understand that the 
DEA's ``5 percent rule'' may apply to pharmacies that are not 
manufacturers and that wish to provide these drugs to the office; 
however, we also understand that the 5 percent rule may not apply to 
situations where a drug must be compounded from bulk chemicals. In

[[Page 69145]]

any event, we have confirmed with the DEA that pharmacies can register 
with the DEA as a distributor/manufacturer and under such a 
registration, can sell these drugs to a physician's office. The office 
would order the drugs using DEA Form 222 (http://www.deadiversion.usdoj.gov/faq/dea222.htm) which facilitates purchasing 
and tracking of controlled substances between registrants and 
accountability at the pharmacy and the office. We also note that the 
DEA provides its own specific definition of a manufacturer. Additional 
information is at http://www.deadiversion.usdoj.gov/drugreg/reg_apps/225/225_instruct.htm.
    Thus, we believe pharmacies can be in compliance with the DEA 
regulations in providing controlled substances to physicians who can 
then bill Medicare under the ``incident to'' benefit category. Indeed, 
we are concerned that current practices described by some commenters 
are inconsistent with DEA regulations. Some commenters described 
dispensing activities that appear to deliver the drugs to the office on 
behalf of the patient (that is, ``dispensing for a patient'') in a 
manner that may not be consistent with DEA regulations, which require 
that controlled substances be dispensed directly to the patient, and 
not to an agent, person, or other entity that is acting on the 
patient's behalf. We also have concerns about the ad hoc record keeping 
methods (like delivery logs) for controlled substance prescription 
delivery that were described in some comments. Such an approach does 
not appear to comply with practices that are required by the DEA for 
transfers or sales of drug between registrants. This process involves 
the use of DEA Form 222 and related record keeping that is described in 
DEA regulation.
    We also note that not all of the drugs used in implanted pumps are 
drugs are controlled substances. Some of the analgesics (for example, 
ziconitide and clonidine) often used in implanted pumps are not 
opiates, and are not always used in conjunction with opiates. Agents 
used to treat spasiticy (baclofen) are also not opiates. These 
medications are not controlled substances, and the DEA provisions 
discussed above do not apply.
    With respect to comments about conflicts with FDA guidance, we 
cannot make statements about when the FDA may require that compounding 
pharmacies be considered manufacturers; as noted above, this is outside 
of CMS's scope of authority and expertise. Nevertheless, we disagree 
that our proposed clarification would, in itself, require that 
compounding pharmacies be considered manufacturers. The FDA Compliance 
Policy Guidance on pharmacy compounding (http://www.fda.gov/ICECI/ComplianceManuals/CompliancePolicyGuidanceManual/ucm074398.htm) states 
that the guidance ``does not create or confer any rights for or on any 
person and does not operate to bind FDA or the public.'' The policy 
states that in determining whether to take enforcement action the FDA 
``will consider whether the pharmacy engages in * * * [certain] acts.'' 
Points 7 and 9 in the list of acts referred to by one commenter include 
the act of reselling a drug and State law. The use of an individualized 
dose of a drug that has been prepared by a pharmacy for use upon a 
physician's order for a specific patient and is administered by a 
physician in an office incident to a procedure in the office is not 
reselling a drug.
    Finally, many of the comments pertaining to State law involved 
dispensing activities. However, our proposal did not address, and we do 
not take a position now, with respect to whether a pharmacy should 
dispense or distribute a drug used by a physician to refill an 
implanted item of DME in the physician office. We understand that State 
laws pertaining to dispensing of prescriptions may be problematic 
because they are not uniform across States and the interpretation of 
all requirements may vary. However, the comments did not foreclose the 
possibility that an appropriately registered and licensed pharmacy 
could sell the drug to the physician's office, for example when the 
pharmacy does not act as a dispenser of a prescription, but acts as a 
distributor of a drug. In response to the state board of pharmacy's 
comment, we note that the comment appears to indicate that 
prescriptions in the state must be dispensed in accordance with DEA 
requirements. As stated above, we believe it is possible to comply with 
DEA requirements under the buy-and-bill method.
    Our approach also minimizes program integrity concerns and avoids a 
situation where billing for a procedure and an item necessary for the 
procedure is done by two different entities that may submit claims with 
two dates of service. Such corresponding services are difficult to 
match during claims processing and the presumption that a drug that has 
been dispensed in advance of the pump refill will always be 
administered to the beneficiary may not always be correct. In other 
words, our approach minimizes the opportunity for fraud and abuse 
caused by splitting up payment for related components of a service 
between providers that bill separately.
    Further, as noted above and as borne out by our experience 
administering and overseeing the Medicare program, the buy and bill 
approach does not appear to be problematic in a majority of the 
country. Therefore, in considering these comments, we continue to 
believe that it is appropriate for Medicare payment policy to be 
uniform, in spite of the fact that suppliers in certain states may need 
to adjust their regulatory standing with the state in order to comply 
with our payment rules. As stated above, inconsistent application of 
the policy has influenced the business and professional practices of 
pharmacies/DME suppliers that prepare drugs for implanted pumps. 
Specifically, pharmacies that have been allowed to bill directly to 
Medicare have marketed this approach to physicians at the expense of 
pharmacies that have not been allowed to direct bill. Inconsistent 
application of the policy has given a distinct economic advantage to 
some pharmacies relative to others that we do not believe is equitable. 
A uniform policy is more fair and predictable for beneficiaries and 
health care providers, and is easier to administer and oversee and, as 
stated above, is consistent with longstanding Medicare law and 
regulations and minimizes the potential for fraud and abuse.
    Nevertheless, if a physician does not have a cost for these drugs, 
the physician does not meet the requirements to bill for these drugs 
under Medicare Part B as an ``incident to'' drug. As explained above, 
these drugs are also not billable under Part B as DME supplies because 
the drugs are not being furnished directly to the beneficiary. However, 
these drugs may be payable to the pharmacy under Part D if the 
ingredients that are being compounded independently meet the definition 
of a Part D drugs--generally a commercial FDA approved drug product.
    We have considered the implications of the proposed clarification 
on patient care and Medicare providers (including physicians and 
pharmacies). Review of the comments also indicated that the issue is 
not national, but does affect the south central region of the 
contiguous United States more than other regions and therefore we 
believe that providers in most states follow the proposed approach and 
most states' laws do not create insurmountable barriers for physician 
offices that administer refills of implanted DME equipment to obtain 
drugs. We do not believe that major revisions to policy should be based 
on

[[Page 69146]]

erroneous guidance that originated from a single contractor, nor do we 
believe that we should permit an inconsistent practice to continue 
indefinitely, because the delay is affecting both those who are in 
compliance with national payment policy, as well as those who are not.
    Comment: We received several comments on the potential impact of 
our proposal. Most commenters expressed concern about the financial 
impact of our proposal on physician practices, especially small 
practices. Three major concerns stated were the financial impact of 
having to buy potentially expensive drugs, the labor involved in 
submitting claims, and the time that elapses between the administration 
of the drug and when the drug claim is paid. Physicians and office 
staff that currently are obtaining the drugs through pharmacies that 
also bill for the drug were concerned that obtaining these drugs using 
a buy and bill approach is not financially sustainable and would lead 
practices to discontinue providing pump refills. Several commenters 
stated that practices relied on the pharmacy-dispensed and pharmacy-
billed approach. Two groups of pharmacies asserted that this 
clarification will affect their ability to be paid under Medicare Part 
B for providing intrathecal pain medications, especially medications 
that contain Schedule II controlled substances.
    Comments about the potential impact to beneficiaries included 
suggestions that some practices would charge beneficiaries up front, 
that some physicians might convert medication regimens to the oral 
route--which may not be as well tolerated or as efficacious, or that 
access could be impaired.
    Response: We acknowledge that our policy clarification will affect 
physicians, suppliers and beneficiaries in cases where the pharmacies 
have been billing for drugs used by the physician to refill implanted 
DME. Based on the comments on our proposal, we do not believe that 
these pharmacies represent all or the majority of pharmacies or the 
providers who obtain pharmacy prepared drugs in their offices. As we 
have discussed elsewhere, we believe that the drug distribution pathway 
is available for physician offices to purchase these drugs from 
appropriately licensed and registered pharmacies in cases where the 
drugs cannot be dispensed.
    We do not believe we should incorporate a change or permit 
continued inconsistent application of our policies based on erroneous 
guidance. As we have stated above and in the proposed rule, the 
erroneous guidance significantly conflicts with longstanding national 
policies for drugs provided incident to physicians' services and items 
furnished under the DME benefit.
    Based on the comments, we understand that many pharmacies that 
prepare drugs used to refill implanted pumps and the providers with 
whom they have a relationship are unaffected by the policy 
clarification in the CRs and this rule. Based on publicly available 
information, we understand that some pharmacies that prepare doses of 
intrathecally administered medications for Medicare beneficiaries 
(including some of the commenters who opposed our clarification) are 
already registered with the DEA as drug distributors. We understand 
that these entities can receive orders for controlled substances via 
the DEA 222 form and can sell (that is, distribute) the individually 
prepared doses to the physician provider, who in turn administers the 
drug and bills Medicare Part B.
    As discussed above, our approach also minimizes program risk that 
arises from billing for a procedure and an item necessary for the 
procedure by two different entities that may submit claims with two 
dates of service. We believe fraud and abuse risk is minimized by 
requiring the same entity to bill for the drug and its administration.
    We are concerned by comments that suggested that some practices may 
charge Medicare patients up front. We would like to remind physicians 
that Medicare providers who accept assignment may not charge up front, 
and note that section 1842(o)(3)(A) of the Act requires these drugs to 
be paid on an assignment-related basis. Also, the routine use of 
advance beneficiary notices (ABNs) is not allowed (See the Medicare 
Claims Processing Manual, chapter 30, Section 40.3.6 at http://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/downloads/clm104c30.pdf).
    Comment: Several comments stated that CMS' proposed approach will 
cause physicians to discontinue the use of intrathecal pain managements 
and to switch to oral analgesics, thereby increasing the risk of 
diversion.
    Response: We do not believe this policy clarification will increase 
the risk of drug diversion. We acknowledge that diversion can occur, 
perhaps particularly in instances where an individual receives high 
doses of analgesics, but we do not believe that either the oral or 
injectable approach is entirely risk free. The risk of drug diversion 
and pump tampering also exists with implanted pumps and has been 
reported in literature.
    Comment: One commenter stated that CMS policy, as reflected in the 
Benefit Policy Manual, allows a physician to be paid for administering 
a drug that has not been bought by the office. The commenter suggests 
that CMS policy would permit the physician to bill for administration 
of a drug used to refill an implanted pump even if the physician did 
not incur the cost for it, and for this reason, the drug should be 
payable under the DME benefit.
    Response: We disagree with the commenter's conclusion. The Benefit 
Policy Manual the commenter cites (Chapter 15, section 60.1A) uses the 
example of drug administration in the case where the patient has 
purchased the drug, stating that the drug administration service would 
be covered, even though drug would not be. We do not believe it follows 
from this example that drugs used by a physician to refill an implanted 
item of DME should be included in the DME benefit category. In fact, we 
believe the manual provision cited by the commenter actually supports 
our position--namely, that the drug in question is not covered under 
Part B if the physician administering it incident to a professional 
service has not incurred the cost for it.
    Comment: Two commenters expressed support for our clarification. 
One commenter described the policy as longstanding and believed that 
most pharmacies are in compliance with this standard. Another commenter 
stressed the importance of consistent payment policy and expressed 
concern that pharmacies that billed under the incident to provision not 
be subject to audits or recoupment if they were acting on good faith 
based on contractor guidance.
    Response: We agree with the comments that supported our policy 
clarification. We thank those who commented on additional issues for 
their thoughts. As we have stated previously, we believe Medicare's 
policy on this issue has been longstanding. However, we acknowledge 
that there are pharmacies that were relying on incorrect contractor 
guidance to bill Medicare directly for these drugs. For these reasons, 
we do not plan to take enforcement action for incorrect billing of 
drugs used to refill an implanted item of DME furnished in a 
physician's office by pharmacies prior to January 1, 2013 if that 
incorrect billing stemmed directly from guidance from a Medicare 
contractor.
    Comment: Some commenters expressed concerns that the clarification

[[Page 69147]]

is a change in policy. Another commenter believes that the fact that we 
delayed the CR amounts to a tacit approval of pharmacy billing for 
drugs used by physicians to refill implanted pumps.
    Response: We disagree that this is a change in our policy. As we 
stated in the proposed rule, we consider the contractor guidance on 
pharmacy billing of drugs used to refill implanted items of DME to be 
erroneous. We believe it was erroneous for other contractors to adopt 
similar processes. Nevertheless, in light of stakeholder concerns, we 
delayed the implementation of two CRs and undertook this rulemaking 
process to ensure that even if our clarification were considered a 
change in policy, potentially affected parties would have notice and a 
meaningful opportunity to comment. Thus, our decision to delay the CRs' 
implementation was not because we approved of, or even condoned, 
pharmacy billing for these drugs. Rather, we delayed the CRs' 
implementation to permit further consideration of this issue and 
ultimately, this rulemaking process. As we undertake rulemaking with 
respect to payment for Part B drugs generally on an annual basis, we 
proposed this clarification at the earliest available opportunity.
    Moreover, in addition to the other indications discussed elsewhere, 
our claims processing structure indicates that these drugs generally 
are billed by physicians incident to their professional service. CMS 
Change Request 2227 dated July 22, 2002 required that ``bills for 
implanted DME * * * accessories and supplies for the implanted DME must 
be billed to local carriers.'' This instruction removed claims 
processing for drugs used to refill implanted DME from the DME MAC 
environment (where pharmacy-based Part B claims are typically 
submitted) and assigned the responsibility to the local carrier, now 
referred to as a Medicare Administrative Contractor (MAC) (where 
physicians' claims are typically submitted). This instruction, now 10 
years old, indicates that we have long intended that payment for drugs 
used to refill implanted pumps in the physician's office be received 
primarily by the physician's office rather than non-physician 
providers/DME suppliers.
    Finally, we wish to clarify one other point. In the proposed rule, 
we stated that in the case of drugs used to refill an implantable item 
of DME, ``the physician must buy and bill for the drug, and a 
nonphysician supplier that has shipped the drug to the physician's 
office may not do so (except as may be permitted pursuant to a valid 
reassignment).'' Our reference to a ``valid reassignment'' was intended 
to refer only to the fact that in certain limited cases, as specified 
in section 1842(b)(6) of the Act and its implementing regulations, a 
physician may reassign a claim for Medicare payment. To the extent that 
our reference to a ``valid reassignment'' in the proposed rule implied 
that a physician could permissibly reassign a claim for a drug used to 
refill an implanted item of DME to a pharmacy supplier, it was in 
error.
    Conclusion: After considering the comments and the potential impact 
on beneficiaries, health care providers and Medicare payment policy for 
DME and drugs used incident to a physician's service, we are finalizing 
the provision as proposed. We are finalizing the clarification that we 
consider drugs used by a physician to refill any implanted item of DME 
to be within the ``incident to'' benefit category and not the DME 
benefit category, and we are adding regulation text at Sec.  410.26 to 
codify our policy. Therefore, to bill under the ``incident to'' 
benefit, the physician must buy and bill for the drug, and a non-
physician supplier that has shipped the drug to the physician's office 
may not do so. In certain circumstances, for example if the physician 
does not incur an expense for the drug, Medicare Part D may be able 
provide payment to the pharmacy for these drugs. We believe that our 
position is straightforward, is consistent with how national Part B 
drug payment policy is applied in the physician office setting, and is 
already adhered to across most of the country. Consistent with this 
final rule, CR 7397 will go into effect on January 1, 2013.
    We maintain that CR 7397 (and its predecessor CR 7109) does not 
change longstanding Part B drug payment policy for drugs paid under 
section 1847A of the Act, in particular, that a drug provided incident 
to a physician's service must represent an expense to the physician. 
Neither laws nor regulations that authorize such payment have been 
changed since the erroneous guidance was brought to CMS' attention. 
Corresponding instructions in the Benefit Policy Manual (Publication 
100-02, Chapter 15, sections 50.3 and 60.1) also have not changed. The 
instructions in the CRs that clarified that payment for drugs furnished 
incident to the filling or refilling of an implanted pump or reservoir 
are determined under section 1847A of the Act and pharmacies (including 
DME suppliers that utilize pharmacists to dispense medications) may not 
bill Medicare Part B for drugs provided to a physician for 
administration to a Medicare beneficiary also have not changed. We 
believe that these facts confirm that our policy clarification is 
consistent with longstanding statute, regulation, and manual 
instructions that pertain to Medicare national policy and that our 
policy remains the appropriate one.
3. Out of Scope Comments
    In addition to comments requesting us to delay AMP-based price 
substitution that were discussed at the end of Section 1.c., we 
received comments pertaining to the creation of unique HCPCS codes for 
new branded drugs and biologicals, the payment amount for part B drugs, 
supply and dispensing fees, concerns about the timeliness of claims 
processing and claims denials, payment incentives that would decrease 
the impact of drug shortages, the duration of the quarterly AMP-based 
price substitution, notice of price substitution for manufacturers, and 
safeguards for WAMP-based price substitution.
    In the proposed rule, we stated that we are not proposing any other 
changes to the safeguards, timing or notification procedures for the 
AMP-based price substitution. Comments on these and other issues listed 
in the paragraph above are outside the scope of this rule, and 
therefore, are not addressed in this final rule with comment period.

C. Durable Medical Equipment (DME) Face-to-Face Encounters and Written 
Orders Prior to Delivery

1. Background
    Sections 1832, 1834, and 1861 of the Act establish that the 
provision of durable medical equipment, prosthetic, orthotics, and 
supplies (DMEPOS) is a covered benefit under Part B of the Medicare 
program.
    Section 1834(a)(11)(B)(i) of the Act, as redesignated by the 
Affordable Care Act, authorizes us to require, for Specified Covered 
Items, that payment may only be made under section 1834(a) of the Act 
if a physician has communicated to the supplier a written order for the 
item, before delivery of the item. Section 1834(h)(3) of the Act states 
that section 1834(a)(11) applies to prosthetic devices, orthotics, and 
prosthetics in the same manner as it applies to items of durable 
medical equipment (DME). In a December 7, 1992 final rule (57 FR 
57675), we implemented this provision in Sec.  410.38(g), for DME items 
and Sec.  410.36(b) for prosthetic devices, orthotics, and prosthetics. 
Together these sections state that as a requirement for payment, CMS, a

[[Page 69148]]

carrier, or, more recently, a Medicare Administrative Contractor (MAC) 
may determine that an item of durable medical equipment, and prosthetic 
and orthotic supplies (DMEPOS) requires a written physician order 
before delivery. In addition to the regulations listed at Sec.  
410.38(g) and Sec.  410.36(b), we have stated in Chapter 5, Section 
5.2.3.1 of the Program Integrity Manual, that the following items 
require a written order prior to delivery: (1) Pressure reducing pads, 
mattress overlays, mattresses, and beds; (2) seatlift mechanisms; (3) 
transcutaneous electrical nerve stimulation (TENS) units; (4) power 
operated vehicles (POVs) and power wheelchairs.
    Section 6407(b) of the Affordable Care Act amended section 
1834(a)(11)(B) of the Act. The Affordable Care Act added language to 
the Act that requires for certain items of DME, a physician documenting 
that a physician, a physician assistant (PA), a nurse practitioner 
(NP), or a clinical nurse specialist (CNS) has had a face-to-face 
encounter with the beneficiary pursuant to the written order. Under 
section 1834(h)(3) of the Act, the items that require a written order 
verifying a face to face encounter may also include prosthetic devices, 
orthotics, and prosthetics. The encounter must occur during the 6 
months prior to the written order for each item or during such other 
reasonable timeframe as specified by the Secretary.
2. Provisions of the Proposed Regulations and Summary of the Public 
Comments
    We have made a series of modifications to the rule based on 
response to comments. As a result of comments, we are implementing 
several changes and clarifications to limit burden and still protect 
the Medicare Trust Funds. We have clarified that this requirement will 
begin only for new orders written after the effective date. We believe 
it is important to apply this requirement prospectively and not 
retroactively. To allow sufficient time for implementation, the 
effective date of this provision is July 1, 2013. Therefore, covered 
items ordered on or after July 1, 2013 will require a face-to-face 
encounter. Additionally, we have modified the timeline to require that 
a face-to-face encounter occur within 6 months before the written 
order. We have also added an additional criterion to remove items from 
the list of covered items. This is discussed in further detail below.
    Comment: Several commenters questioned if these requirements 
adequately address the central drivers of fraud in the home health care 
and DME supply industries. If the goal is to eliminate the situation 
where a physician signs a DME order for a patient they know little 
about, having a physician sign off on a PA note does little to meet the 
goal.
    Response: We believe that increasing physician involvement will 
help limit waste, fraud, and abuse while encouraging beneficiaries to 
maintain access to the necessary services. We believe physician 
involvement will not only assist in reducing waste, fraud and abuse but 
it will also help to ensure that beneficiaries receive high quality DME 
to meet their specific needs. Further, because a face-to-face encounter 
documented by a physician is a statutory requirement, CMS is required 
to implement this provision.
    Comment: One commenter noted that the proposed rule does not 
address the role of the Certificate of Medical Necessity (CMN) under 
the DME face-to-face policy.
    Response: The commenter is correct that the face-to-face 
requirement addressed in this regulation does not change existing 
policy related to CMNs. The face-to-face requirement does not change 
the CMN process for those items that require a face-to-face. The face-
to-face encounter can be completed at the same time as the CMN.
    Comment: A commenter noted that, the rule requiring face-to-face 
encounters and written orders prior to DME delivery uses the terms 
``physician'' and ``practitioner'' inconsistently. Specifically, 
physician is the only term used to describe those authorized to order 
DME, which seems to imply that physicians are the only practitioners 
who may order DME. The proposal then goes on to state that PAs, NPs and 
physicians may perform the face-to-face visit for DME.
    Response: We would like to clarify that under section 
1834(a)(11)(B)(ii) of the Act, physicians, physician assistants, 
clinical nurse specialists and nurse practitioners are authorized to 
conduct the face-to-face encounter. We collectively refer to 
physicians, NPs, PAs and CNSs as ``practitioners.'' However, according 
to the statute, the physician must document that the face-to-face 
encounter occurred when performed by the PA, NP, or CNS. Items of DME 
can be ordered as outlined in the scope of practice for the respective 
practitioners subject to applicable Medicare rules. However, the face-
to-face must be performed by the physician, PA, NP or CNS and 
documented by a physician.
    Comment: Several commenters requested that CMS clarify whether the 
hospitalist ordering the DME for the inpatient and who has the face-to-
face encounter with the patient prior to discharge must meet the face-
to-face encounter requirement.
    Response: Medicare beneficiaries discharged from a hospital do not 
need to receive a separate face-to-face encounter, as long as the 
physician or treating practitioner who performed the face-to-face 
encounter in the hospital issues the DME order within 6 months after 
the date of discharge.
    Comment: Several commenters requested clarification that this 
requirement is for new DME orders and not for existing orders. 
Commenters were concerned that if the proposed face-to-face encounter 
requirements were to apply retroactively to orders already written 
(that is, each new shipment after the effective date of the final rule 
would need to comply with the requirements), suppliers may be required 
to obtain new physician orders for all of the Medicare beneficiaries 
whom they serve.
    Response: We clarify that this requirement is for new DME orders 
only. That is, items that have been ordered on or after the effective 
date of this final rule.
    Comment: Several commenters requested that the effective date of 
the rule be delayed until July 1, 2013, or such later date as found 
reasonable to provide adequate education to patients and suppliers 
about the new requirements. Commenters recommended that CMS provide 
extensive education on the documentation requirements, and alert 
beneficiaries to the new co-payment possibility associated with the 
face-to-face encounter while emphasizing the improved quality of care 
aspect of this rule.
    Response: We agree, and are, therefore, delaying the implementation 
date until July 1, 2013. We believe that provides sufficient time to 
prepare for implementation.
    Comment: A few commenters stated that to ensure the integrity of 
the competitive bidding program's single payment amounts, CMS must 
either (1) ensure that the final rule adopts provisions that are wholly 
consistent with the current documentation requirements dictated by the 
LCDs; (2) exempt items subject to competitive bidding from the proposed 
documentation requirements during the bid program; or (3) permit 
suppliers to resubmit bids for these items that take these additional 
costs into account.
    Response: This requirement is a condition of payment that applies 
uniformly to these items regardless of

[[Page 69149]]

whether they are paid for under the fee schedule or the competitive 
bidding program. There are no exceptions for items that are furnished 
in a competitive bidding area. Moreover, as noted in the impact 
analysis, we believe that this requirement will not result in 
significant costs for suppliers.
a. DME Face-to-Face Encounters
(1) General Requirements
    We had proposed to revise Sec.  410.38(g) to require, as a 
condition of payment for certain covered items of DME, that a physician 
must have documented and communicated to the DME supplier that the 
physician or a PA, an NP, or a CNS has had a face-to-face encounter 
with the beneficiary no more than 90 days before the order is written 
or within 30 days after the order is written. As described in the CY 
2013 PFS proposed rule (77 FR 44794), we outlined the rationale for the 
90 days before or 30 days after the order was written.
    During the face-to-face encounter, the physician, a PA, NP, or CNS 
must have evaluated the beneficiary, conducted a needs assessment for 
the beneficiary or treated the beneficiary for the medical condition 
that supports the need for each covered item of DME. As a matter of 
practice, this information would be part of the beneficiary's medical 
record and include the identity of the practitioner who provided the 
face-to-face assessment. We believe that requiring a face-to-face 
encounter to document the medical condition that supports the need for 
the covered item of DME reduces the risk of fraud, waste, and abuse 
since these visits help ensure that a beneficiary's condition warrants 
the covered item of DME.
    Section 1834(a)(11)(B)(ii) of the Act, as amended by section 
6407(b) of the Affordable Care Act, states that a physician must 
document that the physician, a PA, NP, or CNS has had a face-to-face 
encounter (other than with respect to encounters in which ``incident 
to'' services are involved) with the beneficiary. ``Incident to'' 
services are defined in section 1861(s)(2)(A) of the Act. Likewise, for 
the purpose of this regulation, a face-to-face encounter must be 
documented by a physician and any encounter that is covered as an 
``incident to'' service does not satisfy the requirements of this 
regulation.
    The following is a summary of the comments we received regarding 
the documentation of a face-to-face encounter and the timeframe in 
which it must occur.
    Comment: Many commenters suggested that CMS revise the rule to 
require that face-to-face encounters occur only before the date of the 
written order, and not after the written order is issued.
    Response: After consideration of these comments we have removed the 
option for the face-to-face encounter to occur 30 days after the 
written order. We believe it is critical that the face-to-face be 
conducted before the item is delivered to the beneficiary's home. 
Allowing face-to-face encounters to occur 30 days after the order could 
result in medically unnecessary items being delivered to beneficiaries. 
Further, suppliers could deliver the item but then be unable to bill 
Medicare if the face-to-face encounter does not occur.
    Comment: Many commenters believed the timeframe should be revised 
to allow the face-to-face encounter to occur in the 6-month period 
preceding the order, as authorized by the statute.
    Response: In response to comments, CMS is modifying the encounter 
timeframe so that the face-to-face encounter must now occur 6 months 
prior to the written order, as opposed to the 3 months we previously 
had proposed. We believe this modified timeframe best balances the need 
to protect the Medicare Trust Funds by limiting waste, fraud and abuse 
while limiting burden.
    Comment: Many commenters stated that the 30 days after the written 
order specifically puts the suppliers at financial risk. Many 
commenters expressed concern that it is not reasonable to expect 
suppliers to furnish the item without documentation that the in-person 
encounter took place. Once a beneficiary has received the Specified 
Covered Item of DME, he or she has little incentive to see a doctor. 
The supplier, meanwhile, will not be paid for the item unless it has 
obtained a signed Advance Beneficiary Notice of Noncoverage (ABN) from 
the beneficiary. Therefore, many commenters suggested that the face-to-
face encounter should not be allowed to occur after the written order 
and delivery of the Specified Covered Item. They believed neither the 
beneficiary, nor the physician will have much impetus to follow through 
with the encounter once the equipment is delivered, and the supplier 
will then be unable to bill Medicare. A few commenters suggested that 
if the timeframe is not revised, CMS should compensate suppliers for 
the first 30 days if the physician does not present documentation.
    Response: We concur that it is critical that the face-to-face 
encounter be conducted before the item is furnished to the 
beneficiary's home. We are revising the timeframe for the face-to-face 
encounter to occur and removing the 30 days after the written order. 
The face-to-face encounter must occur in the 6 months before the order 
is written. We will not offer any compensation or liability waivers 
because the supplier should be able to obtain the documentation before 
supplying the item.
    Comment: A few commenters suggested that if the timeframe is not 
revised, CMS must make clear that suppliers would be entitled to 
payment under the waiver of liability provisions in section 1879(a)(1) 
of the Act in the event that the beneficiary does not follow through 
with the face-to-face visit, as the DME supplier would have no way to 
know that the visit would not take place. According to the commenters, 
section 1879(a)(1) clearly states that if a contractor denies payment 
because of a determination that the services was medically unnecessary, 
which would include a denial for a lack of a face-to-face encounter, 
the supplier should nonetheless be paid if the supplier did not know 
and had no reason to know that the payment would be denied.
    Response: As noted previously, we are revising the encounter 
timeframe to be in the 6 months before the DME order is written. We 
believe it is critical that the face-to-face encounter be conducted 
before the item is delivered to the beneficiary's home. Since we have 
removed the 30 days after the order requirement, the waiver of 
liability provisions do not need to be addressed.
    Comment: Several practitioner organizations supported the proposed 
90 days before or 30 days after the order is written timeframe for the 
face-to-face encounter. These commenters believed it was a reasonable 
timeframe for the face-to-face to occur.
    Response: The vast majority of commenters expressed concerns about 
the proposed timeframe. The supplier industry specifically expressed 
serious concerns regarding the provision in the proposed rule that 
allowed the face-to-face order to occur 30 days after the written 
order. Therefore, with this final rule with comment period, we are 
eliminating the option for the face-to-face encounter to occur 30 days 
after the written order and revising the timeframe for a face-to-face 
encounter to occur 6 months preceding the written order.
    We will monitor the implementation of this rule to ensure there are 
no unintended consequences that negatively impact the practitioner, 
supplier, and beneficiary communities. In addition, we do not believe 
the new timeframe will have a significant impact

[[Page 69150]]

on beneficiaries' access to medically necessary, quality DME, since we 
believe that many beneficiaries already see their practitioner during a 
6-month period of time. We believe the new timeframe will make it 
easier for beneficiaries to access DME then the previously proposed 
timeframe.
    Comment: A few commenters cautioned that this proposal will cause a 
certain amount of confusion since certain DME items, such as power 
mobility devices (PMDs) as outlined in Sec.  410.38(c), have a 45 day 
face-to-face encounter requirement as opposed to the proposed 90 day 
requirement for other DME items. Commenters believe greater consistency 
among face-to-face requirements for DME will reduce confusion and 
improve compliance by healthcare professionals. Several commenters 
expressed a desire to have this regulation supersede the PMD face-to-
face regulation.
    Response: This regulation implements section 1834(a)(11)(B) of the 
Act. It does not supersede the PMD regulation as specified in Sec.  
410.38(c), which we issued under different authority. We believe that a 
longer timeframe is necessary for these DME items than the 45-day 
timeframe for PMDs because of the wide variety of DME items covered by 
this rule. This regulation does not apply to PMDs and does not 
supersede other regulations specific to PMDs. We look forward to 
engaging in extensive education to help to clarify the requirements.
    Comment: Several commenters suggested that CMS should consider a 
risk-based approach where specified conditions would be excluded from 
the face-to-face encounter requirement within the proposed timeframe. 
Prior to finalizing the proposed rule, most commenters suggested that 
CMS should work more closely with physicians and supplier stakeholders 
to determine the best approach in establishing a timeframe for the 
face-to-face encounter.
    Response: In response to comments, we have removed the requirement 
allowing the face-to-face encounter to occur 30 days after the written 
order and instead are requiring the face-to-face to be conducted in the 
6 months preceding the written order. However, we are not using a risk 
based approach to determine the methodology and timeframe for the DME 
face-to-face requirement. We believe that a risk based approach would 
be difficult to implement and would create undue confusion. We further 
believe that it is unnecessary particularly in light of the longer 
timeframe.
    Comment: Several commenters expressed concerns that the 
longstanding Medicare policy allows beneficiaries to receive items they 
urgently need by allowing verbal communication between practitioners 
and suppliers; then a written order is required before billing. 
Commenters caution that the coverage policy should not prevent Medicare 
beneficiaries from receiving statutorily-covered, medically necessary 
items.
    Response: We do not believe this provision will prevent Medicare 
beneficiaries from receiving medically necessary DME. Regarding the 
longstanding policy, outlined in the Program Integrity Manual, Chapter 
5, for items that do not require a written order before delivery, 
suppliers are allowed to dispense DME to the beneficiary based upon a 
verbal order, however a supplier must have a written order before 
submitting a claim for payment. For items that do require a written 
order before delivery, a supplier must have a written order (with the 
face-to-face documentation) prior to delivery when submitting a claim 
for payment. This provision will ensure that beneficiaries are only 
receiving medically necessary DME. We encourage open communication 
between the practitioners and suppliers to ensure that beneficiaries 
receive medically necessary items in a timely fashion. In addition, we 
will monitor the implementation of this rule to ensure there are no 
unintended consequences that negatively impact the beneficiary, 
practitioner and supplier communities.
    Comment: Several commenters believe that the agency is implementing 
a flawed statute, and urge the Secretary to carefully consider the 
impact on patients, particularly in rural and urban underserved areas. 
These commenters were especially concerned that NPs and Clinical Nurse 
Midwives (CNMs) are not able to fulfill the face-to-face requirement 
for DME. Commenters cautioned that ordering DME is clearly an activity 
that is within the scope of practice of nurse practitioners. They 
believed that a statutory barrier preventing nurse practitioners from 
independently documenting face-to-face encounters limits the agency 
and, most importantly, the patient's ability to receive timely and 
important care.
    Response: We recognize the concerns commenters have expressed 
regarding the impact that this statute might have on beneficiaries, 
particularly in rural and urban underserved areas if NPs are not 
allowed to fulfill the face-to-face requirement. NPs, PAs, and CNSs can 
still conduct the face-to-face encounter and order DME within their 
scope of practice. However, in this final rule, we are implementing the 
statutory requirement in section 1834(a)(11)(B)(ii) of the Act, that a 
physician must document that the face-to-face encounter occurred when 
performed by a PA, NP, or CNS. CNMs are not listed in the statute as a 
practitioner that may conduct the face-to-face encounter. Moreover, we 
believe that CNMs are distinct from CNSs.
    Comment: A few commenters expressed concerns that NPs have no 
control over how quickly physicians will actually document the face-to-
face encounters that they conduct. The commenters were concerned that 
there may be instances in which it will be difficult to ensure 
documentation is submitted by the physician to the supplier within 30 
days after an order is written, potentially delaying patient access to 
the equipment they need while documentation is being completed.
    Response: We have removed the ability for the face-to-face 
encounter to occur up to 30 days after the order. We are implementing a 
statutory requirement that the physician must document the face-to-face 
encounter even when performed by a PA, NP or CNS within the 6 months 
preceding the written order. We urge physicians, PAs, NPs and CNSs to 
work together to ensure that all beneficiaries receive needed DME. 
Additionally, we believe that 6 months prior to the written order 
provides sufficient time for coordination between the NP, PA, or CNS 
and the physician to document the face-to-face encounter. In addition, 
we will monitor the implementation of this rule to ensure there are no 
unintended consequences that negatively impact the practitioner, 
supplier, and beneficiary communities.
    Comment: Several commenters stated that CMS should assume that 
practitioners' medical judgment determined that the face-to-face 
encounter is valid.
    Response: We appreciate the commenters' recommendation that 
physicians/treating practitioners should be given the presumption that 
their medical judgment determined that the face-to-face encounter is 
valid or medically necessary. However, we must ensure that all CMS 
requirements are met, and cannot accept this recommendation. Therefore, 
just because a face-to-face encounter is performed does not mean that 
all CMS requirements are met, including medical necessity.
    Comment: Several commenters expressed concern that there is no 
evidence that requirements for physician oversight or supervision 
increases quality or reduces fraud. The commenter further stated that 
during

[[Page 69151]]

the past 15 years, there is little evidence that NPs and CNSs engaged 
in fraudulent or abusive ordering of DME and there is little efficiency 
or true accountability in relying on documentation by a physician who 
has not evaluated the patient rather than the NP or CNS who has 
performed that examination.
    Response: This rule does not address the ordering practices of NPs 
and CNSs. Rather, the statute requires that physicians document the 
face-to-face encounters of NPs, CNSs and PAs with beneficiaries for 
certain covered items of DME. Section 1834(a)(11)(B)(ii) of the Act 
requires that a physician must document that the face-to-face encounter 
occurred when performed by a PA, NP, or CNS. The degree to which NPs 
and CNSs are engaged in fraudulent or abusive ordering of DME is not 
specifically addressed by this Affordable Care Act provision; however, 
as we stated earlier and also in the proposed rule, we believe that 
requiring a face-to-face encounter that supports the need for the 
covered item of DME will reduce the risk of fraud, waste, and abuse 
since these visits help ensure that a beneficiary's condition warrants 
the covered item of DME.
    Comment: Several commenters stated that for some beneficiaries 
needing items such as transcutaneous electrical nerve stimulation 
(TENS), it is common for physical therapists, occupational therapists, 
chiropractors, and other participating Medicare health care 
professionals to conduct the face-to-face encounter while physicians 
continue to be responsible for producing the written order and 
documenting that the face-to-face encounter has occurred. A few 
commenters stated that it should be sufficient for a speech pathologist 
to conduct the face-to-face encounter for items such as a speech 
generating device. A few commenters stated that sleep physicians should 
also be allowed to provide DME.
    Response: We appreciate these commenters' suggestions regarding 
including additional types of practitioners that could potentially 
provide DME face-to-face encounters. It is important to keep in mind 
that chiropractors are not allowed to bill Medicare for DME items. 
Other practitioners must be working within their scope of practice. The 
statute specifies that while the physician must document his or her own 
face-to-face encounter, only a physician, NP, PA, or CNS may conduct 
the face to face encounter, however it must be documented by a 
physician. Moreover, a sleep physician who meets the Medicare 
definition of physician can be considered a physician for purposes of 
this face-to-face encounter.
    Comment: Several commenters stated that if this rule is to prevent 
fraud on the physician/non-physician side, then having a strong 
rationale for the DME equipment in their encounter note should provide 
sufficient documentation to determine the medical need for the DME. The 
commenters believe this documentation establishes the trail of the 
request and justification for each piece of DME. No additional 
paperwork should be transmitted and no interpretation of the encounter 
note (by non-clinician DME suppliers) would need to be done. The 
process could create a clear auditing trail for investigators.
    Response: We appreciate these comments; however, we must implement 
the regulation based on the provisions of section 1834(a)(11)(B)(ii) of 
the Act, which requires a physician to document the occurrence of a 
face-to-face encounter for covered items of DME. Throughout the 
development of the proposed rule and based on comments, we attempted to 
balance the implementation of the statute while limiting burden on 
providers, suppliers and beneficiaries, and while ensuring that 
beneficiaries continued to have access to medically necessary DME.
    In response to comments, we removed language that allowed the face-
to-face encounter to occur 30 days after the written order and modified 
the timeframe to now be within the 6 months preceding the written 
order. We believe that this will allow suppliers to deliver medically 
necessary DME while trying to eliminate the possibility that the face-
to-face encounter will never be conducted.
    In the proposed rule, we noted that a face-to-face encounter may be 
accomplished via a telehealth encounter if all Medicare telehealth 
requirements as defined under section 1834(m) of the Act and the 
implementing regulations in Sec.  410.78 and Sec.  414.65 are met as 
described in more detail in the CY 2013 PFS proposed rule (77 FR 
44794). Further, a single face-to-face encounter, including those 
facilitated through the appropriate use of telehealth, can support the 
need for multiple covered items of DME as long as it is clearly 
documented in the pertinent medical record that the beneficiary was 
evaluated or treated for a condition that supports the need for each 
covered item, during the specified timeframe.
    As described in more detail in the CY 2013 PFS proposed rule (77 FR 
44795), we proposed requirements for a written order as a condition of 
payment. For purposes of this final rule with comment period, which is 
focused on implementing section 1834(a)(11)(B) of the Act and reducing 
fraud, waste, and abuse, an order without minimum elements would be 
considered incomplete and would not support a claim for payment.
    The following is a summary of the comments we received regarding 
the written order proposal.
    Comment: Many commenters expressed a belief that instructions and 
requirements related to the order need to be clear and less burdensome. 
Commenters expressed the need for clarity and/or requested removal of 
the need for physicians to describe ``necessary and proper usage 
instructions'', diagnosis codes, and the National Provider Identifier 
(NPI) in the written order.
    Response: We appreciate the commenters' recommendation. We agree 
that instructions that limit burden are important. We have removed the 
proposed requirement for orders to include: ``necessary and proper 
usage instructions'' and the diagnosis. Due to the large number of 
covered DME items and the fact that there could be many diagnoses and 
usage instructions for each, we agree that these proposed requirements 
may be overly burdensome. While this information will not be required 
on the DME order under this regulation, we will still expect to see 
related diagnoses included in the beneficiary's medical record. We 
would also expect ``necessary and proper usage instructions'' to be 
provided to the beneficiary or care giver for proper usage of the item. 
The remaining five elements listed: (1) The beneficiary name; (2) the 
item of DME ordered; (3) prescribing practitioner NPI; (4) the 
signature of the prescribing practitioner; and (5) the date of the 
order are the minimum needed for CMS to consider the order valid. This 
does not supersede other requirements.
    Comment: Several commenters stated that for some DME items, the 
proposed face-to-face encounter requirements represent a significant 
change for Medicare beneficiaries, providers and DME suppliers. 
Commenters noted that even though some of the proposals are relatively 
minor, such as requiring the prescribing practitioner's NPI to be 
included on the written orders, they require providers and suppliers to 
change their standard practices. Such ``minor'' changes are significant 
since non-compliance may adversely affect the payment for DME.
    Response: We appreciate these comments. Our goal is to limit 
provider and supplier burden while still preventing waste, fraud and 
abuse. To

[[Page 69152]]

that end, in response to comments, we have removed the requirement that 
instructions for necessary and proper usage, and the diagnosis be 
included on the order. However, we are retaining the other requirements 
as a way to limit waste, fraud and abuse.
    As a result of the comments, we are requiring at a minimum, the 
written order contains: (1) The beneficiary name; (2) the item of DME 
ordered; (3) the signature of the prescribing practitioner; (4) 
prescribing practitioner NPI; (5) the date of the order. Orders should 
still comply with standards of practice and therefore may be more 
detailed.
    As noted previously, section 1834(h)(3) of the Act incorporates by 
cross reference prosthetic devices, orthotics, and prosthetics to the 
items encompassed by section 1834(a)(11)(B) of the Act. At this time, 
we are not implementing the proposed changes to Sec.  410.36(b) to 
require documentation of a face-to-face encounter for prosthetic 
devices, orthotics, and prosthetics that, according to Sec.  410.36(b), 
require a written order before delivery in this final rule. We intend 
to use future rulemaking to determine which prosthetic devices, 
orthotics, and prosthetics, require, as a condition of payment, a 
written order before delivery supported by documentation of a face-to-
face encounter with the beneficiary consistent with section 
1834(a)(11)(B)(ii) of the Act.
    The following is a summary of comments we received regarding 
prosthetic devices, orthotics, and prosthetics.
    Comment: In many cases, the acute condition (for example, 
amputation, stroke, polio, etc.) that caused the initial medical need 
for the prosthesis or orthotics no longer requires specific medical 
treatment by a physician. In this scenario, Medicare beneficiaries 
often look to their orthotist or prosthetist to continue to provide the 
prosthetics or orthotics (P & O) necessary to restore and maintain 
functional abilities. Commenters were concerned that if applied to P & 
O patients, the face-to-face requirement for P & O care would result in 
extensive administrative burdens for P & O clinicians and the 
physicians who prescribe these services, as well as pose a significant 
impediment for their patients.
    Response: We appreciate this comment and will consider it as we 
contemplate future rule making for P & O.
    Comment: For prosthetic devices, orthotics, and prosthetics, 
commenters urged CMS to conduct an evaluation of the impact of the 
requirements for selected DME items before deciding whether there 
should be any expansion to other product categories. Second, commenters 
believed that CMS should limit any such requirement to items for which 
there is sufficient evidence of fraud and abuse, and not based solely 
on the reimbursement amount of the item. Commenters continued to have 
concerns about what data CMS used to establish and verify the level of 
fraud among Medicare physicians, specifically as related to that data 
comparing physician suppliers vs. commercial suppliers, and by 
specialty area within physician suppliers.
    Several commenters noted that when CMS considers whether to apply 
the new face-to-face encounter requirements to enteral nutrition, CMS 
should be mindful of the existing requirements and not impose redundant 
requirements or request duplicative information.
    Response: We appreciate these comments, and will consider them, 
including physician vs. commercial suppliers, as we consider future 
rule making for P & O.
    We also stated in the proposed rule that none of our proposals 
superseded any regulatory requirements that more specifically address a 
face-to-face encounter requirement for a particular item of DME.
(2) Physician Documentation
    The statute requires that a physician document that the physician 
or a PA, NP or CNS has had a face-to-face encounter with the 
beneficiary. As described in the CY 2013 PFS proposed rule (77 FR 
44795), we proposed two options for how this could be done.
    The following is a summary of the comments we received regarding 
the physician documentation proposal.
    Comment: Several commenters believed a standardized form that 
documents the elements CMS and its contractors require for coverage of 
a DME item should be recognized by CMS as part of the beneficiary's 
medical record and should establish the beneficiary's medical need for 
the item.
    Response: The amount of necessary clinical information needed to 
demonstrate that all coverage and coding requirements are met will vary 
depending on the item/service. For example, we have National and Local 
Coverage Determinations which address many of these items/services. The 
commenters appear to be describing a template. However, we do not 
prohibit the use of templates to facilitate record-keeping. We also do 
not endorse or approve any particular templates. A physician or 
practitioner may choose any template to assist in documenting medical 
information.
    We do caution, however, that some templates provide limited options 
and/or space for the collection of information such as by using ``check 
boxes,'' predefined answers, and limited space to enter information. We 
discourage the use of such templates. Our experience with claim review 
shows that `limited space' templates often fail to capture sufficient 
detailed clinical information to demonstrate that all coverage and 
coding requirements are met. Furthermore, physicians or practitioners 
should be aware that templates designed to gather selected information 
primarily for reimbursement purposes are often insufficient to 
demonstrate that all coverage and coding requirements are met. These 
`limited space' documents often do not provide sufficient comprehensive 
information to adequately show that the medical necessity criteria for 
the item/service have been met.
    Comment: A few commenters expressed a belief that the documentation 
requirements should be the same for physicians as they are for nurse 
practitioners and other non-physician providers.
    Response: We agree that the documentation requirements for the 
face-to-face encounter should be the same. However, it is duplicative 
to have the physician document that the face-to-face occurred when they 
themselves conducted the face-to-face encounter. Therefore, we are not 
requiring additional documentation requirements for the physician in 
addition to what they are required to document during the actual face-
to-face encounter.
    As a result of the comments, the submission of the pertinent 
portion of the medical record documented by the physician is sufficient 
to document that the face-to-face encounter has occurred, when the 
physician conducts the face-to-face encounter. Documentation of the 
face-to-face encounter must include an evaluation of the beneficiary, 
needs assessment for the beneficiary, or treatment of the beneficiary 
for the medical condition that supports the need for each covered item 
of DME. A written order is still required for these covered items of 
DME.
(3) Physician Documentation of Face-to-Face Encounters Performed by a 
Physician Assistant, Nurse Practitioner, or Clinical Nurse Specialist
    As described in the CY 2013 PFS proposed rule (77 FR 44795), we had 
considered four options for the physician documentation of a face-to-

[[Page 69153]]

face encounter performed by a PA, NP, or CNS.
    The following is a summary of the comments we received regarding 
how physician documentation requirements should be handled when the 
face-to-face encounter with the beneficiary is conducted by a PA, NP, 
or CNS.
    Comment: Many commenters believed that CMS should allow each of the 
outlined options so that practices may choose which option will best 
meet their needs and those of the patient.
    Response: We believe there needs to be a standard accepted practice 
for documenting the face-to-face encounter when performed by a PA, NP 
or CNS. We believe that this will promote consistency and ensure that 
there is clear guidance on the requirements.
    Comment: Some commenters believe that if an ordering physician 
certifies the date of a face-to-face encounter on the signed written 
order that should be sufficient documentation for the supplier to 
establish medical necessity for the DME items. This method of 
documentation is most efficient for physicians, and it is easily 
verified by DME suppliers when establishing that medical necessity 
requirements are met.
    Response: While we appreciate this comment, a verification of a 
date added to a written order does not prove that an adequate face-to-
face occurred. Detailed face-to-face documentation is required to 
ensure the item of DME is medically necessary and appropriate for the 
individual beneficiary.
    Comment: Commenters believe there is no justification for requiring 
less information on the beneficiary's medical need for DME if a 
physician personally conducts the evaluation than if a nurse 
practitioner assesses the patient. Typically, the physician 
communicates the order directly to the supplier who, in turn, initiates 
intake and assessment based on a written confirmation of the 
physician's verbal order, which is later ratified by the physician's 
signature and date.
    Response: We are not requiring less information on the need for DME 
if a physician conducts the evaluation than would be deemed appropriate 
if a nurse practitioner assesses the patient. We are not requiring 
additional documentation requirements for the physician above what they 
are required to perform in documenting the actual face-to-face 
encounter.
    Comment: Many commenters expressed a desire to limit their burden. 
Commenters expressed that overly unnecessary copying, drafting, and 
distribution of records from the MD/DO to the physician supplier is 
burdensome at the very least, interferes with the physician-patient 
relationship, and is generally not in the best interests of the 
Medicare beneficiary.
    Response: We have worked to develop a rule that weighs our 
responsibility to implement the statutory provision, while minimizing 
provider and supplier burden. As a result of comments, we are allowing 
flexibility on how the supplier is notified of the face-to-face 
encounter. We have tried to limit the burden by requiring that the 
physician sign/cosign the pertinent portion of the medical record to 
document when a face-to-face encounter was performed by a NP, PA or 
CNS. This step is not needed when the physician personally conducts the 
face-to-face encounter.
    As a result of the comments, we are requiring the physician 
documenting the face-to-face encounter performed by a NP, PA or CNS, 
must sign or cosign the pertinent portion of the medical record 
indicating the occurrence of a face-to-face encounter for the 
beneficiary for the date of the face-to-face encounter, thereby 
documenting that the beneficiary was evaluated or treated for a 
condition relevant to an item of DME on that date of service. Other 
signature requirements described in the manual, such as those for 
determining a legible signature remain in force. This option provides 
evidence that the physician reviewed the relevant documentation to 
support that a face-to-face encounter occurred for that date of 
service. A signed order (in contrast to a signed medical record) would 
not satisfy the requirement described in this option that the physician 
``sign/cosign the pertinent portion of the medical record.''
(4) Supplier Notification
    Since the supplier submits the claims for the covered items of DME, 
the supplier must have access to the documentation of the face-to-face 
encounter. All documentation to support the appropriateness of the item 
of DME ordered, including documentation of the face-to-face encounter, 
must be available to the supplier. As with certain other items and 
services submitted for Medicare payment, we require the entity 
submitting the claim to maintain access to the written order and 
supporting documentation relating to written orders for covered items 
of DME and provide them to us upon our request or at the request of our 
contractors.
    As described in CY 2013 PFS proposed rule (77 FR 44795), we had 
considered four options for the supplier notification of the face-to-
face encounter.
    The following is a summary of the comments we received regarding 
the supplier notification proposal.
    Comment: Several commenters expressed concerns that physicians have 
reported deceptive practices by DME suppliers who have sent letters to 
physicians on letterhead appearing to be co-branded with CMS but 
without CMS authorization. The letters have indicated that because the 
DME supplier is undergoing a CMS audit, the physician must produce 
extensive and costly medical record documentation and submit it to the 
DME supplier.
    Response: Suppliers are required to have the documentation 
available upon request by CMS. CMS has worked to limit the burden 
associated with this regulation. However, the CMS seal and logo are for 
the official use of CMS and its authorized contractors only and must 
not be used by suppliers or others within the private sector. Under 
section 1140 of the Act, individuals or organizations may be subject to 
a civil money penalty for the misuse of words, symbols, or emblems or 
names in reference to Social Security or Medicare. If physicians have 
information about suppliers or others who are misusing CMS words, 
symbols, or emblems, they should contact the HHS Office of Inspector 
General. Organizations or individuals concerned about suppliers who may 
be misrepresenting themselves or CMS should contact the contractor that 
processes their claims. CMS requires that suppliers have access to the 
documentation to support their claims. Suppliers may request supporting 
documentation, including documentation of a face-to-face encounter, 
from the physician, but suppliers must not misuse CMS words, symbols, 
or emblems when making those requests. Suppliers may, of course, share 
unaltered CMS educational material.
    Comment: Commenters suggested that CMS clarify in its regulation 
that after a physician or beneficiary has submitted a medical record 
and documentation of the face-to-face visit to the DME supplier, the 
DME supplier must retain a copy of that already-submitted record, and 
the physician is not required to supply subsequent medical records or 
documentation to the DME supplier.
    Response: The face-to-face encounter is a condition of payment for 
the supplier. Suppliers must make this information available to CMS 
upon request.
    Comment: Commenters urged CMS to give physicians and other 
practitioners maximum flexibility by allowing them to choose among the 
options CMS has proposed. To avoid creating new

[[Page 69154]]

burdens for physicians, commenters recommend that the new process for 
communicating documentation to suppliers resemble, as closely as 
possible, current processes used by physicians. Commenters believe that 
this may be similar to the second option discussed in the proposed 
rule, and, if this is the case, they recommended using that option.
    Response: In response to comments, we are not requiring a 
particular method of transmission for supplier notification that the 
face-to-face encounter has occurred in order to limit burden and not 
create a hindrance to access to care. Practitioners and suppliers can 
communicate the information and requirements through existing business 
processes for transmitting this information. CMS will monitor the 
effects of this provision on beneficiaries' access to medically 
necessary DME. We also note that this documentation must be made 
available to suppliers to allow them to ensure all requirements are 
met. Suppliers must make this documentation available to CMS upon 
request.
    Comment: Many commenters believe that the adopted rules should give 
adequate protection to downstream DME suppliers who act in good faith 
in response to information communicated by physician practices. 
Commenters believe that whatever documentation and communication 
policies CMS adopts for face-to-face encounters should give suppliers 
absolute peace of mind that their subsequent dispersing of DME items 
will not later be second-guessed by CMS or its contractors.
    Response: We believe that by removing the ability for the face-to-
face encounter to occur 30 days after the written order suppliers will 
be afforded more protection as all documentation will be available at 
the time of order. Completion of the face-to-face requirement is a 
condition of payment and could be subject to audit. Therefore, this 
documentation must be available to CMS on request. CMS will monitor the 
effects of this provision on beneficiaries' access to medically 
necessary DME.
    Comment: A few commenters strongly opposed the fourth option of 
requiring the physician to provide a copy of the face-to-face 
documentation to the beneficiary and disagreed with the reasoning that 
this option would, ``ensure that the supplier receives the 
documentation of face-to-face encounter directly and limits the 
supplier's need to rely on the PA, NP, or CNS to receive this 
documentation completed by the physician.''
    Response: We appreciate this concern, and therefore, will not 
require this particular method for transmission of this communication.
    Comment: Several commenters expressed a concern that the ordering 
practitioner has little interest or incentive to ensure the necessary 
paperwork is provided to the supplier since the practitioner/physician 
still gets reimbursed for their services regardless of whether they 
have inadequate documentation and fail to provide such documentation to 
the suppliers. A few commenters stated that the DME supplier should not 
be responsible for scheduling the face-to-face visits to ensure the 
requirement is met. Commenters also believed physicians who are 
continually noncompliant with the rule should be subject to corrective 
action.
    Response: We encourage suppliers and practitioners to work together 
to ensure that beneficiaries receive necessary and appropriate care. 
Completion of the face-to-face requirement is a condition of payment. 
Therefore, this documentation must be available to CMS upon request. We 
believe that by removing the 30 days after the order is written 
timeframe for the face-to-face encounter, the supplier will be able to 
know before delivery if all requirements have been meet. CMS does 
provide education on documentation requirements to physicians and other 
practitioners including through MLN articles.
    As a result of the comments received, we are not requiring a 
particular method of supplier notification. Instead, since this is a 
condition of payment, we only require that the supplier must have all 
documentation to support the claim upon request. We believe this will 
limit the burden on practitioners and suppliers while helping to ensure 
beneficiary access to DME.
b. Covered Items
    Section 1834(a)(11)(B)(i) of the Act (as redesignated by the 
Affordable Care Act authorizes us to specify covered items that require 
a written order prior to delivery of the item. Under section 
1834(a)(11)(B)(ii) of the Act, these orders must be written pursuant to 
a physician documenting that a face-to-face encounter has occurred. 
Accordingly, to reduce the risk of fraud, waste, and abuse, we proposed 
a list of Specified Covered Items that would require a written order 
prior to delivery. Our final list of Specified Covered Items is in 
Table 89. In future years, updates to this list will appear annually in 
the Federal Register and the full updated list will be available on the 
CMS Web site.
    As highlighted in the January 2007 Government Accountability Office 
(GAO) report entitled, ``Improvements Needed to Address Improper 
Payments for Medical Equipment and Supplies,'' it is estimated that 
there were $700 million in improper payments across the spectrum of 
DMEPOS from April 1, 2005, through March 31, 2006. GAO did not 
specifically recommend the use of DME face-to-face encounters as a 
remedial action in its report. However, the GAO did recommend making 
improvements to address improper payments in the DMEPOS arena. This 
final rule with comment period is one way in which we are working to 
prevent DME improper payments.
    Though we initially considered making all items encompassed by 
section 1834(a)(11)(B) of the Act (including prosthetic and orthotic 
items described in section 1834(h)(3) of the Act) subject to a face-to-
face encounter requirement, we have first proposed a more limited 
criteria- driven list to balance a comprehensive face-to-face 
requirement to prevent fraud, waste, and abuse while mitigating any 
undue negative effect on practitioners and suppliers by including all 
items. We welcomed comments on limiting the associated burden of this 
proposed rule by refining the number of items subject to a face-to-face 
encounter, while still protecting the Medicare Trust Funds.
    The following is a summary of the comments we received regarding 
the covered items proposal.
    Comment: Commenters appreciated CMS's efforts to reduce fraud, 
waste, and abuse. Commenters expressed that ``as CMS implicitly 
acknowledges'' in the preamble to the proposed rule that the statute 
does not compel the Secretary to require a written order prior to 
delivery for all DME. Rather, the Secretary ``is authorized'' to 
require a written order prior to delivery for DME items that are 
``specified covered items''. However, for any DME items that are 
Specified Covered Items, the Secretary is obligated to require 
documentation by a physician that the order is based on a face-to-face 
encounter between the beneficiary and an authorized practitioner. 
Commenters stated that CMS should apply the new encounter and 
documentation requirements initially to a smaller number of HCPCS codes 
and first evaluate the impact of the requirements on beneficiary access 
to DME and costs to providers before expanding the list in the future. 
Commenters suggested the new face-to-face encounter requirements should 
not apply to instances where a physician is ordering an item of DME

[[Page 69155]]

that is substantially similar to the item already being used by the 
beneficiary.
    Response: We believe that this is an important provision aimed at 
reducing fraud, waste, and abuse. We used a criterion driven approach 
to select these items, and did not receive sufficiently detailed 
alternative criteria to those proposed. We believe limiting new face-
to-face encounter requirements only to instances where a physician is 
ordering an item of DME that is substantially similar to the item 
already being used by the beneficiary is insufficiently broad to make 
significant inroads into reducing fraud, waste and abuse. It would also 
be difficult to determine and what qualifies as ``substantially 
similar.''
    Comment: Commenters stated that requiring that a physician sign-off 
on commonly prescribed items, such as blood glucose monitors and 
standard wheelchairs that are currently ordered by NP, PA, and Advance 
Practice Nurses including CNSs may create a barrier for consumers, many 
of whom routinely receive this needed equipment from nonphysician 
practitioners, and runs contrary to current Medicare reimbursement 
practice. Several commenters raised concerns that the agency's broad 
list of proposed covered items includes several items that NPs and CNSs 
order routinely for frequent conditions and diagnoses, such as glucose 
monitors. Commenters stated that requiring physician documentation 
before these items may be supplied is likely to delay patient care and 
potentially lead to serious complications and more severe conditions.
    Response: We are implementing the statutory requirements of this 
provision to require a physician has to document the occurrence of a 
face-to-face encounter for certain covered items of DME. Face-to-face 
encounters conducted by NPs, PAs, and CNS are allowed, but as the 
statute states these encounters must be documented by a physician. CMS 
does not believe that this regulation will create a barrier to 
beneficiaries including those who are prescribed orders from PAs, NPs 
and Advance Practice Registered Nurses including CNSs.
    We use a criterion driven approach to select these items and are 
implementing this provision in accordance with the statute. We do not 
believe that this requirement will delay a beneficiary from getting 
necessary care particularly with the longer timeframe. In addition, we 
will monitor the implementation of this rule to ensure there are no 
unintended consequences that negatively impact the practitioner, 
supplier, and beneficiary communities.
    Comment: Commenters recommended that CMS exercise its discretion 
and create a smaller list. Commenters suggested excluding from the list 
of Specified Covered Items any DME covered under an NCD or LCD that 
requires a physician to see the beneficiary before ordering the item. 
These include oxygen and oxygen equipment (E0441, E0442, E0443, and 
E0444) and all ventilators including CPAPs and RADs.
    Additionally, commenters recommended any items necessary to ensure 
a safe discharge from an inpatient stay and preserve continuity of 
care, including wheelchairs, infusion pumps, hospital beds and 
accessories, negative pressure wound therapy (NPWT), and ambulatory 
items, be excluded from the list of Specified Covered Items.
    Commenters stated that the need for glucometers and nebulizers 
(E0570, E0575, E0580) for this population is obvious; if translated to 
office or clinic visits needed to monitor then in the absence of the 
availability of this equipment, or even the extra time it will take 
physicians and nurse practitioners to obtain the extra documentation to 
order these items. This represents a significant amount of unnecessary 
time and cost with poorer patient outcomes.
    Many commenters expressed the view that a face-to-face encounter 
for speech generating device (SGD) should be excluded since it will 
adversely affect an aphasia patient's ability to obtain the equipment 
required for function communication. They believe the face-to-face 
encounter requirement is an undue hardship for people needing a speech 
generating device. A SGD already requires a Certificate of Medical 
Necessity before ordering.
    Commenters noted the current proposed list of Specified Covered 
Items includes equipment that have a fee schedule amount well below 
$1000, including accessories to the primary equipment. To require a 
separate face-to-face encounter to document need for an accessory for 
primary equipment already vetted in a previous face-to-face encounter 
and currently in the possession of the beneficiary seems unduly 
burdensome. To that point, commenters stated, that wheelchair 
accessories should not be included on the Specified Covered Item list. 
Section 410.38(c)(3)(ii) states that accessories for PMDs may be 
ordered by the physician/treating practitioner without conducting a 
face-to-face encounter with the beneficiary.
    Response: In areas where a face-to-face is required by the NCD or 
LCD the documentation requirements of this regulation are in addition 
to those documents for the NCD or LCD. The face-to-face should comply 
with the requirements of the applicable NCD/LCD and its occurrence must 
be documented by a physician. CMS reminds providers and suppliers that 
multiple items can be supported by a single face-to-face encounter.
    For a beneficiary who is discharged from the hospital, the face-to-
face encounter may occur in that setting. This mitigates the concern of 
items needed to safely discharge the beneficiary.
    We are removing items from the covered list of items where 
regulations explicitly state that a face-to-face encounter is not 
necessary such as power wheelchair accessories. We used a criteria-
driven approach in order to create this list, and speech generating 
devices specifically are items meet one of our criteria. There are 
items below $1,000 on the list because these items still have an 
aggregate effect on the Medicare Trust Funds. While commenters 
recommended we remove individual items, we are not convinced that any 
of our criteria are inappropriate.
    Comment: Some commenters supported the inclusion of ventilators, 
respiratory assist device CPAP/BiPAP, and chest wall oscillators on the 
list of items that require a face-to-face encounter.
    Response: We agree and have included these items on the Specified 
Covered Item list.
    Comment: Commenters questioned if aggregate rental cost was 
included in the $1,000 threshold.
    Response: The threshold criterion does not include aggregate rental 
costs of DME.
    Comment: Many commenters believe the overwhelming majority of 
orders for DME are already made in an appropriate medical context. That 
is, DME is typically ordered as part of a beneficiary's routine medical 
care consistent with coverage determinations issued by CMS and its 
contractors. Consequently, they believe it is unnecessary for CMS to 
require additional in-person evaluations or documentation for many 
categories of DME. Moreover, when DME is ordered on discharge from an 
inpatient stay, they believe it is likewise unnecessary for CMS to 
impose an additional face-to-face physician visit or documentation 
requirement because the beneficiary's need for equipment would have 
been evaluated during the stay. Other similar

[[Page 69156]]

comments are that the face-to-face encounter requirements will generate 
considerable additional administrative burden for physicians, patients 
and suppliers, and overall healthcare costs due to increases patient 
morbidities as a result of expired prescriptions or inability to obtain 
documentation that will delay getting DME. Finally, commenters believed 
there is no hard evidence that this provision will have a positive 
impact.
    Response: We are implementing the statutory requirement using a 
criteria-driven approach in order to create this list. We have taken 
into account many of the comments received in revising the rule to 
address the potential burden concerns, extending the proposed timeline 
to 6 months, removing the 30 days post written order option, and 
allowing face-to-face encounters to occur at the hospital prior to 
discharge. While commenters recommended removal of individual items, 
there was no mention of removing any of the specific criteria, nor was 
a detailed alternative methodology provided. While commenters 
recommended individual items to remove, we must maintain a criteria-
driven approach our criteria were outlined in 77 FR 44797.
    Comment: Commenters were very concerned that the proposed rule does 
not make clear that the burden to obtain documentation of face-to-face 
encounters will not be placed on pharmacies.
    Response: We worked to implement this statute in a way that limits 
burden to providers and suppliers while ensuring beneficiary access to 
care. All entities billing Medicare for a covered item of DME are 
subject to this provision. CMS does not believe that it is appropriate 
to carve out an exception for pharmacies. If a pharmacy bills Medicare 
for one of these covered items then this documentation must be 
available upon request.
    Comment: Commenters encouraged the Agency to (1) assess regularly 
how additional documentation requirements could limit patient access to 
DME items and increase the documentation burden on providers, (2) 
describe what types of educational programs it will develop to help 
providers understand the DME documentation requirements necessary for 
Medicare coverage, and (3) evaluate what incentives could be offered to 
encourage providers to focus on reducing documentation error rates.
    Response: We do not believe that this requirement will limit 
patient access to necessary DME particularly in light of the longer 
timeframe. We balanced the need to protect the Medicare Trust Funds 
while limiting burden. We are not being prescriptive on how the face-
to-face encounter must be communicated to the supplier and believe this 
will help limit provider burden. CMS will issue an MLN article 
regarding this requirement. Incentives for document error rate are 
outside the scope of this regulation.
    As a result of the comments, we are maintaining our criteria-driven 
list, however, we are removing items from the covered list of items 
where regulations explicitly state that a face-to-face encounter is not 
necessary.
    As described in the CY 2013 PFS proposed rule (77 FR 44796), we 
described our proposed criteria, as well as the reasons we selected 
these criteria. We first noted that our proposed list of Specified 
Covered Items contains DME items only. We intended to use future 
rulemaking to apply section 1834(a)(11)(B)(ii) of the Act to add 
prosthetics and orthotics. We believe that our proposed current focus 
on DME items is an appropriate way of balancing our goals of reducing 
fraud, waste, and abuse and limiting burden on beneficiaries and the 
supplier community. We also proposed to focus initially on DME items 
for several reasons.
    We welcomed comments on limiting the associated burden of this 
proposed regulation by refining the number of items subject to a face-
to-face encounter, while still meeting the requirements of the statute.
    The proposed list of Specified Covered Items contains items that 
meet at least one of the following four criteria: (1) Items that 
currently require a written order prior to delivery per instructions in 
our Program Integrity Manual; (2) items that cost more than $1,000; (3) 
items that we, based on our experience and recommendations from the 
Durable Medical Equipment Medicare Administrative Contractors, believe 
are particularly susceptible to fraud, waste, and abuse; (4) items 
determined by CMS as vulnerable to fraud, waste and abuse based on 
reports of the HHS Office of Inspector General, Government 
Accountability Office or other oversight entities. We are adding a 
criterion to remove any items where regulations explicitly state that a 
face-to-face encounter is not necessary. As described in the CY 2013 
PFS proposed rule (77 FR 44796), we outlined each of these criteria.
    Our final list of Specified Covered Items is in Table 89 of this 
final rule with comment period. We further proposed to update this list 
of Specified Covered Items annually to add any new items that are 
described by a HCPCS code for the following types of DME:

 TENS unit
 Rollabout chair
 Manual Wheelchair accessories
 Oxygen and respiratory equipment
 Hospital beds and accessories
 Traction-cervical

    Note that the list does not include power mobility devices (PMDs), 
which are subject to already existing face-to-face requirements, as 
previously discussed. In addition, we proposed to add to the list any 
item of DME that in the future appears on the DMEPOS Fee Schedule with 
a price ceiling at or greater than $1,000. Items not included in one of 
the proposed automatic pathways would be added to the list of Specified 
Covered Items through notice and comment rulemaking.
    Through updates in the Federal Register, we propose removing HCPCS 
codes from the list that are no longer covered by Medicare or that are 
discontinued HCPCS codes.
    The DME list of Specified Covered Items are as follows, the 
original list was at 77 FR 44798:

              Table 89--DME List of Specified Covered Items
------------------------------------------------------------------------
          HCPCS code                           Description
------------------------------------------------------------------------
E0185.........................  Gel or gel-like pressure mattress pad.
E0188.........................  Synthetic sheepskin pad.
E0189.........................  Lamb's wool sheepskin pad.
E0194.........................  Air fluidized bed.
E0197.........................  Air pressure pad for mattress standard
                                 length and width.
E0198.........................  Water pressure pad for mattress standard
                                 length and width.
E0199.........................  Dry pressure pad for mattress standard
                                 length and width.
E0250.........................  Hospital bed fixed height with any type
                                 of side rails, mattress.
E0251.........................  Hospital bed fixed height with any type
                                 side rails without mattress.

[[Page 69157]]

 
E0255.........................  Hospital bed variable height with any
                                 type side rails with mattress.
E0256.........................  Hospital bed variable height with any
                                 type side rails without mattress.
E0260.........................  Hospital bed semi-electric (Head and
                                 foot adjustment) with any type side
                                 rails with mattress.
E0261.........................  Hospital bed semi-electric (head and
                                 foot adjustment) with any type side
                                 rails without mattress.
E0265.........................  Hospital bed total electric (head, foot
                                 and height adjustments) with any type
                                 side rails with mattress.
E0266.........................  Hospital bed total electric (head, foot
                                 and height adjustments) with any type
                                 side rails without mattress.
E0290.........................  Hospital bed fixed height without rails
                                 with mattress.
E0291.........................  Hospital bed fixed height without rail
                                 without mattress.
E0292.........................  Hospital bed variable height without
                                 rail without mattress.
E0293.........................  Hospital bed variable height without
                                 rail with mattress.
E0294.........................  Hospital bed semi-electric (head and
                                 foot adjustment) without rail with
                                 mattress.
E0295.........................  Hospital bed semi-electric (head and
                                 foot adjustment) without rail without
                                 mattress.
E0296.........................  Hospital bed total electric (head, foot
                                 and height adjustments) without rail
                                 with mattress.
E0297.........................  Hospital bed total electric (head, foot
                                 and height adjustments) without rail
                                 without mattress.
E0300.........................  Pediatric crib, hospital grade, fully
                                 enclosed.
E0301.........................  Hospital bed Heavy Duty extra wide, with
                                 weight capacity 350-600 lbs with any
                                 type of rail, without mattress.
E0302.........................  Hospital bed Heavy Duty extra wide, with
                                 weight capacity greater than 600 lbs
                                 with any type of rail, without
                                 mattress.
E0303.........................  Hospital bed Heavy Duty extra wide, with
                                 weight capacity 350-600 lbs with any
                                 type of rail, with mattress.
E0304.........................  Hospital bed Heavy Duty extra wide, with
                                 weight capacity greater than 600 lbs
                                 with any type of rail, with mattress.
E0424.........................  Stationary compressed gas Oxygen System
                                 rental; includes contents, regulator,
                                 nebulizer, cannula or mask and tubing.
E0431.........................  Portable gaseous oxygen system rental
                                 includes portable container, regulator,
                                 flowmeter, humidifier, cannula or mask,
                                 and tubing.
E0433.........................  Portable liquid oxygen system.
E0434.........................  Portable liquid oxygen system, rental;
                                 includes portable container, supply
                                 reservoir, humidifier, flowmeter,
                                 refill adaptor, content gauge, cannula
                                 or mask, and tubing.
E0439.........................  Stationary liquid oxygen system rental,
                                 includes container, contents,
                                 regulator, flowmeter, humidifier,
                                 nebulizer, cannula or mask, and tubing.
E0441.........................  Oxygen contents, gaseous (1 month
                                 supply).
E0442.........................  Oxygen contents, liquid (1 month
                                 supply).
E0443.........................  Portable Oxygen contents, gas (1 month
                                 supply).
E0444.........................  Portable oxygen contents, liquid (1
                                 month supply).
E0450.........................  Volume control ventilator without
                                 pressure support used with invasive
                                 interface.
E0457.........................  Chest shell.
E0459.........................  Chest wrap.
E0460.........................  Negative pressure ventilator portable or
                                 stationary.
E0461.........................  Volume control ventilator without
                                 pressure support node for a noninvasive
                                 interface.
E0462.........................  Rocking bed with or without side rail.
E0463.........................  Pressure support ventilator with volume
                                 control mode used for invasive
                                 surfaces.
E0464.........................  Pressure support vent with volume
                                 control mode used for noninvasive
                                 surfaces.
E0470.........................  Respiratory Assist Device, bi-level
                                 pressure capability, without backup
                                 rate used non-invasive interface.
E0471.........................  Respiratory Assist Device, bi-level
                                 pressure capability, with backup rate
                                 for a non-invasive interface.
E0472.........................  Respiratory Assist Device, bi-level
                                 pressure capability, with backup rate
                                 for invasive interface.
E0480.........................  Percussor electric/pneumatic home model.
E0482.........................  Cough stimulating device, alternating
                                 positive and negative airway pressure.
E0483.........................  High Frequency chest wall oscillation
                                 air pulse generator system.
E0484.........................  Oscillatory positive expiratory device,
                                 non-electric.
E0570.........................  Nebulizer with compressor.
E0575.........................  Nebulizer, ultrasonic, large volume.
E0580.........................  Nebulizer, durable, glass or
                                 autoclavable plastic, bottle type for
                                 use with regulator or flowmeter.
E0585.........................  Nebulizer with compressor & heater.
E0601.........................  Continuous airway pressure device.
E0607.........................  Home blood glucose monitor.
E0627.........................  Seat lift mechanism incorporated lift-
                                 chair.
E0628.........................  Separate Seat lift mechanism for patient
                                 owned furniture electric.
E0629.........................  Separate seat lift mechanism for patient
                                 owned furniture non-electric.
E0636.........................  Multi positional patient support system,
                                 with integrated lift, patient
                                 accessible controls.
E0650.........................  Pneumatic compressor non-segmental home
                                 model.
E0651.........................  Pneumatic compressor segmental home
                                 model without calibrated gradient
                                 pressure.
E0652.........................  Pneumatic compressor segmental home
                                 model with calibrated gradient
                                 pressure.
E0655.........................  Non-segmental pneumatic appliance for
                                 use with pneumatic compressor on half
                                 arm.
E0656.........................  Non-segmental pneumatic appliance for
                                 use with pneumatic compressor on trunk.
E0657.........................  Non-segmental pneumatic appliance for
                                 use with pneumatic compressor chest.
E0660.........................  Non-segmental pneumatic appliance for
                                 use with pneumatic compressor on full
                                 leg.
E0665.........................  Non-segmental pneumatic appliance for
                                 use with pneumatic compressor on full
                                 arm.
E0666.........................  Non-segmental pneumatic appliance for
                                 use with pneumatic compressor on half
                                 leg.
E0667.........................  Segmental pneumatic appliance for use
                                 with pneumatic compressor on full-leg.
E0668.........................  Segmental pneumatic appliance for use
                                 with pneumatic compressor on full arm.
E0669.........................  Segmental pneumatic appliance for use
                                 with pneumatic compressor on half leg.
E0671.........................  Segmental gradient pressure pneumatic
                                 appliance full leg.
E0672.........................  Segmental gradient pressure pneumatic
                                 appliance full arm.
E0673.........................  Segmental gradient pressure pneumatic
                                 appliance half leg.
E0675.........................  Pneumatic compression device, high
                                 pressure, rapid inflation/deflation
                                 cycle, for arterial insufficiency.

[[Page 69158]]

 
E0692.........................  Ultraviolet light therapy system panel
                                 treatment 4 foot panel.
E0693.........................  Ultraviolet light therapy system panel
                                 treatment 6 foot panel.
E0694.........................  Ultraviolet multidirectional light
                                 therapy system in 6 foot cabinet.
E0720.........................  Transcutaneous electrical nerve
                                 stimulation, two lead, local
                                 stimulation.
E0730.........................  Transcutaneous electrical nerve
                                 stimulation, four or more leads, for
                                 multiple nerve stimulation.
E0731.........................  Form fitting conductive garment for
                                 delivery of TENS or NMES.
E0740.........................  Incontinence treatment system, Pelvic
                                 floor stimulator, monitor, sensor, and/
                                 or trainer.
E0744.........................  Neuromuscular stimulator for scoliosis.
E0745.........................  Neuromuscular stimulator electric shock
                                 unit.
E0747.........................  Osteogenesis stimulator, electrical, non-
                                 invasive, other than spine application.
E0748.........................  Osteogenesis stimulator, electrical, non-
                                 invasive, spinal application.
E0749.........................  Osteogenesis stimulator, electrical,
                                 surgically implanted.
E0760.........................  Osteogenesis stimulator, low intensity
                                 ultrasound, non-invasive.
E0762.........................  Transcutaneous electrical joint
                                 stimulation system including all
                                 accessories.
E0764.........................  Functional neuromuscular stimulator,
                                 transcutaneous stimulations of muscles
                                 of ambulation with computer controls.
E0765.........................  FDA approved nerve stimulator for
                                 treatment of nausea & vomiting.
E0782.........................  Infusion pumps, implantable, Non-
                                 programmable.
E0783.........................  Infusion pump, implantable,
                                 Programmable.
E0784.........................  External ambulatory infusion pump.
E0786.........................  Implantable programmable infusion pump,
                                 replacement.
E0840.........................  Tract frame attach to headboard,
                                 cervical traction.
E0849.........................  Traction equipment cervical, free-
                                 standing stand/frame, pneumatic,
                                 applying traction force to other than
                                 mandible.
E0850.........................  Traction stand, free standing, cervical
                                 traction.
E0855.........................  Cervical traction equipment not
                                 requiring additional stand or frame.
E0856.........................  Cervical traction device, cervical
                                 collar with inflatable air bladder.
E0958.........................  Manual wheelchair accessory, one-arm
                                 drive attachment.
E0959.........................  Manual wheelchair accessory-adapter for
                                 Amputee.
E0960.........................  Manual wheelchair accessory, shoulder
                                 harness/strap.
E0961.........................  Manual wheelchair accessory wheel lock
                                 brake extension handle.
E0966.........................  Manual wheelchair accessory, headrest
                                 extension.
E0967.........................  Manual wheelchair accessory, hand rim
                                 with projections.
E0968.........................  Commode seat, wheelchair.
E0969.........................  Narrowing device wheelchair.
E0971.........................  Manual wheelchair accessory anti-tipping
                                 device.
E0973.........................  Manual wheelchair accessory, adjustable
                                 height, detachable armrest.
E0974.........................  Manual wheelchair accessory anti-
                                 rollback device.
E0978.........................  Manual wheelchair accessory positioning
                                 belt/safety belt/pelvic strap.
E0980.........................  Manual wheelchair accessory safety vest.
E0981.........................  Manual wheelchair accessory Seat
                                 upholstery, replacement only.
E0982.........................  Manual wheelchair accessory, back
                                 upholstery, replacement only.
E0983.........................  Manual wheelchair accessory power add on
                                 to convert manual wheelchair to
                                 motorized wheelchair, joystick control.
E0984.........................  Manual wheelchair accessory power add on
                                 to convert manual wheelchair to
                                 motorized wheelchair, Tiller control.
E0985.........................  Wheelchair accessory, seat lift
                                 mechanism.
E0986.........................  Manual wheelchair accessory, push
                                 activated power assist.
E0990.........................  Manual wheelchair accessory, elevating
                                 leg rest.
E0992.........................  Manual wheelchair accessory, elevating
                                 leg rest solid seat insert.
E0994.........................  Arm rest.
E1014.........................  Reclining back, addition to pediatric
                                 size wheelchair.
E1015.........................  Shock absorber for manual wheelchair.
E1020.........................  Residual limb support system for
                                 wheelchair.
E1028.........................  Wheelchair accessory, manual swing away,
                                 retractable or removable mounting
                                 hardware for joystick, other control
                                 interface or positioning accessory.
E1029.........................  Wheelchair accessory, ventilator tray.
E1030.........................  Wheelchair accessory, ventilator tray,
                                 gimbaled.
E1031.........................  Rollabout chair, any and all types with
                                 castors 5'' or greater.
E1035.........................  Multi-positional patient transfer system
                                 with integrated seat operated by care
                                 giver.
E1036.........................  Patient transfer system.
E1037.........................  Transport chair, pediatric size.
E1038.........................  Transport chair, adult size up to 300lb.
E1039.........................  Transport chair, adult size heavy duty
                                 >300lb.
E1161.........................  Manual Adult size wheelchair includes
                                 tilt in space.
E1227.........................  Special height arm for wheelchair.
E1228.........................  Special back height for wheelchair.
E1232.........................  Wheelchair, pediatric size, tilt-in-
                                 space, folding, adjustable with seating
                                 system.
E1233.........................  Wheelchair, pediatric size, tilt-in-
                                 space, folding, adjustable without
                                 seating system.
E1234.........................  Wheelchair, pediatric size, tilt-in-
                                 space, folding, adjustable without
                                 seating system.
E1235.........................  Wheelchair, pediatric size, rigid,
                                 adjustable, with seating system.
E1236.........................  Wheelchair, pediatric size, folding,
                                 adjustable, with seating system.
E1237.........................  Wheelchair, pediatric size, rigid,
                                 adjustable, without seating system.
E1238.........................  Wheelchair, pediatric size, folding,
                                 adjustable, without seating system.
E1296.........................  Special sized wheelchair seat height.
E1297.........................  Special sized wheelchair seat depth by
                                 upholstery.

[[Page 69159]]

 
E1298.........................  Special sized wheelchair seat depth and/
                                 or width by construction.
E1310.........................  Whirlpool non-portable.
E2502.........................  Speech Generating Devices prerecord
                                 messages between 8 and 20 Minutes.
E2506.........................  Speech Generating Devices prerecord
                                 messages over 40 minutes.
E2508.........................  Speech Generating Devices message
                                 through spelling, manual type.
E2510.........................  Speech Generating Devices synthesized
                                 with multiple message methods.
E2227.........................  Rigid pediatric wheelchair adjustable.
K0001.........................  Standard wheelchair.
K0002.........................  Standard hemi (low seat) wheelchair.
K0003.........................  Lightweight wheelchair.
K0004.........................  High strength ltwt wheelchair.
K0005.........................  Ultra Lightweight wheelchair.
K0006.........................  Heavy duty wheelchair.
K0007.........................  Extra heavy duty wheelchair.
K0009.........................  Other manual wheelchair/base.
K0606.........................  AED garment with electronic analysis.
K0730.........................  Controlled dose inhalation drug delivery
                                 system.
------------------------------------------------------------------------

c. Physician Payment
    We understand that there is a burden associated with the 
requirement placed on the physician to document that a face-to-face 
encounter has occurred between a PA, a NP or a CNS, and the 
beneficiary. As discussed in section III.M.3 of this final rule with 
comment period, we are establishing work and malpractice RVUs for HCPCS 
codes for G0454 by crosswalking to the work and malpractice RVUs for 
CPT code 99211 ((Level 1 office or other outpatient visit, established 
patient). With regard to practice expense RVUs, we are not including 
any direct practice expense inputs for clinical labor, disposable 
medical supplies, or equipment in the direct PE input database for this 
code; practice expense RVUs will reflect resources for overhead costs 
only. The work, malpractice, and practice expense RVUs for HCPCS code 
G0454 are reflected in Addendum B of this CY 2013 PFS final rule with 
comment period www.cms.gov/physicianfeesched/. A complete list of the 
interim final times assigned to HCPCS code G0454 is available on the 
CMS Web site at www.cms.gov/physicianfeesched/.
    This code is to compensate a physician who documented that a PA, a 
NP, or a CNS practitioner has performed a face-to-face encounter for 
the list of Specified Covered Items. This G-code becomes effective when 
this provision of the regulation becomes effective. We believe that the 
existing Evaluation and Management (E&M) codes are sufficient for 
practitioners furnishing face-to-face encounters. This new G-code will 
be specifically designed and mapped only for a physician who completes 
the documentation of the face-to-face encounter furnished by a PA, NP, 
or CNS. Only a physician who does not bill an associated E&M code for 
the beneficiary in question would be eligible for this G-code. If 
multiple written orders for covered items of DME originate from one 
visit, the physician can receive the G-code payment only once for 
documenting that the face-to-face encounter has occurred. The G-code 
would be mapped so that only eligible DME items would be covered. Upon 
request, we will need to see documentation of the face-to-face 
encounter in order to verify the appropriateness of the G-code payment.
    The following is a summary of the comments we received regarding 
the physician payment proposal.
    Comments: One commenter recommended against adoption of the new G-
code, seeing little or no difference in the proposed documentation 
requirement for face-to-face encounters conducted by a physician 
practice's nonphysicians than other documentation requirements already 
imposed upon physicians. A few commenters stated that if CMS believes 
that physicians should be reimbursed for documenting face-to-face 
patient encounters conducted by nonphysicians in their employ, then the 
agency should more systematically determine all instances in which CMS-
imposed administrative burdens on physicians warrant Medicare 
reimbursement and seek Congressional (statutory) authority for such 
reimbursement policies.
    Response: In this final rule, we were only addressing additional 
work involved with documenting face-to-face encounters furnished by a 
PA, NP, or CNS for certain DME items. Other areas of CMS-imposed 
administrative burden on physicians are beyond the scope of our 
regulation. The work, malpractice, and practice expense RVUs for this 
code (HCPCS code G0454) are reflected in Addendum B of this CY 2013 PFS 
final rule with comment period at www.cms.gov/physicianfeesched/.
    Comment: Several commenters supported the creation of a G-code, 
with a proposed payment of $15 to reimburse physicians for the work 
involved in documenting face-to-face encounters with Physician 
Assistants or Nurse Practitioners. Commenters believed that it is 
important to properly reimburse physicians for time and effort. Some 
commenters request more information on how the dollar figure was 
arrived at and whether it is truly budget neutral.
    Response: The work, malpractice, and practice expense RVUs for this 
code (HCPCS code G0454) are reflected in Addendum B of this CY 2013 PFS 
final rule with comment period at www.cms.gov/physicianfeesched/. This 
code is subject to budget neutrality under the physician fee schedule 
and has been accommodated for in the final rule. This code is cross 
walked to 99211.
    Comment: Many commenters raised concerns about the statement that 
according to CMS, ``only a physician who does not bill an E & M code 
for the beneficiary in question would be eligible for this G-code.'' 
Commenters believed appropriate policy should allow for the billing of 
an E & M service that is clearly unrelated to the patient's need for, 
and documentation of, DME authorization.
    Response: We will clarify in the final rule that this code is only 
for use when a physician documents the face-to-face encounter performed 
by a PA, NP, or CNS for certain DME items.
    Comment: Several commenters believed that there should be an 
additional payment for the suppliers in addition to the additional 
payment for

[[Page 69160]]

the practitioners conducting the face-to-face encounter.
    Response: The only area available for additional payment is the 
physician documenting that a face-to-face encounter occurred by a PA, 
NP, or CNS. We believe that the other documentation of the face-to-face 
encounter is within the normal scope of practice. The supplier receives 
the payment for the item and this face-to-face encounter is a condition 
of payment.
    Comment: This proposal fails to acknowledge the additional burden 
imposed on nurse practitioners and other providers who are required to 
coordinate with physicians to ensure the additional documentation of 
patient encounters in which the physician was not involved. If this 
unnecessary and burdensome documentation requirement cannot be 
eliminated, then nurse practitioners and other nonphysician providers 
who are required to attempt to ensure that it is complied with should 
also be able to bill for the proposed additional payment.
    Response: We must follow the statute which states that a physician 
must document that the face-to-face encounter occurred. In this 
instance, we are recognizing the additional physician work that may be 
involved through the addition of a new G-code to compensate providers 
for this documentation requirement. We believe any necessary 
coordination with a physician following a face-to-face encounter with a 
beneficiary is covered appropriately under the corresponding E/M code 
that would be billed by the PA, NP, or CNS for documenting the 
occurrence.

D. Elimination of the Requirement for Termination of Non-Random 
Prepayment Complex Medical Review (Sec.  421.500 Through Sec.  421.505)

    Medical review is the process performed by Medicare contractors to 
ensure that billed items or services are covered and are reasonable and 
necessary as specified under section 1862(a)(1)(A) of the Act. We enter 
into contractual agreements with contractors to perform medical review 
functions. On December 8, 2003, the Congress enacted the MMA. Section 
934 of the MMA amended section 1874A of the Act by adding a new 
subsection (h)--regarding random prepayment reviews and non-random 
prepayment complex medical reviews and requiring us to establish 
termination dates for non-random prepayment complex medical reviews. 
Although section 934 of the MMA set forth requirements for random 
prepayment review, our contractors do not perform random prepayment 
review. However, our contractors do perform non-random prepayment 
complex medical review.
    On September 26, 2008, we published a final rule in the Federal 
Register (73 FR 55753) entitled, ``Medicare Program; Termination of 
Non-Random Prepayment Complex Medical Review'' that specified the 
criteria contractors would use for the termination of providers and 
suppliers from non-random prepayment complex medical review as required 
under the MMA. The final rule required contractors to terminate the 
non-random prepayment complex medical review of a provider or supplier 
no later than 1 year following the initiation of the complex medical 
review or when calculation of the error rate indicates the provider or 
supplier has reduced its initial error rate by 70 percent or more. (For 
more detailed information, see the September 26, 2008 final rule (73 FR 
55753)).
    On March 23, 2010, the Congress enacted the Patient Protection and 
Affordable Care Act (Pub. L. 111-148) and the Health Care and Education 
Reconciliation Act of 2010 (HCERA) (Pub. L. 111-152) (together known as 
the Affordable Care Act). Section 1302 of the HCERA, repealed section 
1874A(h) of the Act.
    Section 1302 of the HCERA repealed section 1874A(h) of the Act, and 
therefore, removed the statutory basis for our regulation. Thus, we 
proposed to remove the regulatory provisions in 42 CFR part 421, 
subpart F, that require contractors to terminate a provider or supplier 
from non-random prepayment complex medical review no later than 1 year 
following the initiation of the medical review or when the provider or 
supplier has reduced its initial error rate by 70 percent or more. As a 
result of this proposal, contractors would not be required to terminate 
non-random prepayment medical review by a prescribed time but would 
instead terminate each medical review when the provider or supplier has 
met all Medicare billing requirements as evidenced by an acceptable 
error rate as determined by the contractor.
    The following is a summary of the public comments received and our 
responses:
    Comment: Commenters stated that the lack of statutory authority is 
not a valid reason for withdrawing the regulation establishing 
requirements for termination of non-random prepayment complex review. 
CMS continues to possess the general regulatory authority to maintain 
the regulation.
    Response: We believe that the repeal of section 1874A(h) of the Act 
reflects Congressional intent to require CMS to repeal the regulation 
CMS issued under that authority. Regardless of whether or not CMS could 
promulgate a different regulation establishing termination dates for 
non-random prepayment review based on it general rulemaking authority, 
we nonetheless believe that the existing regulation must be removed. We 
also believe that sections 1815(a), 1833(e), 1862(a)(1)(A), and 1893 of 
the Act provide the statutory authority to conduct non-random 
prepayment complex medical review and we do not need to have another 
regulation in place for oversight of this work. We strive to balance 
our need to protect the integrity of the Medicare Trust Fund and our 
need to reduce improper payments against our interest in limiting 
provider and supplier burden.
    Comment: Some commenters expressed concerns about the Agency's 
proposal to remove all protections for practitioners undergoing non-
random prepayment review and the discretion of each contractor to 
determine an acceptable error rate for eliminating non-random 
prepayment review. Other commenters expressed concern that Medicare 
contractors will have too much power and authority. They suggested that 
contractors do not or cannot articulate the thresholds that must be met 
to be taken off prepayment review. They recommended that CMS have a 
uniform, rational, and predictable process that permits providers/
suppliers to be removed from non-random prepayment complex medical 
review.
    Response: We provide guidance to our contractors on the medical 
review process. The guidance is provided in Chapter 3 of the Program 
Integrity Manual (Pub. 100-08). This guidance requires contractors to 
minimize potential future losses to the Medicare Trust Fund through 
targeted claims review and through progressive corrective actions that 
are tailored to the types of errors contractors identify related to 
provider and supplier specific behavior. This requirement reflects CMS' 
goal to limit the burden on providers and suppliers while aiming to 
achieve efficiencies in the Medicare Program.
    Comment: Commenters stated that the prepayment review process is 
burdensome and that reviews are often inconsistent and result in 
costly, unorganized compliance efforts for suppliers.
    Response: We believe that sections 1815(a), 1833(e) and 
1862(A)(1)(a) of the Act provide authority for the collection of 
documentation as may be necessary

[[Page 69161]]

to determine the amounts due to a provider or supplier and to determine 
medical necessity of the services rendered. We strive to balance our 
need to protect the integrity of the Medicare Trust Fund and our need 
to reduce improper payments against our interest in limiting provider 
burden.
    Comment: Commenters suggested that CMS consider broader contractor 
reforms to assess contractors' activities and evaluate the 
appropriateness of their use of prepayment review. Commenters also 
suggested that CMS publish guidelines on contractor requirements, 
public reports of contractor initiatives, have a public complaint and 
resolution process (or an independent entity to review and appeal by 
the provider or supplier for lifting the non-random prepayment complex 
medical review), and increase methods of communications with suppliers 
and beneficiaries.
    Response: CMS has many activities underway that can be found at 
www.cms.hhs.gov Web site to monitor contractor oversight and compliance 
with national guidelines. We welcome all suggestions on how to improve 
the Medicare prepayment complex medical review process.
    Comment: Commenters are concerned that the entire prepayment 
medical review process will now be subject to agency guidelines set 
forth in manuals rather than formal regulation.
    Response: Section 1893 of the Act provides that contractors will 
perform medical review of claims to promote the integrity of the 
Medicare program. We do not believe another regulation is necessary and 
that the guidance to contractors on the medical review process is set 
forth in statute and manuals is adequate. The guidance is provided 
primarily in Chapter 1 and Chapter 3 of the Program Integrity manual 
(Pub. 100-08).
    Comment: Commenters encouraged CMS to employ greater physician 
education and outreach to solve the issue of improper billing before 
placing physicians under prepayment review.
    Response: We provide physician education and outreach through 
various avenues including educational articles and Open Door Forums. 
Contractors are also instructed to provide education to physicians that 
are placed on prepayment review and more details can be found on the 
contractor's individual Web sites.
    After reviewing the public comments, we are finalizing these 
provisions as proposed. We believe we need to do so in order to balance 
protection of the integrity of the Medicare Trust Fund and reduction of 
improper payments against limiting provider burden.

E. Ambulance Coverage--Physician Certification Statement

    We proposed to revise Sec.  410.40(d)(2) by incorporating nearly 
the same provision found at Sec.  410.40(d)(3)(v) to clarify that a 
physician certification statement (PCS) does not, in and of itself, 
demonstrate that a non-emergency, scheduled, repetitive ambulance 
service is medically necessary for Medicare coverage. The Medicare 
ambulance benefit at section 1861(s)(7) of the Act allows for coverage 
of an ``ambulance service where the use of other methods of 
transportation is contraindicated by the individual's condition, but * 
* * only to the extent provided in regulations.'' In other words, the 
definition of the benefit itself embodies the clinical medical 
necessity requirement that other forms of transportation must be 
contraindicated by a beneficiary's condition. Section 410.40(d) 
interprets the medical necessity requirement. Notably, even aside from 
the requirements of section 1861(s)(7), section 1862(a)(1)(A) of the 
Act dictates that any service that is not medically necessary under the 
Act and regulations is not a covered benefit.
    Despite these statutory provisions and the language of the present 
regulation at Sec.  410.40(d)(2) that we believe already requires both 
medical necessity and a PCS, some courts have recently concluded that 
Sec.  410.40(d)(2) establishes that a sufficiently detailed and timely 
order from a beneficiary's physician, to the exclusion of any other 
medical necessity requirements, conclusively demonstrates medical 
necessity with respect to nonemergency, scheduled, repetitive ambulance 
services.
    Absent explicit statutorily-based exceptions, we have consistently 
maintained that the Secretary is the final arbiter of whether a service 
is reasonable and necessary and qualifies for Medicare coverage. For 
example, in HCFA Ruling 93-1, we said ``[i]t is HCFA's ruling that no 
presumptive weight should be assigned to the treating physician's 
medical opinion in determining the medical necessity of inpatient 
hospital or SNF services under section 1862(a)(1) of the Act. A 
physician's opinion will be evaluated in the context of the evidence in 
the complete administrative record. Even though a physician's 
certification is required for payment, coverage decisions are not made 
based solely on this certification; they are made based on objective 
medical information about the patient's condition and the services 
received. This information is available from the claims form and, when 
necessary, the medical record which includes the physician's 
certification.''
    Medical necessity is not just an integral requirement of Medicare's 
ambulance benefit in particular, but, as noted above, section 
1862(a)(1)(A) of the Act dictates that services must be reasonable and 
necessary to qualify for any Medicare coverage. Numerous U.S. Circuit 
Courts of Appeal have held that PCSs or certificates of medical 
necessity do not, in and of themselves, conclusively demonstrate 
medical necessity. The same applies in the context of non-emergency, 
scheduled, repetitive ambulance services--the PCS is not, in and of 
itself, the sole determinant of medical necessity, and, as we discuss 
below, we believe the existing regulation at Sec.  410.40(d)(2) already 
demonstrates that. To erase any doubt, however, we proposed a revision 
to Sec.  410.40(d)(2) to explicitly clarify this principle.
    Since being finalized in the February 27, 2002 Federal Register (67 
FR 9100, 9132), Sec.  410.40(d)(2) has stated that ``Medicare covers 
medically necessary non-emergency, scheduled, repetitive ambulance 
services if the ambulance provider or supplier, before furnishing the 
service to the beneficiary, obtains a written order from the 
beneficiary's attending physician certifying that the medical necessity 
requirements of paragraph (d)(1) of this section are met.'' Although a 
physician certifies with respect to medical necessity, the Secretary is 
the final arbiter of whether a service is medically necessary for 
Medicare coverage. As demonstrated by the inclusion of the phrase 
``medically necessary,'' and by various other clarifying points, we 
made clear that a PCS, while necessary, does not on its own 
conclusively demonstrate the medical necessity of non-emergency, 
scheduled, repetitive ambulance services.
    The preamble to the February 27, 2002 final rule (Medicare Program; 
Fee Schedule for Payment of Ambulance Services and Revisions to the 
Physician Certification Requirements for Coverage of Nonemergency 
Ambulance Services (67 FR 9100)) and the 1999 final rule with comment 
(FRC) (Medicare Program; Coverage of Ambulance Services and Vehicle and 
Staff Requirements (64 FR 3637)) support this interpretation.
    For example, in describing comments regarding medical necessity and 
physician certification in the 1999 FRC, we said: ``[t]wo ambulance 
suppliers commented that physicians are unaware of the coverage 
requirements for

[[Page 69162]]

ambulance services and that their decisions to request ambulance 
services may be based on `family preference or the inability to safely 
transport the beneficiary by other means rather than on the medical 
necessity requirement imposed by Medicare.' '' We responded that 
section 1861(s)(7) of the Act allows coverage only under certain 
limited circumstances, and suggested that ``[t]o facilitate awareness 
of the Medicare rules as they relate to the ambulance service benefit, 
ambulance suppliers may need to educate the physician (or the 
physician's staff members) when making arrangements for the ambulance 
transportation of a beneficiary.'' We continued that ``[s]uppliers may 
wish to furnish an explanation of applicable medical necessity 
requirements, as well as requirements for physician certification, and 
to explain that the certification statement should indicate that the 
ambulance services being requested by the attending physician are 
medically necessary.'' (76 FR 3637, 3641) Since we recognize the 
significant program vulnerability--that the physicians writing PCSs 
might not be fully cognizant of the Medicare ambulance benefit's 
medical necessity requirements (and encourage suppliers to help remedy 
that by educating physicians), it would not be reasonable to vest 
exclusively in the PCS the authority to demonstrate an ambulance 
transport's medical necessity. We made a similar point in response to a 
separate comment: ``It is always the responsibility of the ambulance 
supplier to furnish complete and accurate documentation to demonstrate 
that the ambulance service being furnished meets the medical necessity 
criteria.'' (76 FR 3637, 3639).
    In the section of the February 27, 2002 final rule preamble 
describing the PCS requirements, we said: ``[i]n all cases, the 
appropriate documentation must be kept on file and, upon request, 
presented to the carrier or intermediary. It is important to note that 
the presence of the signed physician certification statement does not 
necessarily demonstrate that the transport was medically necessary. The 
ambulance supplier must meet all coverage criteria for payment to be 
made.'' (67 FR 9100, 9111) Although we incorporated that passage into 
the final rule only at Sec.  410.40(d)(3)(v), we intended, and we 
believe our intent was clear from the preamble narrative, that the 
principle apply equally to all nonemergency ambulance transports.
    The OIG report entitled ``Medicare Payments for Ambulance 
Transports'' (OEI-05-02-00590) (January 2006) also supports our 
position. Based on its analysis of a sample of calendar year 2002 
claims, the OIG reported that ``27 percent of ambulance transports to 
or from dialysis facilities did not meet Medicare's coverage 
criteria.'' The OIG added ``the ongoing and repetitive nature of 
dialysis treatment makes transports to and from such treatment 
vulnerable to abuse. Although the condition of some patients warrants 
repetitive, scheduled ambulance transports for dialysis treatment, many 
dialysis transports do not meet coverage criteria.'' The OIG 
recommended that we instruct our contractors to implement prepayment 
edits with respect to dialysis transports and have them request wide-
ranging documents when conducting postpayment medical review. The fact 
that we agreed with the OIG's recommendations demonstrated our belief 
that the PCS was not the sole determinant of medical necessity. 
Likewise, the fact that the OIG mentioned our ambulance coverage 
regulations, including the PCS requirement, but did not recommend 
altering or clarifying the regulations with respect to medical 
necessity demonstrated that we were of like mind; that, while a 
physician certifies with respect to medical necessity, the Secretary is 
the final arbiter of whether a service is medically necessary.
    Accordingly, we proposed to revise Sec.  410.40(d)(2) to add nearly 
the same provision presently found at Sec.  410.40(d)(3)(v), except for 
the reference to a ``signed return receipt'' that does not pertain to 
non-emergency, scheduled, repetitive ambulance services. We proposed to 
accomplish this by redesignating the current language as Sec.  
410.40(d)(2)(i), and adding the clarifying language to a new Sec.  
410.40(d)(2)(ii). The proposed Sec.  410.40(d)(2)(ii) clarifies that a 
signed physician certification statement does not, in and of itself, 
demonstrate that an ambulance transport was reasonable and necessary. 
Rather, for all ambulance services, providers, and suppliers must 
retain on file all appropriate documentation and present such 
documentation upon request to a Medicare contractor. A CMS contractor 
may use such documentation to assess, among other things, whether the 
service satisfied Medicare's medical necessity, eligibility, coverage, 
benefit category, or any other criteria necessary for Medicare payment 
to be made. For example, the patient's condition must be such that 
other means of transportation would be contraindicated, and the 
services provided must be reasonable and necessary for the diagnosis or 
treatment of illness or injury.
    We also proposed to fix the typographical error ``fro,'' which 
should be ``from'', in the existing Sec.  410.40(c)(3)(ii).
    The following is a summary of the comments received on the 
physician certification statement proposal and our responses:
    Comment: Several commenters stated that it appears that CMS 
believes that the provider, not the physician signing the PCS, is 
responsible for the content of the PCS and that CMS does not intend to 
hold the physician signing the PCS responsible for the content of the 
PCS. Commenters also questioned whether the proposed rule would mean 
that the ambulance provider/supplier cannot rely on a properly 
physician-signed PCS as a tool in the process of proving medical 
necessity. The commenters disagreed with CMS' statement that `no 
presumptive weight' should be assigned to the treating physician's 
medical opinion in determining medical necessity, recommending instead 
that CMS adopt a presumption that a repetitive transport is medically 
necessary when the ambulance provider/supplier has a valid physician-
signed PCS. The commenters stated that CMS is not only requiring 
ambulance providers/suppliers to police themselves, but physicians as 
well. As a result, it is the ambulance provider/supplier who must bear 
the sole risk of not being reimbursed for a claim that CMS deems does 
not meet medical necessity.
    Response: Ambulance providers are not responsible for the content 
of a properly prepared PCS, but, to the extent ambulance providers wish 
to be reimbursed by Medicare, they are responsible for ensuring they 
provide ambulance transports to eligible beneficiaries that meet 
Medicare's ambulance coverage and medical necessity criteria. We 
believe the PCS is one safeguard to help ensure that the medical 
necessity criteria of Medicare's ambulance transport benefit is met, 
but it is not the only safeguard. Indeed, especially since a PCS may be 
written as much as 2 months before the service is provided, we must be 
mindful of other safeguards including the totality of the medical 
record and the physical presentation of the beneficiary when the 
service is rendered. Furthermore, the ambulance provider/supplier is 
not obligated to provide a service in the absence of a properly signed 
PCS. There is no expectation by CMS that ambulance providers/suppliers 
police physician practice.

[[Page 69163]]

    Comment: Several commenters stated that while the proposed rule 
focuses on revisions to the PCS regulations in the case of repetitive 
transports, they strongly urged CMS to modify the requirements for non-
repetitive, non-emergency transports and to address the burden of the 
PCS in that context by eliminating it. Current PCS requirements, they 
asserted, impose unreasonable burdens on providers/suppliers that far 
outweigh any benefit of the PCS to the Medicare Program.
    Response: We disagree because, as we note repeatedly in these 
responses, we believe the PCS is a valuable safeguard and an important 
tool that helps ensure that we pay only for claims that meet all 
Medicare coverage and payment criteria, and will not be making any 
changes in this final rule to the requirements for non-repetitive, non-
emergency transports.
    Comment: Several commenters stated that CMS gives ambulance 
providers/suppliers no assurance that Medicare will cover the service, 
even if they have an attending physician's order for the ambulance 
service. They are concerned that ambulance providers/suppliers have to 
decide whether they are going to disregard an order from a 
beneficiary's attending physician simply because the patient's insurer 
might not give any weight to that order.
    Response: By statute and regulation, Medicare may only pay for 
medically necessary ambulance transports and as with any service, we 
have the discretion to review a claim to ensure it satisfies all 
Medicare coverage and payment criteria. To satisfy coverage criteria, 
medical necessity must be supported by adequate medical record 
documentation.
    Comment: Several commenters stated that the DOJ strategy for 
pursuing ambulance providers/suppliers should not have any bearing on 
CMS policy for coverage of claims, that the requirement for ambulance 
providers/suppliers to obtain a PCS should be based on the need for 
medical judgment on the level of care required by the patient, and that 
ambulance providers/suppliers should be able to rely on the PCS for 
such. These commenters noted that if the PCS requirement is for some 
other non-medical purpose such as DOJ policy, or is simply a CMS 
requirement for an exercise in futility, the PCS requirement should be 
struck in its entirety.
    Response: As noted in the responses above and by virtue of its 
statute and regulations, Medicare only pays for medically necessary 
ambulance transports. The PCS is an important tool that we use as a 
safeguard to help ensure medical necessity, but as we mention above, it 
is not the only tool, nor, in and of itself, is it a conclusive 
determinant of medical necessity.
    Comment: Several commenters stated that CMS should also exempt from 
PCS requirements the two following types of transports: Ground 
intercepts with air ambulance; and hospital-to-hospital transports. 
These commenters noted that these modifications to the PCS requirement 
would apply for non-emergency, non-repetitive transports, thus limiting 
its application.
    Response: Not only do we disagree since we believe the PCS is a 
valuable safeguard, but we note that we did not propose to relax or 
exempt PCS requirements in any situation.
    Comment: Several commenters stated that the proposed rule ignores 
the fact that when ambulance providers/suppliers are contacted to 
transport a patient for a non-emergency transport, they are often given 
little information about the patient's condition. Ambulance providers/
suppliers must rely on information from the attending physician who has 
intimate knowledge about the patient's ambulatory state.
    Response: While we appreciate that obtaining information may 
sometimes be challenging, this does not alter our responsibility to 
only pay Medicare claims that satisfy all Medicare coverage and payment 
criteria. As we noted in the preamble to the proposed rule and in an 
earlier response, it may be incumbent upon ambulance providers/
suppliers to help educate physicians or their staff members regarding 
the rules pertaining to Medicare's ambulance service benefit and to 
request additional information at the time ambulance transport is 
requested to gauge whether the transport meets Medicare's coverage and 
payment criteria.
    Comment: Several commenters believed that a PCS from an attending 
physician obtained before the ambulance service should carry the same 
weight as physician orders that prescribe other Medicare-covered 
services. When a physician signs the PCS, these commenters noted, he or 
she is providing the same support that auditors rely upon to determine 
medical necessity.
    Response: Although we do not disagree that a physician PCS carries 
the same weight as physician orders that prescribe other Medicare-
covered services, we note that we similarly audit physician orders for 
medical necessity based on supporting medical record documentation as 
those orders, like the PCS in the ambulance context, in and of 
themselves are not determinative.
    Comment: Several commenters stated that since CMS already requires 
ambulance providers/suppliers to maintain documentation that 
demonstrates medical necessity for all ambulance transports, they 
believe that CMS should likewise rely on documentation from ambulance 
providers/suppliers for the types of non-emergency transports for which 
a PCS is currently required, and therefore, requested that CMS 
eliminate the PCS requirement for all non-emergency ambulance 
transports and all scheduled, repetitive ambulance transports 
completely.
    Response: We do rely on the medical documentation for ambulance 
transports, but, as described both in the preamble and in other 
responses, believe the PCS is an additional important safeguard that 
helps ensure medical necessity.
    Comment: Several commenters expressed that obtaining a PCS remains 
challenging for ambulance providers/suppliers because, among other 
reasons, physicians may refuse to sign a PCS or because facilities and 
physicians sometimes confuse the PCS requirements for repetitive and 
non-repetitive transport patients, requiring the ambulance provider/
supplier to spend substantial time justifying why they are seeking the 
PCS and what is required.
    Response: While we understand the challenges providers/suppliers 
may face in obtaining a PCS, as noted above our primary responsibility 
is ensuring we pay only properly payable Medicare claims and we believe 
that the PCS is a necessary tool in helping to determine medical 
necessity.
    Comment: Several commenters believed that CMS does not intend to 
hold physicians accountable for their signed certifications about 
medical necessity. Despite the fact that a signed PCS must be obtained 
from a physician, these commenters noted that ambulance providers/
suppliers bear the sole burden of determining whether Medicare's 
medical necessity criteria have been met.
    Response: The fact that ambulance providers/suppliers, just like 
other providers/suppliers, may face some risk of non-payment when 
submitting claims for Medicare payment cannot alter our primary 
responsibility to only pay claims that meet all Medicare coverage and 
payment criteria. Although, as we have explained, we cannot rely 
exclusively upon the PCS as a determinant of medical necessity, the PCS 
is an important tool to help establish medical necessity for the 
ambulance transport of a Medicare beneficiary.

[[Page 69164]]

    Comment: Several commenters recommended that CMS allow additional 
facility personnel, such as LPNs, social workers, or case managers to 
be authorized signatories for the PCS requirement.
    Response: We are limiting the changes in this final rule to those 
outlined in the proposed rule. We did not propose to revise our policy 
regarding who may sign a PCS. As a result, we take no position at this 
time on whether LPNs or other additional facility personnel should be 
authorized signatories.
    After reviewing the public comments, we are finalizing the 
revisions to Sec.  410.40(c)(3)(ii) and Sec.  410.40(d)(2) as proposed.

F. Physician Compare Web Site

1. Background and Statutory Authority
    Section 10331(a)(1) of the Affordable Care Act requires that, by no 
later than January 1, 2011, we develop a Physician Compare Internet Web 
site with information on physicians enrolled in the Medicare program 
under section 1866(j) of the Act, as well as information on other 
eligible professionals who participate in the Physician Quality 
Reporting System (PQRS) under section 1848 of the Act.
    CMS launched the first phase of Physician Compare (http://www.medicare.gov/find-a-doctor/provider-search.aspx) on December 30, 
2010. The initial phase included the posting of the names of eligible 
professionals that satisfactorily submitted quality data for the 2009 
PQRS, consistent with section 1848(m)(5)(G) of the Act. Since the 
initial launch of the Web site, we have continued to build and improve 
Physician Compare. Currently users can search by selecting a location 
and specialty for physicians or other healthcare professionals. Search 
results provide basic information about approved Medicare providers, 
such as primary and secondary specialties, practice locations, group 
practice affiliations, hospital affiliations, Medicare Assignment, 
education, languages spoken, and gender. As required by section 
1848(m)(5)(G) of the Act, we have added the names of those eligible 
professionals who are successful electronic prescribers under the 
Medicare Electronic Prescribing (eRx) Incentive Program. As such, 
physician and other healthcare professional profile pages indicate if 
professionals satisfactorily participated in the PQRS and/or are 
successful electronic prescribers under the eRx Incentive Program based 
on the most recent data available for these two quality initiatives.
2. Public Reporting of Physician Performance
    Section 10331(a)(2) of the Affordable Care Act also requires that, 
no later than January 1, 2013, and for reporting periods that begin no 
earlier than January 1, 2012, we implement a plan for making publicly 
available through Physician Compare, information on physician 
performance that provides comparable quality and patient experience 
measures. This plan is outlined below.
    Comment: We received several comments requesting that CMS clarify 
its plans with respect to making PQRS data publicly available through 
Physician Compare no later than January 1, 2013.
    Response: We appreciate the commenters' interest in public 
reporting on Physician Compare. Please note that CMS has met the 
Affordable Care Act requirements to implement a plan prior to January 
1, 2013 for making physician performance information available on 
Physician Compare, and intends to continue to outline elements of that 
plan through rulemaking.
    To the extent that scientifically sound measures are developed and 
are available, we are required to include, to the extent practicable, 
the following types of measures for public reporting:
     Measures collected under the PQRS.
     An assessment of patient health outcomes and functional 
status of patients.
     An assessment of the continuity and coordination of care 
and care transitions, including episodes of care and risk-adjusted 
resource use.
     An assessment of efficiency.
     An assessment of patient experience and patient, 
caregiver, and family engagement.
     An assessment of the safety, effectiveness, and timeliness 
of care.
     Other information as determined appropriate by the 
Secretary.
    As required under section 10331(b) of the Affordable Care Act, in 
developing and implementing the plan, we must include, to the extent 
practicable, the following:
     Processes to ensure that data made public are 
statistically valid, reliable, and accurate, including risk adjustment 
mechanisms used by the Secretary.
     Processes for physicians and eligible professionals whose 
information is being publicly reported to have a reasonable 
opportunity, as determined by the Secretary, to review their results 
before posting to Physician Compare.
     Processes to ensure the data published on Physician 
Compare provides a robust and accurate portrayal of a physician's 
performance.
     Data that reflects the care provided to all patients seen 
by physicians, under both the Medicare program and, to the extent 
applicable, other payers, to the extent such information would provide 
a more accurate portrayal of physician performance.
     Processes to ensure appropriate attribution of care when 
multiple physicians and other providers are involved in the care of the 
patient.
     Processes to ensure timely statistical performance 
feedback is provided to physicians concerning the data published on 
Physician Compare.
     Implementation of computer and data infrastructure and 
systems used to support valid, reliable, and accurate reporting 
activities.
    Section 10331(d) of the Affordable Care Act requires us to consider 
input from multi-stakeholder groups in selecting quality measures for 
Physician Compare, which we seek to accomplish through rulemaking and 
focus groups. In developing the plan for making information on 
physician performance publicly available through Physician Compare, 
section 10331(e) of the Affordable Care Act requires the Secretary, as 
the Secretary deems appropriate, to consider the plan to transition to 
value-based purchasing for physicians and other practitioners that was 
developed under section 131(d) of the Medicare Improvements for 
Patients and Providers Act of 2008.
    We are required, under section 10331(f) of the Affordable Care Act, 
to submit a report to the Congress by January 1, 2015, on Physician 
Compare development, and include information on the efforts and plans 
to collect and publish data on physician quality and efficiency and on 
patient experience of care in support of value-based purchasing and 
consumer choice. Section 10331(g) of the Affordable Care Act provides 
that any time before that date, we may continue to expand the 
information made available on Physician Compare.
    We believe section 10331 of the Affordable Care Act supports our 
overarching goals of providing consumers with quality of care 
information to make informed decisions about their healthcare, while 
encouraging clinicians to improve on the quality of care they provide 
to their patients. In accordance with section 10331 of the Affordable 
Care Act, we intend to utilize Physician Compare to publicly report 
physician performance results.
    In implementing our plan to publicly report physician performance, 
we will

[[Page 69165]]

use data reported under the existing PQRS as an initial step for making 
physician ``measure performance'' information public on Physician 
Compare. By ``measure performance'' in relation to the PQRS, we mean 
the percent of times that a particular clinical quality action was 
reported as being performed, or a particular outcome was attained, for 
the applicable persons to whom a measure applies as described in the 
denominator for the measure. For measures requiring risk adjustment, 
``measure performance'' refers to the risk adjusted percentage of times 
a particular outcome was attained.
    We previously finalized a decision to make public on Physician 
Compare the performance rates on the quality measures that group 
practices submit under the 2012 PQRS group practice reporting option 
(GPRO) (76 FR 73417). Therefore, we are targeting to post performance 
information collected through the GPRO web interface for group 
practices participating in the 2012 PQRS GPRO on Physician Compare in 
2013 or early 2014. Specifically, we will make public performance 
information for measures included in the 2012 PQRS GPRO that meet the 
minimum sample size, and that prove to be statistically valid and 
reliable. As we previously established, if the minimum threshold is not 
met for a particular measure, or the measure is otherwise deemed not to 
be suitable for public reporting, the group's performance rate for that 
measure will be suppressed and not publicly reported. We previously 
established a minimum threshold of 25 patients for reporting 
performance information on Physician Compare (76 FR 73418). Although we 
considered keeping the threshold for reporting performance data on 
Physician Compare at 25 patients, we proposed to change the minimum 
patient sample size, from 25 patients to 20 patients, beginning with 
data collected for services furnished in 2013 (77 FR 44803).
    The following is summary of the comments we received regarding the 
new minimum patient sample size proposal:
    Comment: We received comments related to the reduction in patient 
threshold for public reporting. Most commenters opposed the reduction, 
stating that the lower threshold may be less accurate and statistically 
valid. One commenter pointed to literature supporting the previous 
threshold of 25, and suggested that CMS maintain this threshold, though 
the commenter did not expressly state which literature they were 
referencing, and one suggested a patient size of 30. We received 
comments stating that this reduced sample size was insufficient to 
apply across all measures, and that the sample size should be 
determined based on the measure to which it is applied. One commenter 
requested further detail on what it would mean for a measure to be 
suitable for public reporting. Several comments were supportive of the 
proposal stating that this may increase participation.
    Response: We appreciate the commenters' feedback regarding reducing 
the patient sample size for public reporting from 25 patients to 20 
patients. We are committed to reporting quality of care data that is 
statistically valid, reliable, and accurate, and will only post data 
that meet this standard of reliability regardless of threshold, and 
regardless of measure type. Should we find a measure meeting the 
minimum threshold to be invalid or unreliable for any reason, the 
measure will not be reported.
    We appreciate the comment that this reduction may increase 
participation; however we note that this proposal only relates to 
Physician Compare. While the decreased threshold may increase 
participation for other quality reporting programs, we do not believe 
it will have an impact on Physician Compare.
    We believe this threshold of 20 patients to be sufficient to 
protect patient privacy for reporting on the site, and should thus be 
applied to every measure reported on Physician Compare. Currently, this 
is the reliability threshold being finalized for both the Value-Based 
Modifier (VBM) and the proposed PQRS criteria for reporting measure 
groups. As we work to align quality initiatives and minimize reporting 
burden on physicians and other healthcare professionals, we will 
finalize our proposal to reduce the reporting threshold from 25 to 20 
patients.
    In the Shared Savings Program final rule (76 FR 67948), we 
finalized Accountable Care Organization (ACO) public reporting 
provisions in the interest of promoting greater transparency regarding 
the ACOs participating in the program. We finalized requirements for 
ACOs to publicly report certain data, as well as data that we would 
publicly report. Because ACO providers/suppliers that are eligible 
professionals are considered to be group practices for purposes of 
qualifying for a PQRS incentive under the Shared Savings Program, we 
indicated that performance on quality measures reported by ACOs at the 
ACO TIN level, on behalf of their ACO providers/suppliers who are 
eligible professionals, using the GPRO web interface would be reported 
on Physician Compare in the same way as for the groups that report 
under the PQRS.
    In April 2012, we added functionality to Physician Compare allowing 
users to search for group practices in preparation for the addition of 
2012 PQRS GPRO data. A full Web site redesign is slated for early 2013 
to further prepare the site for the introduction of quality data and 
ACO information. With each enhancement, we work to improve the 
usability and functionality of the site, providing consumers with more 
tools to help them make informed healthcare decisions.
    In CY 2012, we intend to enhance the accuracy of ``administrative'' 
information displayed on the eligible professional's profile page, and 
to add additional data. By administrative data, we are referring to 
information about eligible professionals that is pulled from the 
Provider Enrollment, Chain, and Ownership System (PECOS) and other 
readily available external data sources. Specifically, we intend to add 
whether a physician or other health care professional is accepting new 
Medicare patients, board certification information, and to improve the 
foreign language and hospital affiliation data. We also intend to 
include the names of those eligible professionals who participated in 
the Medicare EHR Incentive Program, as authorized by section 
1848(o)(3)(D) of the Act, and the names of those eligible professionals 
who satisfactorily participated under the PQRS GPRO for 2011. We will 
continue to update the names of those eligible professionals and group 
practices who satisfactorily participated under the PQRS, and those who 
are successful electronic prescribers under the eRx Incentive Program 
based on the most recent program year data available.
    Comment: We received one comment in support of the inclusion of eRx 
and PQRS Incentive Program Data or Administrative data on the site, and 
one comment requesting that participation information for PQRS be 
limited to those who satisfactorily report this information.
    Response: We appreciate the commenter's feedback and support for 
including eRx and PQRS Incentive Program participation data on 
Physician Compare. We intend to continue to post the names of those 
eligible professionals and group practices who satisfactorily 
participated under the PQRS, and those who are successful electronic 
prescribers under the eRx Incentive Program on the Web site as we are 
required to report this information publicly, and Physician Compare 
offers

[[Page 69166]]

an excellent venue for making this information available to consumers.
    Comment: We received comments regarding the posting of Medicare EHR 
Incentive Program participation and Meaningful Use participation 
information on Physician Compare. One commenter requested that CMS post 
the names of all those who participate in the Medicare EHR Incentive 
Program, not just those who did so successfully. One commenter 
requested that we add a note to distinguish what stage of Meaningful 
Use the eligible professional is taking part.
    Response: We intend to post the names of those eligible 
professionals who successfully participated in the Medicare EHR 
Incentive Program on Physician Compare, when feasible. We will further 
evaluate the suggestion regarding stages of Meaningful Use, but at this 
time CMS does not intend to distinguish between stages of 
participation.
    In support of the HHS-wide Million Hearts Initiative, we proposed 
to post the names of the eligible professionals who report the PQRS 
Cardiovascular Prevention measures group (77 FR 44803). This is 
consistent with the requirements under section 10331 of the Affordable 
Care Act to provide information about physicians and other eligible 
professionals who participate in the PQRS.
    The following is a summary of the comments received regarding the 
proposal to post the names of eligible professionals who report the 
PQRS Cardiovascular Prevention measures group in support of the Million 
Hearts Initiative:
    Comment: Commenters generally supported our proposal. Some 
commenters pointed out that the PQRS Cardiovascular Prevention measures 
group may not apply to all professionals or all specialties, and were 
therefore in support of the proposal only if those professionals who 
did not report on the measures group were not negatively represented 
for their lack of participation. One commenter requested that the 
mechanism of data submission also be reported on the site.
    Response: At this time, we are targeting posting the names of 
eligible professionals who satisfactorily report PQRS Cardiovascular 
Prevention measures group in support of the Million Hearts Initiative 
in 2014 for the 2013 reporting period. As with all participation data 
of this nature on Physician Compare, if a professional is participating 
in this program by satisfactorily reporting on the PQRS Cardiovascular 
Prevention measures group, an indicator will be noted on their profile 
page; if a professional is not satisfactorily reporting on this 
measures group, no indicator will be included. We believe this approach 
serves to acknowledge those who participate without negative reflection 
on those who do not. While we appreciate the comment that data 
submission mechanism also be reported on the site, it is not 
technically feasible to report that information at this time.
3. Future Development of Physician Compare
    Consistent with Affordable Care Act requirements, it is our intent 
to phase in an expansion of Physician Compare over the next several 
years by incorporating quality measures from a variety of sources, as 
technically feasible. For our next phase, we proposed to make public on 
Physician Compare, performance rates on the quality measures that group 
practices submit through the GPRO web interface under the 2013 PQRS 
GPRO and the Medicare Shared Savings Program (77 FR 44803). We 
indicated that we anticipated the 2013 PQRS GPRO web interface measures 
data would be posted no sooner than 2014. These data would include 
measure performance rates for measures included in the 2013 PQRS GPRO 
web interface that met the proposed minimum sample size of 20 patients, 
and that proved to be statistically valid and reliable.
    When technically feasible, and targeted for posting on the site in 
2014, we proposed to publicly report composite measures that reflect 
group performance across several related measures (77 FR 44803). As an 
initial step we intend to develop disease module level composite scores 
for PQRS GPRO measures. Under the Medicare Shared Savings Program, ACOs 
are required to report on composite measures for Diabetes Mellitus (DM) 
and Coronary Artery Disease (CAD) (76 FR 67891). Accordingly, in an 
effort to align the PQRS GPRO measures with the GPRO measures under the 
Shared Savings Program, we proposed to add composite measures for DM 
and CAD into the PQRS starting in reporting year 2013. We also 
indicated we would consider future development of composites for the 
remaining disease level modules within the GPRO web interface. As more 
data are added to Physician Compare over time, we stated we would 
consider adding additional disease level composites across measure 
types as technically feasible and statistically valid.
    The following is a summary of the comments received regarding our 
proposal to post performance rates on the quality measures that group 
practices submit through the GPRO web interface under the 2013 PQRS 
GPRO and the Medicare Shared Savings Program, and to report composite 
measures at the disease module level for 2013 GPRO data:
    Comment: One commenter supported our proposal to post PQRS GPRO and 
ACO performance rates as it was limited to measures reported through 
the GPRO web interface, and suggested CMS not expand reporting to data 
collected via other reporting mechanisms at this time. Another 
commenter expressed support of our proposal to post composite measures 
at the disease module level, but requested that CMS postpone the 
posting of these composites until physicians and groups have time to 
review their performance as it pertains to individual elements of the 
composite.
    Response: We are dedicated to providing quality of care data on 
Physician Compare as soon as feasible so that healthcare consumers have 
access to information to help them make informed healthcare decisions. 
We are finalizing our proposal to post performance rates on the quality 
measures that group practices submit through the GPRO web interface 
under the 2013 PQRS GPRO and the Medicare Shared Savings Program. In an 
effort to align PQRS GPRO measures with the GPRO measures under the 
Shared Savings Program, we are finalizing our proposal to generate 
composite measures for DM and CAD based on measures reported through 
the GPRO web interface for groups participating in program year 2013 
PQRS GPRO and ACOs participating in the Shared Savings Program. This 
requirement regarding posting of ACO data is finalized at Sec.  
425.308. We target posting these data in 2014 for the 2013 reporting 
period, as technically feasible, as we believe these data are valuable 
to consumers in evaluating group practices and ACOs. We will provide a 
30-day preview period prior to publication of quality data on Physician 
Compare so that ACOs and group practices can view their data as it will 
appear on Physician Compare before it is publicly reported.
    Consistent with the requirement under section 10331(a)(2) of the 
Affordable Care Act to implement a plan to make comparable information 
on patient experience of care measures publicly available, we proposed 
to post patient experience survey-based measures from the Clinician and 
Group Consumer Assessment of Healthcare Providers and Systems (CG-
CAHPS) (77 FR 44804). As discussed in section G.6.c. of this final rule 
with comment period, we proposed to collect the

[[Page 69167]]

following patient experience of care measures for group practices 
participating in the PQRS GPRO (77 FR 44964):

 CAHPS: Getting Timely Care, Appointments, and Information
 CAHPS: How Well Your Doctors Communicate
 CAHPS: Patients' Rating of Doctor
 CAHPS: Access to Specialists
 CAHPS: Health Promotion and Education

    These measures capture patients' experiences with clinicians and 
their staff, and patients' perception of care. We proposed, no earlier 
than 2014, to publicly report 2013 patient experience data for all 
group practices participating in the 2013 PQRS GPRO, not limited to 
those groups participating via the GPRO web interface, on Physician 
Compare. At least for 2013, we noted that we intended to administer and 
collect patient experience survey data on a sample of the group 
practices' beneficiaries. As we intend to administer and collect the 
data for these surveys, we indicated that we did not anticipate any 
notable burden on the groups.
    For ACOs participating in the Shared Savings Program, consistent 
with the PQRS proposal to publicly report patient experience measures 
on Physician Compare starting in 2013, we proposed to publicly report 
patient experience data in addition to the measure data reported 
through the GPRO web interface (77 FR 44804). Specifically, the patient 
experience measures that would be reported for ACOs include the CAHPS 
measures in the Patient/Caregiver Experience domain finalized in the 
Shared Savings Program final rule (76 FR 67889):

 CAHPS: Getting Timely Care, Appointments, and Information
 CAHPS: How Well Your Doctors Communicate
 CAHPS: Patients' Rating of Doctor
 CAHPS: Access to Specialists
 CAHPS: Health Promotion and Education
 CAHPS: Shared Decision Making

    For patient experience data reported under either the PQRS GPRO or 
the Medicare Shared Savings Program, we also considered an alternative 
option of providing confidential feedback to group practices and ACOs 
using 2013 patient experience data before publicly reporting patient 
experience data on Physician Compare (77 FR 44804). In lieu of publicly 
reporting the patient experience data relating to 2013 PQRS GPRO and 
ACOs participating in the Shared Savings Program, we considered using 
the 2013 results as a baseline to be shared confidentially with the 
group practices and ACOs, during which time the group practices and 
ACOs would have the opportunity to review their data, and implement 
changes to improve patient experience scores. Under this alternative 
option, program year 2014 patient experience data would be the first to 
be publicly reported on Physician Compare, and we would publicly report 
2014 patient experience data for ACOs and group practices participating 
in the 2014 PQRS GPRO on Physician Compare no earlier than 2015. We 
invited public comment on our proposal to begin publicly reporting 
patient experience data for program year 2013, and also the alternative 
option of delaying public reporting of patient experience of care data 
on Physician Compare until program year 2014 in order to give group 
practices and ACOs the opportunity to make changes to the processes 
used in their practices based on the review of their data from program 
year 2013 (77 FR 44804).
    The following is a summary of the comments we received regarding 
our proposal to publicly report patient experience data:
    Comment: Many commenters supported the alternate proposal to post 
2014 data in 2015, and to use 2013 data as confidential feedback for 
providers to review their results. Most commenters believed this would 
give groups a chance to improve their results before they are 
publically reported, and some commenters suggested that groups have the 
opportunity to resurvey patients prior to the posting of results.
    Response: We appreciate the commenters' feedback regarding the 
posting of patient experience data for 2014 in 2015 and using the 
results of patient experience data collected for program year 2013 as a 
confidential reporting period so that physicians can review their data 
and improve on their performance before the start of public reporting. 
We are dedicated to providing patient experience data on Physician 
Compare as soon as feasible so that healthcare consumers can have 
access to this important information to help them make informed 
decisions. After considering the public comments, our final decision is 
to provide all ACOs and group practices an opportunity to see their 
patient experience data in reports provided by the data collection 
vendor before it is published. A 30-day preview period prior to 
publication will allow ACOs and group practices to see their data as it 
will appear on Physician Compare before it is reported. This 30-day 
period is in line with the preview period provided for other public 
reporting programs such as Hospital Compare.
    Understanding the strong desire from consumers for these data, and 
given our commitment to public reporting, we are finalizing our 
proposal to target the reporting of patient experience data, collected 
no earlier than 2013, on Physician Compare in 2014, if technically 
feasible, for groups of one hundred or more eligible professionals 
reporting via the GPRO web interface, including ACOs participating in 
the Shared Savings Program. The requirement regarding posting of ACO 
data is finalized at Sec.  425.308. We believe that by limiting this 
posting requirement to group practices and ACOs participating via the 
GPRO web interface, and by allowing group practices and ACOs to preview 
their data during a 30-day preview period, we are able to address the 
concerns of the provider community while making this data available to 
healthcare consumers and meeting the mandates set forth by the 
Affordable Care Act. Due to patient privacy and confidentiality, we 
will not implement the suggestion that groups have the opportunity to 
resurvey patients prior to the posting of results.
    Comment: Some commenters expressed concern over the cost of 
implementing a patient experience survey, and others questioned whether 
the surveys were adequately tailored to certain types of groups and 
settings, such as emergency departments, stating that the survey used 
should be validated for a variety of settings. Some of these commenters 
suggested that different surveys, such as S-CAHPS for surgical settings 
should be used based on setting. One commenter also suggested that the 
entire CAHPS survey should be used as opposed to only using certain 
domains.
    Response: We are dedicated to accurate, valid, and reliable public 
reporting on Physician Compare and are aware that each group practice 
is unique in size and scope. We have closely evaluated the available 
data collection mechanisms, and are confident that CG-CAHPS is a well-
tested collection mechanism with strong support from the healthcare 
community, and that it provides the best opportunity to collect useful 
and accurate data for the largest number of group practices. We will 
use only those survey domains that are applicable to group practices or 
ACOs respectively, and believe that these domains have been well 
tested, and will therefore provide the best data for the largest number 
of groups.
    We are dedicated to supporting group practices in the reporting of 
these important data. Thus, we are finalizing a policy under which CMS 
will

[[Page 69168]]

administer the patient experience of care survey for calendar year 2013 
and 2014 for all group practices of 100 or more eligible professionals 
that sign up for the PQRS GPRO web interface. Similarly, as discussed 
in the Shared Savings Program Final Rule, CMS will fund and administer 
the CAHPS survey for ACOs participating in the Shared Savings Program 
in 2013 (76 FR 67875).
    As we continue to improve administrative and provider level data, 
we proposed posting the names of those physicians who earned a PQRS 
Maintenance of Certification Program Incentive as data becomes 
available, and targeted for 2014 (77 FR 44804).
    The following is a summary of the comments we received related to 
posting the names of physicians who earned a PQRS Maintenance of 
Certification Program Incentive:
    Comment: Many commenters were supportive so long as there were no 
negative reflections on those who did not receive the incentive; 
however, one commenter did not believe this information was relevant to 
Physician Compare.
    Response: We are finalizing our proposal to include the names of 
eligible professionals who earned an incentive in the PQRS Maintenance 
of Certification Program Incentive as data are available, and targeted 
for 2014. To address concerns regarding negative impact, as with all 
data of this nature currently on Physician Compare, if an eligible 
professional is participating in the program, an indicator will be 
noted on their profile page; if a professional is not participating, no 
indicator or negative indication will be included. We believe this 
approach serves to acknowledge those who earned a PQRS Maintenance of 
Certification Program Incentive without reflecting negatively on those 
who did not. We also believe that this information will be helpful to 
healthcare consumers as they work to make informed healthcare decisions 
and is thus relevant to Physician Compare.
    Comment: We received one comment requesting that ABMS Maintenance 
of Certification status be posted on the site, and one suggesting that 
information about ABMS Maintenance of Certification also be posted.
    Response: We appreciate the commenter's feedback regarding 
including ABMS Maintenance of Certification data on Physician Compare. 
At this time, we are targeting to post the names of eligible 
professionals who earned a PQRS Maintenance of Certification Program 
incentive as data are available, and targeted for 2014. We do not 
currently have plans to also include the ABMS MOC information, but will 
consider this for future rulemaking.
    We considered allowing measures that have been developed and 
collected by approved and vetted specialty societies to be reported on 
Physician Compare, as deemed appropriate, and as they are found to be 
scientifically sound and statistically valid (77 FR 44804). We proposed 
including additional claims-based process, outcome and resource use 
measures on Physician Compare, and noted that we intend to align 
measure selection for Physician Compare with measures selected for the 
Value Based Modifier (VBM) (section III.K).
    We received several comments related to reporting measures 
developed and collected by specialty societies. The following is a 
summary of the comments we received:
    Comment: Many commenters believe this was a good way to identify 
measures that are most appropriate for certain specialties, and to 
reduce the reporting burden on those specialties as the measures are 
already being collected, and their data are already available. Several 
commenters offered to assist CMS in gathering these data. A few 
commenters requested clarification on what measures would be posted, 
how CMS would vet these measures.
    Response: We appreciate the commenters' feedback regarding 
reporting of measures developed by specialty societies on Physician 
Compare. We understand the importance of publicly reporting measures 
that are most appropriate for all specialties, and believe working with 
specialty societies to identify quality measure data that are already 
collected and available reduces the reporting burden on these 
specialties while providing accurate, reliable, and valid data on the 
site. This approach also provides an opportunity to expand public 
reporting to specialties and types of physicians not currently 
represented. We intend to work with specialty societies to identify the 
most appropriate data sources and mechanism for inclusion on Physician 
Compare.
    We will work to ensure that any specialty society data included on 
Physician Compare is approved, vetted, scientifically sound, and 
statistically reliable. As with PQRS measures and other measures posted 
on Physician Compare, any measures under consideration will be 
subjected to the Measures Application Partnership (MAP) pre-rulemaking 
process prior to being considered for posting on the site. Please note 
that such measures will be addressed in future rulemaking.
    We received comments related to our proposed alignment of Physician 
Compare with the VBM. The following is a summary of the comments we 
received:
    Comment: One commenter did not support our proposal to align with 
PQRS or the VBM as they believed this data may be overwhelming to 
healthcare consumers. The commenter went on to say that Physician 
Compare should distinguish itself as a site committed to communicating 
validated and meaningful information, and not try to align with these 
programs.
    Response: We appreciate the commenters' feedback regarding the 
proposal to align public reporting on Physician Compare with elements 
of PQRS and the VBM. We are committed to working toward reporting 
measures that are accurate and complete. Please note that not all 
measures collected will be posted on the site, and only those measures 
that are deemed appropriate for public reporting and useful to 
consumers will be posted. We believe alignment with PQRS and the VBM on 
Physician Compare provides significant opportunities as we move toward 
a payment model related to quality and cost efficiencies. Aligning 
quality initiatives also provides an opportunity for publically 
reporting more quality data while also minimizing the reporting burden 
on eligible professionals. We will continue to align our public 
reporting goals with these programs.
    Comment: One commenter questioned how CMS is able to report 
performance data on Physician Compare within one year, but points out 
the technical infeasibility of calculating performance-based payments 
within that same time frame.
    Response: We appreciate the commenter's feedback regarding a 
timeline for public reporting on Physician Compare in relation to the 
timeline for calculating performance-based payments. We are working on 
a phased approach to public reporting across a number of data sources 
and are looking to do so in a way that does not increase reporting 
burden, allows accurate reporting, and supports the agency's mission 
and goals. For these reasons, we are working to align the measures 
reported on Physician Compare with other CMS quality initiatives, such 
as PQRS and VBM as technically feasible. Please note that not all 
measures included in these other initiatives will be publicly reported 
on the site, and that the programs have distinct timelines. 
Performance-based payments require additional calculation beyond that 
which we proposed to

[[Page 69169]]

publicly report. While Physician Compare has a plan to report 
performance data as soon as technically feasible, we will not report 
that data before it has been accurately calculated, and has proved to 
be statistically valid and reliable.
    We proposed to include group level ambulatory care sensitive 
condition admission measures of potentially preventable 
hospitalizations developed by the HHS Agency for Healthcare Research 
and Quality (AHRQ) that meet the proposed minimum sample size of 20 
patients, and that prove to be statistically valid and reliable 
(measure details are available at http://www.qualitymeasures.ahrq.gov/content.aspx?id=27275) (77 FR 44804). We proposed reporting these 
measures on Physician Compare no earlier than 2015 for those group 
practices composed of 2-99 eligible professionals participating in the 
proposed 2014 PQRS GPRO, and for ACOs.
    We received comments related to our proposal to post group level 
ambulatory care sensitive condition admission measures of potentially 
preventable hospitalizations developed by AHRQ. The following is a 
summary of the comments we received:
    Comment: Most commenters opposed the posting of these measures, and 
one commenter stated that they strongly opposed the addition of these 
measures. One commenter requested clarification as to what testing and 
validation had been done around these measures.
    Response: We are committed to only including quality of care 
measures on Physician Compare that are properly vetted and tested, as 
well as statistically valid and reliable. We have decided to allow 
other programs within CMS to work with these measures, gather the data, 
and provide feedback to the groups prior to posting on Physician 
Compare. We will not finalize our proposal to post group level 
ambulatory care sensitive condition admission measures of potentially 
preventable hospitalizations at this time. Instead, we will consider 
the input we received as we further evaluate the inclusion of such 
measures on Physician Compare, and address this issue in future 
rulemaking.
    We also proposed to publicly report performance rates on quality 
measures included in the 2015 PQRS and VBM for individual eligible 
professionals (77 FR 44804). We indicated, however, that further 
details on what measures would be included in the 2015 reporting period 
will be addressed in future rulemaking. We also proposed that public 
reporting of 2015 PQRS and administrative claims-based quality measures 
for individuals would occur no earlier than 2016.
    We received several comments related to the posting of individual-
level measures on Physician Compare. The following is a summary of the 
comments we received:
    Comment: Some commenters supported our proposal, and one requested 
that this information be made available as soon as technically feasible 
stating the information was valuable to consumer decision making. One 
commenter requested that CMS consider including data that is reported 
through a variety of reporting mechanisms such as claims and registries 
to ensure all reporting individuals would be represented regardless of 
reporting mechanism.
    Response: We agree that individual-level measure data is important 
in helping consumers make informed healthcare decisions, and agree that 
this information should be posted on the site as soon as technically 
feasible. We will move up this plan and target posting individual-level 
measure data in 2015 using 2014 data if technically feasible. Please 
note that further discussion of this topic, and the measures to be 
included will be addressed in future rulemaking.
    Comment: One commenter opposed the posting of individual-level 
measure data stating this data may be overwhelming to consumers. The 
commenter went on to caution that measures posted on Physician Compare 
should be selected based on how well they resonate with consumers. 
Another commenter expressed concerns regarding the different reporting 
mechanisms available in PQRS, and how measures reported through the 
different mechanisms would be represented.
    Response: We appreciate the commenter's concerns around the posting 
of these measures. We are committed to including only the most 
accurate, statistically reliable and valid quality of care measure data 
on Physician Compare when the data are publicly reported. Any data 
found to be invalid or inaccurate for any reason will not be publicly 
reported. We will ensure that these data are collected and presented 
appropriately, regardless of the mechanism through which they are 
collected, and that they accurately reflect performance. Measures to be 
posted on the site will be selected based on a variety of criteria 
including consumer interest, and will be subject to consumer testing. 
Please note that further discussion of this topic, and the measures to 
be included will be addressed in future rulemaking.
    For all measures publicly reported on Physician Compare, we 
proposed to post a standard of care, such as those endorsed by the 
National Quality Forum (77 FR 44804). Such information would serve as a 
standard for consumers to measure individual provider, and group level 
data.
    We received comments related to our proposal to post a standard of 
care on Physician Compare. The following is a summary of the comments 
we received:
    Comment: One commenter supported our proposal to post a standard 
such as those endorsed by the NQF. Some commenters sought clarification 
around the standard to be used, and expressed concerns that an NQF 
standard may be limiting to certain specialties, stating that NQF 
standards are heavily focused on primary care. Commenters also 
suggested consumer testing if such as standard is to be posted to 
insure the information is understandable to consumers.
    Response: We appreciate the commenters' feedback regarding posting 
a standard of care on Physician Compare. We are currently considering 
including an NQF standard for those measures reported on Physician 
Compare where a standard of care is endorsed, available, and 
applicable. We are declining to finalize our proposal at this time and 
are only seeking additional comment. We will address this issue in 
future rulemaking.
    We received several comments not directly related to our proposals 
which are summarized below.
    Comment: The majority of commenters was concerned about the 
accuracy of data currently on Physician Compare, and urged CMS to 
consider this feedback in its plans for future development. Commenters 
stated that data on Physician Compare did not meet certain standards of 
accuracy, and one called for a cessation of the site until concerns 
could be addressed. Some commenters expressed frustration about the 
difficulty they experienced in getting their information updated or 
corrected, and some requested a way to update their information on the 
site. Some commenters requested that data be updated in a timely 
fashion to ensure it is up-to-date and accurate. One commenter 
expressed concerns related to data collection mechanisms and 
comparability on Physician Compare.
    Response: We are committed to including accurate and up-to-date 
information on Physician Compare and continue to work to make 
improvements to the information presented. The current primary data 
source for Physician Compare is PECOS. In order for a physician, other 
healthcare

[[Page 69170]]

professional, or group practice's information to appear on Physician 
Compare, their enrollment record in PECOS must be current and in 
``approved'' status, a valid physical location or address must be 
identified, and the professional must have an NPI. It is critical that 
data in PECOS be accurate and up-to-date to ensure the data on 
Physician Compare are also accurate and up-to-date. CMS is evaluating 
other options for physician, healthcare professionals and group 
practices to update their information, and is looking at other 
available data sources to validate PECOS data to further improve 
accuracy as we continue to improve the data presented on Physician 
Compare.
    We are equally committed to including only the most accurate, 
statistically reliable and valid quality of care measure data on 
Physician Compare when those data are publicly reported. We are 
committed to ensuring that these data are comparable and presented 
appropriately regardless of the mechanism through which they are 
collected, and that they accurately reflect performance. We will ensure 
these data are updated in a timely fashion as technically feasible, and 
will provide a 30-day preview period for physicians and group practices 
to view their data prior to it being posted on the site.
    Comment: We received comments requesting a disclaimer be placed on 
the site for the purpose of explaining why measures may not apply to 
certain groups, and that the absence of data on a particular measure 
does not imply poor performance or poor quality.
    Response: We agree with the commenters that disclaimers and other 
forms of explanatory language are necessary to help inform healthcare 
consumers and other users of the site. Regarding the request for a 
disclaimer, or clarification explaining the absence of participation or 
measure data, we are evaluating disclaimer language for use on 
Physician Compare when data are published on the site, and will take 
this feedback into consideration.
    Comment: We received several comments cautioning that too much data 
on the site could cause confusion for consumers and other users of the 
site.
    Response: We appreciate the commenters' feedback, and understand 
their concerns. As required under section 10331(b) of the Affordable 
Care Act, in developing and implementing the plan to include 
performance data on Physician Compare, we must include, to the extent 
practicable, processes to ensure that the posted data are statistically 
valid, reliable, and accurate, including risk adjustment mechanisms 
used by the Secretary, as well as processes to ensure appropriate 
attribution of care when multiple providers are involved in the care of 
the patient. We understand that this information is complex, and are 
committed to providing data on Physician Compare that are useful to 
beneficiaries in assisting them to make informed healthcare decisions, 
while being accurate, valid, reliable, and complete. We will closely 
evaluate all quality measures under consideration for public reporting 
on the Web site to ensure they are presented in a way that is helpful 
to beneficiaries and, through consumer testing and stakeholder 
outreach, will work to ensure that the number of measures and data 
sources presented is done in such a way that the information is 
valuable to consumers.
    Comment: We received several comments requesting that a section of 
Physician Compare be dedicated to hospital-based physicians, or that 
Physician Compare link to Hospital Compare for certain hospital-based 
physicians so users may view data on hospital-based physician through a 
variety of perspectives.
    Response: We appreciate the commenters' feedback regarding 
customizing a section of Physician Compare for hospital-based 
physicians. Physician Compare is tasked with providing consumers with 
useful information about Medicare physicians and other healthcare 
professionals who provide services in a variety of specialties and care 
settings. At this time, it is not feasible to customize the Web site 
for specific physician groups, but we will consider this feedback as we 
continue to evaluate if such customization is beneficial to consumers 
and potentially feasible in future development. We will continue to 
evaluate a link between Physician Compare and Hospital Compare as 
appropriate.
    Comment: We received comments requesting that CMS include other 
healthcare professionals on Physician Compare and not limit the site to 
physicians.
    Response: We appreciate the commenter's feedback. Currently the 
site does feature information on physicians and other healthcare 
professionals as required by the Affordable Care Act.
    Comment: We received one comment stating that CMS should consider a 
distillation of quality data into a reporting system such as star 
ratings for physicians and group practices.
    Response: We appreciate the commenter's suggestion, and agree that 
a reporting system such as star ratings can be helpful to users in 
consuming these data. We will continue to evaluate star ratings and 
other methods of displaying measure data based on the measures selected 
for posting on the site.
    Comment: We received one comment requesting that additional 
education, residency and administrative information for physicians and 
other healthcare professionals be posted on the site.
    Response: We appreciate the feedback regarding the inclusion of 
education, and other administrative information on Physician Compare. 
At this time, Physician Compare includes some educational and residency 
information. We are working to include Board Certification information 
on the site as feasible, and will continue to evaluate additional 
information and data sources that can provide beneficial information 
for consumers as they are available in the future. All posting of this 
additional information will be addressed in future rulemaking.
    We are committed to making Physician Compare a constructive tool 
for Medicare beneficiaries, successfully meeting the Affordable Care 
Act mandate, and in doing so, providing consumers with information 
needed to make informed healthcare decisions. We have developed a plan, 
and started to implement that plan with a phased approach to adding 
physician quality data to Physician Compare. We believe this staged 
approach to public reporting of physician quality information allows 
consumers access to information that is currently available while we 
continue to develop the infrastructure necessary to support additional 
types of data and information on physicians' quality measure 
performance. Implementation of subsequent phases of the plan will need 
to be developed and addressed in future notice and comment rulemaking, 
as needed.

G. Physician Payment, Efficiency, and Quality Improvements--Physician 
Quality Reporting System

    There are several healthcare quality improvement programs that 
affect physician payments under the Medicare PFS. The National Quality 
Strategy establishes three aims for quality improvement across the 
nation: Better health, better healthcare, and lower costs. This 
strategy, the first of its kind, outlines a national vision for quality 
improvement and creates an opportunity for programs to align quality 
measurement and incentives

[[Page 69171]]

across the continuum of care. We believe that this alignment is 
especially critical for programs involving physicians. The proposals 
that follow facilitate the alignment of programs, reporting systems, 
and quality measures to make this vision a reality. We believe that 
alignment of CMS quality improvement programs will decrease the burden 
of participation on physicians and allow them to spend more time and 
resources caring for beneficiaries. Furthermore, as the leaders of care 
teams and the healthcare systems, physicians and other clinicians serve 
beneficiaries both as frontline and system-wide change agents to 
improve quality. However, we believe that to improve quality, quality 
measurement and reporting is an important component. It is our intent 
that the following requirements will improve alignment of physician-
focused quality improvement programs, decrease the burden of successful 
participation on physicians, increase engagement of physicians in 
quality improvement, and ultimately lead to higher quality care for 
beneficiaries.
    This section contains the requirements for the Physician Quality 
Reporting System (PQRS). The PQRS, as set forth in section 1848(a), 
(k), and (m) of the Act, is a quality reporting program that provides 
incentive payments and payment adjustments to eligible professionals 
based on whether or not they satisfactorily report data on quality 
measures for covered professional services furnished during a specified 
reporting period. We note that, in developing these requirements, it 
was our goal to align program requirements between these quality 
reporting programs, such as the eRx Incentive Program, EHR Incentive 
Program, Medicare Shared Savings Program, and value-based payment 
modifier, wherever possible. We believe that alignment of these quality 
reporting programs will lead to greater overall participation in these 
programs, as well as minimize the reporting burden on eligible 
professionals.
    Please note that, during the comment period following the proposed 
rule, we received comments that were not related to our specific 
proposals for PQRS in the CY 2013 Medicare PFS proposed rule. While we 
appreciate the commenters' feedback and intend to use these comments to 
better develop PQRS, these comments will not be specifically addressed 
in this CY 2013 Medicare PFS final rule, as they are beyond the scope 
of this rule. However, we will take these comments into consideration 
when developing policies and program requirements for future years.
    The regulation governing the PQRS is located at Sec.  414.90. The 
program requirements for years 2007-2012 of the PQRS that were 
previously established, as well as information on the PQRS, including 
related laws and established requirements, are available at https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/PQRS/index.html. Please also note that in this final rule 
with comment period, we are making technical changes to Sec.  414.90 to 
aid in the readability of the regulation.
1. Methods of Participation
    There are two ways an eligible professional can participate in the 
PQRS: (1) As an individual or (2) as part of a group practice 
participating in the PQRS group practice reporting option (GPRO).
a. Participation as an Individual Eligible Professional--Traditional 
Reporting Mechanisms
    As defined at Sec.  414.90(b), the term ``eligible professional'' 
means any of the following: (1) A physician; (2) a practitioner 
described in section 1842(b)(18)(C) of the Act; (3) a physical or 
occupational therapist or a qualified speech-language pathologist; or 
(4) a qualified audiologist. For more information on which 
professionals are eligible to participate in the PQRS, we refer readers 
to the ``List of Eligible Professionals'' download located in the ``How 
to Get Started'' section of the PQRS CMS Web site at http://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/PQRS/How_To_Get_Started.html. There is no requirement to 
self-nominate to participate in the PQRS as an individual eligible 
professional for the incentive or to use claims, registry, or EHR 
reporting mechanisms.
b. Participation as a Group Practice in the GPRO
(1) Definition of Group Practice
    We proposed to modify Sec.  414.90(b) to define group practice as 
``a single Tax Identification Number (TIN) with 2 or more eligible 
professionals, as identified by their individual National Provider 
(NPI), who have reassigned their Medicare billing rights to the TIN'' 
(77 FR 44806). We proposed to change the number of eligible 
professionals comprising a PQRS group practice from 25 or more to 2 or 
more to allow all groups of smaller sizes to participate in the GPRO. 
We believe that expanding the scope of group practices eligible to 
participate under the program will lead to greater program 
participation. To participate in the GPRO, a group practice would be 
required to meet this proposed definition at all times during the 
reporting period for the program year in which the group practice is 
selected to participate in the GPRO.
    We solicited public comments on the proposed definition of group 
practice. The following is a summary of the comments we received 
regarding this proposal.
    Comment: Several commenters supported our proposal to change the 
definition of group practice to include groups of 2-24 eligible 
professionals because the commenters believed that the proposal would 
allow more group practices to participate in the GPRO.
    Response: We appreciate the commenters' feedback and are finalizing 
our proposal to modify Sec.  414.90(b) to define a group practice as 
``a single Tax Identification Number (TIN) with 2 or more eligible 
professionals, as identified by their individual National Provider 
Identifier (NPI), who have reassigned their billing rights to the 
TIN.'' We hope that expanding the GPRO to allow small group practices 
of 2-24 eligible professionals to participate in the GPRO will 
encourage greater participation in PQRS.
    Comment: Although some commenters supported our proposal to change 
the definition of group practice to include groups of 2-24 eligible 
professionals, the commenters urged CMS not to make additional changes 
to this definition in the near future. The commenters note that CMS has 
changed the group practice definition every year since it was included 
as a PQRS reporting option in 2010, leading to confusion for many 
eligible professionals and group practices participating in PQRS.
    Response: Each year, we have sought to improve the GPRO based on 
stakeholder feedback and data we receive from past participation. The 
GPRO has also changed due to a desire to align this GPRO with other 
quality reporting programs, such as the Medicare Shared Savings 
Program. Nonetheless, we understand the complexity and confusion caused 
by changing this definition each year and will keep that in mind in the 
future when proposals are presented.
    Comment: One commenter opposed our proposal to change the 
definition of group practice to include groups of 2-24 eligible 
professionals until the implications of such a change are more clearly 
understood. Furthermore, the commenter believes the proposal confuses 
the alignment of the PQRS program with the VBM that proposes to

[[Page 69172]]

incorporate groups of 25 or more eligible professionals.
    Response: We understand the commenters' concern and acknowledge 
that our proposal to define a group practice as groups of 2 or more 
eligible professionals does not align perfectly with our proposal to 
apply the Value-based Payment Modifier to physician groups of 25 or 
more eligible professionals (see section K). However, we note that, 
although our goal is overall alignment with the Value-based Payment 
Modifier, there may be instances, such as this one, where the two 
programs may not completely align. For example, although we are 
expanding the definition of group practice to define a group practice 
as a group of 2 or more eligible professionals, the Value-based Payment 
Modifier, as described in section K, will only apply to physician group 
practices of 100 or more in 2013. Therefore, smaller groups of 2-99 
eligible professionals will remain unaffected by the final policies we 
are finalizing under the Value-based Payment Modifier in 2013.
    When determining program requirements, we considered factors other 
than alignment with the Value-based Payment Modifier. For example, 
aside from alignment, we adopted policies that we believe will increase 
overall participation in PQRS, as well as increase the likelihood that 
eligible professionals will meet the criteria for satisfactory 
reporting for the 2013 and 2014 PQRS incentives and 2015 and 2016 PQRS 
payment adjustments. We believe that expanding the definition of group 
practices to groups of 2 or more eligible professionals will help to 
achieve these goals, because we are providing group practices with 
additional ways to participate in PQRS.
    Comment: Some commenters disagreed with our proposal to define a 
group practice as ``a single Tax Identification Number (TIN) with 2 or 
more eligible professionals, as identified by their individual National 
Provider Identifier (NPI), who have reassigned their billing rights to 
the TIN'' rather than limiting the definition of group practice to 
physicians. The commenters believe this classification is misleading, 
as a solo physician with a nurse practitioner or other eligible 
professional working in the practice would be classified as a group 
practice under this definition.
    Response: We thank the commenter for expressing their concern 
regarding the definition of a group practice. We note that section 
1848(m)(3)(c) of the Act, which governs group practice reporting under 
the PQRS, explicitly identifies ``eligible professionals in a group 
practice'' (and further affords us the authority to define group 
practice). So we do not believe the definition of group practice under 
the PQRS is limited to physicians. We also note that the PQRS applies 
to ``eligible professionals,'' which is defined under section 
1848(k)(3)(B) of the Act to include physicians and other types of 
practitioners that are specifically identified. Also, from a policy 
perspective, we believe it is important to measure the care given by 
healthcare professionals other than physicians. Therefore, we are 
finalizing the PQRS definition of a group practice to include all 
eligible professionals, not just physician group practices.
(2) Election Requirement for Group Practices Selected To Participate in 
the GPRO
    Please note that, for group practices participating in PQRS through 
other Medicare programs (such as but limited to those group practices 
participating as Accountable Care Organizations (ACOs) under the 
Medicare Shared Savings Program), certain provisions in this section 
may not apply. For information on how to participate in PQRS through 
other Medicare programs, please refer to the requirements for those 
respective programs.
    GPRO Self-Nomination Statement. We established the process for 
group practices to be selected to participate in the GPRO in the CY 
2012 PFS final rule with comment period (76 FR 73316). However, this 
section contains additional processes for a group practice's self-
nomination statement that we proposed for group practices selected to 
participate in the GPRO for 2013 and beyond. For the requirement that 
group practices wishing to participate in the GPRO submit a self-
nomination statement (76 FR 73316), for 2012, we accepted these self-
nomination statements via a letter accompanied by an electronic file 
submitted in a format specified by CMS because it was not operationally 
feasible to receive self-nomination statements via the web at that 
time. In the CY 2012 Medicare PFS final rule with comment period, we 
noted that we anticipated that CMS would have the ability to collect 
self-nomination statements via the web for the 2013 PQRS. Therefore, we 
proposed that, for 2013 and beyond, a group practice must submit its 
self-nomination statement via the web.
    We noted that this web-based functionality is still being developed 
by CMS. Therefore, in the event this web-based functionality would not 
be available in time to accept self-nomination statements for the 2013 
PQRS, we proposed that, in lieu of submitting self-nomination 
statements via the web, a group practice would be required to submit 
its self-nomination statement via a letter accompanied by an electronic 
file submitted in a format specified by CMS (such as a Microsoft excel 
file) (77 FR 44807). We proposed that this self-nomination statement 
would be mailed to the following address: Centers for Medicare & 
Medicaid Services, Center of Clinical Standards and Quality, Quality 
Measurement and Health Assessment Group, 7500 Security Boulevard, Mail 
Stop S3-02-01, Baltimore, MD 21244-1850. If mailing the self-nomination 
statement, we would require that this self-nomination statement be 
received by no later than 5 p.m. Eastern Standard Time on January 31 of 
the year in which the group practice wishes to participate in the GPRO.
    We invited public comment on the proposed method for submitting a 
GPRO self-nomination statement. The following is a summary of the 
comments we received on this proposal.
    Comment: One commenter was concerned about the use and efficiency 
of a web portal for accepting GPRO self-nomination statements due to a 
potentially increased number of self-nomination statements that will be 
accepted through the web and potential delays in the web portal.
    Response: We understand the commenter's concerns regarding the 
potential for delays in the web portal. However, we believe that 
accepting self-nomination statements via the web will be the most 
efficient way for group practices to complete and CMS to accept and 
process GPRO self-nomination statements. Therefore, we are finalizing 
our proposal to accept GPRO self-nomination statements via the web for 
2013 and beyond. We also anticipate an increase in the number of GPRO 
self-nomination statements received due to our expansion of the GPRO as 
well as use of the PQRS GPRO for the application of the Value-based 
Payment Modifier. Therefore we are working to further develop the web 
portal to account for increased traffic. Please note that group 
practices submitting self-nomination statements via the web will be 
required to comply with CMS' security and system requirements to submit 
a self-nomination statement via the web. However, should a group 
practice wishing to self-nominate encounter issues doing so, the group 
practice may contact the QualityNet Help Desk for assistance with 
submitting a self-nomination statement.

[[Page 69173]]

    As for our proposed contingency plan for accepting self-nomination 
statements via mail in the event the web-based functionality was not be 
available in time to accept self-nomination statements for the 2013 
PQRS, or in the event we experience issues with accepting self-
nomination statements via the web, we are also finalizing that 
proposal. While we expect that we will have the web system operational, 
we believe it is appropriate to have an alternative submission process 
available as a back-up. Therefore, if the web-based functionality is 
unavailable in time to accept self-nomination statements for the 2013 
PQRS, or in the event we experience issues with accepting self-
nomination statements via the web, in lieu of submitting self-
nomination statements via the web, a group practice is required to 
submit its self-nomination statement via a letter accompanied by an 
electronic file submitted in a format specified by CMS (such as a 
Microsoft excel file), and a mailed to the following address: Centers 
for Medicare & Medicaid Services, Center of Clinical Standards and 
Quality, Quality Measurement and Health Assessment Group, 7500 Security 
Boulevard, Mail Stop S3-02-01, Baltimore, MD 21244-1850.
    Although we proposed to require that this self-nomination statement 
be received by no later than 5 p.m. Eastern Standard Time on January 31 
of the year in which the group practice wishes to participate in the 
GPRO, we believe it is appropriate to provide group practices with 
additional time to submit this information and self-nominate under the 
PQRS. Additional time for submissions may also address concerns raised 
by commenters about the potential for increased number of self-
nomination statements and efficiency of the web portal with regard to 
avoiding delays. As we discuss in greater detail below in response to 
comments we received, we also believe it would be helpful to afford 
group practices additional time with regard to selecting its reporting 
mechanism, which group practices must include in the self-nomination 
statement. Therefore, we are finalizing a deadline of October 15 of the 
year in which the group practice wishes to participate in the GPRO. We 
believe this is an appropriate amount of time for group practices under 
the PQRS. Moreover, we note that this deadline aligns with the final 
policies we are adopting for the value-based payment modifier. For 
those group practices for whom the value-based payment modifier will 
apply, this extended deadline will provide groups with additional time 
to make decisions with regard to participation under the PQRS.
    GPRO Selection of Reporting Mechanisms. In the CY 2012 Medicare PFS 
final rule with comment period, we established what information is 
required to be included in a group practice's self-nomination statement 
(76 FR 73316). In 2012, the group practice only had one reporting 
mechanism available on which to report data on PQRS quality measures: 
The GPRO web interface. However, beginning 2013, we proposed to allow 
group practices to report data on quality measures using the claims, 
registry, and EHR-based reporting mechanisms for the PQRS incentive and 
payment adjustment (77 FR 44870). Additionally, we proposed to allow 
group practices to use the proposed administrative claims reporting 
option. We proposed that a group practice wishing to participate in the 
GPRO for a program year would be required to indicate the reporting 
mechanism the group practice intends to use for the applicable 
reporting period in its self-nomination statement. Furthermore, once a 
group practice is selected to participate in the GPRO and indicates 
which reporting mechanism the group practice would use, we proposed 
that the group practice would not be allowed to change its selection. 
Therefore, under this proposal, the reporting mechanism the group 
practice indicates it would use in its self-nomination statement for 
the applicable reporting period would be the only reporting mechanism 
under which CMS would analyze the group practice to determine whether 
the group practice has met the criteria for satisfactory reporting for 
the PQRS incentive and/or payment adjustment. We acknowledged that this 
proposal would depart from the way we analyze an individual eligible 
professional, as CMS analyzes an individual eligible professional (who 
is permitted to use multiple reporting mechanisms during a reporting 
period) under every reporting method the eligible professional uses. 
Unfortunately, due to the complexity of analyzing group practices under 
the GPRO, such as having to associate multiple NPIs under a single TIN, 
it is not technically feasible for us to allow group practices using 
the GPRO to use multiple reporting mechanisms or switch reporting 
mechanisms during the reporting period.
    We solicited public comment on our proposal to lock-in a group 
practice's reporting mechanism choice at the time of self-nomination. 
The following is summary of the comments we received regarding this 
proposal.
    Comment: One commenter stated that group practices should be 
allowed to change the reporting mechanisms through the calendar year in 
case a more advantageous reporting option is available later in the 
year. For example, a group practice may want to change its reporting 
mechanism during a given reporting period after the list of qualified 
registries becomes available.
    Response: We agree that group practices should be provided with 
some flexibility to change their reporting mechanisms. We it is only 
fair to provide group practices with a window to switch their initially 
chosen reporting mechanisms, as individual eligible professionals are 
allowed to switch reporting mechanisms throughout the year. Therefore, 
we are allowing group practices to switch their chosen reporting 
mechanism until October 15 of the applicable reporting period. We 
believe this window provides eligible professionals with ample time to 
make an informed decision on which reporting mechanism to use and still 
provides CMS with advance notification of the group practices' chosen 
reporting mechanism. Based on the comments received, we are finalizing 
a deadline of October 15 of the applicable reporting period (that is, 
October 15, 2013 for reporting periods occurring in 2013) for group 
practices to elect (via its self-nomination statement) the reporting 
mechanism they will use to submit quality measures data for PQRS. 
Additionally, should a group practice wish to switch the reporting 
mechanism it chose when self-nominating, the group practice will be 
allowed to do so as long as the group practice switches its reporting 
mechanism prior to the October 15 deadline.
    Please note that the ability to elect the administrative claims-
based reporting mechanism will not be available until the summer of the 
applicable reporting period. Therefore, should a group practice self-
nominate earlier, if the group practice elects to use the 
administrative claims-based reporting mechanism, the group practice 
would have to visit the Web page to elect the administrative claims-
based reporting mechanism.
(3) Process To Participate in the GPRO
    Please note that, for group practices participating in PQRS through 
other Medicare programs (such as but limited to those group practices 
participating as Accountable Care Organizations (ACOs) under the 
Medicare Shared Savings Program), certain provisions in this section 
may not apply. For information on how to participate in PQRS through 
other Medicare programs, please refer to

[[Page 69174]]

the requirements for those respective programs.
    Determining Group Practice Size. Please note that if a group 
practice participates in PQRS as a group practice, the eligible 
professionals in the selected group practice cannot participate in the 
PQRS individually. When selecting group practices to participate in the 
GPRO, CMS bases its decision on the information the group practice 
provides in its self-nomination statement. We believe that changes in a 
group practice's size or TIN constitute such a significant change in 
the group practice's composition that it would cause CMS to reconsider 
its decision to allow the group practice to participate in the GPRO for 
the applicable program year. Specifically, we understand that a group 
practice's size may vary throughout the program year. For example, we 
understand that eligible professionals enter into and leave group 
practices throughout the year. Similarly, we understand that group 
practices may undergo business reorganizations during the program year. 
We note that size fluctuations may affect the criteria under which a 
group practice would use to report after being selected to participate 
in the GPRO. We proposed that groups of varying sizes be subject to 
different criteria for satisfactory reporting for the 2013 and 2014 
incentives, as well as for the payment adjustments (77 FR 44822-44833). 
Therefore, we proposed that, for analysis purposes, the size of the 
group practice must be established at the time the group practice is 
selected to participate in the GPRO. We invited but received no public 
comment on this proposal (77 FR 44807). Therefore, we are finalizing 
this proposal.
    Changes in GPRO TIN. We also understand that, for various reasons, 
a group practice may change TINs within a program year. For example, a 
group practice may undergo a mid-year reorganization that leads to the 
group practice changing its TIN mid-year. We proposed that, if a group 
practice changes its TIN after the group practice is selected to 
participate in the GPRO, the group practice cannot continue to 
participate in PQRS as a group practice. We considered the changing of 
a group practice's TIN a significant change to the makeup of the group 
practice, as the group practice is evaluated under the TIN the group 
practice provided to CMS at the time the group is selected to 
participate in the GPRO for the applicable year (77 FR 44807). 
Therefore, we viewed a group practice that changes its TIN as an 
entirely new practice, associated with a new TIN. We noted that this 
proposal may pose a disadvantage for those group practices who find it 
beneficial to report PQRS quality measures using the GPRO. However, we 
noted that eligible professionals in a group practice that has changed 
its TIN within a year may instead participate as individuals.
    We invited public comment on this proposal. The following is 
summary of the comments we received regarding this proposal not to 
allow group practices who change their TINs to continue to participate 
in the GPRO for the applicable program year.
    Comment: Some commenters urged CMS to allow group practices using 
the GPRO that subsequently change their TIN within a program year to 
continue participating in PQRS as a group practice. One commenter noted 
that not allowing a group practice to continue to use the GPRO should 
the group practice change their TIN in a program year is a hindrance to 
practice mergers and reorganizations.
    Response: We appreciate the commenters' feedback. It is not our 
intention to hinder group practices from merging with another practice 
or reorganizing. However, it is not operationally feasible to allow a 
group practice selected to participate in the GPRO that changes its TIN 
within a program year to continue to participate in PQRS under the 
GPRO. Therefore, we are finalizing our proposal to require that a group 
practice maintain the same TIN throughout a given program year to 
continue to participate in the GPRO. We note that group practices will 
now be given until October 15 to self-nominate and select its reporting 
mechanism for the GPRO, allowing more time within the program year for 
group practices to organize its composition and ultimately its 
reporting structure. We note that, should a group practice change its 
TIN, eligible professionals within the group practice have the option 
to participate in PQRS individually.
    GPRO Opt-out Period. We understand that a group practice may decide 
not to participate in PQRS using the GPRO after being selected. 
Therefore, we proposed that group practices be provided with an 
opportunity to opt out of participation in the GPRO after selection (77 
FR 44807). We noted that it is necessary for a group practice to 
indicate to CMS the group practice's intent not to use the GPRO 
because, once a group practice is selected to participate in the GPRO 
for the applicable reporting period, CMS will not separately assess the 
NPIs associated with the group practice's TIN to see if they meet the 
criteria for satisfactory reporting as individual eligible 
professionals. Therefore, we must be notified of the group practice's 
decision not to participate in the GPRO so the eligible professionals 
within the group practice could be assessed at the individual TIN/NPI 
level. We proposed that group practices would have until April 1 of the 
year of the applicable reporting period (for example, by April 1, 2013 
for reporting periods occurring in 2013) to opt out of participating in 
the GPRO.
    We invited public comment on the proposed selection process for 
group practices wishing to participate in the GPRO. The following is 
summary of the comments we received regarding this proposed opt-out 
period for group practices that have elected to participate in PQRS 
under the GPRO.
    Comment: One commenter supported our proposal to provide an opt-out 
period for those group practices who self-nominated to participate in 
the GPRO but later decide to participate at the individual level.
    Response: We appreciate the commenter's feedback. We have 
historically provided an opt-out period, because the deadline for a 
group practice to submit a self-nomination statement to participate in 
the GPRO has normally been on or about January 31 of the applicable 
program year. We believed it was necessary to provide an opt-out period 
for group practices, as we required group practices to submit a self-
nomination statement indicating their intent to participate in the GPRO 
early in the year. However, since, as we discussed above, beginning in 
2013, group practices will have until October 15 of the applicable 
program year to submit its self-nomination statement, we believe that 
this opt-out period is no longer necessary. Therefore, we are not 
finalizing an opt-out period for group practices that are selected to 
participate in the GPRO for the applicable program year. Once a group 
practice is selected and approved to participate in the GPRO, past the 
opt-out period, the group practice will be required to participate in 
the GPRO for the applicable program year.
c. Requirement for Eligible Professionals and Group Practices Electing 
To Use the Administrative Claims-Based Reporting Mechanism for the 2015 
Payment Adjustment
    Unlike using the traditional PQRS reporting mechanisms (that is, 
claims, registry, EHRs, GPRO web interface) to satisfy the reporting 
requirements for the 2015 and 2016 payment adjustments, we proposed 
that eligible professionals and group practices wishing to use the 
proposed administrative claims reporting

[[Page 69175]]

mechanism, available for the 2015 and/or 2016 payment adjustments, must 
elect to use the administrative claims reporting mechanism (77 FR 
44805). We believed this election requirement is important because it 
is necessary for eligible professionals to actively engage in quality 
reporting. By requiring registration, eligible professionals and group 
practices are making an active choice in how they would like their 
quality performance measured. For eligible professionals, we proposed 
that this election process would consist of a registration statement 
that included: The eligible professional's name and practice name, the 
eligible professional's TIN and NPI for analytical purposes, and the 
eligible professional's contact information (77 FR 44806). For group 
practices, we proposed that this election process would also consist of 
a registration statement that included: The group practice's business 
name and contact information, the group practice's TIN, and contact 
information of the group practice's contact(s) who will be contacted 
for program, clinical, and/or technical purposes. For the method of 
submitting this registration statement, we proposed any of the 
following options:
     If technically feasible, submission of this statement via 
the web; and
     If technically feasible, submission of an eligible 
professional's or group practice's intent to register to use the 
administrative claims-based reporting mechanism by placing a G-code on 
at least 1 Medicare Part B claim.
    In the event the two proposed options are not technically feasible, 
we also considered allowing for submission of the registration 
statement by submitting a mailed letter to CMS at Centers for Medicare 
& Medicaid Services, Center of Clinical Standards and Quality, Quality 
Measurement and Health Assessment Group, 7500 Security Boulevard, Mail 
Stop S3-02-01, Baltimore, MD 21244-1850. However, we noted that using 
this mailing option would be a more burdensome and time-intensive 
process for CMS.
    The eligible professional would be required to complete this 
election process by January 31 of the applicable payment adjustment 
reporting period (for example, by January 31, 2013 for the 2015 payment 
adjustment). However, we noted that we proposed that we may extend this 
deadline based on the submission method that we finalized. For example, 
because processing mailed letters would take the longest to process 
(out of the 3 methods), we anticipated that if we were to include the 
option of mailed letters, the deadline for submitting a mailed 
registration letter would be January 31 of the applicable payment 
adjustment reporting period. Since it would be more efficient to 
process registration statements received via the web or via a G-code on 
a claim, we anticipated that we would be able to extend the 
registration deadline to as late as December 31 of the applicable 
payment adjustment reporting period. Once an eligible professional 
makes an election to participate in PQRS using the administrative 
claims-based reporting mechanism for the PQRS payment adjustments, the 
eligible professional would be assessed under the administrative 
claims-based reporting mechanism.
    For group practices participating in the GPRO, we proposed that 
these group practices would use the 3 methods described above (mailed 
letter, web, or G-code submission) and have the same deadline as 
eligible professionals wishing to elect to use the administrative 
claims-based reporting mechanism for an applicable payment adjustment. 
In the alternative, we proposed that a group practice participating in 
the GPRO would be required to elect to use the administrative claims-
based reporting mechanism in its self-nomination statement. We proposed 
to provide less time for group practices to elect to use the 
administrative claims-based reporting mechanism because it is necessary 
for CMS to receive this information in the beginning of the applicable 
reporting period to indicate to CMS how these group practices should be 
analyzed throughout the reporting period. This early notification is 
especially important for large group practices, which may have hundreds 
or thousands of eligible professionals to track as a group practice. 
Therefore, we felt it was appropriate to request that a group practice 
elect to use the administrative claims-based reporting mechanism when 
the group practice self-nominates.
    We further proposed that an eligible professional or group practice 
would be required to make this election for each payment adjustment 
year the eligible professional or group practice seeks to be analyzed 
under this mechanism. For example, if the eligible professional seeks 
to report under the administrative claims mechanism for the 2015 and 
2016 payment adjustments, the eligible professional would be required 
to make this election by the applicable deadline, for the 2015 payment 
adjustment and again by the applicable deadline, for the 2016 payment 
adjustment. We invited public comment on the proposed election 
requirement for eligible professionals and group practices electing to 
participate in the 2015 and 2016 payment adjustments using the 
administrative claims-based reporting mechanism.
    We invited public comment on the process for electing the 
administrative claims-based reporting option for eligible professionals 
and group practices. The following is a summary of the comments 
received on this proposed process and on the proposed election 
requirement.
    Comment: Some commenters requested that the deadline for electing 
the administrative claims-based reporting option be extended. The 
commenters believed eligible professionals and group practices needed 
more time to understand the different reporting options and determine 
whether the administrative claims-based reporting option would be 
appropriate for their respective practices.
    Response: We agree with the commenters and would like to provide 
eligible professionals and group practices with sufficient time to make 
an informed decision as to whether to elect the administrative claims-
based reporting option. Therefore, we are extending the timeframe that 
eligible professionals and group practices have for electing the 
administrative claims-based reporting mechanism. However, as we explain 
in greater detail below, we are not finalizing the administrative 
claims-based reporting option for the 2016 PQRS payment adjustment. For 
the 2015 payment adjustment, eligible professionals and group practices 
may begin to make an election in the summer of the applicable reporting 
period. The deadline for electing the administrative claims-based 
reporting mechanism will be October 15 of the applicable reporting 
period for both eligible professionals and group practices. For 
example, for the 2015 payment adjustment, eligible professionals and 
group practices will be able to elect the administrative claims-based 
reporting mechanism until October 15, 2013.
    Therefore, based on the comments received, we are finalizing the 
following election process for eligible professionals and group 
practices wishing to use the administrative claims-based reporting 
option for the 2015 PQRS payment adjustment. We note that we are 
changing the name of this process from a registration to an election 
process. We believe using the term election process is more 
appropriate, as individuals and group practices would be electing to be 
analyzed under a reporting mechanism, not registering to participate in 
PQRS

[[Page 69176]]

(as registration is not a requirement to participate in PQRS). This 
election process is the same process as the registration process 
proposed, with the following exceptions:
     We proposed three methods of accepting this election: Via 
the web, a G-code on claims, or, if neither were technically feasible, 
via U.S. mail. We are finalizing submission of the administrative 
claims election statement via the web, because we believe that this is 
the most efficient method of accepting these elections. However, in the 
event that we experience issues with accepting election statements via 
the web, we are finalizing a back-up method of accepting elections via 
U.S. mail. In the event the we experience issues with accepting 
election statements via the web, eligible professionals and group 
practices may elect to be analyzed under the administrative claims-
based reporting mechanism by submitting a mailed letter to CMS at 
Centers for Medicare & Medicaid Services, Center of Clinical Standards 
and Quality, Quality Measurement and Health Assessment Group, 7500 
Security Boulevard, Mail Stop S3-02-01, Baltimore, MD 21244-1850.
     The final deadline for submitting the administrative 
claims election statement to participate using the administrative 
claims reporting mechanism for the 2015 PQRS payment adjustment for 
both individual eligible professionals, and group practices is October 
15, 2013. Group practices will be able to make this election under its 
self-nomination statement. As we discussed above, we are finalizing a 
later deadline so that eligible professionals and group practices have 
more time to determine which reporting mechanism would be more 
advantageous for their respective practices. We note that, should we 
encounter issues with accepting election statements via the web, we may 
extend the deadline for submitting these administrative claims election 
statements to account for any time the web may not be properly 
functioning.
    We are modifying newly created Sec.  414.90(h) to indicate this 
election requirement for individual eligible professionals and group 
practices who wish to use the administrative claims-based reporting 
option for the 2015 PQRS payment adjustment.
    Please note that, for group practices participating in PQRS through 
other Medicare programs, the administrative claims-based reporting 
mechanism may not be a reporting option for reporting PQRS measures. 
For example, under the Medicare Shared Savings Program, eligible 
professionals within Accountable Care Organizations (ACOs) must report 
for purposes of the PQRS using the GPRO web interface (77 FR 67870). 
Therefore, group practices participating within ACOs participating in 
the PQRS under the Medicare Shared Savings Program cannot participate 
in the traditional PQRS or report using the administrative claims-based 
reporting mechanism.
2. Reporting Periods for the PQRS Payment Adjustments
    For the PQRS incentives, we previously established 12 and 6-month 
reporting periods for satisfactorily reporting PQRS quality measures at 
Sec.  414.90(f)(1). Under section 1848(a)(8)(C)(iii) of the Act, we are 
authorized to specify the quality reporting period (reporting period) 
for a payment adjustment year. We proposed to modify the regulation to 
establish the reporting periods for the PQRS payment adjustments for 
2015 and beyond (77 FR 44808). Please note that we are re-designating 
Sec.  414.90(f) as Sec.  414.90(g) and making technical changes to 
change the structure of the regulation and to improve the readability 
of the regulation. Newly designated Sec.  414.90(g)(1) indicates the 
reporting periods available for the PQRS incentives.
    Additional Reporting Periods for the 2015 and 2016 PQRS Payment 
Adjustments. For the 2015 payment adjustment, in the CY 2012 Medicare 
PFS final rule, we established CY 2013 (that is, January 1, 2013 
through December 31, 2013) as the reporting period for the 2015 payment 
adjustment (76 FR 73392). We established a 12-month reporting period 
occurring 2 years prior to the application of the payment adjustments 
for group practices and for individual eligible professionals to allow 
time to perform all reporting analysis prior to applying payment 
adjustments on eligible professionals' Medicare Part B PFS claims. 
However, we noted that we might specify additional reporting periods 
for the 2015 payment adjustment. To coincide with the 6-month reporting 
period associated with the 2013 incentive for the reporting of measures 
groups via registry, we proposed to modify the regulation at newly 
designated Sec.  414.90(h) to add a 6-month reporting period occurring 
July 1, 2013-December 31, 2013, for the 2015 payment adjustment for the 
reporting of measures groups via registry (77 FR 44808).
    For the 2016 payment adjustment, to coincide with the reporting 
periods for the 2014 incentive, we proposed to modify the regulation at 
newly designated Sec.  414.90(h) to specify a 12-month (January 1, 
2014-December 31, 2014) and, for individual eligible professionals 
reporting measures groups via registry only, a 6-month (July 1, 2014-
December 31, 2014) reporting period for the 2016 payment adjustments.
    We invited public comment on our proposed reporting periods for the 
2015 and 2016 payment adjustments. The following is a summary of the 
comments we received on our proposals.
    Comment: Some commenters supported our proposal to establish a 6-
month payment adjustment reporting period for the 2015 and 2016 PQRS 
payment adjustments to coincide with the 6-month reporting period for 
the 2013 and 2014 PQRS incentives. Some commenters also supported our 
proposal to establish a 12-month payment adjustment reporting period 
for the 2016 PQRS payment adjustment. One commenter believes that a 12-
month reporting period provides a more accurate assessment of actions 
performed in a clinical setting than data collected based on a 6-month 
reporting period. Other commenters supported continuing to allow a 6-
month and 12-month reporting period.
    Response: Based on the comments received and to parallel the 
reporting periods for the 2013 and 2014 PQRS incentives, we are 
finalizing the addition of a 6-month reporting period for the 2015 and 
2016 PQRS payment adjustments as proposed. We are also finalizing the 
12-month reporting period for the 2016 PQRS payment adjustment. We are 
therefore finalizing newly created Sec.  414.90(h) to specify 6- and 
12-month reporting periods occurring 2 years prior to the 2015 and 2016 
PQRS payment adjustments.
    With respect to the commenter's concern that a 6-month reporting 
period may not provide as accurate of a picture of the quality of care 
provided than the 12-month period, we generally agree with the 
commenter. However, our desire to align the reporting periods of the 
2013 and 2014 PQRS incentive and 2015 and 2016 PQRS payment 
adjustments, and afford additional reporting options, outweighs this 
interest. We also note that the 6-month reporting period will only be 
available for individual eligible professionals reporting measures 
groups via registry.
    Reporting Periods for the 2017 PQRS Payment Adjustment and Beyond. 
We believe that data on quality measures collected based on 12 months 
provide a more accurate assessment of actions performed in a clinical 
setting than data collected based on a 6-month reporting period, as 
eligible professionals would

[[Page 69177]]

report on a larger set of patients. We stated that it was our intention 
to move towards using solely a 12-month reporting period once the 
reporting periods for the 2013 and 2014 incentives conclude. Therefore, 
for payment adjustments occurring in 2017 and beyond, we proposed to 
modify the regulation at newly designated Sec.  414.90(h) to specify 
only a 12-month reporting period occurring January 1-December 31, that 
falls 2 years prior to the applicability of the respective payment 
adjustment (for example, January 1, 2015 through December 31, 2015, for 
the 2017 payment adjustment) (77 FR 44808).
    We invited public comment on our proposal to establish a 12-month 
reporting period for payment adjustments occurring in 2017 and beyond. 
The following is a summary of the comments we received on this 
proposal.
    Comment: One commenter supported our proposal to eliminate the 6-
month reporting period for 2015 and beyond, because the commenter 
believes that data collected based on 12 months provides a more 
accurate assessment of actions performed in a clinical setting than 
data collected based on a 6-month reporting period.
    Response: We agree with the point raised by the commenter and are 
therefore not finalizing a 6-month period for payment adjustments 
occurring in 2017 and beyond. However, we note that we did not propose 
to eliminate the 6-month reporting period for 2015 and beyond. Rather, 
we simply did not propose a 6-month reporting period for payment 
adjustments occurring in 2017 and beyond (77 FR 44808).
    Comment: Several commenters opposed our proposal to base the PQRS 
payment adjustment year on a reporting period occurring 2 years prior 
to the payment adjustment year. The commenters believe that the 
reporting period should occur closer to the payment adjustment year. 
Some commenters urged that the implementation of the PQRS payment 
adjustment should be delayed until the PQRS participation rate 
increases.
    Response: We understand the commenters' concerns on establishing a 
reporting period 2 years prior to the payment adjustment year. However, 
it is not operationally feasible to create a full calendar year 
reporting period for the PQRS payment adjustment any later than 2 years 
prior to the adjustment year and still avoid retroactive payments or 
the reprocessing of claims. Section 1848(a)(8) of the Act requires that 
a payment adjustment be applied to covered professional services 
furnished by an eligible professional in the particular payment 
adjustment year. Therefore, using 2017 as an example, we believe it is 
necessary to reduce the PFS amount concurrently for PFS allowed charges 
for covered professional services furnished in 2017. If we do not 
reduce the PFS amount concurrently with claims submissions in 2017, we 
would need to potentially recoup or provide added payments after the 
determination is made about whether the payment adjustment applies, or 
alternatively, hold claims until such a determination is made. In 
addition, we note that if such retroactive adjustments were made it may 
require a reconciliation of beneficiary copayments.
    As a result, we need to determine whether eligible professionals 
have satisfactorily reported under the PQRS based on a reporting period 
that occurs prior to 2017. For the reasons stated above, for the PQRS 
payment adjustments occurring in 2017 and beyond, we are finalizing 12-
month reporting periods that fall 2 years prior to the application of 
the respective payment adjustment year. For example, the reporting 
period for the 2017 PQRS payment adjustment will be CY 2015 (that is, 
January 1, 2015-December 31, 2015). We are finalizing newly created 
Sec.  414.90(e) to specify a 12-month reporting period for the 2017 
PQRS payment adjustments and beyond.
    Comment: One commenter supported our proposal to move towards a 12-
month reporting period, provided that we continue to offer the 
administrative claims-based reporting option to eligible professionals 
and group practices.
    Response: We appreciate the commenter's feedback but reiterate that 
we view the administrative claims-based reporting option as a temporary 
option under PQRS. Therefore, as we discuss in section III.G.3, we are 
only finalizing use of the administrative claims-based reporting 
mechanism for the 2015 PQRS payment adjustment at this time.
    Comment: One commenter opposed our proposal to eliminate the 6-
month reporting period beginning with the 2017 PQRS payment adjustment, 
at least until such time as the PQRS achieves greater alignment with 
other CMS quality reporting programs. The commenter believes that this 
alternative reporting period should be maintained to offer greater 
flexibility in reporting. The commenter also noted that the late start 
of this 6-month reporting period has traditionally served as an 
alternative reporting option for eligible professionals who are new to 
PQRS.
    Response: We appreciate the commenter's feedback. However, in an 
effort to streamline the satisfactory reporting requirements under PQRS 
and to align with programs such as the Value-based Payment Modifier 
which utilize a performance period of 12 months, we are not adding a 6-
month reporting period for payment adjustments occurring in 2017 and 
beyond.
3. Requirements for the PQRS Reporting Mechanisms
    This section addresses the following reporting mechanisms: Claims, 
registry, EHR (including direct EHR products and EHR data submission 
vendor), GPRO web interface, and administrative claims. We previously 
established at Sec.  414.90(f)(2) that eligible professionals reporting 
individually may use the claims, registry, and EHR-based reporting 
mechanisms. We proposed to modify Sec.  414.90 to allow group practices 
comprised of 2-99 eligible professionals to use the claims, registry, 
and EHR-based reporting mechanisms as well, because we recognized the 
need to provide varied reporting criteria for smaller group practices, 
particularly since we proposed to expand the definition of group 
practice (77 FR 44808). For example, we noted that a smaller group 
practice may not have a sufficiently varied practice to be able to meet 
the proposed satisfactory reporting criteria for the GPRO web interface 
that would require a smaller group practice to report on all of the 
PQRS quality measures we proposed. We proposed changes to Sec.  414.90, 
which we proposed to re-designate Sec.  414.90(g) and Sec.  414.90(h).
    We invited public comment on this proposal to make the claims, 
registry, and EHR-based reporting options applicable to group practices 
of 2-99 eligible professionals. The following is summary of the 
comments we received regarding this proposal.
    Comment: Several commenters supported our proposal to expand the 
claims, registry, direct EHR, and EHR data submission vendor reporting 
mechanisms to group practices of 2-99 eligible professionals using the 
GPRO. Commenters were pleased that groups that are not able to use the 
GPRO web interface (such as specialty provider group practices for 
which GPRO measures typically do not apply) would still be able to 
participate in PQRS as a group practice in the GPRO. Most of these 
commenters suggested that we extend use of the claims, registry, direct 
EHR, and EHR data submission vendor reporting mechanisms to group 
practices of 100 or more eligible

[[Page 69178]]

professionals to allow greater flexibility in reporting for these 
larger group practices. These commenters noted that extending the 
claims, registry, and EHR-based reporting options would be especially 
beneficial to large specialty groups for which the GPRO measures do not 
apply.
    Response: We appreciate the commenters' positive feedback regarding 
these proposals. Although we proposed to expand the claims-based 
reporting mechanism to group practices of 2-99 eligible professionals, 
we have discovered that it will not be technically feasible to accept 
group practice reporting data via the claims-based reporting mechanism 
at this time. Therefore, we are not finalizing that part of our 
proposal. However, we will work to provide group practice reporting via 
the claims-based reporting mechanism in the future.
    As for the registry-based reporting mechanism, we are finalizing 
our proposal to extend the registry-based reporting mechanism to groups 
practices comprised of 2-99 eligible professionals participating in 
PQRS via the GPRO for 2013 and beyond.
    For group practices of 2-99 eligible professionals using direct EHR 
and EHR data submission vendor products, we are delaying availability 
of this option until 2014 to coincide with when the EHR Incentive 
Program introduces its group practice reporting option for meeting the 
clinical quality measures (CQM) objective for achieving meaningful use 
(77 FR 54076 through 54078). Therefore, in this final rule, we are 
adopting the EHR-based reporting options for groups of 2-99 eligible 
professionals participating in PQRS via the GPRO for 2014 and beyond.
    As for extending use of the registry and EHR-based reporting 
mechanisms for GPRO group practices of 100 of more eligible 
professionals, we agree with the commenters that extending the registry 
and EHR-based reporting mechanisms would provide more opportunities for 
large specialty group practices to participate in PQRS. Therefore, 
based on the comments received, we are finalizing the registry-based 
reporting mechanism for 2013 and beyond and the EHR-based reporting 
mechanisms for 2014 and beyond for groups of 100 or more eligible 
professionals under the GPRO as well as those group practices with 2-99 
eligible professionals under the GPRO.
    Therefore, we are finalizing Sec.  414.90(g) and Sec.  414.90(h) to 
indicate that the registry-based reporting mechanism will be available 
for use by eligible professionals and group practices beginning in 2013 
and the EHR-based reporting mechanisms (direct EHR product and EHR data 
submission vendor) will be available for use by eligible professional 
and group practices beginning in 2014 to report for the PQRS incentives 
and payment adjustments.
a. Claims-Based Reporting: Requirements for Using Claims-Based 
Reporting for 2013 and Beyond
    Eligible professionals that wish to report data on PQRS quality 
measures via claims for the incentives and for the payment adjustments 
must submit quality data codes (QDCs) on claims to CMS for analysis. 
QDCs for the eligible professional's selected PQRS (individual or 
measures groups) quality measures that are reported on claims may be 
submitted to CMS at any time during the reporting period for the 
respective program year. However, as required by section 1848(m)(1)(A) 
of the Act, all claims for services furnished during the reporting 
period, would need to be processed by no later than the last Friday 
occurring 2 months after the end of the reporting period, to be 
included in the program year's PQRS analysis. For example, all claims 
for services furnished during a reporting period that occur during 
calendar year 2013 would need to be processed by no later than the last 
Friday of the second month after the end of the reporting period, that 
is, processed by February 28, 2014 for the reporting periods that end 
December 31, 2013. In addition, after a claim has been submitted and 
processed, we proposed at re-designated Sec.  414.90(g)(2)(i)(A) and 
newly added Sec.  414.90(h)(2)(i)(A) to indicate that EPs cannot submit 
QDCs on claims that were previously submitted and processed (for 
example, for the sole purpose of adding a QDC for the PQRS).
    We invited public comment on our proposed requirements for using 
the claims-based reporting mechanism for the incentives and for the 
payment adjustments for 2013 and beyond. The following is a summary of 
the comments we received regarding these proposals.
    Comment: Some commenters disagreed with our proposal not to allow 
the resubmission of claims for the sole purpose of attaching a 
reporting code on a claim.
    Response: We understand that there are instances where Medicare 
Part B claims are resubmitted and reprocessed. However, to avoid 
unnecessary reprocessing of claims for the sole purpose of reporting 
PQRS quality data, and because it is overly burdensome and costly to 
analyze claims that are resubmitted to identify the submission of 
additional codes for the PQRS, we are finalizing our proposal. We note 
that this has been a program policy since the inception of PQRS in 
2007. Therefore, we are finalizing Sec.  414.90(g)(2)(i)(A) and Sec.  
414.90(hg)(2)(i)(A), with some technical changes to the language we are 
making in this final rule, to indicate that if an eligible professional 
re-submits a Medicare Part B claim for reprocessing, the eligible 
professional may not attach a G-code at that time for reporting on 
individual Physician Quality Reporting System measures or measures 
groups.
b. Registry-Based Reporting
(1) Proposed Qualification Requirements for Registries for 2013 and 
Beyond
    For 2013 and beyond, we proposed that registries wishing to submit 
data on PQRS quality measures for a particular reporting period would 
be required to be qualified for each reporting period the registries 
wish to submit quality measures data (77 FR 44808). This qualification 
process is necessary to verify that registries are able to submit data 
on PQRS quality measures on behalf of eligible professionals and group 
practices to CMS. Registries who wish to become qualified to report 
PQRS quality measures for a reporting period undergo (1) a self-
nomination process and (2) a qualification process regardless of 
whether the registry was qualified the previous program year.
    Registry Self-nomination Process. For the self-nomination process, 
we proposed that the self-nomination process would consist of the 
submission of a self-nomination statement submitted via the web by 
January 31 of each year in which the registry seeks to submit data on 
PQRS quality measures on behalf of eligible professionals and group 
practices (77 FR 44809). For example, registries that wish to become 
qualified to report data in 2013 under the program, that is, to report 
during all of the reporting periods for the 2013 incentive and the 2015 
payment adjustment, would be required to submit its self-nomination 
statement by January 31, 2013. We proposed that the self-nomination 
statement contain all of the following information:
     The name of the registry.
     The reporting period start date the registry will cover.
     The measure numbers for the PQRS quality measures on which 
the registry is reporting.
    We noted that CMS is currently developing the functionality to 
accept registry self-nomination statements via the web and anticipate 
development of this functionality to be complete for registries to 
submit their self-

[[Page 69179]]

nomination statements via the web in 2013. However, in the event that 
it is not technically feasible to collect this self-nomination 
statement via the web, we proposed that registry vendors would submit 
its self-nomination statement via a mailed letter to CMS (77 FR 44809). 
The self-nomination statement would be mailed to the following address: 
Centers for Medicare & Medicaid Services, Center for Clinical Standards 
and Quality, Quality Measurement and Health Assessment Group, 7500 
Security Boulevard, Mail Stop S3-02-01, Baltimore, MD 21244-1850. We 
proposed that these self-nomination statements must be received by CMS 
by 5:00 p.m. Eastern Standard Time on January 31 of the applicable 
year.
    We invited public comment on our proposals related to the registry 
self-nomination process. The following is a summary of these comments.
    Comment: One commenter suggested that we extend the proposed self-
nomination deadline of January 31 for registries who wish to become 
qualified to submit PQRS measures data should we finalize the option to 
submit this self-nomination statement via U.S. mail.
    Response: Based on our desire to streamline the self-nomination 
process, we are finalizing our proposal to accept the registry self-
nomination statements via the web. However, we understand that issues 
may arise with respect to the web-based self-nomination process. 
Therefore, we are finalizing the proposed back-up submission method. 
Specifically, only in the event that we encounter issues accepting 
registry self-nomination statements via the web, we are finalizing our 
proposal to accept self-nomination statements from registries who wish 
to become qualified to submit PQRS measures data to CMS via U.S. mail. 
The self-nomination statement will be mailed to the following address: 
Centers for Medicare & Medicaid Services, Center for Clinical Standards 
and Quality, Quality Measurement and Health Assessment Group, 7500 
Security Boulevard, Mail Stop S3-02-01, Baltimore, MD 21244-1850.
    We are also finalizing the deadline of January 31. Although we 
agree that submitting a self-nomination statement via U.S. mail would 
require more time to complete than submitting the self-nomination 
statement via the web, we do not believe an extended submission 
deadline is warranted since registries (such as those participating in 
PQRS in 2012) are familiar with submitting self-nomination statements 
by January 31 via U.S. mail. Beginning 2013, registries wishing to 
indicate their intent to submit PQRS measure data on behalf of eligible 
professionals are required to submit a self-nomination statement for 
each year in which the registry seeks to participate in PQRS. Please 
note that when submitting self-nomination statements via the web, 
registries are required to meet CMS' security and system requirements. 
Should a registry wishing to self-nominate encounter issues using the 
web, the registry may contact the QualityNet Help Desk for assistance 
in submitting a self-nomination statement.
    Comment: One commenter suggested that we extend the proposed self-
nomination deadline of January 31 for registries who wish to become 
qualified to submit PQRS measures data to CMS. The commenter believes 
that, since we are proposing new criteria for registries, the 
registries should be provided with more time to make any needed changes 
prior to submitting its self-nomination statement.
    Response: We understand that registries need time to decide whether 
to undergo the qualification process to submit PQRS measures data to 
CMS. However, extending the self-nomination deadline would delay our 
ability to make the list of qualified registries available to eligible 
professionals and group practices for a particular reporting period. We 
note that the deadline for registries to submit a self-nomination 
statement has historically been January 31 of the year in which the 
registry seeks to become qualified. The January 31 deadline has 
provided registries with sufficient time to submit self-nomination 
statements in the past, even when new requirements were established for 
registries, so we do not believe it is necessary to extend the self-
nomination deadline for registries past January 31 of the year in which 
the registry seeks to become qualified. In addition, as previously 
stated, beginning 2013, we are accepting registry self-nomination 
statements via the web. We believe this will provide registries with 
more time to submit their self-nomination statements, as registries 
will not have to account for the time it takes for CMS to receive its 
self-nomination statement via U.S. mail. Please note that the self-
nomination statement simply indicates to CMS a registry's intent to 
participate in PQRS. The process to become a qualified registry, which 
follows this discussion, occurs after the deadline for registries to 
submit its self-nomination statement.
    Registry Qualification Process. For the qualification process, we 
proposed that all registries, regardless of whether or not they have 
been qualified to report PQRS quality measures in a prior program year, 
undergo a qualification process to verify that the registry is prepared 
to submit data on PQRS quality measures for the reporting period in 
which the registry seeks to be qualified (77 FR 44809-44810). To become 
qualified for a particular reporting period, we proposed that a 
registry would be required to:
     Be in existence as of January 1 the year prior to the 
program year in which the registry seeks qualification (for example, 
January 1, 2012, to be qualified to submit data in 2013).
     Have at least 25 participants by January 1 the year prior 
to the program year in which the registry seeks qualification (for 
example, January 1, 2012, to be qualified for the reporting periods 
occurring in 2013).
     Provide at least 1 feedback report to participating 
eligible professionals and group practices for each program year in 
which the registry submits data on PQRS quality measures on behalf of 
eligible professionals and group practices. This feedback reporting 
would be based on the data submitted by the registry to CMS for the 
applicable reporting period or periods occurring during the program 
year. For example, if a registry was qualified for the reporting 
periods occurring in 2013, the registry would be required to provide a 
feedback report to all participating eligible professionals and group 
practices based on all 12 and 6-month reporting periods for the 2013 
incentive and the 12-month reporting period for 2015 payment 
adjustment. Although we proposed to require that qualified registries 
provide at least 1 feedback report to all participating eligible 
professionals and group practices, we encouraged registries to provide 
an additional, interim feedback report, if feasible, so that an 
eligible professional may determine what steps, if any, are needed to 
meet the criteria for satisfactory reporting.
     For purposes of distributing feedback reports to its 
participating eligible professionals and group practices, the registry 
must collect each participating eligible professional's email address 
and have documentation from each participating eligible professional 
authorizing the release of his or her email address.
     Not be owned or managed by an individual, locally-owned, 
single-specialty group (for example, single-specialty practices with 
only 1 practice location or solo practitioner practices would be 
precluded from becoming a qualified PQRS registry).
     Participate in all ongoing PQRS mandatory support 
conference calls and meetings hosted by CMS for the

[[Page 69180]]

program year in which the registry seeks to be qualified. For example, 
a registry wishing to be qualified for reporting in 2013 would be 
required to participate in all mandatory support conference calls 
hosted by CMS related to reporting in 2013 under the PQRS.
     Be able to collect all needed data elements and transmit 
to CMS the data at the TIN/NPI level for at least 3 measures.
     Be able to calculate and submit measure-level reporting 
rates and/or, upon request, the data elements needed to calculate the 
reporting rates by TIN/NPI.
     Be able to calculate and submit, by TIN/NPI, a performance 
rate (that is, the percentage of a defined population who receive a 
particular process of care or achieve a particular outcome based on a 
calculation of the measure's numerator and denominator specifications) 
for each measure on which the eligible professional (as identified by 
the TIN/NPI) or group practice reports and/or, upon request, the 
Medicare beneficiary data elements needed to calculate the reporting 
rates.
     Be able to separate out and report on Medicare Part B FFS 
patients.
     Report the number of eligible instances (reporting 
denominator).
     Report the number of instances a quality service is 
performed (reporting/performance numerator).
     Report the number of performance exclusions, meaning the 
quality action was not performed for a valid reason as defined by the 
measure specification.
     Report the number of reported instances, performance not 
met, meaning the quality action was not performed for any valid reason 
as defined by the measure specification. Please note that an eligible 
professional receives credit for reporting, not performance.
     Be able to transmit data on PQRS quality measures in a 
CMS-approved XML format.
     Comply with a CMS-specified secure method for data 
submission, such as submitting the registry's data in an XML file 
through an identity management system specified by CMS or another CMS-
approved method, such as use of appropriate Nationwide Health 
Information Network specifications, if technically feasible.
     Submit an acceptable ``validation strategy'' to CMS by 
March 31 of the reporting year the registry seeks qualification (for 
example, if a registry wishes to become qualified for reporting in 
2013, this validation strategy would be required to be submitted to CMS 
by March 31, 2013). A validation strategy details how the registry will 
determine whether eligible professionals and group practices have 
submitted accurately and on at least the minimum number (80 percent) of 
their eligible patients, visits, procedures, or episodes for a given 
measure. Acceptable validation strategies often include such provisions 
as the registry being able to conduct random sampling of their 
participant's data, but may also be based on other credible means of 
verifying the accuracy of data content and completeness of reporting or 
adherence to a required sampling method.
     Perform the validation outlined in the strategy and send 
the results to CMS by June 30 of the year following the reporting 
period (for example, June 30, 2014, for data collected in the reporting 
periods occurring in 2013).
     Enter into and maintain with its participating 
professionals an appropriate Business Associate agreement that provides 
for the registry's receipt of patient-specific data from the eligible 
professionals and group practices, as well as the registry's disclosure 
of quality measure results and numerator and denominator data and/or 
patient-specific data on Medicare beneficiaries on behalf of eligible 
professionals and group practices who wish to participate in the PQRS.
     Obtain and keep on file signed documentation that each 
holder of an NPI whose data are submitted to the registry has 
authorized the registry to submit quality measure results and numerator 
and denominator data and/or patient-specific data on Medicare 
beneficiaries to CMS for the purpose of PQRS participation. This 
documentation would be required to be obtained at the time the eligible 
professional signs up with the registry to submit PQRS quality measures 
data to the registry and would be required to meet any applicable laws, 
regulations, and contractual business associate agreements.
     Upon request and for oversight purposes, provide CMS 
access to review the Medicare beneficiary data on which PQRS registry-
based submissions are founded or provide to CMS a copy of the actual 
data.
     Provide CMS a signed, written attestation statement via 
mail or email which states that the quality measure results and any and 
all data including numerator and denominator data provided to CMS are 
accurate and complete.
     Use PQRS measure specifications and the CMS provided 
measure calculation algorithm, or logic, to calculate reporting rates 
or performance rates unless otherwise stated. We will provide 
registries a standard set of logic to calculate each measure and/or 
measures group they intend to report for each reporting period.
     Provide a calculated result using the CMS-supplied measure 
calculation logic and XML file format for each measure that the 
registry intends to calculate. The registries may be required to show 
that they can calculate the proper measure results (that is, reporting 
and performance rates) using the CMS-supplied logic and send the 
calculated data back to CMS in the specified format. The registries 
will be required to send in test files with fictitious data in the 
designated file format.
     Describe to CMS the cost for eligible professionals and 
group practices that the registry charges to submit PQRS and/or eRx 
Incentive Program data to CMS.
     Agree to verify the information and qualifications for the 
registry prior to posting (includes names, contact, measures, cost, 
etc.) and furnish/support all of the services listed for the registry 
on the CMS Web site.
     Agree that the registry's data for Medicare beneficiaries 
may be inspected or a copy requested by CMS and provided to CMS under 
our oversight authority.
     Be able to report consistent with the satisfactory 
reporting criteria requirements for the PQRS incentives and payment 
adjustments.
    In addition to meeting all the requirements specified previously 
for the reporting of individual quality measures via registry, for 
registries that intend to report on PQRS measures groups, we proposed 
that these registries, regardless of whether or not registries were 
qualified in previous years, would be required to:
     Indicate the reporting period chosen for each eligible 
professional who chooses to submit data on measures groups.
     Base reported information on measures groups only on 
patients to whom services were furnished during the relevant reporting 
period.
     If the registry is reporting using the measures group 
option for 20 patients, the registry on behalf of the eligible 
professional may include non-identifiable data for non-Medicare 
beneficiaries as long as these patients meet the denominator of the 
measure and the eligible professional includes a majority of Medicare 
Part B patients in their cohort of 20 patients for the measures group.
    We intend to post the final list of registries qualified for each 
reporting period by the summer of each year in which the reporting 
periods occur on

[[Page 69181]]

the CMS Web site at http://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/PQRS/index.html. For example, we intend 
to post the list of registries qualified for 2013 reporting periods by 
summer 2013. For each reporting period, the list of qualified 
registries would contain the following information: The registry name, 
registry contact information, the measures and/or measures group(s) for 
which the registry is qualified and intends to report for the 
respective reporting period.
    The registry qualification process we proposed was largely the same 
process we established to qualify registries for the reporting periods 
occurring in 2012. We proposed a similar process to the 2012 
qualification process because, registries are already familiar with 
this qualification process, so we felt there would be a greater 
likelihood that registries wishing to be qualified to report quality 
measures data for a particular reporting period would be able to pass 
the qualification process. We felt this would provide eligible 
professionals with more qualified registry products from which to 
choose.
    We invited public comment on our proposals related to the 
qualification process for registries. The following is a summary of the 
comments we received regarding these proposals.
    Comment: One commenter asked for clarification on our proposal to 
have a validation strategy.
    Response: Please note that we do not provide requirements or 
guidelines for a validation strategy. Registries must adopt a strategy 
in the manner the registry chooses. Therefore, the specifics of the 
validation strategy are dependent on the registry. However, we are 
finalizing the requirement that a registry seeking to be qualified to 
submit PQRS quality measures data have a validation strategy. As we 
discuss in further detail in the following response, although we 
strongly encourage registries to test their validation strategies with 
CMS, we are not finalizing this testing requirement.
    Comment: One commenter requested that the requirement for 
registries to provide data to CMS should contain the stipulation that 
it be de-identified at the patient level.
    Response: We have historically reserved the right to request 
patient identifiable data if we so choose. We understand the security 
concerns around patient-identified data and will work with the registry 
to receive the data in a secure manner.
    Comment: One commenter recommended that the final list of qualified 
PQRS registries be available earlier than the summer of each reporting 
period.
    Response: We realize that it may be challenging for eligible 
professionals to choose among the numerous registries. Due to the 
commenter's concerns as well as concerns we have heard from other 
stakeholders regarding the timing of the availability of the qualified 
registry list, we are not finalizing the following proposed registry 
qualification requirement: Perform the validation outlined in the 
strategy and send the results to CMS by June 30 of the year following 
the reporting period (for example, June 30, 2014, for data collected in 
the reporting periods occurring in 2013). We note that the delay in 
posting the list of qualified registries was mainly due to our desire 
to test a registry's validation strategy prior to qualifying the 
registry to report PQRS quality measures data for the applicable year. 
Since we are not requiring that this validation strategy be tested, we 
will be able to post the list of qualified registries sooner. We 
anticipate that we will post the list of qualified registries in the 
Spring of the applicable year the registries are qualified submit 
quality measures data on behalf of eligible professionals (for example, 
Spring 2013 for reporting periods occurring in 2013).
    We note that, although we are not requiring that a registry's 
validation strategy be tested to become qualified to submit PQRS 
quality measures data on behalf of its eligible professionals, this 
testing process will still be available for registries to test their 
respective validation strategies. It is important for registries to 
undergo this testing process to check whether they will be able to 
submit quality measures data accurately to CMS after the applicable 
reporting period.
    Comment: One commenter sought clarification on our proposal to, 
``upon request and for oversight purposes, provide CMS access to review 
the Medicare beneficiary data on which PQRS registry-based submissions 
are founded or provide to CMS a copy of the actual data.'' 
Specifically, the commenter sought clarification as to whether this 
requirement would require that CMS have access to more data than is 
already required for PQRS.
    Response: This requirement would not require that CMS have access 
to more data than is already required for PQRS. Rather, this 
requirement is necessary in order for CMS to verify the accuracy of the 
data submitted by the respective registry. As stated previously, CMS 
will work with registries to accept data in a secure manner.
    Based on the comments received and for the reasons stated 
previously, we are finalizing the registry qualification process for 
2014 and beyond, as proposed, with the exception that we are not 
finalizing the requirement that a registry perform the validation 
outlined in its strategy and send the results to CMS by June 30 of the 
year following the reporting period.
    Registry Audit and Disqualification Process. Lastly, in the CY 2012 
Medicare PFS proposed rule, we raised the issue of disqualifying 
registries that submit inaccurate data (76 FR 42845). We did not adopt 
a disqualification process but noted the importance of such a process, 
as well as our intention to provide detailed information regarding a 
disqualification process in future rulemaking (76 FR 73322). In an 
effort to ensure that registries provide accurate reporting of quality 
measures data, we proposed to modify Sec.  414.90(b) to indicate that 
we would audit qualified registries (77 FR 45044-45045). If, during the 
audit process, we find that a qualified registry has submitted grossly 
inaccurate data, we proposed, under Sec.  414.90(b), to indicate that 
we would disqualify such a registry from the subsequent year under the 
program, meaning that a registry would not be allowed to submit PQRS 
quality measures data on behalf of eligible professionals and group 
practices for the next year. Under this proposal, a disqualified 
registry would not be included in the list of qualified registries that 
is posted for the applicable reporting periods under which the registry 
attempted to qualify (77 FR 44810). We further proposed to post a 
registry's disqualification status on the CMS Web site at https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/PQRS/index.html. For example, if a qualified registry 
submits quality measures data for the reporting periods occurring in 
2013 but is then audited and later disqualified, the registry would not 
be allowed to submit PQRS quality measures data on behalf of 
participating eligible professionals and group practices to CMS for the 
reporting periods occurring in 2014 or later. One example of submitting 
grossly inaccurate data that CMS has encountered in the past is if a 
registry reports inaccurate TIN/NPIs on 5 percent or more of the 
registry's submissions. As CMS calculates data on a TIN/NPI level, it 
is important for registries to provide correct TIN/NPI information.
    In proposing registry disqualification, we considered other 
alternatives, such as placing registries in a probationary

[[Page 69182]]

status. However, we believed it is important for registries to submit 
correct data once it is qualified to submit data on behalf of its 
eligible professionals and therefore, find that immediate 
disqualification to be appropriate. This becomes especially important 
particularly as the program moves from the use of incentives to payment 
adjustments (77 FR 44811).
    We invited public comment as to the threshold of grossly inaccurate 
data for the purpose of disqualifying a registry. The following is a 
summary of the comments we received regarding this proposal.
    Comment: One commenter generally supported the establishment of a 
process to audit qualified registries, but advised CMS to exercise 
caution when using their authority to disqualify registries, thereby 
preventing these registries from submitting data on PQRS measures.
    Response: We understand the consequences of disqualifying a 
previously qualified registry and will therefore use this authority 
with caution. It is our intention that disqualification be used only 
for those registries submitting grossly inaccurate data. However, we 
stress the importance of having registries provide correct data to 
ensure that eligible professionals and group practices are correctly 
provided with incentive payments or payment adjustments.
    Comment: Should CMS discover that a registry has submitted 
inaccurate data, one commenter requested that the registry be allowed 
an opportunity to correct their mistakes and rectify any processes 
leading to data submission errors.
    Response: We appreciate the commenter's feedback. However, due to 
the time it takes to perform data analysis for payment determination, 
it is not technically feasible to allow registries to another 
opportunity resubmit data that is found to be inaccurate. We note that 
the registries have until the last Friday of February following the 
applicable reporting period (for example, February 28, 2014 for 
reporting periods occurring in 2013). After this data submission 
period, CMS must perform its analysis to determine whether eligible 
professionals have met the criteria for satisfactory reporting for the 
PQRS incentives or payment adjustments. In order to perform this 
analysis in time to issue payment adjustments beginning January 1 of 
the applicable payment adjustment year (for example, January 1, 2015 
for the 2015 PQRS payment adjustment), CMS cannot provide for an 
additional opportunity to resubmit data that is found to be inaccurate.
    We note that, although no longer required, registries have an 
opportunity during the year to test its validation and submission 
strategy with CMS prior to submitting the data that CMS will use to 
determine whether its eligible professionals or group practices have 
met the criteria for satisfactory reporting for the PQRS incentives 
and/or payment adjustments. We strongly encourage registries to undergo 
this testing process, as it will help to alleviate issues that may 
occur when submitting PQRS quality measures data to CMS.
    Comment: Some commenters oppose disqualifying registries because of 
inaccuracies in TIN/NPI information provided to CMS by the registries. 
One commenter states that registries do not gather TIN/NPI information; 
rather, outside reporting sites provide TIN/NPI information. Since the 
registries do not have access to this information provided by these 
outside sites, registries have no way of verifying the accuracy of TIN/
NPI information. Another commenter stated that submission of inaccurate 
data should be shared by those generating the data, that is, the 
responsibility of submitting inaccurate data should be shared with the 
registry, its eligible professionals and group practices, as well as 
other entities involved in submitting quality measures data to CMS via 
a qualified registry.
    Response: We recognize that registries are limited to the data they 
receive from their eligible professionals. It is not our intention to 
seek to disqualify registries who, through no fault of their own, 
submit inaccurate data. However, we believe it is necessary to 
eliminate or, at a minimum, drastically reduce instances where 
mismatches in TIN/NPI information would result in nonpayment of an 
incentive or conversely the application of the payment adjustment when 
it appears that the eligible professional or group practice would 
otherwise be eligible to receive an incentive. While we understand that 
registries are reliant on the data they receive from their eligible 
professionals or group practices, CMS discovered numerous instances 
where registries have failed to correct data inaccuracies within the 
purview of a registry's calculations. We understand that registry 
vendors undergo costs associated with qualifying their products to 
submit data on PQRS measures. We also understand that it would place an 
added burden on registries who were previously qualified to repeat the 
qualification process should CMS disqualify the registry. Therefore, as 
proposed, it is our intention to limit disqualification of registries 
to those who submit grossly inaccurate data to CMS.
    Comment: One commenter suggested that registries in their first 
year of PQRS participation be provided with leniency with regard to 
disqualification.
    Response: We note that CMS typically works with registries during 
the data submission period following a PQRS reporting period to help 
avoid the reporting of inaccurate data. One example of this is 
providing the testing process whereby registries may test its 
validation and submission strategy. In addition, during the submission 
process occurring immediately after the PQRS reporting periods, CMS 
provides help and guidance to those registries who encounter issues 
submitting PQRS quality measures data to CMS. Therefore, we do not 
believe that registries participating in PQRS for the first time are 
disadvantaged to the point that they should be provided greater 
leniency. The need for CMS to receive accurate data to determine PQRS 
incentive and/or payment adjustment applicability outweighs the need to 
afford newly qualified registries leniency should these registries 
submit grossly inaccurate data.
    Comment: One commenter sought clarification on the following 
questions: (1) What happens to the registry participants' respective 
data? Are their submissions also ``disqualified''? (2) Does a finding 
of a submission with ``grossly inaccurate data'' by a registry mean 
that all data collected and submitted by that registry is to be 
considered ``grossly inaccurate''?
    Response: We appreciate the commenter's questions. With respect to 
the first question, if we find that a registry has submitted grossly 
inaccurate data, the data submitted by its registry participants those 
reporting periods will be disregarded. For example, if a registry 
submits grossly inaccurate data to CMS in 2014 for reporting periods 
occurring in 2013, the data submitted by the registry on behalf of its 
eligible professionals and group practices for reporting periods 
occurring in 2013 will not be accepted by CMS. With respect to the 
second question, should we find that a registry has submitted grossly 
inaccurate data, the data submitted will be considered inaccurate, and 
CMS will not accept the data provided.
    Based on the comments received and for the reasons stated, we are 
modifying Sec.  414.90(b) to indicate that we are finalizing the 
proposed disqualification process for registries. Should CMS decide to 
disqualify a registry, please note that our decision to disqualify a 
registry is final.

[[Page 69183]]

    Collection of Registry Data via the NwHIN. The Nationwide Health 
Information Network (NwHIN) is an initiative developed by the 
Department of Health and Human Services that provides for the exchange 
of healthcare information. Traditionally, CMS has not collected data 
received via a registry through NwHIN. However, we strive to encourage 
the collection of data via the NwHIN and intend to do so when it is 
technically feasible to do so (as early as 2014). Therefore, we 
solicited public comment on collecting data via registry for PQRS via 
NwHIN. We received no comments on this proposal. However, since we 
believe the NwHIN must be further developed in order to be able to 
collect registry data via the NwHIN, we are not finalizing any policy 
to collect data via the NwHIN at this time.
c. EHR-Based Reporting
(1) Requirements for a Vendor's Direct EHR Products for 2014 and Beyond
    Definition of Direct EHR Product. We proposed to modify Sec.  
414.90(b) to define a direct electronic health record (EHR) product as 
``an electronic health record vendor's product and version that submits 
data on Physician Quality Reporting System measures directly to CMS'' 
(77 FR 45053). Please note that the self-nomination and qualification 
requirements for a vendor's direct EHR products for 2012 and 2013 were 
established in the CY 2012 Medicare PFS final rule (76 FR 73323).
    We did not receive public comment on our proposal to modify the 
definition of a direct electronic health record (EHR) product (77 FR 
44811). Therefore, we are modifying Sec.  414.90(b) to define a direct 
electronic health record (EHR) product as ``an electronic health record 
vendor's product and version that submits data on Physician Quality 
Reporting System measures directly to CMS,'' as proposed.
    Discontinuation of the Qualification Process for Direct EHR 
Products. In the CY 2012 PFS final rule, we established the requirement 
that direct EHR products that submit PQRS quality measures data to CMS 
for reporting periods occurring in 2013 be qualified (77 FR 77323). We 
proposed to no longer require qualification of direct EHR products 
beginning in 2014 (77 FR 44811). Although we would still allow EHR 
vendors to submit test files to the PQRS and continue to provide 
support calls, we would no longer require vendors to undergo this 
testing process. Although vendors and their products would no longer be 
required to undergo this testing or qualification process, we proposed 
that CMS would only accept the data if the data are:
     Transmitted in a CMS-approved XML format utilizing a 
Clinical Document Architecture (CDA) standard such as Quality Reporting 
Data Architecture (QRDA) level 1 and
     In compliance with a CMS-specified secure method for data 
submission, such as submitting the direct EHR vendor's data (for 
testing) through an identity management system specified by CMS or 
another approved method.
    CMS would therefore no longer post a list of qualified EHR vendors 
and their products on the CMS Web site. Therefore, eligible 
professionals would need to work with their respective EHR vendor to 
determine whether their specific EHR product has undergone any testing 
with the PQRS and/or whether their EHR product can produce and transmit 
the data in the CMS-specified form and manner. While we no longer 
believe that this process is necessary, we invited public comment as to 
whether CMS should continue to require that direct EHR products undergo 
self-nomination and qualification processes prior to being authorized 
to submit quality measures data to CMS for PQRS reporting purposes.
    We proposed to not continue the qualification requirement (that is, 
no longer propose this process for future years of the program) because 
we believe adequate checks are in place to ensure that a direct EHR 
product is able to submit quality measures data for the PQRS. For 
example, to the extent possible, we intend to align with the Medicare 
EHR Incentive Program for our criteria for satisfactory reporting and 
measures available for reporting under the EHR-based reporting 
mechanism. The Medicare EHR Incentive Program requires that an eligible 
professional submit clinical quality measures using EHR technology 
certified under the program established by the Office of the National 
Coordinator for Health Information Technology (ONC). We anticipated 
that ONC's certification process could include testing related to the 
reporting of the proposed PQRS EHR measures indicated in Tables 32 and 
33, since we proposed to align the PQRS EHR-based measures with the 
measures available for reporting under the EHR Incentive Program. We 
invited public comment as to whether, in lieu of qualification, CMS 
should require that direct EHR products that would be used to submit 
data on PQRS quality measures for a respective reporting period be 
classified as certified under the program established by ONC.
    The following is summary of the comments we received regarding our 
proposal to discontinue the qualification process for direct EHR 
products as well as our proposal to require CEHRT in lieu of PQRS 
qualification.
    Comment: Several commenters supported our proposal to discontinue 
qualification of direct EHR products. The commenters believe that this 
proposal moves towards our goal of aligning PQRS and the EHR Incentive 
Program. The commenters also believe discontinuing qualification of 
direct EHR vendor products helps to encourage use of the EHR-based 
reporting mechanism for reporting under PQRS.
    Response: We appreciate the commenters' feedback and, based on the 
support we received for this proposal and the reasons we discussed 
above, we are finalizing our proposal to discontinue qualifying direct 
EHR products beginning in 2014.
    Comment: Should CMS discontinue the qualification process, one 
commenter requested that CMS continue to allow EHR vendors the 
opportunity to submit test files when needed.
    Response: Although CMS is discontinuing qualifying EHR products, 
vendors will be able to continue to submit test files. We believe that 
allowing submission of test files is an important tool for providers 
and provides an adequate check to determine whether the vendor products 
are able to successfully submit data to CMS.
    Comment: Some commenters opposed our proposal to discontinue 
qualification of direct EHR products. The commenters believed that 
discontinuing qualification will increase burden on providers, who will 
have no guide to determine whether a direct EHR product is qualified to 
report PQRS measures. One commenter therefore urged CMS to continue to 
qualify direct EHR products until the ONC's certification process can 
be used for PQRS in addition to the EHR Incentive Program. Another 
commenter expressed concern that, should CMS discontinue the 
qualification process for direct EHR products, eligible professionals 
and group practices would simply assume that their CEHRT are able to 
submit data on measures under PQRS.
    Response: We understand that our decision to discontinue the 
qualification process for direct EHR products puts the onus on eligible 
professionals and group practices to determine whether a direct EHR 
product meets the requirements for reporting PQRS measures. However, we

[[Page 69184]]

have received much stakeholder feedback requested that we discontinue 
the requirement that an eligible professional select a ``qualified'' 
direct EHR product; the stakeholders believe that the qualified 
designation is confusing, because there is already certification 
process in place administered by ONC that tests EHR products. 
Therefore, we are finalizing our proposal to discontinue the 
qualification process for direct EHR products under the PQRS beginning 
in 2014.
    Nonetheless, we share the commenter's concern to provide guidance 
to eligible professionals on choosing EHR products. Therefore, based on 
the comments received, we are also finalizing to the requirement that a 
direct EHR product be certified by ONC as Certified EHR Technology 
(CEHRT), and therefore meet the definition of CEHRT in ONC's 
regulations (see 45 CFR 170.102), to submit PQRS measures. (For the 
2014 Edition EHR certification criteria, please refer to 77 FR 54163). 
While the process for certifying EHR technology may not be distinctly 
tailored for reporting PQRS quality measures, we note that we are 
making efforts to align, to the maximum extent possible, the measures 
and reporting criteria with the EHR Incentive Program, which requires 
eligible professionals to use CEHRT. For example, it is our intention 
to further align the EHR measures available for reporting by eligible 
professionals and group practices under PQRS and the EHR Incentive 
Program, so that the specifications of these measures will be the same. 
Therefore, beginning in 2014, ONC's certification process would test 
the submission of data on CQMs available for reporting under the EHR 
Incentive Program and, consequently, since the measures would be the 
same, data on PQRS quality measures that are reportable via an EHR.
    We understand that CEHRT may provide more capabilities than needed 
to report PQRS quality measures. However, we note that most of these 
capabilities are intertwined with the direct EHR product's ability to 
capture data on quality measures and therefore necessary. The certified 
health information technology product list (CHPL) includes all EHR 
technology that has been certified, and it can be found at http://oncchpl.force.com/ehrcert?q=CHPL.
    Comment: While one commenter generally supported requiring direct 
EHR products to be ONC certified as CEHRT to report PQRS measures, the 
commenter stated that the ONC certification process should only be used 
for the PQRS and EHR Incentive Programs if the measures are identical, 
particularly in specifications and reporting format.
    Response: We note the commenter's concern regarding use of the ONC 
certification process and the alignment of EHR-based measures in PQRS 
and the EHR Incentive Program. As we noted in the previous response, it 
is our intention to align, to the maximum extent possible, the measures 
and reporting criteria for eligible professionals to meet the criteria 
for satisfactory reporting under PQRS and the criteria for meeting the 
CQM component of meaningful use under the EHR Incentive Program. By 
2014, we expect that the measures and reporting criteria available 
under both programs will be sufficiently aligned to justify requiring 
that an EHR product used to report PQRS quality measures data undergo 
the ONC certification process. Therefore, we believe that requiring a 
direct EHR product to be CEHRT in order to be eligible to report 
measures under PQRS beginning in 2014 is appropriate.
    Comment: One commenter recommended that a certified quality 
reporting module be considered as a direct EHR product for purposes of 
submitting PQRS measures to CMS.
    Response: We are discontinuing the qualification process and 
requiring that a direct EHR product be CEHRT beginning in 2014. A 
certified quality reporting module may be part of CEHRT, but CEHRT as a 
whole is more comprehensive. Please refer to ONC's standards and 
certification criteria final rule for additional information on 
requirements for CEHRT (77 FR 54163). The Certified HIT Product List 
CHPL, which is the listing of all certified products, is available at 
http://oncchpl.force.com/ehrcert?q=CHPL.
    Other Requirements for Direct EHR Products. Although we proposed 
that direct EHR products would no longer be required to undergo this 
testing or qualification process, we proposed that CMS would only 
accept the data if the data are:
     Transmitted in a CMS-approved XML format utilizing a 
Clinical Document Architecture (CDA) standard such as Quality Reporting 
Data Architecture (QRDA) level 1 and
     In compliance with a CMS-specified secure method for data 
submission, such as submitting the direct EHR vendor's data (for 
testing) utilizing an identity management system specified by CMS or 
another approved method (77 FR 44811).
    In addition, upon request and for oversight purposes, we proposed 
that the vendor would still be expected to provide CMS access to review 
the Medicare beneficiary data on which PQRS direct EHR-based 
submissions are founded or provide to CMS a copy of the actual data.
    We invited public comment on these additional proposed requirements 
for direct EHR products. The following is a summary of comments we 
received on this proposal.
    Comment: One commenter opposed our proposed requirement that direct 
EHR vendors would be expected to provide CMS access to review to 
Medicare beneficiary data on which PQRS direct EHR-based submissions 
are founded or provide to CMS a copy of the actual data. Under the 
direct EHR submission method, healthcare organizations are submitting 
data directly to CMS. The vendor does not come into possession of the 
data being submitted during this process and does not have a copy of 
the data to provide to CMS. Responsibility for providing access to such 
data must remain with the healthcare organization. Another commenter 
expressed HIPAA concerns regarding our proposed requirement that EHR 
vendors would be expected to provide CMS access to review to Medicare 
beneficiary data on which PQRS direct EHR-based submissions are founded 
or provide to CMS a copy of the actual data.
    Response: We agree with the concerns the commenters have raised. 
Therefore, we are not finalizing the requirement that direct EHR 
products provide CMS access to review the Medicare beneficiary data 
upon which the direct vendor's submissions are founded or a copy of the 
actual data.
    In summary, we are finalizing the requirements for submitting 
quality measures data via a direct EHR product, as proposed, with the 
following exception: We are not finalizing our proposal to allow CMS 
access to review the Medicare beneficiary data on which PQRS direct 
EHR-based submissions are founded or provide to CMS a copy of the 
actual data. In addition, we note that the EHR Incentive Program has 
provided an additional format for transmitting quality measures data to 
CMS from CEHRT. In addition to finalizing the submission of quality 
measures data using the QRDA Category I format, the EHR Incentive 
Program also finalized the QRDA Category III transmission format (77 FR 
54075). In our proposal, we proposed to require that eligible 
professionals and group practices using CEHRT transmit quality measures 
data in a CMS-approved XML format utilizing a Clinical Document 
Architecture (CDA) standard, and used QRDA Category I as an example. 
Since

[[Page 69185]]

it was our intent to align with the EHR Incentive Program, who 
finalized transmission of quality measures data using the QRDA Category 
I and QRDA Category III formats, we are requiring that quality measures 
data submitted via CEHRT for purposes of reporting for PQRS beginning 
in 2014 be transmitted using the QRDA Category I and QRDA Category III 
formats. We note that, although we are requiring that products be able 
to transmit data using the QRDA Category I and III formats, for 
purposes of reporting PQRS quality measures data to CMS, eligible 
professionals need only submit data via their EHR using 1 (either QRDA 
Category I or III) of these formats. For those eligible professionals 
who wish to participate in both PQRS and the EHR Incentive Program 
using an EHR product that is CEHRT beginning in 2014, we refer readers 
to Option 2 for the submission of CQMs under the EHR Incentive Program 
(77 FR 54058).
    Collection of EHR data via the NwHIN. The Nationwide Health 
Information Network (NwHIN) is an initiative developed by the 
Department of Health and Human Services that provides for the exchange 
of healthcare information. Traditionally, CMS has not collected data 
received via a direct EHR product through NwHIN, but we would like to 
encourage this method with EHR-based reporting. However, we strive to 
encourage the collection of data via the NwHIN and intend to do so when 
it is technically feasible to do so (as early as 2014). Therefore, we 
solicited public comment on collecting data via an EHR for PQRS via 
NwHIN. The following is a summary of the comments we received.
    Comment: One commenter opposed collection of data received via a 
direct EHR product through the Nationwide Health Information Network 
(NwHIN). The commenter believes collecting data through NwHIN is 
premature and believes that development of the NwHIN is necessary prior 
to collecting data through the NwHIN.
    Response: We appreciate the commenter's feedback and agree with the 
commenter. Therefore, we are not finalizing any policy to collect data 
received via a direct EHR product through the NwHIN at this time.
(2) Requirements for a Vendor's EHR Data Submission Vendor Products for 
2013 and Beyond
    Definition of EHR Data Submission Vendors. The EHR data submission 
vendor product was a reporting mechanism that was newly established in 
the CY 2012 Medicare PFS final rule (76 FR 73324). EHR products from an 
EHR data submission vendor were products that are able to receive and 
transmit clinical quality data extracted from an EHR to CMS. We 
proposed to modify Sec.  414.90(b) to define an electronic health 
record (EHR) data submission vendor product as ``an electronic health 
record vendor's product and version that acts as an intermediary to 
submit data on Physician Quality Reporting System measures on behalf of 
an eligible professional or group practice'' (77 FR 45053).
    We invited public comment but received no comments on this proposed 
definition of EHR data submission vendor product. However, we are 
modifying this definition to indicate that a data submission vendor is 
not necessarily an EHR product. Rather, according to stakeholder 
feedback, an EHR data submission vendor is any entity that is able to 
receive and transmit to CMS quality measures data extracted from an EHR 
product on behalf of the eligible professional. Therefore, we are 
modifying Sec.  414.90(b) to define an ``electronic health record (EHR) 
data submission vendor'' as ``an entity that receives and transmits 
data on Physician Quality Reporting System measures from an EHR product 
to CMS.''
    Qualification process for EHR Data Submission Vendors for 2013. 
Please note that the qualification requirements for a vendor's EHR data 
submission vendor products for 2013 were established in the CY 2012 
Medicare PFS final rule (76 FR 73327). Specifically, we established 
that a qualification and testing process would occur in 2012 to qualify 
EHR data submission vendor products to submit PQRS quality measures 
data for reporting periods occurring in CY 2013. Operationally, we were 
unable to establish a qualification and testing process in 2012 to 
qualify EHR data submission vendor products for reporting periods 
occurring in CY 2013. Therefore, we proposed to perform, in 2013, the 
qualification and testing process established in the CY 2012 Medicare 
PFS final rule (76 FR 73327) that was supposed to occur in 2012 (77 FR 
44812). We invited but received no public comment on this proposal. 
Therefore, we are finalizing our proposal to perform this qualification 
and testing process for EHR data submission vendor products in 2013.
    Discontinuation of Qualification Process for EHR Data Submission 
Vendors. For 2014 and beyond, we proposed to no longer qualify EHR data 
submission vendor products to use such products under the PQRS for the 
same reasons we have articulated in our proposal not to continue 
qualifying direct EHR products (77 FR 44812). Although we would still 
allow EHR data submission vendors to submit test files to the PQRS and 
continue to provide support calls, we would no longer require vendors 
to undergo this testing process. CMS, however, would no longer post a 
list of qualified EHR data submission vendors on the CMS Web site. 
Therefore, eligible professionals would need to work with their 
respective EHR data submission vendor to determine whether the vendor 
has undergone any testing with the PQRS and/or whether EHR data 
submission vendor can produce and transmit the data in the CMS-
specified form and manner.
    We invited public comment on our proposal to, beginning 2014, not 
require qualification of EHR data submission vendor products. We also 
invited public comment as to whether CMS should continue to require 
that EHR data submission vendors undergo these self-nomination and 
qualification processes prior to being authorized to submit quality 
measure data to CMS on an eligible professional's behalf for PQRS 
reporting purposes.
    We proposed to not continue the qualification requirement (that is, 
no longer propose this process for 2014 and future years of the 
program) because we felt adequate checks were in place to ensure that 
an EHR data submission vendor is able to submit quality measures data 
for the PQRS. For example, to the extent possible, we intend to align 
with the Medicare EHR Incentive Program for our criteria for 
satisfactory reporting and measures available for reporting under the 
EHR-based reporting mechanism. The Medicare EHR Incentive Program 
requires that an eligible professional submit clinical quality measures 
using EHR technology certified under the program established by the 
Office of the National Coordinator for Health Information Technology 
(ONC). We anticipated that the ONC's certification process could 
include testing related to the reporting of the proposed PQRS EHR 
measures indicated in Table 95, since we proposed to align the PQRS 
EHR-based measures with the measures available for reporting under the 
EHR Incentive Program. We invited public comment as to whether, in lieu 
of qualification, CMS should require that direct EHR products that 
would be used to submit data on PQRS quality measures for a respective 
reporting period be classified as CEHRT under the program established 
by the ONC.
    The following is a summary of comments we received regarding our

[[Page 69186]]

proposals to discontinue the qualification process for EHR data 
submission vendors and/or requiring that a vendor's EHR product be 
CEHRT.
    Comment: Several commenters supported our proposal to discontinue 
qualification of EHR data submission vendors. The commenters believed 
that this proposal moves towards our goal of aligning PQRS and the EHR 
Incentive Program. The commenters also believed discontinuing 
qualification of EHR data submission vendors helps to encourage use of 
the EHR-based reporting mechanism for reporting under PQRS.
    Response: Based on the comments received and for the reasons stated 
previously, we are finalizing our proposal to discontinue qualifying 
EHR data submission vendors beginning in 2014.
    Comment: Some commenters opposed our proposal to discontinue 
qualification of EHR data submission vendors. The commenters believe 
that discontinuing qualification will increase burden on providers, who 
will have no guide to determine whether an EHR data submission vendor 
is qualified to report PQRS measures. One commenter therefore urged CMS 
to continue to qualify EHR data submission vendors until the Office of 
the National Coordinator (ONC) for Health Information Technology 
certification process can be used for PQRS to certify its EHR products 
in addition to the EHR Incentive Program. Another commenter expressed 
concern that, should CMS discontinue the qualification process for EHR 
data submission vendors, eligible professionals and group practices 
would simply assume that their CEHRT are able to submit data on 
measures under PQRS.
    Response: We understand that our decision to discontinue the 
qualification process for an EHR data submission vendor's EHR products 
puts the onus on eligible professionals and group practices to 
determine whether a product meets the requirements for reporting PQRS 
measures. However, we have received much stakeholder feedback requested 
that we discontinue the requirement that an eligible professional 
select a ``qualified'' EHR product; the stakeholders believe that the 
qualified designation is confusing, because there is already a 
certification program in place established by ONC that tests and 
certifies certain EHR products. Therefore, we are finalizing our 
decision to discontinue the qualification process for EHR data 
submission vendor's EHR products under the PQRS beginning in 2014.
    Nonetheless, we share the commenter's concern that discontinuing 
the qualification process would place additional burden on providers 
when trying to determine which EHR data submission vendor to enter into 
an agreement with. Therefore, based on the comments received and for 
the reasons we are requiring that direct EHR products be CEHRT 
beginning in 2014, we are also finalizing a requirement that a vendors 
EHR product be certified under the program established by ONC as 
Certified EHR Technology (CEHRT), and therefore meet the definition of 
CEHRT in ONC's regulations (see 45 CFR 170.102), to submit PQRS 
measures. We understand that CEHRT may provide more capabilities than 
needed to report PQRS quality measures. However, we note that most of 
these capabilities are intertwined with the EHR product's ability to 
capture data on quality measures and therefore necessary.
    Comment: While one commenter generally supported requiring that EHR 
data submission vendor products be ONC certified as CEHRT to report 
PQRS measures, the commenter stated that the ONC certification process 
should only be used for the PQRS and EHR Incentive Programs if the 
measures are identical, particularly in specifications and reporting 
format.
    Response: We note the commenter's concern regarding use of the ONC 
certification process and the alignment of EHR-based measures in PQRS 
and the EHR Incentive Program. As we noted in the response to this 
comment regarding requiring CEHRT and direct EHR products, it is our 
intention to align, to the maximum extent possible, the measures and 
reporting criteria for eligible professionals to meet the criteria for 
satisfactory reporting under PQRS and the criteria for meeting the CQM 
component of meaningful use under the EHR Incentive Program. By 2014, 
we expect that the measures and reporting criteria available under both 
programs will be sufficiently aligned to justify requiring that an EHR 
product undergo the ONC certification process. Therefore, we believe 
that requiring a direct EHR product to be CEHRT in order to be eligible 
to report measures under PQRS beginning in 2014 is appropriate.
    Other Requirements for Data Submission Vendors' EHR Products. 
Although EHR data submission vendor products are no longer be required 
beginning in 2013 to undergo this testing or qualification process, we 
proposed that CMS would only accept the data if the data are:
     Transmitted in a CMS-approved XML format utilizing a 
Clinical Document Architecture (CDA) standard such as Quality Reporting 
Data Architecture (QRDA) level 1 and for EHR data submission vendor 
products that intend to report for purposes of the proposed PQRS-
Medicare EHR Incentive Program Pilot, if the aggregate data are 
transmitted in a CMS-approved XML format.
     In compliance with a CMS-specified secure method for data 
submission (77 FR 44812).
    In addition, upon request and for oversight purposes, we proposed 
that the vendor would still be expected to provide CMS access to review 
the Medicare beneficiary data on which PQRS direct EHR-based 
submissions are founded or provide to CMS a copy of the actual data.
    We invited public comment on these proposed requirements for EHR 
data submission vendors. The following is a summary of the comments we 
received on this proposal.
    Comment: One commenter generally supported our proposal to require 
that data submitted follow the proposed format, regardless of whether 
the qualification process is discontinued. The commenter also 
specifically supported use of a standard reporting structure in XML. 
The commenter further believes that QRDA Level 1 should adequately 
capture measure information for patients and types of measures where 
the analysis is something other than the patient.
    Response: We appreciate the commenter's support and are finalizing 
these proposed requirements, as proposed.
    In addition, we note that in addition to finalizing the submission 
of quality measures data using the QRDA Category I format, the EHR 
Incentive Program also finalized the QRDA Category III transmission 
format (77 FR 54075). In our proposal, we proposed to require that 
eligible professionals and group practices using CEHRT transmit quality 
measures data in a CMS-approved XML format utilizing a Clinical 
Document Architecture (CDA) standard, and used QRDA Category I as an 
example. Since it was our intent to align with the EHR Incentive 
Program, who finalized transmission of quality measures data using the 
QRDA Category I and QRDA Category III formats, we are also requiring 
that quality measures data submitted via CEHRT for purposes of 
reporting for PQRS beginning in 2014 be transmitted using the QRDA 
Category I and QRDA Category III formats. We note that, although we are 
requiring that products be able to transmit data using the QRDA 
Category I and III formats, for purposes of reporting PQRS quality 
measures data to CMS, eligible

[[Page 69187]]

professionals need only submit data via their EHR using 1 (either QRDA 
Category I or III) of these formats. For those eligible professionals 
who wish to participate in both PQRS and the EHR Incentive Program 
using an EHR product that is CEHRT beginning in 2014, we refer readers 
to Option 2 for the submission of CQMs under the EHR Incentive Program 
(77 FR 54058).
    Collection of EHR Data via the NwHIN. The Nationwide Health 
Information Network (NwHIN) is an initiative developed by the 
Department of Health and Human Services that provides for the exchange 
of healthcare information. Traditionally, CMS has not collected data 
received via an EHR data submission vendor through NwHIN, but we would 
like to encourage this method with EHR-based reporting. However, we 
strive to encourage the collection of data via the NwHIN and intend to 
do so when it is technically feasible to do so (as early as 2014). 
Therefore, we solicited public comment on collecting data via an EHR 
for PQRS via NwHIN. The following is a summary of comments we received.
    Comment: One commenter opposed collection data received via a 
direct EHR product through the Nationwide Health Information Network 
(NwHIN). The commenter believes collecting data through NwHIN is 
premature and believes that development of the NwHIN is necessary prior 
to collecting data through the NwHIN.
    Response: We appreciate the commenter's feedback and agree with the 
commenter. Therefore, we are not finalizing any plan to collect data 
received via an EHR data submission vendor through the NwHIN at this 
time.
d. GPRO Web Interface: Requirements for Group Practices Using the GPRO 
Web Interface for 2013 and Beyond
    The GPRO web interface is a reporting mechanism established by CMS 
that is used by group practices that are selected to participate in the 
GPRO. For 2013 and beyond, we proposed to modify newly designated Sec.  
414.90(g) and Sec.  414.90(h) to identify the GPRO web interface as a 
reporting mechanism available for reporting under the PQRS by group 
practices comprised of 25 or more eligible professionals (77 FR 45055). 
Consistent with the GPRO satisfactory reporting criteria we established 
for the 2012 PQRS (76 FR 73338), as well as the GPRO satisfactory 
reporting criteria we proposed for 2013 and beyond, we proposed to 
limit reporting via the GPRO web interface during a respective 
reporting period to group practices composed of at least 25 eligible 
professionals (that is, this reporting option would not be available to 
group practices that contain 2-24 eligible professionals) and selected 
to participate in the GPRO for the year under which the reporting 
period occurs (77 FR 44812). For example, a group practice wishing to 
submit quality measure data via the GPRO web interface for 2013 must be 
a group practice selected to participate in the GPRO for the 2013 
program year. We believe it is necessary to limit use of the GPRO web 
interface to group practices comprised of at least 25 eligible 
professionals selected to participate in the GPRO because the 18 
measures (including 2 composite measures, for a total of 22 measures) 
that are proposed to be reportable via the GPRO web interface (as 
specified in Table 33 of the proposed rule) reflect a variety of 
disease modules: Patient/caregiver experience, care coordination/
patient safety, preventive health, diabetes, hypertension, ischemic 
vascular disease, heart failure, and coronary artery disease.
    We believe that the reporting of the 18 proposed measures spanning 
across various settings would lend this reporting mechanism to larger 
group practices that are more likely to be multi-specialty practices 
(which are typically group practices consisting of more than 24 
eligible professionals). The GPRO web interface was modeled after the 
CMS Physician Group Practice (PGP) demonstration, and this 
demonstration was originally intended for large group practices. From 
our experience with the PGP demonstration, we believe a group practice 
comprised of 25 eligible professionals is the smallest group practice 
that could benefit from use of the GPRO web interface as a reporting 
mechanism. We also do not believe that excluding group practices 
comprised of 2-24 eligible professionals from using the GPRO web 
interface as a reporting mechanism would harm these smaller group 
practices because we proposed to expand the reporting options for small 
group practices by proposing to allow groups composed of 2-99 eligible 
professionals to report using the claims, qualified registry, EHR, and 
administrative claims-based reporting mechanisms.
    We proposed to provide group practices that are selected to 
participate in the GPRO using GPRO web interface reporting option with 
access to the GPRO web interface by no later than the first quarter of 
the year following the end of the reporting period under which the 
group practice intends to report (77 FR 44813). For example, for group 
practices selected for the GPRO for the 2013 incentive using the GPRO 
web interface tool, we proposed to provide group practices selected to 
participate in the GPRO with access to the GPRO web interface by no 
later than the first quarter of 2014 for purposes of reporting for the 
applicable 2013 reporting period for the incentive. In addition, we 
noted that if CMS encountered operational issues with the use of the 
GPRO web interface, we reserved the right to use a similar tool for 
group practices to use in lieu of reporting via the GPRO web interface.
    We invited public comment on our proposed requirements for group 
practices using the GPRO web interface for 2013 and beyond. We received 
the following comment on these proposals:
    Comment: One commenter supported our proposal to limit availability 
of the GPRO web interface to group practices of 25 or more eligible 
professionals and agreed with our reasoning.
    Response: We appreciate with the commenter's feedback and, 
therefore, we are finalizing our proposal to limit the availability of 
the GPRO web interface to group practices comprised of 25 or more 
eligible professionals. In the future, CMS will try to develop ways by 
which smaller group practices could be able to use the GPRO web 
interface.
    Based on the comments received, we are finalizing, as proposed, 
requirements for group practices using the GPRO web interface for 2013 
and beyond. We are also modifying Sec.  414.90(g)(3) and Sec.  
414.90(h)(3) to indicate that the GPRO web interface will be a 
reporting mechanism available for use by group practices for the PQRS 
incentives and payment adjustments.
    Collection of GPRO Web interface Data via the NwHIN. The Nationwide 
Health Information Network (NwHIN) is an initiative developed by the 
Department of Health and Human Services that provides for the exchange 
of healthcare information. Traditionally, CMS has not collected data 
received via the GPRO web interface through NwHIN. However, we strive 
to encourage the collection of data via the NwHIN and intend to do so 
when it is technically feasible to do so (as early as 2014). Therefore, 
we solicited public comment on collecting data via the GPRO web 
interface for PQRS via NwHIN. We received no public comment on this 
proposal. However, since we believe collecting data via the NwHIN would 
be premature, we are not finalizing any policy to collect data received 
via the GPRO web interface in the NwHIN.

[[Page 69188]]

e. Administrative Claims
    For purposes of reporting for the 2015 and 2016 PQRS payment 
adjustments only, we proposed to modify Sec.  414.90(h) to allow 
eligible professionals and group practices to use an administrative 
claims reporting mechanism (77 FR 45056). The administrative claims 
reporting mechanism builds off of the traditional PQRS claims-based 
reporting mechanism. Under the traditional PQRS claims-based reporting 
mechanism, eligible professionals and group practices wishing to report 
data on PQRS quality measures via claims for the incentives and for the 
payment adjustments must submit quality data codes (QDCs) on claims to 
CMS for analysis. Under the proposed administrative claims reporting 
mechanism, unlike the traditional claims-based reporting option, an 
eligible professional or group practice would not be required to submit 
QDCs on claims to CMS for analysis (77 FR 44813). Rather, CMS would 
analyze every eligible professional's or group practice's patient's 
Medicare claims to determine whether the eligible professional or group 
practice has performed any of the clinical quality actions indicated in 
the proposed PQRS quality measures in Table 63 of the CY 2013 PFS 
proposed rule. We proposed that, for purposes of assessing claims for 
quality measures under this option, all claims for services furnished 
that occur during the 2015 and/or 2016 PQRS payment adjustment 
reporting period would need to be processed by no later than 60 days 
after the end of the respective 2015 and 2016 payment adjustment 
reporting periods (that is, December 31, 2013 and December 31, 2014).
    We invited public comment on our proposed requirements for using 
the administrative claims-based reporting mechanism for the 2015 and 
2016 payment adjustments. The following is summary of the comments we 
received regarding these proposals.
    Comment: Several commenters supported the addition of the 
administrative claims-based reporting mechanism for the 2015 and 2016 
PQRS payment adjustments. The commenters noted that this addition of 
the administrative claims-based reporting mechanism would relieve the 
reporting burden on eligible professionals.
    Response: We appreciate the commenters' feedback and are finalizing 
the administrative claims-based reporting mechanism for the 2015 
payment adjustment. Since it is our intention that this reporting 
option be temporary, we will consider having the administrative claims-
based reporting mechanism available for the 2016 PQRS payment 
adjustment in the future, but we are not finalizing our proposal to 
have the administrative claims-based reporting option for eligible 
professionals and group practices for the 2016 PQRS payment adjustment 
at this time. As participation in PQRS increases and eligible 
professionals and group practices become more familiar with the 
traditional claims, registry, direct EHR, EHR data submission vendor-
based, or GPRO web interface reporting mechanisms, it is our intention 
to move away from use of the administrative claims-based reporting 
mechanism to allow for more proactive reporting by eligible 
professionals and group practices.
    Comment: One commenter suggested that eligible professionals be 
allowed to choose the administrative claims-based reporting option to 
meet the criteria for satisfactory reporting for the 2013 and 2014 PQRS 
incentives.
    Response: We respectfully disagree. We believe that eligible 
professionals and group practices should be required to use the 
traditional reporting mechanisms (claims, registry, EHR, or GPRO web 
interface) to report for the PQRS incentive as we believe that 
reporting via these traditional reporting mechanisms produce more 
meaningful data. As noted previously, while the administrative claims-
based reporting mechanism still satisfies PQRS requirements by 
submitting quality measures data to CMS, we agree with other commenters 
that the administrative claims-based reporting option may not provide 
data that is as meaningful as data collected through other mechanisms. 
We are finalizing the addition of the administrative claims-based 
reporting option only as a means to report for the 2015 PQRS payment 
adjustments to ease eligible professionals into reporting PQRS 
measures. Since we see this option as temporary, only a limited set of 
measures were proposed for use under the administrative claims-based 
reporting option. We believe that more meaningful data will be 
collected using the traditional claims, registry, EHR, or GPRO web 
interface reporting mechanisms, where eligible professionals or group 
practices may choose measures from a broad set that may be more 
relevant to their practice. Therefore, eligible professionals will not 
be able to use the administrative claims-based reporting mechanism for 
the 2013 and 2014 PQRS incentives.
    Based on the comments received, we are finalizing, as proposed, the 
administrative claims-based reporting mechanism for reporting for the 
2015 payment adjustment only. We are not finalizing the administrative 
claims-based reporting mechanism for the 2016 PQRS payment adjustment, 
as we will revisit the necessity of having this reporting option 
available for the 2016 PQRS payment adjustment next year. We are 
modifying Sec.  414.90(h)(2) and Sec.  414.90(h)(3) to indicate that 
the administrative claims-based reporting mechanism is available for 
use by eligible professionals and group practices for the 2015 PQRS 
payment adjustment.
4. Criteria for Satisfactory Reporting for the 2013 and 2014 Incentives
    For 2013 and 2014, in accordance with Sec.  414.90(c)(3), eligible 
professionals that satisfactorily report data on PQRS quality measures 
are eligible to receive an incentive equal to 0.5 percent of the total 
estimated Medicare Part B allowed charges for all covered professional 
services furnished by the eligible professional or group practice 
during the applicable reporting period. This section contains the 
criteria for satisfactory reporting for the 2013 and 2014 incentives, 
which are the last two incentives authorized under the PQRS.
a. Criteria for Satisfactory Reporting for Individual Eligible 
Professionals
(1) Criteria for Satisfactory Reporting on Individual PQRS Quality 
Measures via Claims
    According to the ``2010 Physician Quality Reporting System and eRx 
Reporting Experience and Trends,'' available for viewing in the 
``downloads'' section of the main page the PQRS Web site (http://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/PQRS/index.html), reporting via the claims-based reporting 
mechanism was the most commonly used reporting method. We believe that 
this trend would continue, so we anticipated that, for the 2013 and 
2014 incentives, the criteria for satisfactory reporting for the 
claims-based reporting mechanism would be the method most widely used 
by individual eligible professionals. So as not to change reporting 
criteria that a large number of individual eligible professionals are 
familiar with using, we established the same reporting criteria for the 
2011 and 2012 incentives (76 FR 73330). Therefore, for the respective 
12-month reporting periods for the 2013 and 2014 incentives, based on 
our authority under section 1848(m)(3)(D) of the Act to revise the 
reporting criteria for

[[Page 69189]]

satisfactory reporting specified under the statute and our desire to 
maintain the same reporting criteria we established for individual 
eligible professionals for the 2012 PQRS incentive (76 FR 73330), we 
proposed the following criteria for satisfactory reporting of PQRS 
individual measures for individual eligible professionals using the 
claims-based reporting mechanism: Report at least 3 measures, OR, if 
less than 3 measures apply to the eligible professional, report 1-2 
measures, AND report each measure for at least 50 percent of the 
eligible professional's Medicare Part B FFS patients seen during the 
reporting period to which the measure applies (77 FR 44813). Measures 
with a 0 percent performance rate would not be counted. For an eligible 
professional who reports fewer than 3 measures via the claims-based 
reporting mechanism, we proposed that the eligible professional be 
subject to the Measures Applicability Validation (MAV) process, which 
would allow us to determine whether an eligible professional should 
have reported quality data codes for additional measures. We felt the 
MAV process was necessary to review whether there are other closely 
related measures (such as those that share a common diagnosis or those 
that are representative of services typically provided by a particular 
type of eligible professional). Under the MAV process, if an eligible 
professional who reports on fewer than 3 measures reports on a measure 
that is part of an identified cluster of closely related measures, then 
the eligible professional would not qualify as a satisfactory reporter 
for the 2013 and/or 2014 incentives. We proposed this MAV process for 
the claims-based reporting mechanism only because it is more likely for 
EPs to report on more than 3 measures under the registry and EHR-based 
reporting mechanisms, as a registry or EHR product will typically 
automatically report on all measures that apply to the eligible 
professional's practice. We note that, consistent with section 
1848(m)(3)(A)(i) of the Act, this proposed claims-based reporting 
criteria would be the only proposed criteria where an eligible 
professional could report on fewer than 3 measures.
    We invited public comment on the proposed criteria for satisfactory 
reporting of individual measures by individual eligible professionals 
via claims for the 2013 and 2014 incentives. The following is a summary 
of the comment we received regarding these proposed criteria:
    Comment: One commenter supported our proposed criteria for 
satisfactory reporting for individual eligible professionals via 
claims. The commenter stated that the 3-measure threshold allows small 
practices that participate individually treating multi-morbid patients 
to participate in PQRS.
    Response: Based on the comments received and for the reasons stated 
previously, we are finalizing, as proposed, the criteria for 
satisfactory reporting for individual eligible professionals via claims 
for the 2013 and 2014 PQRS incentives. These criteria are specified in 
Tables 25 and 26 below.
(2) Criteria for Satisfactory Reporting on Individual PQRS Quality 
Measures via Registry
    We note that section 1848(m)(3)(A)(ii) of the Act provides that, to 
meet the criteria for satisfactory reporting under PQRS, an eligible 
professional would be required to report on at least 3 measures for at 
least 80 percent of the cases in which the respective measure is 
reportable under the system. Although we have the authority under 
section 1848(m)(3)(D) of the Act to revise the criteria for 
satisfactory reporting, for registry-based reporting, we have largely 
followed these reporting criteria for the PQRS incentives. According to 
the ``2010 Physician Quality Reporting System and eRx Reporting 
Experience and Trends,'' eligible professionals are more likely to meet 
the requirements for a PQRS incentive using the satisfactory reporting 
criteria for the registry-based reporting mechanism than claims. In 
fact, in 2010, approximately 87 percent of the eligible professionals 
reporting individual PQRS quality measures via registry were eligible 
and met the criteria for satisfactory reporting for the 2010 incentive. 
Since eligible professionals have had success with using these 
satisfactory reporting criteria, we believe such criteria are 
appropriate and see no reason to change the criteria for satisfactory 
reporting via registry that has been in place since 2010. Therefore, 
for those reasons and our desire to maintain the same reporting 
criteria we established for individual eligible professionals for the 
2012 PQRS incentive (76 FR 73331), we proposed the following criteria 
for satisfactory reporting of PQRS individual measures for individual 
eligible professionals using the registry-based reporting mechanism for 
the 12-month reporting periods for the 2013 and 2014 incentives, 
respectively: Report at least 3 measures AND report each measure for at 
least 80 percent of the eligible professional's Medicare Part B FFS 
patients seen during the reporting period to which the measure applies 
(77 FR 44814). Measures with a zero percent performance rate will not 
be counted.
    We invited but received no public comment on the proposed criteria 
for satisfactory reporting of individual measures by individual 
eligible professionals via a registry for the 2013 and 2014 incentives. 
Therefore, we are finalizing these criteria as proposed. These criteria 
are specified in Tables 25 and 26 below.
(3) Criteria for Satisfactory Reporting on Individual PQRS Quality 
Measures via EHR
    Satisfactory Reporting Criteria of Individual PQRS Quality Measures 
via EHR for the 2013 PQRS Incentive. As stated previously, section 
1848(m)(7) of the Act requires us to develop a plan to integrate 
reporting requirements for PQRS and the EHR Incentive Program. 
Therefore, for EHR-based reporting, it is our main goal to align our 
EHR reporting requirements with the reporting requirements an eligible 
professional must meet to satisfy the clinical quality measure (CQM) 
component of meaningful use (MU) under the EHR Incentive Program. To 
align with the EHR Incentive Program, we based our proposals on the EHR 
Incentive Program--Stage 2 NPRM (77 FR 13698). Also to align with the 
EHR Incentive Program, for the EHR reporting periods in CY 2013, we 
proposed (77 FR 13745) to continue the CQM reporting requirements that 
were established for eligible professionals for CYs 2011 and 2012 in 
the EHR Incentive Program--Stage 1 final rule (75 FR 44398-44411). 
Therefore, to align with the reporting requirements for meeting the CQM 
component of meaningful use, and based on our authority under section 
1848(m)(3)(D) of the Act to revise the reporting criteria for 
satisfactory reporting identified under the statute, we proposed the 
following criteria for the 12-month reporting period for the 2013 
incentive (77 FR 44814):
     As required by the Stage 1 final rule, eligible 
professionals must report on three Medicare EHR Incentive Program core 
or alternate core measures, plus three additional measures. The EHR 
Incentive Program's core, alternate core, and additional measures can 
be found in Table 6 of the EHR Incentive Program's Stage 1 final rule 
(75 FR 44398) or in Tables 32 and 33 of the CY 2013 PFS proposed rule. 
We referred readers to the discussion in the Stage 1 final rule for 
further explanation of the requirements for reporting those CQMs (75 FR 
44398 through 44411).
    Under this proposal, eligible professionals using these reporting

[[Page 69190]]

criteria would be required to report on 6 measures. For the proposed 
PQRS EHR measures that are also Medicare EHR Incentive Program core, 
alternate core, or additional measures that the eligible professional 
reports (75 FR 44398 through 44411), an eligible professional would be 
required to report the applicable measure for 100 percent of the 
eligible professionals Medicare Part B FFS patients.
    In addition, we noted that section 1848(m)(3)(A)(ii) of the Act 
provides that, to meet the criteria for satisfactory reporting under 
PQRS, an eligible professional would be required to report on at least 
3 measures for at least 80 percent of the cases in which the respective 
measure is reportable under the system. Although we have the authority 
under section 1848(m)(3)(D) of the Act to revise the criteria for 
satisfactory reporting, for EHR-based reporting, we noted that we have 
largely kept these reporting criteria for the 2010-2012 incentives. As 
some eligible professionals succeeded with these criteria, we proposed 
the following similar criteria for the 12-month reporting period for 
the 2013 incentive: Report at least 3 measures AND report each measure 
for at least 80 percent of the eligible professional's Medicare Part B 
FFS patients seen during the reporting period to which the measure 
applies (77 FR 44814). Measures with a zero percent performance rate 
will not be counted.
    We received no public comment on the satisfactory reporting 
criterion we proposed for individual PQRS measures using a direct EHR 
or EHR data submission vendor product for the 2013 PQRS incentive: 
Report at least 3 measures for at least 80 percent of the cases in 
which the respective measure is reportable under the system. Therefore, 
for the reasons previously stated, we are finalizing the criterion.
    We invited public comment on the proposed criteria for the 
satisfactory reporting of individual PQRS measures using a direct EHR 
or EHR data submission vendor product for the 2013 PQRS incentive. The 
following is a summary of those comments.
    Comment: Several commenters generally supported our proposals to 
align the EHR reporting criteria with the criteria established for 
meeting the CQM component of achieving meaningful use under the EHR 
Incentive Program.
    Response: We appreciate the commenters' positive feedback.
    Comment: Several commenters supported our proposed criteria for the 
satisfactory reporting of PQRS measures via direct EHR or EHR data 
submission vendor products for the 2013 PQRS incentive, as the proposed 
criteria aligns with the CQM criteria of meaningful use for the EHR 
Incentive Program.
    Response: We appreciate the commenters' feedback. Based on the 
support received for this proposed criterion and for the reasons we 
discussed above, we are finalizing the following criterion for the 
satisfactory reporting of individual PQRS measures using a direct EHR 
or EHR data submission vendor product for the 2013 PQRS incentive: As 
required by the Stage 1 final rule, eligible professionals must report 
on three Medicare EHR Incentive Program core or alternate core 
measures, plus three additional measures. The EHR Incentive Program's 
core, alternate core, and additional measures can be found in Tables 6 
and 7 of the EHR Incentive Program's Stage 1 final rule (75 FR 44398 
through 44411) or in Table 95 of this section. We refer readers to the 
discussion in the Stage 1 final rule for further explanation of the 
requirements for reporting those CQMs (75 FR 44398 through 44411).
    Comment: Several commenters encouraged us to accept the reporting 
of measures with a zero percent performance rate using the EHR-based 
satisfactory reporting criteria that aligns with the EHR Incentive 
Program. Under Stage 1, many of the core and alternate core measures 
are not applicable to specialties. The commenter believes that allowing 
the reporting of measures with a zero percent performance rate will 
achieve our goal of having eligible professionals report one set of 
data for PQRS and the EHR Incentive Program.
    Response: We understand the commenter's concerns. We have stressed 
the importance of collecting data that is applicable to the eligible 
professional's practice. Therefore, or PQRS, we are only concerned with 
the reporting of measures that are relevant to an eligible 
professional's practice. An eligible professional may still report on 
the same number of measures he/she is reporting for the EHR Incentive 
Program. However, for purposes of PQRS, we will only analyze the 
measures that are applicable to the eligible professional's practice. 
If using this reporting criterion, an eligible professional should be 
able to report on at least one applicable measure.
    Satisfactory Reporting Criteria of Individual PQRS Quality Measures 
via EHR for the 2014 PQRS Incentive. At the time of the CY 2013 PFS 
proposed rule, we noted that we had proposed under the Medicare EHR 
Incentive Program options for meeting the CQM component of achieving 
meaningful use beginning with CY 2014 (77 FR 13746--13748). To align 
our EHR-based reporting requirements with those proposed under the 
Medicare EHR Incentive Program, we proposed the following criteria for 
satisfactory reporting using the EHR-based reporting mechanism for the 
12-month reporting period for the 2014 incentive:
     Option 1a: Select and submit 12 clinical quality measures 
available for EHR-based reporting from Tables 32 and 33 of the proposed 
rule, including at least 1 measure from each of the following 6 
domains--(1) patient and family engagement, (2) patient safety, (3) 
care coordination, (4) population and public health, (5) efficient use 
of healthcare resources, and (6) clinical process/effectiveness.
     Option 1b: Submit 12 clinical quality measures composed of 
all 11 of the proposed Medicare EHR Incentive Program core clinical 
quality measures specified in Table 95 plus 1 menu clinical quality 
measure from Tables 32 and 33 of the proposed rule. We noted it was our 
intention to finalize the reporting criteria that aligns with the 
criteria that would be established for meeting the CQM component of 
meaningful use beginning with CY 2014 for the Medicare EHR Incentive 
Program. Furthermore, to the extent that the final criteria for meeting 
the CQM component of achieving meaningful use differ from what was 
proposed, we noted that our intention was to align with the reporting 
criteria the EHR Incentive Program ultimately established (77 FR 
44814). Therefore, eligible professionals who participate in both PQRS 
and the EHR Incentive Program would be able to use one reporting 
criterion, during overlapping reporting periods, to satisfy the 
satisfactory reporting criteria under PQRS and the CQM component of 
meaningful use under the Medicare EHR Incentive Program.
    In addition to this proposed criterion, we had proposed under the 
Medicare EHR Incentive Program that, beginning with CY 2014, eligible 
professionals who participate in both the Physician Quality Reporting 
System and the Medicare EHR Incentive Program may satisfy the CQM 
component of meaningful use if they submit and satisfactorily report 
PQRS clinical quality measures under the PQRS EHR reporting option 
using Certified EHR Technology (77 FR 13748). Since this language 
suggested that the Medicare EHR Incentive Program may defer to the 
satisfactory reporting criteria for the EHR-based reporting mechanism 
that we will establish for 2014, we proposed the following reporting 
criteria for the 12-month reporting period for the 2014 incentive that 
largely conform to the criteria set forth under section

[[Page 69191]]

1848(m)(3)(A)(ii) of the Act that we established for the 2012 incentive 
and that we proposed for the 2013 incentive: Report at least 3 measures 
AND report each measure for at least 80 percent of the eligible 
professional's Medicare Part B FFS patients seen during the reporting 
period to which the measure applies. Measures with a zero percent 
performance rate will not be counted.
    We received no comments regarding the following proposed criteria 
using a direct EHR or EHR data submission vendor product for the 2014 
incentive: Report at least 3 measures AND report each measure for at 
least 80 percent of the eligible professional's Medicare Part B FFS 
patients seen during the reporting period to which the measure applies. 
However, in an effort to streamline reporting requirements for the 2014 
PQRS incentives, we only wish to finalize one reporting criterion to 
meet the criteria for satisfactory reporting for the 2014 PQRS 
incentive using an EHR-based reporting mechanism. Therefore, since the 
EHR Incentive Program did not finalize this proposed reporting 
criterion, we are not finalizing this proposed criterion. We understand 
that not finalizing this criterion would eliminate a reporting option 
previously available to eligible professionals. We note however, that 
this EHR-based reporting criterion was not widely used by eligible 
professionals. In fact, according to the 2010 PQRS and eRx Experience 
Report, less than 1% of eligible professionals participating in PQRS 
did so using the EHR-based reporting mechanism. Therefore, we do not 
believe eligible professionals will be harmed by our decision not to 
finalize this criterion. Furthermore, we believe that eligible 
professionals that have used the EHR-based reporting mechanism in the 
past will gravitate towards using reporting criterion that aligns with 
the EHR Incentive Program, as eligible professionals using aligned 
criterion will have the ability to submit one set of quality measures 
data to achieve the requirements under both PQRS and the EHR Incentive 
Program. Nonetheless, we are streamlining the criteria in 2014, and not 
2013, in order to give eligible professionals an additional year to 
adjust their practice workflows to account for this change.
    We invited public comment on the proposed criteria for satisfactory 
reporting on PQRS measures via EHR for the 2014 PQRS incentive that 
were proposed under the EHR Incentive Program for 2014. The following 
is summary of the comments we received regarding these proposals.
    Comment: Several commenters generally supported our proposals to 
align the EHR reporting criteria with the criteria established for 
meeting the CQM component of achieving meaningful use under the EHR 
Incentive Program.
    Response: We appreciate the commenters' positive feedback.
    Comment: Some commenters suggested an alternative criterion for the 
satisfactory reporting of individual PQRS measures via EHR: For the 
2014 PQRS incentive, report six measures, covering at least two 
domains. If no individual measures available for EHR-based reporting 
are relevant to the eligible professional, the eligible professional 
may submit measures with a zero percent performance rate.
    Response: We appreciate the commenter's suggestion. However, as 
previously stated, it is our intention to adopt satisfactory reporting 
criteria that closely aligns with the criteria established for 
achieving meaningful use for the EHR Incentive Program. Since the 
alternative criterion proposed by the commenter does not align with the 
criteria established for the EHR Incentive Program, we respectfully 
decline to establish this alternative criterion for the satisfactory 
reporting of individual measures via EHR for the 2014 PQRS incentive.
    Comment: For the proposed option 1a for EHR-based reporting for the 
2014 PQRS incentive, one commenter believed that the requirement to 
report 12 CQMs is too high. The commenter believed that because many 
measures are focused towards primary care and preventive medicine, it 
may be difficult for sub-specialists to meet the 12 CQM threshold, 
leading these eligible professionals to potentially report a zero 
percent performance rate on most measures. Commenters were also 
concerned that the proposal to report at least 1 measure from each of 
the six proposed domains would add to difficulty in reporting, as some 
of the domains have limited measure sets.
    Response: We understand and agree with the commenter's arguments 
against option 1a. Indeed, the EHR Incentive Program did not finalize 
these criteria for reporting CQMs to achieve meaningful use under the 
EHR Incentive Program. Therefore, we are not finalizing this proposal 
for the PQRS.
    Comment: For the proposed option 1b for EHR-based reporting for the 
2014 PQRS incentive, one commenter believed that the requirement to 
report 12 CQMs is too high. Because many measures are focused towards 
primary care and preventive medicine, the commenter was concerned that 
it may be difficult for sub-specialists to meet the 12 CQM threshold, 
leading these eligible professionals to potentially report a zero 
percent performance rate on most measures. Commenters also believed 
that the additional proposed requirement to reporting on 11 core CQM 
measures may have the negative consequence of forcing eligible 
professionals to report on measures that are not fully relevant to 
their respective practice, as there may not be 12 CQMs relevant to 
their practice.
    Response: We understand and agree with the commenter's arguments 
against option 1b. Indeed, the EHR Incentive Program did not finalize 
these criteria for reporting CQMs to achieve meaningful use under the 
EHR Incentive Program. Therefore, we are not finalizing this proposal 
for the PQRS.
    Comment: Several commenters encouraged us to accept the reporting 
of measures with a zero percent performance rate using the EHR-based 
satisfactory reporting criteria that aligns with the EHR Incentive 
Program. The commenter believes that allowing the reporting of measures 
with a zero percent performance rate will achieve our goal of having 
eligible professionals report one set of data for PQRS and the EHR 
Incentive Program.
    Response: We understand the commenter's concerns. For PQRS, we are 
only concerned with the reporting of measures that are relevant to an 
eligible professional's practice. Therefore, we will only analyze the 
measures for which there is Medicare patient data.
    We note that, despite this distinction in the way the eligible 
professional's submitted data is analyzed, we are still achieving our 
goal of aligning the criteria for satisfactory reporting under PQRS 
with the criteria for meeting the CQM component of achieving meaningful 
use under the EHR Incentive Program. Eligible professionals will still 
be able to report the same set of data in the same form and manner to 
satisfy the requirements for both programs. The only distinction lies 
in the analysis performed by the two programs. For example, let's 
pretend an eligible professional, in 2014, uses CEHRT to report 9 
measures covering 3 domains, and only 1 measure applies to the eligible 
professional's practice (that is, the eligible professional has 
patients that are eligible for inclusion in only 1 measure's 
denominator). The eligible professional will have met the criteria for 
meeting the CQM component of achieving meaningful use in 2014, because 
the eligible professional would have reported 9 measures covering at 
least 3 domains and reported the measures (1 measure, in this example) 
for which there is patient data and the remaining required measures as 
``zero denominators'' as displayed by the

[[Page 69192]]

eligible professional's CEHRT. The eligible professional will have also 
met the criteria for satisfactory reporting under PQRS for the 2014 
PQRS incentive, because we will assume that by receiving data for only 
1 measure with a denominator greater than zero that the eligible 
professional did not have any other applicable measures on which to 
report.
    We understand that there may be instances where no measures apply 
to an eligible professional. For those eligible professionals for which 
no measures available for reporting used the EHR-based reporting 
mechanisms apply, for 2014, we strongly encourage those eligible 
professionals to meet the criteria for satisfactory reporting using an 
alternative reporting option.
    Based on the comments received and for the reasons we stated above, 
we are finalizing the following criteria for satisfactory reporting of 
individual PQRS measures using direct EHR or EHR data submission vendor 
products for the 2014 PQRS incentive: Report 9 measures covering at 
least 3 domains, as specified in Table 95. If an eligible 
professional's CEHRT does not contain patient data for at least 9 
measures covering at least 3 domains, then the eligible professional 
must report the measures for which there is patient data.
    We note that the EHR Incentive Program established the 
requirements, should an eligible professional's CEHRT not contain 
patient data for at least 9 measures covering at least 3 domains, the 
eligible professional must report the measures for which there is 
patient data and report the remaining required measures as ``zero 
denominators'' as displayed by the eligible professional's CEHRT. If 
there are no measures applicable to the eligible professional's scope 
of practice and patient population, eligible professionals must still 
report 9 measures even if zero is the result in either the numerator or 
denominator of the measure. If all applicable measures have a value of 
zero from their CEHRT, then eligible professional must report any 9 
measures (77 FR 54058). For PQRS, we are only concerned with the 
reporting of measures that are relevant to an eligible professional's 
practice. Therefore, we are not accepting the reporting of ``zero 
denominators.'' Therefore, to meet the criteria for satisfactory 
reporting for the 2014 PQRS incentive using this criterion, an eligible 
professional must report on at least 1 applicable measure (that is, at 
least 1 of the 9 measures that the eligible professional reports using 
an EHR-based reporting mechanism must not have a ``zero denominator'').
(4) Criteria for Satisfactory Reporting on PQRS Measures Groups via 
Claims
    In the CY 2012 Medicare PFS final rule, we established the 
following criteria for satisfactorily reporting PQRS measures groups 
for the 12-month reporting period for the 2012 incentive (76 FR 73335):
     Report at least 1 PQRS measures group, AND report each 
measures group for at least 30 Medicare Part B FFS patients. Measures 
groups containing a measure with a 0 percent performance rate will not 
be counted; OR
     Report at least 1 PQRS measures group, AND report each 
measures group for at least 50 percent of the eligible professional's 
Medicare Part B FFS patients seen during the reporting period to whom 
the measures group applies; BUT report each measures group on no less 
than 15 Medicare Part B FFS patients seen during the reporting period 
to which the measures group applies. Measures groups containing a 
measure with a 0 percent performance rate will not be counted.
    We received stakeholder feedback that it is difficult for some 
specialties to meet the 30 Medicare Part B FFS patient threshold. 
Therefore, based on our authority under section 1848(m)(3)(D) of the 
Act to revise the reporting criteria for satisfactory reporting, we 
proposed the following criteria for the satisfactorily reporting PQRS 
measures groups for individual eligible professionals using the claims-
based reporting mechanism for the 12-month reporting periods for the 
2013 and 2014 incentives: Report at least 1 measures group AND report 
each measures group for at least 20 Medicare Part B FFS patients. 
Measures groups containing a measure with a zero percent performance 
rate will not be counted (77 FR 44815).
    We invited public comment on the proposed criterion for 
satisfactory reporting of measures groups via claims for the 2013 and 
2014 incentives. The following is summary of the comments we received 
regarding this proposal.
    Comment: Several commenters supported our proposal to lower the 
minimum patient count for reporting measures groups from 30 to 20. 
Commenters noted that lowering the reporting threshold would ease the 
reporting burden of reporting measures groups for eligible 
professionals.
    Response: We appreciate the commenters' feedback and are finalizing 
our proposed criteria for individual eligible professionals reporting 
measures groups via claims for the 2013 and 2014 PQRS incentives. The 
criteria are specified in Tables 25 and 26 below.
(5) Criteria for Satisfactory Reporting on PQRS Measures Groups via 
Registry
    In the CY 2012 Medicare PFS final rule, we established the 
following criteria for satisfactorily reporting PQRS measures groups 
for the 12-month reporting period for the 2012 incentive (76 FR 73337):
     Report at least 1 PQRS measures group AND report each 
measures group for at least 30 Medicare Part B FFS patients. Measures 
groups containing a measure with a 0 percent performance rate will not 
be counted; OR
     Report at least 1 PQRS measures group, AND report each 
measures group for at least 80 percent of the eligible professional's 
Medicare Part B FFS patients seen during the reporting period to whom 
the measures group applies; BUT report each measures group on no less 
than 15 Medicare Part B FFS patients seen during the reporting period 
to which the measures group applies. Measures groups containing a 
measure with a 0 percent performance rate will not be counted.
    In addition, we established the following criteria for 
satisfactorily reporting PQRS measures groups for the 6-month reporting 
period for the 2012 incentive (76 FR 73337): Report at least 1 PQRS 
measures group, AND report each measures group for at least 80 percent 
of the eligible professional's Medicare Part B FFS patients seen during 
the reporting period to whom the measures group applies; BUT report 
each measures group on no less than 8 Medicare Part B FFS patients seen 
during the reporting period to which the measures group applies. 
Measures groups containing a measure with a 0 percent performance rate 
will not be counted.
    We received stakeholder feedback that it is difficult for some 
specialties to meet the 30 Medicare Part B FFS patient threshold. 
Therefore, based on our authority under section 1848(m)(3)(D) of the 
Act to revise the reporting criteria for satisfactory reporting, we 
proposed the following criteria for satisfactory reporting of PQRS 
measures groups for individual eligible professionals using the 
registry-based reporting mechanism for the 2013 and 2014 incentives:
    (1) For the 12-month reporting periods for the respective 2013 and 
2014 incentives, report at least 1 measures group, AND report each 
measures group for at least 20 patients, a majority of which must be 
Medicare Part B FFS patients. Measures groups containing a measure with 
a 0 percent performance rate would not be counted.
    (2) For the 6-month reporting period for the respective 2013 and 
2014

[[Page 69193]]

incentives, report at least 1 measures group, AND report each measures 
group for at least 20 patients, a majority of which must be Medicare 
Part B FFS patients. Measures group containing a measure with a zero 
percent performance rate will not be counted. We noted that this is the 
same criterion established for the 12-month reporting period. We 
proposed the same criterion for both reporting periods in an effort to 
simplify the reporting criteria for satisfactory reporting (77 FR 
44815).
    We noted that, while we still proposed to require that an eligible 
professional report on at least 20 patients, we understood that a 
patient's personal identification information may be stripped when data 
is collected via a qualified registry. Therefore, we understood that it 
may be difficult to distinguish Medicare and non-Medicare patients. 
Given this difficulty and that the eligible professionals generally 
would be attempting to report data on Medicare patients, we felt the 
reporting of some non-Medicare patients could serve as a proxy for the 
reporting of Medicare patients whose data is not easily distinguishable 
as data on Medicare patients under this reporting mechanism.
    Finally, we noted that our proposals would satisfy the requirement 
under section 1848(m)(5)(F) of the Act that we provide for alternative 
reporting periods and criteria for satisfactory reporting with regard 
to measures groups and registry-based reporting.
    We invited public comment on the proposed criteria for satisfactory 
reporting of measures groups by individual eligible professionals via 
registry for the 2013 and 2014 incentives. The following is summary of 
the comments we received regarding these proposals.
    Comment: One commenter opposed our proposed satisfactory reporting 
criteria for reporting measures groups via registry for the 6-month 
reporting period for the 2013 and/or 2014 PQRS incentives because the 
commenter was concerned that eligible professionals who are 
satisfactory reporters using this criteria would only receive half the 
allowed amount for the 2013 and/or 2014 PQRS incentives.
    Response: We appreciate the commenter's feedback. Please note that 
all eligible professionals who satisfactorily report PQRS measures 
under the criteria for satisfactory reporting via registry for the 6-
month reporting period for the 2013 and/or 2014 PQRS incentives will 
receive the 2013 and/or 2014 incentive of 0.5% of our estimate of the 
group practice's PFS allowed charges furnished during the applicable 
reporting period. Therefore, an eligible professional would earn the 
same incentive amount regardless of which reporting period the eligible 
professional chooses to use. In an effort to streamline our criteria 
for satisfactory reporting, this satisfactory reporting criterion is 
identical to the satisfactory reporting criterion for the 12-month 
reporting period.
    Comment: Several commenters supported our proposal to lower the 
minimum patient count for reporting measures groups from 30 to 20. 
Commenters noted that lowering the reporting threshold would ease the 
reporting burden of reporting measures groups for eligible 
professionals. Several commenters also supported our proposal to allow 
for the reporting of data on non-Medicare patients.
    Response: We appreciate the commenters' feedback and are 
finalizing, as proposed, the criteria for satisfactory reporting of 
measures groups by individual eligible professionals via registry for 
the 2013 and 2014 incentives. We note that, with respect to the 
requirement that an eligible professional report on at least a majority 
(11) of the 20 patients on which the eligible professionals report, to 
the extent that an eligible professional reports on more than 20 
patients, for purposes of the 2013 and 2014 PQRS incentives, an 
eligible professional need only ensure that he/she has reported on 11 
Medicare patients.
    Tables 90 and 91 provide a summary of the final criteria for the 
satisfactory reporting of PQRS quality measures for the 2013 and 2014 
incentives.

  Table 90--Summary of Criteria for Satisfactory Reporting by Individual Eligible Professionals of Data on PQRS
                                     Quality Measures for the 2013 Incentive
----------------------------------------------------------------------------------------------------------------
         Reporting period              Measure type      Reporting mechanism      Proposed reporting criteria
----------------------------------------------------------------------------------------------------------------
Jan 1, 2013-Dec 31, 2013 *.......  Individual Measures.  Claims.............  Report at least 3 measures, OR,
                                                                              If less than 3 measures apply to
                                                                               the eligible professional, report
                                                                               1-2 measures *; AND
                                                                              Report each measure for at least
                                                                               50 percent of the eligible
                                                                               professio
                                                                              al's Medicare Part B FFS patients
                                                                               seen during the reporting period
                                                                               to which the measure applies.
                                                                              Measures with a 0 percent
                                                                               performance rate will not be
                                                                               counted.
Jan 1, 2013-Dec 31, 2013.........  Individual Measures.  Qualified Registry.  Report at least 3 measures, AND
                                                                              Report each measure for at least
                                                                               80 percent of the eligible
                                                                               professional's Medicare Part B
                                                                               FFS patients seen during the
                                                                               reporting period to which the
                                                                               measure applies.
                                                                              Measures with a 0 percent
                                                                               performance rate will not be
                                                                               counted.
Jan 1, 2013-Dec 31, 2013.........  Individual Measures.  Qualified Direct     Option 1: Report on ALL three PQRS
                                                          EHR Product.         EHR measures that are also
                                                                               Medicare EHR Incentive Program
                                                                               core measures.
                                                                              If the denominator for one or more
                                                                               of the Medicare EHR Incentive
                                                                               Program core measures is 0,
                                                                               report on up to three PQRS EHR
                                                                               measures that are also Medicare
                                                                               EHR Incentive Program alternate
                                                                               core measures; AND
                                                                              Report on three additional PQRS
                                                                               EHR measures that are also
                                                                               measures available for the
                                                                               Medicare EHR Incentive Program.
                                                                              Option 2: Report at least 3
                                                                               measures, AND
                                                                              Report each measure for at least
                                                                               80 percent of the eligible
                                                                               professional's Medicare Part B
                                                                               FFS patients seen during the
                                                                               reporting period to which the
                                                                               measure applies.
                                                                              Measures with a 0 percent
                                                                               performance rate will not be
                                                                               counted.

[[Page 69194]]

 
Jan 1, 2013-Dec 31, 2013.........  Individual Measures.  Qualified EHR Data   Option 1: Report on ALL three PQRS
                                                          Submission Vendor.   EHR measures that are also
                                                                               Medicare EHR Incentive Program
                                                                               core measures.
                                                                              If the denominator for one or more
                                                                               of the Medicare EHR Incentive
                                                                               Program core measures is 0,
                                                                               report on up to three PQRS EHR
                                                                               measures that are also Medicare
                                                                               EHR Incentive Program alternate
                                                                               core measures; AND
                                                                              Report on three additional PQRS
                                                                               EHR measures that are also
                                                                               measures available for the
                                                                               Medicare EHR Incentive Program.
                                                                              Option 2: Report at least 3
                                                                               measures, AND
                                                                              Report each measure for at least
                                                                               80 percent of the eligible
                                                                               professional's Medicare Part B
                                                                               FFS patients seen during the
                                                                               reporting period to which the
                                                                               measure applies.
                                                                              Measures with a 0 percent
                                                                               performance rate will not be
                                                                               counted.
Jan 1, 2013-Dec 31, 2013.........  Measures Groups.....  Claims.............  Report at least 1 measures group,
                                                                               AND
                                                                              Report each measures group for at
                                                                               least 20 Medicare Part B FFS
                                                                               patients.
                                                                              Measures groups containing a
                                                                               measure with a 0 percent
                                                                               performance rate will not be
                                                                               counted.
Jan 1, 2013-Dec 31, 2013.........  Measures Groups.....  Qualified Registry.  Report at least 1 measures group,
                                                                               AND
                                                                              Report each measures group for at
                                                                               least 20 patients, a majority of
                                                                               which must be Medicare Part B FFS
                                                                               patients.
                                                                              Measures groups containing a
                                                                               measure with a 0 percent
                                                                               performance rate will not be
                                                                               counted.
Jul 1, 2013-Dec 31, 2013.........  Measures Groups.....  Qualified Registry.  Report at least 1 measures group,
                                                                               AND
                                                                              Report each measures group for at
                                                                               least 20 patients, a majority of
                                                                               which must be Medicare Part B FFS
                                                                               patients.
                                                                              Measures groups containing a
                                                                               measure with a 0 percent
                                                                               performance rate will not be
                                                                               counted.
----------------------------------------------------------------------------------------------------------------
* Subject to the measure applicability validation (MAV) process.


  Table 91--Summary of Criteria for Satisfactory Reporting by Individual Eligible Professionals of Data on PQRS
                                     Quality Measures for the 2014 Incentive
----------------------------------------------------------------------------------------------------------------
         Reporting period              Measure type      Reporting mechanism      Proposed reporting criteria
----------------------------------------------------------------------------------------------------------------
Jan 1, 2014-Dec 31, 2014 *.......  Individual Measures.  Claims.............  Report at least 3 measures, OR,
                                                                              If less than 3 measures apply to
                                                                               the eligible professional, report
                                                                               1-2 measures *; AND
                                                                              Report each measure for at least
                                                                               50 percent of the eligible
                                                                               professional's Medicare Part B
                                                                               FFS patients seen during the
                                                                               reporting period to which the
                                                                               measure applies.
                                                                              Measures with a 0 percent
                                                                               performance rate will not be
                                                                               counted.
Jan 1, 2014-Dec 31, 2014.........  Individual Measures.  Qualified Registry.  Report at least 3 measures, AND
                                                                              Report each measure for at least
                                                                               80 percent of the eligible
                                                                               professional's Medicare Part B
                                                                               FFS patients seen during the
                                                                               reporting period to which the
                                                                               measure applies.
                                                                              Measures with a 0 percent
                                                                               performance rate will not be
                                                                               counted.
Jan 1, 2014-Dec 31, 2014.........  Individual Measures.  Direct EHR product   Report 9 measures covering at
                                                          that is CEHRT.       least 3 domains. If an eligible
                                                                               professional's CEHRT does not
                                                                               contain patient data for at least
                                                                               9 measures covering at least 3
                                                                               domains, then the eligible
                                                                               professional must report the
                                                                               measures for which there is
                                                                               patient data.
Jan 1, 2014-Dec 31, 2014.........  Individual Measures.  EHR data submission  Report 9 measures covering at
                                                          vendor's product     least 3 domains. If an eligible
                                                          that is CEHRT.       professional's CEHRT does not
                                                                               contain patient data for at least
                                                                               9 measures covering at least 3
                                                                               domains, then the eligible
                                                                               professional must report the
                                                                               measures for which there is
                                                                               patient data.
Jan 1, 2014-Dec 31, 2014.........  Measures Groups.....  Claims.............  Report at least 1 measures group,
                                                                               AND
                                                                              Report each measures group for at
                                                                               least 20 Medicare Part B FFS
                                                                               patients.
                                                                              Measures groups containing a
                                                                               measure with a 0 percent
                                                                               performance rate will not be
                                                                               counted.
Jan 1, 2014-Dec 31, 2014.........  Measures Groups.....  Qualified Registry.  Report at least 1 measures group,
                                                                               AND
                                                                              Report each measures group for at
                                                                               least 20 patients, a majority of
                                                                               which must be Medicare Part B FFS
                                                                               patients.
                                                                              Measures groups containing a
                                                                               measure with a 0 percent
                                                                               performance rate will not be
                                                                               counted.
Jul 1, 2014-Dec 31, 2014.........  Measures Groups.....  Qualified Registry.  Report at least 1 measures group,
                                                                               AND
                                                                              Report each measures group for at
                                                                               least 20 patients, a majority of
                                                                               which must be Medicare Part B FFS
                                                                               patients.

[[Page 69195]]

 
                                                                              Measures groups containing a
                                                                               measure with a 0 percent
                                                                               performance rate will not be
                                                                               counted.
----------------------------------------------------------------------------------------------------------------
* Subject to the measure applicability validation (MAV) process.

b. Criteria for Satisfactory Reporting for Group Practices 
Participating in the GPRO
    This section addresses the criteria for satisfactory reporting for 
group practices participating in the GPRO for the 2013 and 2014 
incentives, which are the last two incentives authorized under the 
Physician Quality Reporting System. Please note that, in addition to 
offering the GPRO web interface that we've previously included under 
the program, we proposed new criteria for group practices under the 
GPRO that allow group practices to use the claims, registry, and EHR-
based reporting mechanisms (77 FR 44819). In prior program years, large 
group practices have been successful in reporting quality measures data 
via the GPRO web interface. We proposed new criteria under the claims, 
qualified registry, and EHR-based reporting mechanisms because we felt 
that smaller groups may benefit from different reporting criteria and 
also other reporting mechanisms. Since the introduction of smaller 
group practices composed of 25-99 eligible professionals under the GPRO 
was fairly recent, and given that we proposed to modify the definition 
for group practice such that the PQRS GPRO would include, beginning in 
2013, group practices composed of 2-24 eligible professionals, we 
proposed additional criteria for reporting because we felt it might be 
more practicable for smaller group practices to report on PQRS quality 
measures via claims, qualified registry, or direct EHR or EHR data 
submission vendor versus the GPRO web interface, which was designed for 
use by larger group practices.
(1) Beneficiary Assignment Methodology and Criteria for Satisfactory 
Reporting on PQRS Quality Measures via the GPRO Web Interface
    GPRO Beneficiary Assignment Methodology. To populate the GPRO web 
interface, we must first assign beneficiaries to each group practice 
and then from those assigned beneficiaries draw a sample of 
beneficiaries for the disease and patient care modules in the GPRO web 
interface.
    In the proposed rule we discussed how we are assigning 
beneficiaries in 2012 to group practices for purposes of reporting on 
the PQRS quality measures via the GPRO web interface. We proposed to 
continue using this same assignment methodology for 2013 and subsequent 
years because it is already in place operationally.
    However, as an alternative way to assign beneficiaries to groups 
for the GPRO web interface, in the proposed rule we also discussed and 
invited comments on using the assignment and sampling methodology 
utilized under the more recently implemented Medicare Shared Savings 
Program (76 FR 6700). The Medicare Shared Savings Program uses an 
approach that is generally similar to and is based on the approach 
previously used by the PGP Transition demonstration, but that was 
revised to reflect both our experiences under the demonstration and 
specific statutory requirements for the Medicare Shared Savings 
Program. In particular, the attribution method used by the Medicare 
Shared Savings Program emphasizes primary care services furnished by 
physicians. More information regarding the assignment methodology that 
is used in the Shared Savings Program can be found on the program Web 
site at https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/sharedsavingsprogram/index.html?redirect=/sharedsavingsprogram/. To 
more closely align with the Medicare Shared Savings Program, we invited 
comments on whether it would be preferable to modify the assignment 
method PQRS uses to assign beneficiaries to a group practice to be more 
consistent with the two-step assignment method specified in Sec.  
425.402 that is used under the Medicare Shared Savings Program to 
assign beneficiaries to an ACO.
    Consistent with that two-step methodology, in order for a 
beneficiary to be eligible for assignment to a group practice, the 
beneficiary must have received at least one primary care service from a 
physician within the group practice during the reporting period. 
Accordingly, we would identify beneficiaries who received at least one 
primary care service from any group practice physician (regardless of 
specialty) participating in the group practice during the reporting 
period. Under the first assignment step, we would assign the 
beneficiary to the group practice if the beneficiary had at least one 
primary care service furnished by a primary care physician at the 
participating group practice, and more primary care services (measured 
by Medicare allowed charges) furnished by primary care physicians in 
the participating group practice than furnished by primary care 
physicians at any other group or solo practice.
    The second step applies only for those beneficiaries who do not 
receive any primary care services from a primary care physician during 
the reporting period. We would assign the beneficiary to the 
participating group practice in this step if the beneficiary had at 
least one primary care service furnished by a group practice physician 
regardless of specialty, and more primary care services were furnished 
by group practice eligible professionals (measured by Medicare allowed 
charges) at the participating group practice than at any other group or 
solo practice We would then pull samples of beneficiaries for the 
relevant measures/modules from this population of assigned 
beneficiaries to populate the GPRO web interface. In other words, the 
GPRO web interface would be populated based on a sample of the group 
practice assigned beneficiary population. Group practices would need to 
complete the tool for the first 411 or 218 consecutively ranked and 
assigned beneficiaries in the order in which they appear in the group's 
sample for each domain, measures set, or individual measure if a 
separate denominator is required such as in the case of preventive care 
measures which may be specific to one sex. If the pool of eligible 
assigned beneficiaries is less than 411 or 218, the group practice 
would report on 100 percent of assigned beneficiaries for the domain, 
measure set, or individual measure. The GPRO web interface would need 
to be completed for all domains, measure sets, and measures described 
in Table 96.
    We considered making this change to the assignment method beginning 
with the 2013 PQRS GPRO web interface so that the rules used to assign

[[Page 69196]]

beneficiaries to group practices participating in PQRS and ACOs 
participating in the Medicare Shared Savings Program would be more 
consistent. Since both group practices that are participating in the 
PQRS GPRO and ACOs participating in the Medicare Shared Savings Program 
would be using the same GPRO web interface to report the same set of 
quality measures to CMS, we believe that applying consistent assignment 
methods across the two programs would allow us to streamline our 
processes and could potentially reduce confusion among group practices 
considering participation in the PQRS GPRO or ACOs considering 
participation in the Medicare Shared Savings Program.
    We invited public comment whether to continue to use the PQRS-
established methodology for assigning beneficiaries, or, in the 
alternative, to use the assignment and sampling methodology utilized 
under the Medicare Shared Savings Program. The following is summary of 
the comments we received regarding these proposals.
    Comment: One commenter supported our proposal to continue the 
assignment and sampling methodology currently being used to populate 
the GPRO web interface. However, another commenter urged CMS to adopt 
an assignment and sampling methodology that is more focused on primary 
care, as the commenter believes that medical colleges participating in 
the GPRO will experience more success in reporting via the GPRO web 
interface with this change.
    Response: We appreciate the commenters' feedback. We appreciate the 
commenters' feedback. In an effort to align with the Medicare Shared 
Savings Program, we are adopting the beneficiary assignment and 
sampling methodology used under the Medicare Shared Savings Program, 
which, unlike the current methodology to populate the GPRO web 
interface, requires that the beneficiary being assigned had at least 
one primary care service furnished by a group practice physician. We 
understand that as a result of this requirement, there could be some 
group practices (such as groups consisting only of non-physician 
practitioners) that would not be able to report PQRS quality measures 
using the GPRO web interface because no beneficiaries would be assigned 
to them. However, we do not expect this would affect many group 
practices reporting PQRS quality measures using the GPRO web interface. 
We offer a number of other options for participating in PQRS. We note 
that the assignment and sampling methodology does not depart 
drastically from the assignment and sampling methodology currently used 
to populate the GPRO web interface as both methods were based off of 
the assignment and sampling methodology used under the PGP 
demonstration. Therefore, we are modifying 414.1240 to reflect the 
final decision to apply the same assignment and sampling methodology as 
is currently used under the Medicare Shared Savings Program.
    Criteria for Satisfactory Reporting on PQRS Quality Measures via 
the GPRO Web interface. Consistent with the group practice reporting 
requirements under section 1848(m)(3)(C) of the Act, we proposed the 
following criteria for the satisfactory reporting of PQRS quality 
measures for group practices participating- in the GPRO for the 12-
month reporting periods for the 2013 and 2014 incentives, respectively, 
using the GPRO web interface for groups practices of 25-99 eligible 
professionals: Report on all measures included in the web interface; 
AND populate data fields for the first 218 consecutively ranked and 
assigned beneficiaries in the order in which they appear in the group's 
sample for each disease module or preventive care measure (77 FR 
44820). If the pool of eligible assigned beneficiaries is less than 
218, then report on 100 percent of assigned beneficiaries. In other 
words, we understand that, in some instances, the sampling methodology 
CMS provides will not be able to assign at least 218 patients on which 
a group practice may report, particularly those group practices on the 
smaller end of the range of 25-99 eligible professionals. If the group 
practice is assigned less than 218 Medicare beneficiaries, then the 
group practice would report on 100 percent of its assigned 
beneficiaries. In addition, we proposed the following criteria for the 
satisfactory reporting of PQRS quality measures for group practices 
participating in the GPRO for the 2013 and 2014 incentives, 
respectively, using group practices of 100 or more eligible 
professionals: Report on all measures included in the web interface; 
AND populate data fields for the first 411 consecutively ranked and 
assigned beneficiaries in the order in which they appear in the group's 
sample for each disease module or preventive care measure. If the pool 
of eligible assigned beneficiaries is less than 411, then report on 100 
percent of assigned beneficiaries.
    The satisfactory reporting criteria we proposed for the GPRO web 
interface for groups of 25-99 eligible professionals and for large 
group practices for the 2013 and 2014 incentives were consistent with 
the reporting criteria we established for the 2012 PQRS incentive (76 
FR 73339). We proposed these same criteria because the thresholds 
proposed for these criteria were based on analysis performed on group 
reporting based on the Medicare Care Management Performance (MCMP) and 
PGP demonstrations used to determine reasonable thresholds for group 
practice reporting. We also note that there are the same criteria used 
for ACOs participating in the Medicare Shared Savings Program. 
Therefore, we believed the satisfactory reporting criteria that for the 
GPRO web interface for the 2013 and 2014 incentives were appropriate 
criteria and reasonable for groups to meet.
    Furthermore, we proposed using Medicare Part B claims data for 
dates of service on or after January 1 and submitted and processed by 
approximately the last Friday in October of the applicable 12-month 
reporting period under which the group practice participates in the 
GPRO to assign Medicare beneficiaries to each group practice. For 
example, for a group practice participating under the GPRO for the 
reporting periods occurring in 2013, for the sampling model, we 
proposed that we would assign beneficiaries on which to report based on 
Medicare Part B claims with dates of service beginning January 1, 2013 
and processed by October 25, 2013 (77 FR 44820).
    We invited but received no public comment on the proposed 
satisfactory reporting criteria on PQRS quality measures via the GPRO 
web interface. Therefore, we are finalizing these proposals as 
proposed. These criteria are specified in Tables 27 and 28.
(2) Criteria for Satisfactory Reporting on Individual PQRS Quality 
Measures for Group Practices Participating in the GPRO via Claims, 
Registry, and EHR
    We proposed to have the claims, registry, and EHR reporting 
mechanisms available for group practices of 2-99 eligible professionals 
to use to report PQRS quality measures (77 FR 44820). For these group 
practices, we proposed alternative criteria to those proposed under the 
GPRO web interface for satisfactory reporting for the 2013 and 2014 
incentives using the claims, registry, and EHR-based reporting 
mechanisms that mirror the criteria we proposed for individual 
reporting for the claims, registry, and EHR-based reporting mechanisms 
from the 2013 and 2014 incentives. We noted that the criteria we 
proposed for the 2013 and 2014 incentives using the claims, registry, 
and EHR-based reporting mechanisms are similar to the criteria

[[Page 69197]]

for individual reporting, because we believe smaller group practices 
are more akin to individuals for practice scope. We believed that the 
larger the group practice, the more likely that the group practice 
would benefit using the reporting options under the GPRO web interface.
    Therefore, based on our authority under section 1848(m)(3)(C) of 
the Act, we proposed the following satisfactory reporting criteria via 
claims for group practices comprised of 2-99 eligible professionals 
under the GPRO for the 2013 and 2014 incentives via claims: Report at 
least 3 measures AND report each measure for at least 50 percent of the 
group practice's Medicare Part B FFS patients seen during the reporting 
period to which the measure applies. Measures with a zero percent 
performance rate will not be counted.
    For those group practices that chose to report using a qualified 
registry, we proposed the following satisfactory reporting criteria via 
qualified registry for group practices comprised of 2-99 eligible 
professionals under the GPRO for the 2013 and 2014 incentives: Report 
at least 3 measures AND report each measure for at least 80 percent of 
the group practice's Medicare Part B FFS patients seen during the 
reporting period to which the measure applies. Measures with a zero 
percent performance rate will not be counted.
    For group practices comprised of 2-99 eligible professionals that 
chose to report PQRS quality measures via EHR, we proposed the 
following 2 options for the satisfactory reporting criteria via a 
direct EHR product or EHR data submission vendor for group practices 
comprised of 2-99 eligible professionals under the GPRO for the 2013 
incentive:
    Option 1: Eligible professionals in a group practice must report on 
three Medicare EHR Incentive Program core or alternate core measures, 
plus three additional measures. We noted that the EHR Incentive 
Program's core, alternate core, and additional measures could be found 
in Table 6 of the EHR Incentive Program's Stage 1 final rule (75 FR 
44398) or in Tables 32 and 33 of the proposed rule (77 FR 44821). We 
also referred readers to the discussion in the Stage 1 final rule for 
further explanation of the requirements for eligible professionals 
reporting those CQMs (75 FR 44398 through 44411).
    Option 2: Report at least 3 measures AND report each measure for at 
least 80 percent of the eligible professional's Medicare Part B FFS 
patients seen during the reporting period to which the measure applies. 
Measures with a zero percent performance rate will not be counted.
    We noted that at the time of the CY 2013 PFS proposed rule, that we 
had proposed under the Medicare EHR Incentive Program 2 options for 
meeting the CQM component of achieving meaningful use beginning with CY 
2014 (see 77 FR 13746-13748). To align our EHR-based reporting 
requirements with those proposed under the Medicare EHR Incentive 
Program at the time, we proposed the following criteria for 
satisfactory reporting using the EHR-based reporting mechanism for the 
12-month reporting period for the 2014 incentive:
     Option 1a: Select and submit 12 clinical quality measures 
available for EHR-based reporting from Tables 32 and 33, including at 
least 1 measure from each of the following 6 domains--(1) patient and 
family engagement, (2) patient safety, (3) care coordination, (4) 
population and public health, (5) efficient use of healthcare 
resources, and (6) clinical process/effectiveness (77 FR 44821).
     Option 1b: Submit 12 clinical quality measures composed of 
all 11 of the proposed Medicare EHR Incentive Program core clinical 
quality measures specified in Tables 32 and 33 of the proposed rule 
plus 1 menu clinical quality measure from Tables 32 and 33 of the 
proposed rule. We proposed to adopt the group reporting criteria that 
aligns with the criteria that would be established for meeting the CQM 
component under CY 2014 for the Medicare EHR Incentive Program. 
Furthermore, to the extent that the final group reporting criteria for 
meeting the CQM component of achieving meaningful use differ from what 
was proposed, our intention was to align with the group reporting 
criteria the EHR Incentive Program ultimately established. We invited 
public comment on this proposal.
    We also considered proposing the following satisfactory reporting 
criteria for the 2014 PQRS incentive for groups of 2-99 that was 
similar to the satisfactory reporting criteria being proposed for the 
2013 PQRS incentive via EHR: report at least 3 measures, AND report 
each measure for at least 80 percent of the group practice's Medicare 
Part B FFS patients seen during the reporting period to which the 
measure applies. Measures with a zero percent performance rate will not 
be counted (77 FR 44821). We invited public comment on this alternative 
considered.
    We invited public comment on the proposed criteria for satisfactory 
reporting of individual measures by group practices via claims, 
registry, or EHR for the 2013 and 2014 incentives. The following is a 
summary of general comments we received.
    Comment: Several commenters supported our proposal to expand the 
reporting mechanisms and satisfactory reporting criteria for group 
practices participating in the GPRO.
    The commenters believe that establishing these proposals would lead 
to greater overall program participation.
    Response: We appreciate the commenters' positive feedback. We are 
finalizing all proposed criteria for the satisfactory reporting of PQRS 
quality measures via the GPRO using the registry-based reporting 
mechanisms for groups of 2-99 eligible professionals for the 2013 and 
2014 PQRS incentives, as proposed. In addition, to align with the EHR 
Incentive Program, which will introduce a group practice reporting 
option in 2014, we are delaying implementing criteria for satisfactory 
reporting for group practices of 2-99 eligible professionals to 2014. 
The details of the EHR reporting criterion for group practices are 
discussed in greater detail below. However, since we have determined 
that it is not technically feasible to accept group reporting via the 
claims-based reporting mechanism at this time, we are not finalizing 
our proposed reporting criteria for group practices using the claims-
based reporting mechanism for the 2013 and 2014 PQRS incentives at this 
time.
    Comment: One commenter opposes offering varying reporting criteria, 
depending on group size and reporting method. The commenter believes 
that these varying methods of reporting unnecessarily complicates the 
program and provide a strong disincentive for participation.
    Response: We understand the commenter's concern regarding the 
complexity of reporting under PQRS. Therefore, we have made an effort 
to streamline reporting criteria wherever possible. For example, the 
criteria we are establishing for satisfactory reporting using the 
registry and EHR-based reporting mechanisms are similar whether an 
eligible professional is reporting PQRS measures as part of a group in 
a GPRO or as an individual. However, we believe it is necessary to 
offer different reporting options and varying criteria to provide 
flexibility in reporting as well as ensure that the reporting threshold 
we are establishing is appropriate given a particular group practice's 
size and resources. We also note that it is not necessary for eligible 
professionals and group practices to meet the criteria for satisfactory 
reporting for the PQRS incentives or payment adjustments using multiple 
criteria and reporting mechanisms.

[[Page 69198]]

Eligible professionals and group practices need only chose one 
criterion under which to report.
    Comment: One commenter sought clarification on how many eligible 
professionals within the group practice would be required to report 
PQRS measures using the proposed GPRO satisfactory reporting criteria 
for the claims, registry, and EHR-based reporting mechanisms for the 
2013 and 2014 PQRS incentives. The commenter suggests that CMS not 
focus on requiring a certain amount of eligible professionals within 
the group practice to report but, instead, focus on a group practice's 
aggregate patients.
    Response: We clarify that the criteria we establish for reporting 
using the registry and EHR-based reporting mechanisms does not require 
every eligible professional in the group practice to report PQRS 
measures. Rather, we note that the criteria we establish focuses on the 
group reporting on a certain percentage of its applicable patients, 
regardless of how many of the group practice's eligible professionals 
participate in reporting the PQRS measures. For example, if a group 
practice comprised of 10 eligible professionals participating in the 
GPRO chooses to report PQRS measures using the registry-based reporting 
mechanism, the group practice must report on at least 3 measures for 80 
percent of the group practice's aggregate applicable patients. A 
measure is applicable to a patient if the service provided to the 
patient and billed to Medicare under the Physician Fee Schedule is 
contained in the denominator of a measure. For more information on the 
PQRS measures, including what types of services are contained in the 
denominator of certain measures, please visit the PQRS Web site at 
http://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/PQRS/index.html to view the PQRS Measures List and 
Implementation Guide for the relevant year. It is irrelevant whether 5 
or all 10 of the group practice's eligible professionals report. We 
would imagine, however, that a group practice would have to report on a 
larger set of patients the larger the group size.
    Comment: One commenter urged CMS to expand the proposed 
satisfactory reporting criteria of individual PQRS measures under the 
GPRO using the claims, registry, and EHR based reporting mechanisms to 
groups of 100 or more eligible professionals. The commenter notes that 
the measures available for reporting using the GPRO web interface are 
limited, so expanding the proposed claims, registry, and EHR-based 
reporting options under the GPRO would allow greater flexibility for 
large specialty practices to report on PQRS measures.
    Response: We agree with the commenter's feedback. Our desire to 
encourage specialties to submit meaningful measure data outweighs our 
desire to restrict the GPRO registry and EHR-based reporting options to 
smaller groups of 2-99 eligible professionals. We provided our reasons 
for limiting our proposal to restrict the registry and EHR-based 
reporting mechanisms to groups of 2-99 eligible professionals in the CY 
2012 PFS proposed rule (76 FR 44821). Specifically, we stated that the 
reporting behavior of these smaller group practices would be more akin 
to individual reporting. However, we have received stakeholder 
feedback, such as the commenter's, that large groups (mainly large 
single specialty groups) find it more beneficial to report via registry 
or EHR as the measures available under these reporting mechanisms are 
more applicable to the group's practice. Stakeholders have also 
expressed concern that it is difficult for their billing departments to 
keep track of the reporting activities of each individual eligible 
professional. Providing a group practice reporting option for these 
groups would reduce the administrative burden these large single 
specialty practices incur from having to keep track of the group 
practice's reporting activity by each individual TIN/NPI combination. 
Therefore, we will expand the GPRO qualified registry and EHR-based 
reporting options to groups of 100 or more eligible professionals.
    Comment: One commenter stressed the importance of allowing eligible 
professionals to still report as individuals despite these newly 
proposed group reporting options under the GPRO. The commenter noted 
that requiring eligible professionals to participate in PQRS under 
their respective group practices would have a negative impact on 
registries. The commenter noted that, historically, eligible 
professionals choosing to participate in PQRS independent of their 
group practice have used the registry-based reporting mechanism. The 
commenter believed that the registries have been particularly 
successful in collecting data relevant for measuring quality of care 
furnished to patients.
    Response: CMS understands the need to establish reporting criteria 
for eligible professionals who wish to participate in PQRS independent 
of the other eligible professionals in their group practice. We note 
that the proposal to establish satisfactory reporting criteria using 
the claims, registry, and EHR-based reporting mechanisms for group 
practices using the GPRO was not intended to eliminate reporting 
options for eligible professionals who wish to participate in PQRS as 
individuals. These options are still available for individual 
reporting. Please note, however, that should an eligible professional 
fall under a TIN that elects to participate in PQRS using the GPRO, the 
eligible professional must participate in PQRS as part of the group 
practice. The eligible professional can no longer participate as an 
individual.
    Comment: With regard to the satisfactory reporting criteria we 
proposed for groups in the GPRO using direct EHR products or EHR data 
submission vendor, one commenter noted that, should we finalize these 
proposed reporting criteria, the PQRS would be out of sync with Stage 1 
of the Medicare EHR Incentive Program, which did not establish a group 
practice reporting option. The commenter did note, however, that the 
EHR Incentive Program established an EHR-based reporting option for 
group practices under Stage 2, which begins in 2014.
    Response: We agree with the commenter that our proposed Options 1 
and 2 for the satisfactory reporting of measures using the EHR-based 
reporting mechanism under the GPRO for the 2013 PQRS Incentive do not 
align with the requirements for meeting the CQM component of meaningful 
use in 2013 of the EHR Incentive Program, as there is no group 
reporting option for CQMs for the Medicare EHR Incentive Program until 
2014. Therefore, we are not finalizing the following proposed 
satisfactory reporting criteria for the 2013 PQRS Incentive: (1) Option 
1: Eligible professionals in a group practice must report on three 
Medicare EHR Incentive Program core or alternate core measures, plus 
three additional measures and (2) Option 2: Report at least 3 measures, 
AND report each measure for at least 80 percent of the group practice's 
Medicare Part B FFS patients seen during the reporting period to which 
the measure applies. Measures with a zero percent performance rate will 
not be counted.
    However, we finalized for the EHR Incentive Program two group 
reporting options beginning in 2014 for the CQM component of achieving 
meaningful use, one of which is the following: Medicare EPs who 
satisfactorily report PQRS CQMs using CEHRT under the PQRS GPRO would 
be considered to have satisfied their CQM reporting requirement as a 
group for the Medicare EHR Incentive Program (77 FR 54076

[[Page 69199]]

through 54078). In the proposed rule, we proposed 3 GPRO options for 
the satisfactory reporting of PQRS individual measures. However, we 
also indicated that it was our intent to finalize reporting criterion 
that aligns with the CQM requirements for achieving meaningful use in 
the EHR Incentive Program. Following the criteria we finalized for the 
satisfactory reporting of individual PQRS quality measures using a 
direct EHR product or EHR data submission vendor for individual 
eligible professionals, we are finalizing the following criteria for 
the satisfactory reporting of data on PQRS quality measures via the 
GPRO for the 2014 Incentive: Report 9 measures covering at least 3 
domains specified in Table 95. If the group practice's CEHRT does not 
contain Medicare patient data for at least 9 measures covering at least 
3 domains, then the group practice must report the measures for which 
there is Medicare patient data. A group practice must report on at 
least 1 measure for which there is Medicare patient data.
    Although we proposed three reporting criteria for the satisfactory 
reporting of PQRS measures via an EHR-based reporting mechanism under 
the GPRO for the 2014 PQRS incentive, we are only finalizing one GPRO 
EHR reporting criterion. Similar to the reasoning we provided to 
streamline the reporting criteria for reporting measures groups via 
registry for the 2013 and 2014 PQRS incentives, it is our desire to 
provide one streamlined reporting option via EHR for group practices 
participating in the GPRO.
    We note that we believe these proposed criteria meet the 
requirements for group practice reporting specified in section 
1848(m)(3)(C) of the Act. Section 1848(m)(3)(C) requires that the 
criterion for group reporting use a statistical sampling model, such as 
the model used in the PGP demonstration. We note that, although these 
criteria depart from the model used in the PGP demonstration, we 
believe that these criteria still meet the statistical sampling model 
requirement in that the group practices would still be required to 
report the measures on a sample of their patients. Rather than CMS 
choosing which sample of patients the group practice must report, with 
these criteria, the group practice decides to submit quality measures 
data on a sample of 100 percent of its patients. We note that although 
reporting on 100 percent of patients is not a sample, for data 
collection purposes, CMS would only collect data on the group 
practice's patients to which the EHR measures apply. Therefore, even 
though a group practice would report on 100 percent of patients to 
which the measure applies, not all of the EHR measures would 
necessarily apply to all of the group practice's patients. Since the 
group practice is then only providing information on its patients to 
whom the measure is applicable, we believe the proposed EHR reporting 
criteria would still meet the statistical sampling model requirement.
    A summary of the final criteria for satisfactory reporting for 
group practices selected to participate in the GPRO for the 2013 and 
2014 incentives is specified in Tables 92 and 93:

    TABLE 92--Criteria for Satisfactory Reporting of Data on PQRS Quality Measures via the GPRO for the 2013
                                                    Incentive
----------------------------------------------------------------------------------------------------------------
         Reporting period           Reporting mechanism  Group practice size     Proposed reporting criterion
----------------------------------------------------------------------------------------------------------------
12-month (Jan 1-Dec 31)..........  GPRO Web interface..  25-99 eligible       Report on all measures included in
                                                          professionals.       the web interface in Table 96;
                                                                               AND
                                                                              Populate data fields for the first
                                                                               218 consecutively ranked and
                                                                               assigned beneficiaries in the
                                                                               order in which they appear in the
                                                                               group's sample for each module or
                                                                               preventive care measure. If the
                                                                               pool of eligible assigned
                                                                               beneficiaries is less than 218,
                                                                               then report on 100 percent of
                                                                               assigned beneficiaries.
12-month (Jan 1-Dec 31)..........  GPRO Web interface..  100+ eligible        Report on all measures included in
                                                          professionals.       the web interface in Table 96;
                                                                               AND
                                                                              Populate data fields for the first
                                                                               411 consecutively ranked and
                                                                               assigned beneficiaries in the
                                                                               order in which they appear in the
                                                                               group's sample for each module or
                                                                               preventive care measure. If the
                                                                               pool of eligible assigned
                                                                               beneficiaries is less than 411,
                                                                               then report on 100 percent of
                                                                               assigned beneficiaries.
12-month (Jan 1-Dec 31)..........  Qualified Registry..  2+ eligible          Report at least 3 measures, AND
                                                          professionals.      Report each measure for at least
                                                                               80 percent of the group
                                                                               practice's Medicare Part B FFS
                                                                               patients seen during the
                                                                               reporting period to which the
                                                                               measure applies.
                                                                              Measures with a 0 percent
                                                                               performance rate will not be
                                                                               counted.
----------------------------------------------------------------------------------------------------------------
* Subject to the measure applicability validation (MAV) process.


    Table 93--Criteria for Satisfactory Reporting of Data on PQRS Quality Measures via the GPRO for the 2014
                                                    Incentive
----------------------------------------------------------------------------------------------------------------
         Reporting period           Reporting mechanism  Group practice size     Proposed reporting criterion
----------------------------------------------------------------------------------------------------------------
12-month (Jan 1-Dec 31)..........  GPRO Web interface..  25-99 eligible       Report on all measures included in
                                                          professionals.       the web interface in Table 96;
                                                                               AND
                                                                              Populate data fields for the first
                                                                               218 consecutively ranked and
                                                                               assigned beneficiaries in the
                                                                               order in which they appear in the
                                                                               group's sample for each module or
                                                                               preventive care measure. If the
                                                                               pool of eligible assigned
                                                                               beneficiaries is less than 218,
                                                                               then report on 100 percent of
                                                                               assigned beneficiaries.
12-month (Jan 1-Dec 31)..........  GPRO Web interface..  100+ eligible        Report on all measures included in
                                                          professionals.       the web interface in Table 96;
                                                                               AND

[[Page 69200]]

 
                                                                              Populate data fields for the first
                                                                               411 consecutively ranked and
                                                                               assigned beneficiaries in the
                                                                               order in which they appear in the
                                                                               group's sample for each module or
                                                                               preventive care measure. If the
                                                                               pool of eligible assigned
                                                                               beneficiaries is less than 411,
                                                                               then report on 100 percent of
                                                                               assigned beneficiaries.
12-month (Jan 1-Dec 31)..........  Qualified Registry..  2+ eligible          Report at least 3 measures, AND
                                                          professionals.      Report each measure for at least
                                                                               80 percent of the group
                                                                               practice's Medicare Part B FFS
                                                                               patients seen during the
                                                                               reporting period to which the
                                                                               measure applies.
                                                                              Measures with a 0 percent
                                                                               performance rate will not be
                                                                               counted.
12-month (Jan 1-Dec 31)..........  Direct EHR product    2+ eligible          Report 9 measures covering at
                                    that is CEHRT or      professionals.       least 3 domains. If the group
                                    EHR Data Submission                        practice's CEHRT does not contain
                                    Vendor's Product                           patient data for at least 9
                                    that is CEHRT.                             measures covering at least 3
                                                                               domains, then the group practice
                                                                               must report the measures for
                                                                               which there is patient data.
----------------------------------------------------------------------------------------------------------------
* Subject to the measure applicability validation (MAV) process.

c. Analysis of the Criteria for Satisfactory Reporting for the 2013 and 
2014 Incentives
    For the proposed criteria for satisfactory reporting for the 2013 
and 2014 incentives described in this section, we proposed that 
eligible professionals and group practices may not combine different 
satisfactory reporting criteria under different reporting mechanisms to 
meet the requirements of satisfactory reporting for the 2013 and 2014 
incentives (77 FR 44824). For example, an eligible professional may not 
meet the requirements for the 2013 incentive by reporting on 2 
applicable PQRS quality measures via EHR and 1 applicable PQRS quality 
measure via qualified registry, because the eligible professional did 
not meet the criteria for satisfactory reporting under at least one 
reporting mechanism. Similarly, a group practice would be required to 
select a single reporting mechanism for the entire group practice. For 
example, for a group practice consisting of 4 eligible professionals, 
the group practice would not be able to meet the requirements for the 
2014 incentive by reporting 2 individual measures via qualified 
registry and 1 measure via the direct EHR submission method.
    For individual eligible professionals and group practices reporting 
on individual measures and/or measures groups, we noted that, although 
an eligible professional or group practice could meet more than one 
criterion for satisfactory reporting, only one incentive payment will 
be made to the eligible professional or group practice. For example, if 
an eligible professional meets the criteria for satisfactory reporting 
of individual measures via claims and measures groups via claims for 
the 2013 incentive, the eligible professional would nonetheless only be 
entitled to one incentive payment. CMS would consider the eligible 
professional to be incentive eligible under whichever reporting 
criterion yields the greatest bonus.
    We invited but received no public comment on our proposed analysis 
of the criteria for satisfactory reporting for the 2013 and 2014 
incentives. Therefore, we are finalizing this analysis rule.
5. Criteria for Satisfactory Reporting for the Payment Adjustments
    Section 1848(a)(8) of the Social Security Act, as added by section 
3002(b) of the Affordable Care Act, provides that for covered 
professional services furnished by an eligible professional during 2015 
or any subsequent year, if the eligible professional does not 
satisfactorily report data on quality measures for covered professional 
services for the quality reporting period for the year, the fee 
schedule amount for services furnished by such professional during the 
year shall be equal to the applicable percent of the fee schedule 
amount that would otherwise apply to such services. The applicable 
percent for 2015 is 98.5 percent. For 2016 and subsequent years, the 
applicable percent is 98.0 percent.
    This section contains the final criteria for satisfactory reporting 
for purposes of the 2015 and 2016 payment adjustments for eligible 
professionals and group practices, as well as some discussion of what 
we are considering for the payment adjustments for 2017 and beyond.
    As stated previously, the majority of eligible professionals 
currently are not participating in the PQRS. Yet, the payment 
adjustment will apply to all eligible professionals who are not 
satisfactory reporters during the reporting period for the year. 
Therefore, we noted that in implementing the PQRS payment adjustment, 
we seek to achieve two overarching policy goals. First, and foremost, 
we sought to increase participation in the PQRS and to implement the 
payment adjustment in a manner that will allow eligible professionals 
who have never participated in the program to familiarize themselves 
with the program. Second, we sought to align the reporting requirements 
under the PQRS with the quality reporting requirements of various CMS 
programs, such as the physician value-based payment modifier discussed 
in section III.K of this final rule with comment period.
a. Criteria for Satisfactory Reporting for the 2015 and 2016 Payment 
Adjustments for Eligible Professionals and Group Practices using the 
Claims, Registry, EHR, and GPRO web interface Reporting Mechanisms
    This section addresses the criteria for satisfactory reporting for 
the 2015 and 2016 payment adjustments using the claims, registry, EHR-
based, and GPRO web interface reporting mechanisms. First, we proposed 
that for purposes of the 2015 and 2016 payment adjustments (which would 
be based on data reported during 12 and 6-month reporting periods that 
fall within 2013 and 2014, respectively), an eligible professional or 
group practice would meet the requirement to satisfactorily report data 
on quality measures for covered professional services for the 2015 and 
2016 payment adjustments by meeting the requirement for satisfactory 
reporting for the 2013 and 2014 incentives respectively (77 FR 44824). 
That is, we proposed the exact same

[[Page 69201]]

criteria for satisfactory reporting for the 2015 and 2016 payment 
adjustments that we proposed for the 2013 and 2014 incentives, 
described in Tables 25 and 26 of the proposed rule, with the exception 
of two additional alternative criteria. Since we had already proposed 
satisfactory reporting criteria for the 2013 and 2014 incentives and 
the reporting periods for the respective 2013 and 2014 incentives and 
2015 and 2016 payment adjustments coincide, we felt it was appropriate 
that the proposed criteria for the 2013 and 2014 incentives apply to 
satisfy the satisfactory reporting requirements for the 2015 and 2016 
payment adjustments, respectively. We noted that these proposed 
criteria for the 2013 and 2014 PQRS incentives were the only criteria 
we proposed to establish for the respective 2015 and 2016 PQRS payment 
adjustments for group practices using the GPRO web interface.
    For individual eligible professionals also participating in the EHR 
Incentive Program, we noted that it is our intention to align our 
proposed criteria for satisfactory reporting for the 2015 and 2016 PQRS 
payment adjustments with the criteria for meeting the CQM component of 
meaningful use applicable during the 2015 and 2016 PQRS payment 
adjustment reporting periods. For eligible professionals participating 
in PQRS and the EHR Incentive Program using a direct EHR product or EHR 
data submission vendor that is CEHRT, we noted that since we proposed 
to align our proposed EHR criteria for satisfactory reporting for the 
2013 and 2014 PQRS incentives with the proposed criteria for meeting 
the CQM component of meaningful use for CYs 2013 and 2014 if these 
proposals were established and we meet our goal of aligning the two 
programs, an eligible professional that met the CQM component of 
meaningful use during the PQRS 2015 and 2016 payment adjustment 
reporting periods occurring in CYs 2013 and 2014 respectively using a 
direct EHR product or EHR data submission vendor that is CEHRT would 
meet the requirements for satisfactory reporting for the 2015 and 2016 
PQRS payment adjustments by submitting a single set of data.
    We invited public comment on our proposals related to applying the 
satisfactory reporting criteria established for the 2013 and 2014 PQRS 
incentives for eligible professionals and group practices using the 
GPRO to the respective 2015 and 2016 PQRS payment adjustments. The 
following is a summary of the comments we received on these proposals.
    Comment: Several commenters supported applying the satisfactory 
reporting criteria established for the 2013 and 2014 PQRS incentives 
for eligible professionals and group practices using the GPRO to the 
respective 2015 and 2016 PQRS payment adjustments.
    Response: We appreciate the commenters' support for these proposals 
and are, therefore, finalizing these proposals, as proposed.
    In addition, as a result of the overarching goals we have 
articulated above about encouraging participation and concern about 
eligible professionals' familiarity and experience with the program, we 
proposed the following alternative criteria for satisfactory reporting 
during the 12-month reporting periods for the 2015 and 2016 payment 
adjustments for eligible professionals and group practices: Report 1 
(applicable) measure or measures group using the claims, registry or 
EHR-based reporting mechanisms. We noted that this particular proposed 
alternative criterion for satisfactory reporting was significantly less 
stringent than the satisfactory reporting criteria we have proposed for 
the 2013 and 2014 incentives. However, we stressed that we were 
proposing less stringent criteria only to ease eligible professionals 
and group practices who have not previously participated in PQRS into 
reporting into the mechanics of reporting quality measures under PQRS. 
As indicated in the proposed rule, for the 2017 PQRS payment adjustment 
and beyond, we anticipate eliminating these alternative proposed 
criteria and establishing criteria that more closely resemble the 
proposed satisfactory reporting criteria for the 2013 and 2014 
incentives (77 FR 44826).
    For group practices, section 1848(m)(3)(C) requires that the 
criterion for group reporting use a statistical sampling model, such as 
the model used in the PGP demonstration, we noted that we believed that 
the proposed reporting criteria met this standard, as the group 
practice would decide on which sample of patients to report (77 FR 
44825). Under the proposed criteria, the group practice would select 
the sample number, meaning the group could choose to report on all 
applicable patients or a certain number of patients to which the 
particular measure applied. We noted that, although the group practice 
could choose the sample, we expected that the sample the group practice 
selects would represent a sufficient picture of the beneficiaries the 
group practice sees.
    We invited public comments on these proposed criteria for 
satisfactory reporting for the 2015 and 2016 payment adjustments for 
eligible professionals and group practices using the claims, registry, 
EHR-based reporting mechanisms. The following is a summary of the 
comments we received regarding these proposed criteria.
    Comment: Realizing the need to increase participation in PQRS, 
several commenters generally supported our proposed phased approach of 
introducing more lenient satisfactory reporting criteria for the 2015 
and 2016 PQRS payment adjustments with the intention of moving towards 
more stringent satisfactory reporting criteria, such as the 
satisfactory reporting criteria established for the 2013 and 2014 PQRS 
incentives, for future payment adjustments.
    Response: We appreciate the commenters' positive feedback on our 
proposals for satisfactory reporting for the 2015 and 2016 PQRS payment 
adjustments.
    Comment: Several commenters supported our proposed criteria for 
satisfactory reporting for the 2015 and 2016 PQRS payment adjustments: 
Reporting 1 measure or measures group. These commenters believed that 
these proposed criteria would help ensure that an eligible professional 
who makes a good faith effort to report PQRS measures would avoid the 
2015 and 2016 PQRS payment adjustments. In fact, some commenters 
suggested that we establish these criteria for the 2017 PQRS payment 
adjustment and beyond.
    Response: We are not finalizing these reporting criteria for the 
2017 PQRS payment adjustment and beyond. We note that we proposed these 
criteria to help eligible professionals and group practices who are 
participating in PQRS for the first time to become familiar with the 
PQRS reporting requirements. We believe that, by the reporting period 
for the 2017 PQRS payment adjustment, eligible professionals and group 
practices should be held to satisfactory reporting criteria that are 
identical or similar to the satisfactory reporting criteria we are 
establishing for the 2013 and 2014 PQRS incentives.
    Based on the comments received and for the reasons previously 
stated, we are finalizing the proposed criteria for satisfactory 
reporting for the 2015 PQRS payment adjustment--Report 1 measure or 
measures group during the applicable payment adjustment reporting 
period. Therefore, an individual eligible professional will meet the 
criteria for satisfactory reporting for the 2015 payment adjustment if 
the eligible

[[Page 69202]]

professional reports 1 measure or, for eligible professionals only, 
measures group using a claims, qualified registry, or EHR-based 
reporting mechanism during the applicable payment adjustment reporting 
period. Unlike the criteria for satisfactory reporting for the 2013 and 
2014 PQRS incentives, which requires an eligible professional to report 
on measures based on a percentage of applicable patients or patient 
count, this criterion only requires that an eligible professional or 
group practice report on 1 measure or, for individual eligible 
professionals only, 1 measures group for at least 1 applicable patient. 
However, we strongly encourage eligible professionals and group 
practices to report on as many applicable patients as possible. For 
group practices, please note that since we are not finalizing the 
claims-based reporting option for group practices, we are not 
finalizing this reporting criterion for satisfactory reporting for the 
claims-based reporting mechanism for group practices.
    Although we did not propose using the GPRO web interface as a 
reporting mechanism to report 1 measure to meet the criteria for 
satisfactory reporting for the 2015 PQRS payment adjustment, we did 
propose this criterion for the other three traditional reporting 
mechanisms (claims, registry, and EHR). We anticipated that it would be 
sufficient to establish this criterion for these three other reporting 
mechanisms (claims, registry, and EHR) for the 2015 PQRS payment 
adjustment. However, as we previously stated, we are not finalizing the 
claims-based reporting mechanism for group practices participating in 
the GPRO. We are also not finalizing the EHR-based reporting mechanism 
for group practices participating in the GPRO until 2014. Therefore, 
since the registry-based reporting mechanism will be the only reporting 
mechanism under which group practices would be able to use this 
criterion, we are expanding this criterion for use under the GPRO web 
interface. Therefore, a group practice will not be subject to the 2015 
payment adjustment if the group practice meets the criteria for 
satisfactory reporting by reporting 1 applicable measure using a 
qualified registry or the GPRO web interface reporting mechanism during 
the CY 2013 payment adjustment reporting period.
    We are not finalizing these proposed criteria for the 2016 payment 
adjustment at this time, as we intend to revisit whether we should 
establish more stringent satisfactory reporting criteria beginning with 
the 2016 payment adjustment. We believe that, rather than maintaining 
this criterion for the 2016 PQRS payment adjustment, it may be more 
preferable to adopt a phased approach to moving towards reporting 
criteria that is identical to or similar to the criteria for 
satisfactory reporting for the 2013 and 2014 PQRS incentives. However, 
as we explained above, we are finalizing one criterion for satisfactory 
reporting for the 2016 PQRS payment adjustment: Meet the criteria for 
satisfactory reporting for the 2014 PQRS incentive.
    Comment: Some commenters sought clarification on how the PQRS 
payment adjustment will be applied to specialties for which little to 
no relevant measures exist in the PQRS measures set, such as 
audiologists and endocrinologists. One commenter is concerned that 
endocrinologists who specialize in thyroid conditions will be unable to 
meet the proposed criteria for satisfactory reporting, as the commenter 
believes there are no proposed PQRS measures specific to the treatment 
of thyroid disease.
    Response: Although the proposed PQRS measures set contains a broad 
set of measures, we understand that, in rare cases, there remains 
certain sub-specialties that may not be able to find relevant PQRS 
measures on which to report. However, please note that the PQRS measure 
set contains a broad set of measures that may in fact be applicable to 
these sub-specialties and relevant to their specific practice area. 
Many measures have broad denominator codes and code sets that apply to 
the majority of eligible professionals. Therefore, we urge these 
eligible professionals and group practices to contact our QualityNet 
Help Desk for advice on reporting and determining whether applicable 
measures can be found in the PQRS measure set. Meanwhile, to the extent 
possible, we will continue to work with stakeholders to ensure that the 
PQRS measure set addresses gaps for future program years.
b. Criteria for Satisfactory Reporting for the 2015 Payment Adjustment 
for Eligible Professionals and Group Practices Using the Administrative 
Claims-Based Reporting Mechanism
(1) Criteria for Satisfactory Reporting for the 2015 Payment Adjustment 
for Eligible Professionals and Group Practices Using the Administrative 
Claims-Based Reporting Mechanism
    Unlike the traditional PQRS claims-based reporting mechanism, the 
administrative claims-based reporting mechanism we proposed does not 
require an eligible professional to submit quality data codes (QDCs) on 
Medicare Part B claims (77 FR 44825). Rather, using the administrative 
claims-based reporting mechanism only requires that an eligible 
professional or group practice submit Medicare claims to CMS. Since 
CMS, rather than the eligible professional or group practice, is 
performing the analysis and collecting the data provided in an eligible 
professional's or group practice's Medicare claims for an eligible 
professional's or group practice's Medicare beneficiaries, we believe 
it is appropriate to propose a reporting threshold that is more 
stringent than that proposed for the 2013 and 2014 incentives that use 
traditional PQRS reporting mechanisms. Therefore, we proposed the 
following criteria for satisfactory reporting for the 12-month 
reporting periods for the 2015 and 2016 payment adjustments (that occur 
in 2013 and 2014 respectively) for eligible professionals and group 
practices using the administrative claims-based reporting mechanism: 
Report ALL measures in Table 63 of the proposed rule for 100 percent of 
the cases in which the measures apply.
    Section 1848(m)(3)(C) requires that the criterion for group 
reporting use a statistical sampling model, such as the model used in 
the PGP demonstration. We noted that, although these criteria depart 
from the model used in the PGP demonstration, similar to our arguments 
for the satisfactory reporting criteria we proposed for group practices 
using the claims, registry, and EHR-based reporting mechanisms, we 
believe that these criteria would still meet the statistical sampling 
model requirement in that the group practices would still be required 
to report the measures on a sample of their patients. We noted that, 
with these proposed criteria, the group practice would provide claims 
data to CMS on 100 percent of its patients for which the measure 
applies. We note that although reporting on 100 percent of patients is 
not a sample, for data collection purposes, CMS would only collect data 
on the group practice's patients to which the administrative claims 
measures apply. Therefore, the applicable measures will determine the 
sample size for which the group would report. Since the group practice 
is then only providing information on its applicable patients, we 
believe these reporting criteria would still meet the statistical 
sampling model requirement.
    We invited public comment on these proposed criteria for eligible 
professionals and group practices using the administrative claims-based 
reporting mechanism. The following is a summary of comments received on 
these proposed criteria.

[[Page 69203]]

    Comment: Several commenters supported our proposed criteria for the 
administrative claims-based reporting option for the 2015 and 2016 PQRS 
payment adjustments.
    Response: We thank the commenters for their feedback. For the 
reasons we stated for not finalizing availability of the administrative 
claims-based reporting mechanism for the 2016 PQRS payment adjustment, 
we are finalizing the satisfactory reporting criteria for the 
administrative claims-based reporting option for the 2015 PQRS payment 
adjustment only.
    Comment: One commenter sought clarification on the reporting 
threshold for eligible professionals and group practices using the 
administrative claims-based reporting option. Specifically, the 
commenter sought clarification on how eligible professionals and group 
practices would be assessed under the proposed requirement to report on 
all measures available under the administrative claims-based reporting 
option, particularly for those patients for whom not all of the 
administrative claims measures apply.
    Response: Unlike the traditional claims, registry, EHR, or GPRO web 
interface reporting mechanisms, where an eligible professional or group 
practice is not required to submit reporting G-codes to submit data on 
quality measures, CMS will calculate the administrative claims measures 
on behalf of the eligible professional or group practice, therefore 
reducing the chance that a reporting error would occur. For those 
eligible professionals and group practices for which not all of the 
administrative claims measures apply to the patients of the eligible 
professionals or group practices, CMS would report zero percent 
performance rates for these measures, meaning that a certain clinical 
quality action was not performed because it did not apply to a certain 
patient. Please note that this administrative claims reporting option 
will be analyzed in the same manner as it will be analyzed under the 
Value-based Payment Modifier.
    Comment: One commenter recommended that eligible professionals be 
allowed to choose the administrative claims-based reporting option to 
meet the criteria for satisfactory reporting for the 2013 and 2014 PQRS 
incentives.
    Response: We respectfully disagree. We believe that eligible 
professionals and group practices should be held to a higher standard 
of reporting for the PQRS incentive vs. the PQRS payment adjustment. As 
noted previously, we agree with other commenters that the 
administrative claims-based reporting option may not always provide 
data that is as relevant to a practice as the data that would otherwise 
be provided from reporting measures using the traditional reporting 
mechanisms. We proposed the administrative claims-based reporting 
option primarily as a means to report for the 2015 and 2016 PQRS 
payment adjustments to ease eligible professionals into reporting PQRS 
measures. In fact, we are not finalizing the administration claims-
based reporting option for the 2016 PQRS payment adjustment at this 
time. Since we see this option as temporary, only a limited set of 
measures were proposed for use under the administrative claims-based 
reporting option. We believe that more meaningful data will be 
collected using the traditional claims, registry, EHR, or GPRO web 
interface reporting mechanisms, where eligible professionals or group 
practices may choose measures from a broad set that may be more 
relevant to their practice and where we are able to collect richer data 
than what is routinely submitted for billing purposes. Therefore, 
eligible professionals and group practices will not be able to use the 
administrative claims-based reporting mechanism for the 2013 and 2014 
PQRS incentives. However, should an eligible professional or group 
practice elect to use the administrative claims-based reporting 
mechanism for the 2015 PQRS payment adjustment, please note the 
eligible professional or group practice may use the traditional 
reporting mechanisms for the 2013 PQRS incentive.
    Comment: One commenter stated that the administrative claims-based 
reporting option may not produce meaningful data. However, the 
commenter understands the need to balance our goal of increasing 
participation with our goal to collect meaningful data.
    Response: We agree with the commenter that data collected using our 
traditional PQRS reporting options (using the claims, registry, EHR, 
and GPRO web interface reporting mechanisms) would provide more 
meaningful data. As such, we believe the administrative claims-based 
reporting option should be temporary, and we intend to move away from 
the administrative claims-based reporting option. Therefore, we are 
only finalizing it for the 2015 PQRS payment adjustment. We believe 
that providing this option for eligible professionals during the first 
year of the implementation of the PQRS payment adjustment will provide 
eligible professionals with enough time to transition into using a 
traditional PQRS reporting mechanism.
    In addition, when developing proposals for reporting criteria for 
the 2015 and 2016 PQRS payment adjustments, we considered satisfactory 
reporting options that would encourage eligible professionals and group 
practices to report for the 2013 and/or 2014 incentives but, should 
eligible professionals or group practices come up shy of meeting the 
2013 and/or 2014 incentive reporting criteria, would still allow an 
eligible professional to meet the criteria for satisfactory reporting 
for the 2015 and/or 2016 payment adjustments (77 FR 44825). In lieu of 
more lenient satisfactory reporting criteria we proposed for the 2015 
and 2016 payment adjustment, for example, to report at least 1 measure 
or measures group or to elect the administrative claims-based reporting 
option, we considered the option of defaulting those eligible 
professionals who report but fail to meet the criteria for satisfactory 
reporting using the proposed criteria for the 2013 and/or 2014 
incentives to the administrative claims-based reporting option. We 
would therefore analyze the claims of all eligible professionals who 
report at least 1 measure under a traditional reporting method during 
the respective 2015 and 2016 payment adjustment reporting periods under 
the administrative claims-based reporting option. We considered this 
proposal because it is our intention to encourage eligible 
professionals to report PQRS measures using the proposed reporting 
criteria for the 2013 and 2014 PQRS incentives. However, given our 
concern about new eligible professionals' familiarity and experience 
with the program, we stated that we felt it was necessary to propose an 
alternative, less stringent reporting option.
    We invite public comment on this alternative, and the following is 
a summary of the comments we received.
    Comment: One commenter opposed defaulting eligible professionals 
who do not meet the criteria for satisfactory reporting for the 2013 
and/or 2014 PQRS incentives to the administrative claims-based 
reporting option. The commenter notes that the proposed measures under 
the administrative claims-based reporting option are not broadly 
applicable to all medical specialties and do not encourage the 
reporting of PQRS measures that are applicable to their patients.
    Response: We understand the limitations of the proposed 
administrative claims-based reporting option, particularly as it 
applies to certain specialties. Based on the

[[Page 69204]]

comments received and our desire to encourage eligible professionals to 
report measures applicable to the eligible professionals' practice, we 
are not finalizing a policy to default eligible professionals who do 
not meet the criteria for satisfactory reporting for the 2013 and/or 
2014 PQRS incentives to the administrative claims-based reporting 
option.
    Comment: One commenter supported defaulting eligible professionals 
who do not meet the criteria for satisfactory reporting for the 2013 
and/or 2014 PQRS incentives to the administrative claims-based 
reporting option. The commenter noted that should CMS default eligible 
professionals to the administrative claims-based reporting option, 
registration would not be necessary.
    Response: Although we disagree, we appreciate the commenter's 
feedback. As eligible professionals and group practices choose the 
traditional reporting mechanisms under which they report PQRS quality 
measures, we are requiring eligible professionals to affirmatively 
choose whether or not to elect the administrative claims reporting 
option. We emphasize our preference towards the traditional claims, 
registry, EHR, and GPRO web interface PQRS reporting mechanisms.
    In summary, eligible professionals and group practices have 3 
options for meeting the criteria for satisfactory reporting for the 
2015 PQRS payment adjustment:
     Meet the criteria for the 2013 PQRS incentive;
     Report 1 applicable measure or, for eligible professionals 
only, measures group; or
     Elect to be analyzed under the administrative claims-based 
reporting mechanism.
    Eligible professionals and group practices have 1 option for 
meeting the criteria for satisfactory reporting for the 2016 PQRS 
payment adjustment: Meet the criteria for satisfactory reporting for 
the 2016 PQRS payment adjustment.
c. Analysis of Eligible Professionals and Group Practices Who Will Be 
Assessed a PQRS Payment Adjustment
    As noted in Sec.  414.90(b), an eligible professional is assessed 
at the TIN/NPI level and a group practice selected to participate in 
the GPRO is assessed at the TIN level. As there is a 1-year lapse in 
time between the end of a proposed respective payment adjustment 
reporting period and when an eligible professional is expected to 
receive a PQRS payment adjustment for not meeting the requirements for 
satisfactory reporting for the respective payment adjustment, we 
understand that an eligible professional may change his or her TIN/NPIs 
during this lapse of time. Likewise, a group practice selected to 
participate in the GPRO may change its TIN during this lapse in time. 
In the proposed rule (77 FR 44825-44826). We noted that we believed 
this could raise issues with regard to the subsequent application of 
the payment adjustment and concerns about the potential for abuse (for 
example, ``gaming the system'').
    Accordingly, we invited public comment this issue, including what 
parameters, if any, CMS should impose regarding the changes in TIN/NPIs 
and compositions of group practices with regard to the payment 
adjustment. We received the following comment regarding this issue.
    Comment: One commenter disagreed with our concern for potential 
abuse for allowing changes in an eligible professional's TIN/NPI 
composition for applying the PQRS payment adjustment. The commenter 
stated that actual reporting of PQRS measures is typically documented 
by the practice's administrative staff, not the eligible professional. 
Therefore, should an eligible professional decide to enter a new 
practice, the eligible professional should not be held accountable for 
errors that occurred in his or her previous practice. The commenter 
stated that having a PQRS payment follow the eligible professional into 
a potential new practice could affect the eligible professional's 
ability to seek new employment.
    Response: It is not CMS' intention to affect the employment 
opportunities of eligible professionals by establishing parameters 
concerning changes in an eligible professional's TIN/NPI composition 
for applying the PQRS payment adjustment. Rather, CMS' concern 
regarding changes in an eligible professionals TIN/NPI combination lie 
in the potential that an eligible professional may change his/her TIN/
NPI composition solely for the purpose of avoiding application of the 
PQRS payment adjustment. After taking into consideration the comment 
received, at this point, we are not placing any parameters around the 
changing of an eligible professional's TIN/NPI composition for purposes 
of the payment adjustment. However, we may place such parameters in the 
future should the need arise.
6. PQRS Quality Measures for 2013 and Beyond
    This section focuses on the PQRS quality measures we are making 
available for reporting under PQRS using the claims, registry, EHR 
(direct EHR or EHR data submission vendor product), GPRO web interface, 
and/or administrative claims-based reporting mechanisms. Below, we 
address the comments we received regarding these measures. We note, 
however, that many commenters provided comments related to measure 
specifications and suggestions for additional measures. For the measure 
specifications for these proposed PQRS measures, please note that we do 
not use the rulemaking process to change measure specifications. 
Measure specifications are determined by the measure developers and 
owners. Therefore, suggestions on changes to measure specifications 
should be addressed to the respective measure developer and/or owner.
    In addition, we note that we received some comments in which 
commenters suggested additional measures. However, as we have noted in 
prior program years, we do not generally adopt measures in the final 
measure set that were not proposed in the proposed rule (though we do 
take them in consideration for possible use in future years of the 
program). In addition, we note that we undergo a pre-rulemaking 
process--including the requirement that measure owners and developers 
submit these measures for inclusion in the PQRS measure set in our 
annual PQRS Call for Measures and have these measures subsequently 
reviewed by the MAP--prior to proposing measures in rulemaking. Since 
these proposed measures have not gone through our various vetting 
channels, we cannot include these newly suggested measures that arise 
from the comments provided.
    We also received comments asking whether PQRS measures applied to 
certain specialties. Please note that these questions are not typically 
addressed in rulemaking. We urge the commenters to contact the 
QualityNet Help Desk for assistance with finding applicable measures.
a. Statutory Requirements for the Selection of PQRS Quality Measures 
for 2013 and Beyond
    Under section 1848(k)(2)(C)(i) of the Act, the PQRS quality 
measures shall be such measures selected by the Secretary from measures 
that have been endorsed by the entity with a contract with the 
Secretary under subsection 1890(a) of the Act (currently, that is the 
National Quality Forum, or NQF). However, in the case of a specified 
area or medical topic determined appropriate by the Secretary for which 
a feasible and practical measure has not been endorsed by the NQF, 
section 1848(k)(2)(C)(ii) of

[[Page 69205]]

the Act authorizes the Secretary to specify a measure that is not so 
endorsed as long as due consideration is given to measures that have 
been endorsed or adopted by a consensus organization identified by the 
Secretary, such as the AQA alliance. In light of these statutory 
requirements, we believe that, except in the circumstances specified in 
the statute, each PQRS quality measure must be endorsed by the NQF. 
Additionally, section 1848(k)(2)(D) of the Act requires that for each 
PQRS quality measure, ``the Secretary shall ensure that eligible 
professionals have the opportunity to provide input during the 
development, endorsement, or selection of measures applicable to 
services they furnish.''
    The statutory requirements under section 1848(k)(2)(C) of the Act, 
subject to the exception noted previously, require only that the 
measures be selected from measures that have been endorsed by the 
entity with a contract with the Secretary under section 1890(a) (that 
is, the NQF) and are silent for how the measures that are submitted to 
the NQF for endorsement were developed. The basic steps for developing 
measures applicable to physicians and other eligible professionals 
prior to submission of the measures for endorsement may be carried out 
by a variety of different organizations. We do not believe there needs 
to be any special restrictions on the type or make-up of the 
organizations carrying out this basic process of development of 
physician measures, such as restricting the initial development to 
physician-controlled organizations. Any such restriction would unduly 
limit the basic development of quality measures and the scope and 
utility of measures that may be considered for endorsement as voluntary 
consensus standards for purposes of the PQRS.
    In addition to section 1848(k)(2)(C) of the Act, section 1890A of 
the Act, which was added by section 3014(b) of the Affordable Care Act, 
requires that the entity with a contract with the Secretary under 
subsection 1890(a) of the Act (currently that, is the NQF) convene 
multi-stakeholder groups to provide input to the Secretary on the 
selection of certain categories of quality and efficiency measures. 
These categories are described in section 1890(b)(7)(B) of the Act, and 
include such measures as the quality measures selected for reporting 
under the PQRS. Pursuant to section 3014 of Affordable Care Act, the 
NQF convened multi-stakeholder groups by creating the Measure 
Applications Partnership (MAP). Section 1890(A)(a) of the Act requires 
that the Secretary establish a pre-rulemaking process in which the 
Secretary must make publicly available by December 1st of each year a 
list of the quality and efficiency measures that the Secretary is 
considering for selection through rulemaking for use in the Medicare 
program. Once we have made this list available to the public, the NQF 
must provide CMS with the MAP's input on selecting measures by February 
1st of each year. The list of measures under consideration for 2012 is 
available at http://www.qualityforum.org/Setting_Priorities/Partnership/Measure_Applications_Partnership.aspx.
    We received the following comments regarding these statutory 
requirements for the selection of PQRS quality measures:
    Comment: One commenter was concerned with the requirement that all 
measures included in PQRS be NQF-endorsed.
    Response: As we discussed above, section 1848(k)(2)(C)(i) of the 
Act generally requires that the PQRS quality measures be NQF endorsed. 
However, we note that section 1848(k)(2)(C)(ii) of the Act authorizes 
CMS to include measures in PQRS that are not NQF-endorsed. PQRS gives 
preference to measures that have been endorsed by NQF. However, there 
are cases where no NQF measures exist which address an identified 
quality area. Additionally, PQRS measures undergo yearly revisions 
based on NQF and measure owner direction, which incorporate new 
evidence and clinical recommendations.
    Comment: Some commenters believed that only measures that are NQF-
endorsed should be available for reporting in PQRS.
    Response: We understand the importance of NQF endorsement. While we 
appreciate the commenters' feedback, we believe there are circumstances 
(such as when a measure addresses a gap in the PQRS measure set) where 
we may believe that it is important to include a non-NQF endorsed 
measure to be available for reporting under PQRS. Section 
1848(k)(2)(C)(ii) of the Act authorizes the Secretary to include 
measures available for reporting under PQRS that are not NQF endorsed. 
We believe that the measures we finalize under PQRS undergo a vetting 
process. For example, prior to rule making, CMS reviews input from the 
Measure Applications Partnership (MAP). Among other factors, utility, 
feasibility, and analytics are assessed during this process. The 
Secretary has contracted with the National Quality Forum (NQF), as the 
consensus-based entity for a number of reasons, as described in section 
1890 of the Act, including for the specific purpose of convening multi-
stakeholder groups to provide input to CMS on the identification of the 
best available performance measures and the selection of these measures 
for PQRS (amongst other purposes).
    Comment: One commenter stressed its concern with prioritizing 
measures that are NQF-endorsed. The commenter notes that NQF 
endorsement is not achievable for all measures as staff and financial 
resources are limited for many measure developers, both of which are 
needed to deploy large testing projects to support reliability and 
validity. Moreover, the commenter believed the method of measure 
development for primary care differs vastly from that of specialty care 
due to dissimilarities in patient populations and target diseases which 
may be more amenable to qualitative vs. quantitative research.
    Response: We understand the commenter's concerns regarding the 
limitations of NQF-endorsement and have historically included measures 
that are not NQF-endorsed for inclusion in the PQRS measure set based 
on our exception authority under section 1848(k)(2)(C)(ii) of the Act. 
We continue to include measures that are not NQF-endorsed to address 
gaps in the PQRS measure set when appropriate.
    Comment: One commenter requested that, in the future, CMS include 
more information regarding measure recommendations from the Measure 
Applications Partnership (MAP) to allow the public to more meaningfully 
comment on proposed PQRS measures.
    Response: We understand the need to provide the public with 
adequate information to meaningfully comment on our proposals. 
Therefore, in the future, we will seek to provide more information 
regarding measure recommendations from the MAP.
b. Other Considerations for the Selection of Proposed PQRS Quality 
Measures for 2013 and Beyond
    As we noted above, section 1848(k)(2)(C)(ii) of the Act provides an 
exception to the requirement that the Secretary select measures that 
have been endorsed by the entity with a contract under section 1890(a) 
of the Act (that is, the NQF). We may select measures under this 
exception if there is a specified area or medical topic for which a 
feasible and practical measure has not been endorsed by the entity. 
Under this exception, aside from NQF endorsement, we requested that 
stakeholders apply the following considerations when submitting 
measures for possible inclusion in the PQRS measure set:

[[Page 69206]]

     High impact on healthcare.
     Measures that are high impact and support CMS and HHS 
priorities for improved quality and efficiency of care for Medicare 
beneficiaries.
     Measures that address gaps in the quality of care 
delivered to Medicare beneficiaries.
     Address Gaps in the PQRS measure set.
     Measures impacting chronic conditions (chronic kidney 
disease, diabetes mellitus, heart failure, hypertension and 
musculoskeletal).
     Measures applicable across care settings (such as, 
outpatient, nursing facilities, domiciliary, etc.).
     Broadly applicable measures that could be used to create a 
core measure set required of all participating eligible professionals.
     Measures groups that reflect the services furnished to 
beneficiaries by a particular specialty.
    On October 7, 2011, we ended a Call for Measures that solicited new 
measures for possible inclusion in the PQRS for 2013 and beyond. During 
the Call for Measures, we solicited measures that were either NQF-
endorsed or fell under the exception specified in section 
1848(k)(2)(C)(ii) of the Act.
    Although the deadline to submit measures for consideration for the 
2013 PQRS program year has ended, we invited public comment on future 
considerations related to the selection of new PQRS quality measures. 
The following is a summary of the comments received.
    Comment: One commenter emphasized the need that measures selected 
for reporting under PQRS be vetted by multi-stakeholder entities from 
development to endorsement, particularly by physicians who are 
ultimately the end-users of the measures. Another commenter stressed 
the importance of providing a better review and vetting process of 
measures.
    Response: We appreciate the commenter's feedback and understand the 
importance of ensuring that stakeholders review measures prior to being 
included in PQRS, particularly during our annual PQRS Call for Measures 
and subsequently through use of the MAP's input.
    Comment: One commenter strongly supports the continued development 
of risk-adjusted measures versus process measures as true measures of 
physician quality.
    Response: CMS agrees and will strive to include and implement 
robust outcomes measures in the PQRS measure set as appropriate 
measures.
    Comment: One commenter urges CMS to bolster the current PQRS 
requirements, which rely too heavily on measures of basic competencies 
and other processes that are not necessarily close to or related to an 
outcome. The commenter believes that many measure gaps (particularly in 
the area of outcomes) must be filled for PQRS to effectively and 
accurately assess physician performance. Therefore, the commenter urges 
CMS to fill these gaps at the earliest opportunity by working with 
medical societies and other measure developers.
    Response: We agree with the commenter's feedback and are actively 
working with stakeholders to address measure gaps in the PQRS measure 
set.
    Comment: One commenter urged CMS to continue to develop risk 
adjustment methodologies as there is not a clear method to adjust many 
quality measures. The commenter asked CMS to support the development of 
measures that better address multi-morbidity and patient centeredness.
    Response: We appreciate the commenter's feedback and encourage the 
submission of risk adjusted measures for consideration for inclusion in 
the PQRS measures set.
c. PQRS Quality Measures
    This section focuses on the proposed PQRS individual Measures 
available for reporting via claims, registry, and/or EHR-based 
reporting for 2013 and beyond. To align with the proposed measure 
domains provided in the EHR Incentive Program (77 FR 13743), we 
classify all proposed measures against six domains based on the 
National Quality Strategy's six priorities, as follows (77 FR 44827):
    (1) Patient and Family Engagement. These are measures that reflect 
the potential to improve patient-centered care and the quality of care 
delivered to patients. They emphasize the importance of collecting 
patient-reported data and the ability to impact care at the individual 
patient level as well as the population level through greater 
involvement of patients and families in decision making, self-care, 
activation, and understanding of their health condition and its 
effective management.
    (2) Patient Safety. These are measures that reflect the safe 
delivery of clinical services in both hospital and ambulatory settings 
and include processes that would reduce harm to patients and reduce 
burden of illness. These measures should enable longitudinal assessment 
of condition-specific, patient-focused episodes of care.
    (3) Care Coordination. These are measures that demonstrate 
appropriate and timely sharing of information and coordination of 
clinical and preventive services among health professionals in the care 
team and with patients, caregivers, and families to improve appropriate 
and timely patient and care team communication.
    (4) Population and Public Health. These are measures that reflect 
the use of clinical and preventive services and achieve improvements in 
the health of the population served and are especially focused on the 
leading causes of mortality. These are outcome-focused and have the 
ability to achieve longitudinal measurement that will demonstrate 
improvement or lack of improvement in the health of the U.S. 
population.
    (5) Efficient Use of Healthcare Resources. These are measures that 
reflect efforts to significantly improve outcomes and reduce errors. 
These measures also impact and benefit a large number of patients and 
emphasize the use of evidence to best manage high priority conditions 
and determine appropriate use of healthcare resources.
    (6) Clinical Processes/Effectiveness. These are measures that 
reflect clinical care processes closely linked to outcomes based on 
evidence and practice guidelines.
    We invited but received no public comment on these domains.
    Please note that the PQRS quality measure specifications for any 
given proposed PQRS individual quality measure may differ from 
specifications for the same quality measure used in prior years. For 
example, for the proposed PQRS quality measures that were selected for 
reporting in 2012, please note that detailed measure specifications, 
including the measure's title, for the proposed individual PQRS quality 
measures for 2013 and beyond may have been updated or modified during 
the NQF endorsement process or for other reasons. In addition, due to 
our desire to align measure titles with the measure titles that were 
proposed for 2013, 2014, 2015, and potentially subsequent years of the 
EHR Incentive Program, we note that the measure titles for measures 
available for reporting via EHR may change. To the extent that the EHR 
Incentive Program updates its measure titles to include version numbers 
(77 FR 13744), we intend to use these version numbers to describe the 
PQRS EHR measures that will also be available for reporting for the EHR 
Incentive Program. We will continue to work toward complete alignment 
of measure specifications across programs whenever possible.
    Through NQF's measure maintenance process, NQF endorsed measures 
are

[[Page 69207]]

sometimes updated to incorporate changes that we believe do not 
substantially change the nature of the measure. Examples of such 
changes could be updated diagnosis or procedure codes or changes to 
exclusions to the patient population or definitions. We believe these 
types of maintenance changes are distinct from more substantive changes 
to measures that result in what are considered new or different 
measures, and that they do not trigger the same agency obligations 
under the Administrative Procedure Act. We proposed that if the NQF 
updates an endorsed measure that we have adopted for the PQRS in a 
manner that we consider to not substantially change the nature of the 
measure, we would use a subregulatory process to incorporate those 
updates to the measure specifications that apply to the program (77 FR 
44822). Specifically, we would revise the Specifications Manual so that 
it clearly identifies the updates and provide links to where additional 
information on the updates can be found. We would also post the updates 
on the CMS QualityNet Web site at https://www.QualityNet.org. We would 
provide sufficient lead time for implementing the changes where changes 
to the data collection systems would be necessary.
    We would continue to use the rulemaking process to adopt changes to 
measures that we consider to substantially change the nature of the 
measure. We believe that this proposal adequately balances our need to 
incorporate NQF updates to NQF-endorsed measures in the most 
expeditious manner possible, while preserving the public's ability to 
comment on updates that so fundamentally change an endorsed measure 
that it is no longer the same measure that we originally adopted.
    We invite public comment on this proposal. The following is a 
summary of comments we received on this proposal to allow for altering 
of a measure that has been finalized in rulemaking, provided that the 
updates do not substantially change the nature of the measure.
    Comment: Some commenters opposed our proposal to handle changes to 
a measure through a subregulatory process.
    Response: We understand the need for transparency when effectuating 
changes to a measure. However, we note that the measure changes we 
envision making outside of rulemaking are relatively minor, such as 
minor changes to the measure specifications. Other examples of minor 
changes include: Adding the NQF endorsement number to a measure, 
correcting faulty logic, adding or deleting codes as well as providing 
additional implementation guidance for a measure. These changes do not 
substantively change the measures we finalize in rulemaking. We believe 
it is necessary to be able to make non-substantive changes to PQRS 
measures, so that we may quickly address issues that arise with the 
reporting of measures. Therefore, we are finalizing our proposal to 
make non-substantive measure changes outside of rulemaking.
    We note that CMS does not usually make unilateral changes to 
measures. These minor changes are usually addressed in collaboration 
with stakeholder feedback--measure developers, measure owners, eligible 
professionals reporting the respective measures, etc. Therefore, to the 
extent that we received comments related to minor changes to the 
proposed PQRS measures, we did not address these comments in this final 
rule. Commenters are encouraged to contact the respective measures 
owners regarding these issues.
    To receive more information on the proposed measures contained in 
this section, including the measure specifications for these proposed 
measures, please contact the respective measure owners. Contact 
information for the measure owners of these proposed PQRS measures is 
available at the PQRS Web site at http://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/PQRS/index.html.
(1) HHS Million Hearts Individual Measures Available for Claims, 
Qualified Registry, and EHR-Based Reporting for 2013 and Beyond
    In 2011, the Department of Health and Human Services (HHS) started 
the Million Hearts Initiative, which is an initiative to prevent 1 
million heart attacks and strokes in 5 years. We are dedicated to this 
initiative and seek to encourage eligible professionals to join in this 
endeavor. Therefore, based on our desire to support the Million Hearts 
Initiative and maintain our focus on cardiovascular disease prevention, 
we proposed individual PQRS Core Measures that were specified in Table 
94 of the CY 2013 MPFS proposed rule for 2013 and beyond (77 FR 44827). 
These measures were the same measures we finalized under the 2012 PQRS 
in the CY 2012 Medicare PFS final rule (76 FR 73345). Please note that, 
although we proposed that certain measures serve as core PQRS quality 
measures, we did not propose to require that eligible professionals 
report on these proposed PQRS core measures. We invited public comment 
on the proposed PQRS core measures for 2013 and beyond. We did not 
receive public comment on the majority of measures we proposed to 
classify as PQRS core measures.
    The following is a summary of the comments we received on the 
proposed PQRS core measures for 2013 and beyond and our proposal 
regarding the ``core'' designation.
    Comment: One commenter recommended that we avoid classifying the 
proposed PQRS core measures as ``core measures,'' because the EHR 
Incentive Program uses the term ``core measures'' differently. 
Therefore, the commenter stated that classifying these PQRS measures as 
``core measures'' may cause confusion.
    Response: We agree with the commenter that the term ``core 
measures'' is used differently under PQRS and the EHR Incentive 
Program. Therefore, we will refer to these measures as HHS Million 
Hearts Measures.
    Comment: One commenter supports CMS' dedication to view the 
treatment of cardiovascular conditions as a top priority.
    Response: We appreciate the commenter's feedback. Indeed, aside 
from finalizing our measures related to cardiovascular conditions, we 
are finalizing this proposed measure set. However, rather than 
referring to this measure set as PQRS core measures, we will refer to 
this measure set as the measure set containing the HHS Million Hearts 
Measures.
    Comment: One commenter opposed classifying the following measure as 
a PQRS core measure:
     Preventive Care and Screening: Cholesterol-Fasting Low 
Density Lipoprotein (LDL) Test Performed AND Risk-Stratified Fasting 
LDL
    The commenter does not believe that this measure should be a core 
measure because it is only available for reporting using the EHR-based 
reporting mechanism.
    Response: While this measure is only available for reporting using 
the EHR-based reporting mechanism, the measure addresses important 
quality actions related to the Million Hearts Initiative. Therefore, we 
are finalizing these proposed measures as part of the HHS Million 
Hearts measure set available for reporting under PQRS for 2013 and 
beyond.

[[Page 69208]]

    Table 94 provides a summary of the HHS Million Hearts measures we 
are finalizing for 2013 and beyond. Please note that, although we 
strongly encourage that eligible professionals report these measures, 
eligible professionals are not required to report these specific 
measures for the purposes of meeting the criteria for satisfactory 
reporting for the PQRS incentives or payment adjustments.
BILLING CODE 4120-01-P

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BILLING CODE 4120-01-C
(2) PQRS Quality Measures Available for Reporting via the Claims, 
Qualified Registry, EHR, and GPRO Web Interface Reporting Mechanisms 
for 2013 and Beyond
    This section contains individual PQRS quality measures we proposed 
for 2013 and beyond (77 FR 44830) and the final measure set we are 
adopting in this final rule with comment period. Please note that, in 
large part, we proposed to retain most of the quality measures we 
finalized for reporting for the 2012 PQRS (76 FR 42865 through 42872). 
However, in 2013 and 2014, we proposed to include new measures, as well 
as remove measures that were available for reporting under the 2012 
PQRS (not re-propose certain measures for 2013 and beyond). Table 97 of 
the CY 2013 PFS proposed rule contains the list of measures we proposed 
to be available for reporting under the PQRS for 2013 and beyond that 
were available under the 2012 PQRS (77 FR 44841). Tables 30 and 33 of 
the CY 2013 PFS proposed rule contains the list of new measures we 
proposed to be available for reporting under the PQRS beginning in 2013 
and 2014 respective that were not available under the 2012 PQRS (77 FR 
44831 and 77 FR 44942). Tables 31 and 34 of the CY 2013 PFS proposed 
rule contains the list of measures we did not propose for reporting 
under PQRS beginning in 2013 and 2014 respectively that are available 
for reporting under the 2012 PQRS (77 FR 44837 and 77 FR 44953).
    General Comments on Proposed Individual Measures for Reporting for 
2013/2014 and Beyond. We received the following general comments 
related to the individual measures we proposed for reporting under PQRS 
beginning in 2013 or 2014:

[[Page 69211]]

    Comment: Several commenters appreciate CMS' efforts to align the 
PQRS measures available for reporting under the EHR-based reporting 
mechanisms with the measures available for reporting under the EHR 
Incentive Program. The commenters believe this alignment will reduce 
the administrative burden on eligible professionals while harmonizing 
the two programs.
    Response: We appreciate the commenter's feedback and note that we 
are working to completely align the measures available for reporting 
via EHR under PQRS and the EHR Incentive Program. For the 2012 PQRS, we 
have attempted to align the PQRS measures available for EHR-based 
reporting with the EHR measures available for reporting under the EHR 
Incentive Program (76 FR 73364) and we are retaining those measures for 
2013 and beyond. In fact, we are adding or removing measures available 
for EHR-based reporting that align with what has been finalized for 
reporting under the EHR Incentive Program for beginning in CY 2014 (77 
FR 54060).
    Comment: Some commenters were pleased that the proposed PQRS 
measure set provided a variety of measures for which certain 
specialties may report, such as vascular surgeons.
    Response: We appreciate the commenters' feedback. It is our goal to 
ensure that specialties are able to report under PQRS. Therefore, as 
our final set of measures specified in Table 95 indicates, we allow for 
a broad variety of measures in the PQRS measure set.
    We note that we received several comments related to the addition 
of measures we did not propose for inclusion in PQRS. We note the need 
to be transparent and provide the public with an opportunity to provide 
comment on the measures we include in PQRS prior to finalizing these 
measures in the PQRS measure set. Since we did not propose including 
these measures for reporting under PQRS, we are not addressing these 
comments in this final rule. However, we will use the comments we have 
received when selecting measures to be included in PQRS for future 
program years.
    Prior Measures Not Proposed for Reporting under PQRS. We did not 
propose to retain 14 measures in 2013 that were previously established 
for reporting under the 2012 PQRS (see Table 96 of the CY 2013 PFS 
proposed rule, 77 FR 44837). We did not propose to retain 9 measures in 
2014 that were previously established for reporting under the 2012 PQRS 
(see Table 34 of the CY 2013 proposed rule, 77 FR 44953). The public 
comments we received did not address the majority of the measures 
identified from prior PQRS program years that we did not propose to 
include from reporting under PQRS in 2013 and 2014.
    The following is a summary of the comments we did receive regarding 
prior program measures we did not propose to include under PQRS in 2013 
or 2014:
    Comment: Some commenters opposed our decision not to propose for 
the 2013 PQRS and beyond:
     Chronic Wound Care: Use of Compression System in Patients 
with Venous Ulcers. One commenter states that the MAP recommended that 
the measure be submitted for NQF endorsement.
    Response: We are not retaining this measure for reporting under 
PQRS beginning in 2013. Indeed, as the commenter stated, the MAP 
recommended that this measure be submitted for NQF endorsement. 
Currently, this measure is not-NQF endorsed. We interpret the MAPs 
recommendation that this measure be submitted for NQF endorsement as 
the MAP not recommending this measure until the measure is NQF 
endorsed. As such, according to the MAP recommendation, we are not 
retaining this measure for reporting under PQRS. However, we may 
consider including this measure for reporting under PQRS in future 
years should this measure later receive NQF endorsement. We note that 
it is the responsibility of the respective measure owners and 
developers to submit measures for NQF endorsement.
    Comment: Some commenters opposed our proposal not to retain the 
following measure for reporting under PQRS:
     Health Information Technology (HIT): Adoption/Use of 
Electronic Health Records (EHR).
    One commenter suggested that this measure be retained until a 
majority of eligible professionals have adopted EHR systems. Another 
commenter disagreed with CMS' contention that this measure is redundant 
to have an eligible professional report on whether or not s/he has 
adopted an EHR. The commenter believed that the measure is only 
redundant in the instances where the eligible professional is using 
direct EHR reporting. The commenter suggested that CMS follow the same 
protocol as other PQRS measures by designating measure 124 
available only to those eligible professional who report using claims 
or registry reporting.
    Response: We appreciate the commenter's feedback, but we are not 
retaining this measure for reporting under PQRS. It is our intention to 
align the measures available for EHR-based reporting under PQRS with 
the measures available for reporting under the Medicare EHR Incentive 
Program. Since this measure is not available for reporting under the 
EHR Incentive Program, we do not believe it is appropriate to include 
in the final PQRS measure set.
    With respect to the commenter's request that this measure be 
retained until a majority of eligible professionals have adopted EHR 
systems, we do not believe we need to retain this measure for reporting 
for this purpose as we are encouraging eligible professionals to adopt 
EHR systems in other ways. For example, we are aligning our EHR 
reporting criteria with the criteria for meeting the CQM component of 
meaningful use such that eligible professionals reporting quality 
measures data via an EHR may satisfy the requirements for satisfactory 
reporting under PQRS and achieving meaningful use under the EHR 
Incentive Program by submitting one set of data.
    With respect to the commenter who disagreed that the measure is 
redundant, we respectfully disagree with the commenter. Measures in 
PQRS generally provide that the eligible professional perform some sort 
of clinical quality action. For example, with respect to the HHS 
Million Hearts measure set that we are finalizing, the measure set 
indicates that an eligible professional asks certain questions of 
beneficiaries and perform certain procedures that we believe would help 
prevent heart disease. This measure does not do this; rather, the 
measure merely asks the eligible professional in indicate to CMS 
whether or not the eligible professional has adopted an EHR system. We 
do not believe this measure provides meaningful information to CMS 
anymore, as there are other PQRS requirements and CMS programs that 
more appropriately address the adoption and use of EHR systems. For 
these reasons, we will not extend the reporting of this measure for 
claims or registry-based reporting as the commenter requested.
    Comment: One commenter opposed our decision not to include the 
following measure for reporting under PQRS:
     Stroke and Stroke Rehabilitation: Computed Tomography (CT) 
and Magnetic Resonance Imaging (MRI).
    Response: We respectfully disagree with the commenter. This measure 
was reviewed by the MAP and not recommended for inclusion in the PQRS 
measure set beginning 2013. Therefore, we are following the MAP's 
recommendation and excluding this

[[Page 69212]]

measure from reporting in PQRS beginning in 2013.
    Comment: One commenter opposed our decision not to retain the 
following measure from reporting under PQRS:
     Coronary Artery Disease (CAD): Symptom and Activity 
Assessment.
    The commenter is concerned that this measure is paired with PQRS 
Measure 242 (CAD: Symptom Management), and therefore should be 
remain in PQRS for reporting to coincide with the reporting of measure 
242.
    Response: This measure was part of a two-part measure paired with 
Measure 242 for the 2012 PQRS. The two measures were intended 
to reflect the quality of services provided for the primary management 
of patients with CAD who are seen in the ambulatory setting. For 2012, 
the PQRS measure specifications (available on the PQRS Web site at 
http://www.cms.gov/apps/ama/license.asp?file=/PQRS/downloads/2012_PhysQualRptg_IndividualClaimsRegistry_Specs_SupportingDocs_01162012.zip) note that, should an eligible professional assess angina 
symptoms and patient activity under this measure, then Measure 
242 should also be reported. As such, this measure triggered 
the reporting of Measure 242.
    We prioritize the recommendation the MAP provides for the inclusion 
of measures in the PQRS measure set over our desire to retain the 
manner we have suggested that eligible professionals reporting these 
CAD measures in 2012. Since this measure was reviewed by the MAP and 
not recommended for inclusion in the PQRS measure set beginning 2013, 
we are not retaining this measure for reporting in PQRS. Measure 
242 will therefore be reportable as a standalone measure. The 
description on how to report Measure 242 will be found in the 
Measures Specifications Manual that will be published for 2013 that 
will be available on the PQRS Web site at http://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/PQRS/index.html.
    Comment: One commenter opposed our proposal to remove the following 
measure from reporting under PQRS:
     Emergency Medicine: Community-Acquired Pneumonia (CAP): 
Assessment of Oxygen Saturation.
    Response: The MAP recommended that this measure be ``removed'' from 
the PQRS measure set. Although we are not bound by the recommendations 
of the MAP, we find no reason to oppose the MAP's recommendation and 
retain this measure for reporting in PQRS. Therefore, we are not 
retaining this measure for reporting in PQRS beginning in 2013.
    Comment: One commenter opposed our proposal to remove the following 
measure from the PQRS measure set:
     Referral for Otologic Evaluation for Patients with Acute 
or Chronic Dizziness.
    The commenter urged CMS to consider retiring Measure 188: Referral 
for Otologic Evaluation for Patients with Congenital or Traumatic 
Deformity of the Ear in lieu of retiring Measure 190: Referral for 
Otologic Evaluation for Patients with Acute or Chronic Dizziness, 
because Measure 100 relates to a relatively uncommon condition seen in 
audiology practices.
    Response: Although we are not bound by the MAP's recommendation, we 
note that the MAP recommended that this measure be ``removed'' from 
reporting under PQRS. We agree with the MAP's recommendation. We 
believe that this measure is too low bar as it is not a high impact 
measure that provides analysis on the patient or provider level. 
Rather, the measure simply asks whether a beneficiary has been referred 
for an evaluation. Therefore, we are not retaining this measure for 
reporting in PQRS. However, we encourage the development of a similar, 
more robust measure related to Otologic services.
    Comment: Commenters supported our decision not to retain the 
following measure from reporting under PQRS:
     Emergency Medicine: Community-Acquired Pneumonia (CAP): 
Assessment of Mental Status.
     Heart Failure: Patient Education.
     Hypertension (HTN): Plan of Care.
     Hypertension (HTN): Blood Pressure Measurement.
     Prostate Cancer: Three Dimensional (3D) Radiotherapy.
     Heart Failure: Warfarin Therapy for Patients with Atrial 
Fibrillation.
     Preventive Care and Screening: Unhealthy Alcohol Use--
Screening.
    Response: We appreciate the commenter's feedback. These measures 
will not be included in the PQRS measure set for 2013 or 2014 and 
beyond.
    Individual Measures Available for Reporting Under PQRS. Table 97 of 
the CY 2013 PFS proposed rule contains the list of measures we proposed 
to be available for reporting under the PQRS for 2013 and beyond that 
were available under the 2012 PQRS (77 FR 44841). Tables 30 and 33 of 
the CY 2013 PFS proposed rule contains the list of new measures we 
proposed to be available for reporting under the PQRS beginning in 2013 
and 2014 respective that were not available under the 2012 PQRS (77 FR 
44831 and 77 FR 44942). We proposed a total of 212 measures for 
available for reporting beginning in 2013. Beginning 2014, we proposed 
that 210 measures be available for reporting under PQRS. As indicated 
previously, these proposed measures are classified under 6 domains: (1) 
Patient safety, (2) patient and family engagement, (3) care 
coordination, (4) clinical process/effectiveness, (5) population/public 
health, and (6) efficiency.
    With respect to the individual measures we proposed to include for 
reporting in PQRS beginning in 2013 or 2014, we did not receive public 
comments on a majority of the measures we proposed for inclusion in 
PQRS (specific measures we did receive comments on are addressed 
below). Therefore, based on the reasons previously stated in the CY 
2013 PFS proposed rule, we are finalizing these measures, as proposed. 
These measures either meet the requirement that the measures available 
in the PQRS measure set be NQF endorsed or address an exception to NQF 
endorsement, such as filling a gap in the PQRS measure set. The 
following is a summary of the comments we did receive on certain 
proposed individual measures:
    Comment: Commenters provided general support for the following 
measures that are available for reporting in PQRS in 2012:
     Melanoma: Coordination of Care--The inclusion of this 
measure would expand the number of measures relevant to dermatologists.
     Melanoma: Continuity of Care--Recall System--The inclusion 
of this measure would expand the number of measures relevant to 
dermatologists.
     Melanoma: Overutilization of Imaging Studies in Melanoma--
The inclusion of this measure would expand the number of measures 
relevant to dermatologists.
    For the following measures, one commenter supported the following 
proposed measures for inclusion in PQRS as they are relevant to 
ophthalmologists:
     Age-Related Macular Degeneration (AMD): Dilated Macular 
Examination.
     Diabetic Retinopathy: Documentation of Presence or Absence 
of Macular Edema and Level of Severity of Retinopathy.
     Diabetic Retinopathy: Communication with the Physician 
Managing On-going Diabetes Care.
    One commenter applauds the decision to incorporate the following 
measures for reporting in PQRS:
     Cardiac Stress Imaging Not Meeting Appropriate Use 
Criteria: Preoperative Evaluative in Low-Risk Surgery Patients.

[[Page 69213]]

     Cardiac Stress Imaging Not Meeting Appropriate Use 
Criteria: Routine Testing After Percutaneous Coronary Intervention 
(PCI).
     Cardiac Stress Imaging Not Meeting Appropriate Use 
Criteria: Testing in Asymptomatic, Low-Risk Patients.
    The commenter believes these measures collect data on three most 
common areas on inappropriate imaging, allowing CMS to more accurately 
capture information on the overall value of cardiac diagnostic imaging 
for beneficiaries. Another commenter specifically supported the measure 
titled ``Cardiac Stress Imaging Not Meeting Appropriate Use Criteria: 
Testing in Asymptomatic, Low-Risk Patients.''
    Response: We agree with the commenters' feedback and are therefore 
finalizing these individual measures for reporting in PQRS beginning in 
2013 or 2014. Since these measures were available for reporting in 
2012, we are retaining these measures so that eligible professionals 
may continue to report on these measures.
    Comment: Commenters provided support for the following measures 
that we proposed to add to the PQRS measure set beginning in 2013:
     Participation by a Hospital, Physician or Other Clinician 
in a Systematic Clinical Database Registry that Includes Consensus 
Endorsed Quality.
     Atrial Fibrillation and Atrial Flutter: Chronic 
Anticoagulation Therapy--The commenter also requested that the measure 
owner information on this measure should be updated to indicate that 
AMA-PCPI/ACCF/AHA is the current measure owner.
     Pediatric Kidney Disease: Adequacy of Volume Management--
The commenter also requested that the measure owner information on this 
measure should be updated to indicate that AMA-PCPI is the current 
measure owner.
    Response: We appreciate the commenters' support for adding these 
measure and, for the reasons stated in the CY 2012 PFS proposed rule 
(76 FR 44956), are finalizing these measures for reporting under PQRS 
for 2013 and beyond. For the measure ``Atrial Fibrillation and Atrial 
Flutter: Chronic Anticoagulation Therapy,'' we will reflect that the 
measure owner for this measure is currently AMA-PCPI/ACCF/AHA. For the 
measure ``Pediatric Kidney Disease: Adequacy of Volume Management,'' we 
will reflect that the measure owner for this measure is currently AMA-
PCPI.
    Comment: One commenter supported our proposal to include the 
following measure:
     Adult Major Depressive Disorder (MDD): Coordination of 
Care of Patients With Co-morbid Conditions.
    However, the commenter opposed our proposal that this measure be 
paired, since the measure owner did not support the following second 
part of the measure: ``who have a follow-up attempt within 60 days of 
original communication by the physician treating MDD to elicit a 
response from the other physician.''
    Response: We appreciate the commenter's feedback. However, this 
measure was submitted for consideration for inclusion in the PQRS 
measure set as a paired measure. Since we usually defer to the 
respective measures owners and developers on how a particular measure 
should be reported, we are finalizing this measure, as proposed.
    Comment: One commenter urged CMS to consider retiring the following 
measure:
     Referral for Otologic Evaluation for Patients with 
Congenital or Traumatic Deformity of the Ear.
    The commenter requests retiring this measure in lieu of retiring 
Measure 190: Referral for Otologic Evaluation for Patients with Acute 
or Chronic Dizziness, because Measure 100 relates to a relatively 
uncommon condition seen in audiology practices.
    Response: We appreciate the commenter's feedback. According to the 
2012 PQRS and eRx Experience Report, we note that no eligible 
professionals satisfactorily reported this measure. Since eligible 
professionals attempting to report this measure have had difficulty 
historically with reporting this measure, we are finalizing our 
decision not to retain this measure for reporting under PQRS.
    Comment: Some commenters requested that the following measure be 
reclassified from the NCQA domain ``Clinical Process/Effectiveness'' to 
the ``Care Coordination'' domain:
     Diabetic Retinopathy: Communication with the Physician 
Managing On-going Diabetes Care
    Since the activity addressed in the measure relates to 
communication and coordination with diabetes patients, the measure is 
more appropriately classified in the Care Coordination domain.
    Response: We appreciate the commenters' feedback. We agree with the 
commenters that the actions indicated in this measure involve 
coordination between patients and physicians. We understand that 
measures may pertain to multiple domains. However, as the EHR Incentive 
Program has also classified this as a clinical process/effectiveness 
measure (77 FR 54071), we are retaining the classifying this measure as 
a clinical process/effectiveness measure. We will, however, consider 
changing the classification of this measure in the future.
    Comment: One commenter supported our proposal to include an 
Osteoporosis composite measure but suggested that a sub-measure 
(``Osteoporosis: Management Following Fracture of Hip, Spine or Distal 
Radius for Men and Women Aged 50 Years and Older'') be added to the 
Osteoporosis composite measure owned by ABIM.
    Response: We appreciate the commenter's feedback and are finalizing 
the Osteoporosis composite measure for inclusion in the PQRS measures 
set. However, we are not finalizing this measure under the individual 
measures set. Rather, this composite measure is being finalized as a 
measures group as specified in Table 119 because we believe that 
composite measures are reported more similarly to measures groups under 
which an eligible professional must report on a group of interrelated 
measures. Please note that the addition of sub-measures is determined 
by the measure owner, ABIM. The sub-measure suggested for inclusion 
under the Osteoporosis measure (``Osteoporosis: Management Following 
Fracture of Hip, Spine or Distal Radius for Men and Women Aged 50 Years 
and Older'') is owned by AMA. While we agree that post-fracture care is 
an important component of quality related to Osteoporosis care, we are 
unable to add components to composite measures owned by outside 
entities.
    Comment: One commenter opposed our proposal to include the 
following measures for reporting in PQRS, as the measure owners will no 
longer support these measures:

 Stroke and Stroke Rehabilitation: Tissue Plasminogen Activator 
(t-PA) Considered (Paired Measure)
 Stroke and Stroke Rehabilitation: Tissue Plasminogen Activator 
(t-PA) Administered Initiated (Paired Measure)
 Coordination of Care of Patients with Co-Morbid Conditions--
Timely Follow-Up (Paired Measure)

    Response: We agree with the commenter and are therefore not 
finalizing these measures for reporting under PQRS.
    Please note that we are making the following changes to certain 
proposed measures for the following reasons:


[[Page 69214]]


 Chronic Obstructive Pulmonary Disease (COPD): Bronchodilator 
Therapy--The measure owner updated the threshold of an FEV1/FVC less 
than 70 percent to 60 percent based on scientific evidence/clinical 
trials
 Colon Cancer: Chemotherapy for AJCC Stage III Colon Cancer 
Patients--The measure owner updated the age criteria for this measure 
to 18 to 80
 Adult Major Depressive Disorder (MDD): Comprehensive 
Depression Evaluation: Diagnosis and Severity--The measure owner has 
added an assessment of depression severity to this measure
 Oncology: Cancer Stage Documented--The measure owner has 
broadened the denominator for this measure
 Melanoma: Overutilization of Imaging Studies in Melanoma--The 
measure owner has incorporated cancer staging into this measure
 Radiation Dose Optimization--The measure owner has updated 
this measure title to ``Optimizing Patient Exposure to Ionizing 
Radiation''

    A list of the measures we are finalizing for PQRS beginning in 2013 
or 2014 is contained in Table 95. Please note that the titles of the 
measures may change slightly from CMS program and/or CMS program year 
based on specifications updates. We intend to continue to work toward 
complete alignment of measure specifications across programs whenever 
possible.
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(3) PQRS Quality Measures Available for Group Practices Using the GPRO 
Web Interface
    We have previously discussed our measure proposals for group 
practices using the GPRO web interface in the proposed rule (77 FR 
44954). A summary of these proposed measures for group practices using 
the GPRO web interface can be found in Table 35 of the CY 2013 PFS 
proposed rule (77 FR 44960). We proposed (77 FR 44959) 18 measures--
including 2 composite measures for diabetes (5 component measures) and 
CAD (2 component measures), for a total of 22 measures--for reporting 
under the PQRS using the GPRO web interface for 2013 and beyond to 
align with the quality measures available for reporting under the 
Medicare Shared Savings Program (76 FR 67890). Because of our desire to 
align with measures available for reporting under the Medicare Shared 
Savings Program, we did not propose to retain the 13 measures specified 
in Table 36 of the CY 2013 PFS proposed rule for purpose of reporting 
via the GPRO web interface beginning in 2013 (77 FR 44963). We invited 
public comment on the proposed PQRS quality measures available for 
reporting under the GPRO web interface for 2013 and beyond. We did not 
receive public comment on a majority of the measures we proposed for 
reporting in the GPRO web interface. The following is a summary of the 
comments we did receive regarding the proposed measures for the GPRO 
web interface:
    Comment: Several commenters supported our overall proposal to align 
the measures available for reporting in the GPRO web interface with the 
measures that are available for reporting under the Medicare Shared 
Savings Program.
    Response: We appreciate the commenters' support and are moving 
forward with our proposals to align the measures available for 
reporting in the GPRO web interface with the measures that are 
available for reporting under the Medicare Shared Savings Program. 
Therefore, mainly due to our desire to align measures available under 
PQRS and the Medicare Shared Savings Program, as indicated in Table 96 
of this final rule, we are finalizing the 18 measures--which includes 2 
composites, for a total of 22 measures -- we proposed to be available 
for reporting via the GPRO web interface and not retaining 13 measures 
that were previously available for reporting under the GPRO web 
interface in 2012.
    We also proposed to have the following measure available for 
reporting occurring in 2013 and beyond: CG-CAHPS Clinician/Group 
Survey: Getting timely care, appointments and information; How well 
your doctors communicate; Patients' rating of doctor; Access to 
specialists; Health promotion and education; Shared decision making; 
Courteous and helpful office staff; Care coordination; Between visit 
communication; Educating patients about medication adherences; and 
Stewardship of patient resources (77 FR 44964).
    Comment: One commenter noted that the proposed CAHPS measures do 
not apply to hospital-based physicians and encouraged PQRS to 
incorporate measures that reflect care provided by all types of 
physicians.
    Response: We believe that PQRS measures should be broadly 
applicable to eligible professionals of varying practices. Therefore, 
we are not excluding hospital-based physicians from reporting the CAHPS 
measures, as we believe these CAHPS measures may be relevant to the 
practice of hospital-based physicians.
    Comment: One commenter requested that our proposal to report the 
CG-CAHPS survey measure under the GPRO web interface be made voluntary 
as the survey is expensive to administer.
    Response: We understand the commenter's concern regarding the 
expense of administering the CG-CAHPS survey. However, we require group 
practices using the GPRO web interface to report on all measures 
available under the GPRO web interface. As this CG-CAHPS survey is part 
of the GPRO web interface, it will be mandatory for group practices 
using the GPRO web interface to also be held accountable for the survey 
results. We are developing a process, however, to standardize the 
administration of the survey, which should help lower the cost. We note 
that this survey measure requires a different form of data collection 
and analysis than the other proposed measures in the PQRS. Therefore, 
for these measures only, CMS intends to administer the survey on

[[Page 69268]]

behalf of the group practices participating in the 2013 and 2014 PQRS 
GPRO. In other words, CMS initially intends to fund data collection for 
this measure on group practices' behalf for the CYs 2013 and 2014 
reporting periods.
    The final measures available for reporting using the GPRO web 
interface beginning in 2013 and listed in Table 96:

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BILLING CODE 4120-01-C
(4) PQRS Measures Groups Available for Reporting for 2013 and Beyond
    We proposed the following 20 measures groups for reporting in the 
PQRS beginning with reporting periods occurring in 2013: Diabetes 
Mellitus; Chronic Kidney Disease (CKD); Preventive Care; Coronary 
Artery Bypass Graft (CABG); Rheumatoid Arthritis (RA); Perioperative 
Care; Back Pain; Hepatitis C; Heart Failure (HF); Coronary Artery 
Disease (CAD); Ischemic Vascular Disease (IVD); HIV/AIDS; Asthma; 
Chronic Obstructive Pulmonary Disease (COPD); Inflammatory Bowel 
Disease (IBD); Sleep Apnea; Dementia; Parkinson's Disease; 
Hypertension; Cardiovascular Prevention; and Cataracts (77 FR 44964). 
These 20 proposed measures groups are also available for reporting 
under the PQRS in 2012.
    Beginning in 2013, we proposed the oncology measures group for 
reporting under the PQRS that provides measures available for reporting 
related to breast cancer and colon cancer. We believe it is important 
to measure cancer care (77 FR 44964).
    We proposed the following 4 measures groups for inclusion in the 
PQRS beginning with reporting periods occurring in 2014: Osteoporosis; 
Total Knee Replacement; Radiation Dose; and Preventive Cardiology. 
These measures groups address conditions that the measures groups 
established in 2012 do not address.
    Therefore, we proposed to finalize a total of 26 measures groups 
for inclusion in PQRS.
    We invited public comment on these proposed PQRS measures groups. 
The following is a summary of the comments we received regarding these 
proposed measures groups:
    Comment: One commenter supported inclusion of the Cataracts 
measures group for 2013 and beyond, as the measures included in the 
measures group are relevant to an ophthalmologist's practice.
    Response: Based on the comment we received and for the reasons 
stated previously, we are finalizing the Cataracts measures group for 
2013 and beyond.
    Comment: One commenter generally supported the proposed 
osteoporosis measures group. However, the commenter suggests a change 
in the composition of the measures group. Specifically, the commenter 
suggested that CMS remove the proposed ABIM-sourced osteoporosis 
measures from the proposed osteoporosis measures group and, instead, 
include all six individual osteoporosis measures (PQRS measure numbers 
24, 39, 40, 41, 154, and 155) currently available for reporting under 
PQRS. The commenter believes these six measures more closely reflect 
the desired outcomes to improve osteoporosis disease prevention and 
management.
    Response: We appreciate the commenters' feedback. However, we note 
that the measures within the osteoporosis measures group have been 
examined to determine the ability to report and analyze the measures 
contained within the measures group as a whole, whereas the suggested 
PQRS measures have not been analyzed to determine the feasibility of 
reporting these measures together within a measures group. Therefore, 
we are finalizing the osteoporosis measures group as proposed.
    Comment: One commenter supported the addition of a new Oncology 
measures group for 2013 and beyond.
    Response: Based on the comments received, we are finalizing the 
Oncology measures group for 2013 and beyond as proposed.
    Comment: One commenter opposed the measures contained within the 
proposed Diabetes Mellitus measures group because the measures are not 
reflective of the highly-skilled, labor intensive cognitive care 
provided by an endocrinologist over a long period of time to treat 
patients with uncontrolled diabetes. The commenter also believed that 
use of the measures contained in the Diabetes Mellitus measures group 
provides an incentive for primary care physicians to cherry pick 
diabetes patients who have well-controlled diabetes and to request 
endocrinologic care for difficult and complicated patients.
    Response: We appreciate the commenter's feedback regarding the 
measures contained within the Diabetes Mellitus measures group. While 
we understand that the measures contained within the Diabetes Mellitus 
measures group do not address every aspect of care to those patients 
with diabetes, we believe that the measures collect appropriate data 
and address an important issue. Therefore, we are finalizing the 
Diabetes Mellitus measures group with all of the proposed component 
measures for 2013 and beyond. However, we welcome other suggested 
measures addressing care of diabetes patients in the future.
    In addition, in 2012, the PQRS included a community-acquired 
pneumonia (CAP) measures group among others. We did not propose to 
include this measures group again in the PQRS measure set for the 2013 
PQRS or subsequent years because measures contained within this 
measures group were not recommended for retention by the Measure 
Applications Partnership. We received no comments regarding our 
decision not to continue inclusion this measures group for reporting in 
PQRS beginning in 2013.
    We also proposed, as identified in Table 47 of the CY 2013 PFS 
proposed rule, to change the composition of the Coronary Artery Disease 
(CAD) measures group from what was finalized for 2012 (77 FR 44970). 
Specifically, we proposed to remove PQRS measure 196: Coronary 
Artery Disease (CAD): Symptom and Activity Assessment and replace this 
measure with PQRS measure 242: Coronary Artery Disease (CAD): 
Symptom Management in the CAD measures group, because the measure 
196 was not recommended for retention by the Measure 
Applications Partnership (77 FR 44964). On the other hand, measure 
242 was recommended for retention by the Measure Applications 
Partnership. We received no comments regarding our proposal to change 
the composition of the CAD measures group. Therefore, we are finalizing 
the CAD measures group, as proposed.
    Based on the comments received and for the reasons previously 
stated, we are finalizing the following 26 measures groups indicated in 
Tables 97 through 122. Descriptions of the measures within each 
measures group are provided in Tables 97 through 122. Please note that 
some of the proposed measures included within a final PQRS quality 
measures group may also be available for reporting as an individual 
measure. In addition, please note that the Osteoporosis and Preventive 
Cardiology measures groups contain composite measures. Since composite 
measures must be reported as a group, similar to reporting measures 
within a measures group, we felt it was appropriate to classify these 
two composite measures as measures groups.

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                                  Table 97--Diabetes Mellitus Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
0059/1..............................  Diabetes Mellitus: Hemoglobin A1c Poor   NCQA.
                                       Control in Diabetes Mellitus:
                                       Percentage of patients aged 18 through
                                       75 years with diabetes mellitus who
                                       had most recent hemoglobin A1c greater
                                       than 9.0 percent.
0064/2..............................  Diabetes Mellitus: Low Density           NCQA.
                                       Lipoprotein (LDL-C) Control in
                                       Diabetes Mellitus: Percentage of
                                       patients aged 18 through 75 years with
                                       diabetes mellitus who had most recent
                                       LDL-C level in control (less than 100
                                       mg/dL).
0061/3..............................  Diabetes Mellitus: High Blood Pressure   NCQA.
                                       Control in Diabetes Mellitus:
                                       Percentage of patients aged 18 through
                                       75 years with diabetes mellitus who
                                       had most recent blood pressure in
                                       control (less than 140/90 mmHg).
0055/117............................  Diabetes Mellitus: Dilated Eye Exam in   NCQA.
                                       Diabetic Patient: Percentage of
                                       patients aged 18 through 75 years with
                                       a diagnosis of diabetes mellitus who
                                       had a dilated eye exam.
0062/119............................  Diabetes Mellitus: Urine Screening:      NCQA.
                                       Percentage of patients aged 18 through
                                       75 years with diabetes (type 1 or type
                                       2) who had a nephropathy screening
                                       test or evidence of nephropathy.
0056/163............................  Diabetes Mellitus: Foot Exam: The        NCQA.
                                       percentage of patients aged 18 through
                                       75 years with diabetes who had a foot
                                       examination.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through both claims and registry-based reporting.
This measures group is available for reporting beginning in 2013.


                             Table 98--Chronic Kidney Disease (CKD) Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
0041/110............................  Preventive Care and Screening:           AMA-PCPI.
                                       Influenza Immunization: Percentage of
                                       patients aged 6 months and older who
                                       received an influenza immunization
                                       during the flu season (October 1
                                       through March 31).
AQA adopted/121.....................  Adult Kidney Disease: Laboratory         AMA-PCPI.
                                       Testing (Lipid Profile): Percentage of
                                       patients aged 18 years and older with
                                       a diagnosis of CKD (stage 3, 4, or 5,
                                       not receiving Renal Replacement
                                       Therapy [RRT]) who had a fasting lipid
                                       profile performed at least once within
                                       a 12-month period.
AQA adopted/122.....................  Adult Kidney Disease: Blood Pressure     AMA-PCPI.
                                       Management: Percentage of patient
                                       visits for those patients aged 18
                                       years and older with a diagnosis of
                                       CKD (stage 3, 4, or 5, not receiving
                                       Renal Replacement Therapy [RRT]) and
                                       documented proteinuria with a blood
                                       pressure < 130/80 mmHg OR >= 130/80
                                       mmHg with a documented plan of care.
AQA adopted/123.....................  Adult Kidney Disease: Patients On        AMA-PCPI.
                                       Erythropoiesis-Stimulating Agent
                                       (ESA)--Hemoglobin Level > 12.0 g/dL:
                                       Percentage of calendar months within a
                                       12-month period during which a
                                       Hemoglobin level is measured for
                                       patients aged 18 years and older with
                                       a diagnosis of advanced Chronic Kidney
                                       Disease (CKD) (stage 4 or 5, not
                                       receiving Renal Replacement Therapy
                                       [RRT]) or End Stage Renal Disease
                                       (ESRD) (who are on hemodialysis or
                                       peritoneal dialysis) who are also
                                       receiving ESA therapy AND have a
                                       Hemoglobin level > 12.0 g/dL.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through both claims and registry-based reporting.
This measures group is available for reporting beginning in 2013.


                                   Table 99--Preventive Care Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
0046/39.............................  Screening or Therapy for Osteoporosis    AMA-PCPI/NCQA.
                                       for Women Aged 65 Years and Older:
                                       Percentage of female patients aged 65
                                       years and older who have a central
                                       dual-energy X-ray absorptiometry (DXA)
                                       measurement ordered or performed at
                                       least once since age 60 or
                                       pharmacologic therapy prescribed
                                       within 12 months.
0098/48.............................  Urinary Incontinence: Assessment of      AMA-PCPI/NCQA.
                                       Presence or Absence of Urinary
                                       Incontinence in Women Aged 65 Years
                                       and Older: Percentage of female
                                       patients aged 65 years and older who
                                       were assessed for the presence or
                                       absence of urinary incontinence within
                                       12 months.
0041/110............................  Preventive Care and Screening:           AMA-PCPI.
                                       Influenza Immunization: Percentage of
                                       patients aged 6 months and older who
                                       received an influenza immunization
                                       during the flu season (October 1
                                       through March 31).
0043/111............................  Preventive Care and Screening:           NCQA.
                                       Pneumonia Vaccination for Patients 65
                                       Years and Older: Percentage of
                                       patients aged 65 years and older who
                                       have ever received a pneumococcal
                                       vaccine.
0031/112............................  Preventive Care and Screening:           NCQA.
                                       Screening Mammography: Percentage of
                                       women aged 40 through 69 years who had
                                       a mammogram to screen for breast
                                       cancer.
0034/113............................  Preventive Care and Screening:           NCQA.
                                       Colorectal Cancer Screening:
                                       Percentage of patients aged 50 through
                                       75 years who received the appropriate
                                       colorectal cancer screening.
0421/128............................  Preventive Care and Screening: Body      CMS/QIP.
                                       Mass Index (BMI) Screening and Follow-
                                       Up: Percentage of patients aged 18
                                       years and older with a calculated BMI
                                       in the past 6 months or during the
                                       current visit documented in the
                                       medical record AND if the most recent
                                       BMI is outside of normal parameters, a
                                       follow-up plan is documented. Normal
                                       Parameters: Age 65 years and older BMI
                                       = 23and < 30; Age 18-64
                                       years BMI > 18.5 and < 25.
AQA adopted/173.....................  Preventive Care and Screening:           AMA-PCPI.
                                       Unhealthy Alcohol Use--Screening:
                                       Percentage of patients aged 18 years
                                       and older who were screened for
                                       unhealthy alcohol use using a
                                       systematic screening method within 24
                                       months.

[[Page 69274]]

 
0028/226............................  Preventive Care and Screening: Tobacco   AMA-PCPI.
                                       Use: Screening and Cessation
                                       Intervention: Percentage of patients
                                       aged 18 years and older who were
                                       screened for tobacco use one or more
                                       times within 24 months AND who
                                       received cessation counseling
                                       intervention if identified as a
                                       tobacco user.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through both claims and registry-based reporting.
This measures group is available for reporting beginning in 2013.


                         Table 100--Coronary Artery Bypass Graft (CABG) Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
0134/43.............................  Coronary Artery Bypass Graft (CABG):     STS.
                                       Use of Internal Mammary Artery (IMA)
                                       in Patients with Isolated CABG:
                                       Surgery Percentage of patients aged 18
                                       years and older undergoing isolated
                                       CABG surgery using an IMA graft.
0236/44.............................  Coronary Artery Bypass Graft (CABG):     CMS/QIP.
                                       Preoperative Beta-Blocker in Patients
                                       with Isolated CABG Surgery: Percentage
                                       of patients aged 18 years and older
                                       undergoing isolated CABG surgery who
                                       received a beta-blocker within 24
                                       hours prior to surgical incision.
0129/164............................  Coronary Artery Bypass Graft (CABG):     STS.
                                       Prolonged Intubation: Percentage of
                                       patients aged 18 years and older
                                       undergoing isolated CABG surgery who
                                       require intubation >24 hours.
0130/165............................  Coronary Artery Bypass Graft (CABG):     STS.
                                       Deep Sternal Wound Infection Rate:
                                       Percentage of patients aged 18 years
                                       and older undergoing isolated CABG
                                       surgery who, within 30 days
                                       postoperatively, develop deep sternal
                                       wound infection (involving muscle,
                                       bone, and/or mediastinum requiring
                                       operative intervention).
0131/166............................  Coronary Artery Bypass Graft (CABG):     STS.
                                       Stroke: Percentage of patients aged 18
                                       years and older undergoing isolated
                                       CABG surgery who have a postoperative
                                       stroke (i.e., any confirmed
                                       neurological deficit of abrupt onset
                                       caused by a disturbance in blood
                                       supply to the brain) that did not
                                       resolve within 24 hours.
0114/167............................  Coronary Artery Bypass Graft (CABG):     STS.
                                       Postoperative Renal Failure:
                                       Percentage of patients aged 18 years
                                       and older undergoing isolated CABG
                                       surgery (without pre-existing renal
                                       failure) who develop postoperative
                                       renal failure or require dialysis.
0115/168............................  Coronary Artery Bypass Graft (CABG):     STS.
                                       Surgical Re-Exploration: Percentage of
                                       patients aged 18 years and older
                                       undergoing isolated CABG surgery who
                                       require a return to the operating room
                                       (OR) during the current
                                       hospitalization for mediastinal
                                       bleeding with or without tamponade,
                                       graft occlusion, valve dysfunction, or
                                       other cardiac reason.
0116/169............................  Coronary Artery Bypass Graft (CABG):     STS.
                                       Antiplatelet Medications at Discharge:
                                       Percentage of patients aged 18 years
                                       and older undergoing isolated CABG
                                       surgery who were discharged on
                                       antiplatelet medication.
0117/170............................  Coronary Artery Bypass Graft (CABG):     STS.
                                       Beta-Blockers Administered at
                                       Discharge: Percentage of patients aged
                                       18 years and older undergoing isolated
                                       CABG surgery who were discharged on
                                       beta-blockers.
0118/171............................  Coronary Artery Bypass Graft (CABG):     STS.
                                       Anti-Lipid Treatment at Discharge:
                                       Percentage of patients aged 18 years
                                       and older undergoing isolated CABG
                                       surgery who were discharged on a
                                       statin or other lipid-lowering regimen.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through registry-based reporting only.
This measures group is available for reporting beginning in 2013.


                              Table 101--Rheumatoid Arthritis (RA) Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
0054/108............................  Rheumatoid Arthritis (RA): Disease       NCQA.
                                       Modifying Anti-Rheumatic Drug (DMARD)
                                       Therapy: Percentage of patients aged
                                       18 years and older who were diagnosed
                                       with RA and were prescribed,
                                       dispensed, or administered at least
                                       one ambulatory prescription for a
                                       DMARD.
AQA adopted/176.....................  Rheumatoid Arthritis (RA): Tuberculosis  AMA-PCPI/NCQA.
                                       Screening: Percentage of patients aged
                                       18 years and older with a diagnosis of
                                       RA who have documentation of a
                                       tuberculosis (TB) screening performed
                                       and results interpreted within 6
                                       months prior to receiving a first
                                       course of therapy using a biologic
                                       disease-modifying anti-rheumatic drug
                                       (DMARD).
AQA adopted/177.....................  Rheumatoid Arthritis (RA): Periodic      AMA-PCPI/NCQA.
                                       Assessment of Disease Activity:
                                       Percentage of patients aged 18 years
                                       and older with a diagnosis of RA who
                                       have an assessment and classification
                                       of disease activity within 12 months.
AQA adopted/178.....................  Rheumatoid Arthritis (RA): Functional    AMA-PCPI/NCQA.
                                       Status Assessment: Percentage of
                                       patients aged 18 years and older with
                                       a diagnosis of RA for whom a
                                       functional status assessment was
                                       performed at least once within 12
                                       months.
AQA adopted/179.....................  Rheumatoid Arthritis (RA): Assessment    AMA-PCPI/NCQA.
                                       and Classification of Disease
                                       Prognosis: Percentage of patients aged
                                       18 years and older with a diagnosis of
                                       RA who have an assessment and
                                       classification of disease prognosis at
                                       least once within 12 months.

[[Page 69275]]

 
AQA adopted/180.....................  Rheumatoid Arthritis (RA):               AMA-PCPI/NCQA.
                                       Glucocorticoid Management: Percentage
                                       of patients aged 18 years and older
                                       with a diagnosis of RA who have been
                                       assessed for glucocorticoid use and,
                                       for those on prolonged doses of
                                       prednisone >=10 mg daily (or
                                       equivalent) with improvement or no
                                       change in disease activity,
                                       documentation of glucocorticoid
                                       management plan within 12 months.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through both claims and registry-based reporting.


                                 Table 102--Perioperative Care Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
0270/20.............................  Perioperative Care: Timing of            AMA-PCPI/NCQA.
                                       Antibiotic Prophylaxis--Ordering
                                       Physician: Percentage of surgical
                                       patients aged 18 years and older
                                       undergoing procedures with the
                                       indications for prophylactic
                                       parenteral antibiotics, who have an
                                       order for prophylactic parenteral
                                       antibiotic to be given within one hour
                                       (if fluoroquinolone or vancomycin, 2
                                       hours), prior to the surgical incision
                                       (or start of procedure when no
                                       incision is required).
0268/21.............................  Perioperative Care: Selection of         AMA-PCPI/NCQA.
                                       Prophylactic Antibiotic--First OR
                                       Second Generation Cephalosporin:
                                       Percentage of surgical patients aged
                                       18 years and older undergoing
                                       procedures with the indications for a
                                       first OR second generation
                                       cephalosporin prophylactic antibiotic,
                                       who had an order for cefazolin OR
                                       cefuroxime for antimicrobial
                                       prophylaxis.
0271/22.............................  Perioperative Care: Discontinuation of   AMA-PCPI/NCQA.
                                       Prophylactic Antibiotics (Non-Cardiac
                                       Procedures): Percentage of non-cardiac
                                       surgical patients aged 18 years and
                                       older undergoing procedures with the
                                       indications for prophylactic
                                       parenteral antibiotics AND who
                                       received a prophylactic parenteral
                                       antibiotic, who have an order for
                                       discontinuation of prophylactic
                                       parenteral antibiotics within 24 hours
                                       of surgical end time.
0239/23.............................  Perioperative Care: Venous               AMA-PCPI/NCQA.
                                       Thromboembolism (VTE) Prophylaxis
                                       (When Indicated in ALL Patients):
                                       Percentage of patients aged 18 years
                                       and older undergoing procedures for
                                       which VTE prophylaxis is indicated in
                                       all patients, who had an order for Low
                                       Molecular Weight Heparin (LMWH), Low-
                                       Dose Unfractionated Heparin (LDUH),
                                       adjusted-dose warfarin, fondaparinux
                                       or mechanical prophylaxis to be given
                                       within 24 hours prior to incision time
                                       or within 24 hours after surgery end
                                       time.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through both claims and registry-based reporting.
This measures group is available for reporting beginning in 2013.


                                      Table 103--Back Pain Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
0322/148............................  Back Pain: Initial Visit: The            NCQA.
                                       percentage of patients aged 18 through
                                       79 years with a diagnosis of back pain
                                       or undergoing back surgery who had
                                       back pain and function assessed during
                                       the initial visit to the clinician for
                                       the episode of back pain.
0319/149/...........................  Back Pain: Physical Exam: Percentage of  NCQA.
                                       patients aged 18 through 79 years with
                                       a diagnosis of back pain or undergoing
                                       back surgery who received a physical
                                       examination at the initial visit to
                                       the clinician for the episode of back
                                       pain.
0314/150............................  Back Pain: Advice for Normal             NCQA.
                                       Activities: The percentage of patients
                                       aged 18 through 79 years with a
                                       diagnosis of back pain or undergoing
                                       back surgery who received advice for
                                       normal activities at the initial visit
                                       to the clinician for the episode of
                                       back pain.
0313/151............................  Back Pain: Advice Against Bed Rest: The  NCQA.
                                       percentage of patients aged 18 through
                                       79 years with a diagnosis of back pain
                                       or undergoing back surgery who
                                       received advice against bed rest
                                       lasting 4 days or longer at the
                                       initial visit to the clinician for the
                                       episode of back pain.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through both claims and registry-based reporting.
This measures group is available for reporting beginning in 2013.


                                     Table 104--Hepatitis C Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
0395/84.............................  Hepatitis C: Ribonucleic Acid (RNA)      AMA-PCPI.
                                       Testing Before Initiating Treatment:
                                       Percentage of patients aged 18 years
                                       and older with a diagnosis of chronic
                                       hepatitis C who are receiving
                                       antiviral treatment for whom
                                       quantitative HCV RNA testing was
                                       performed within 6 months prior to
                                       initiation of antiviral treatment.
0396/85.............................  Hepatitis C: HCV Genotype Testing Prior  AMA-PCPI.
                                       to Treatment: Percentage of patients
                                       aged 18 years and older with a
                                       diagnosis of chronic hepatitis C who
                                       are receiving antiviral treatment for
                                       whom HCV genotype testing was
                                       performed prior to initiation of
                                       antiviral treatment.
0397/86.............................  Hepatitis C: Antiviral Treatment         AMA-PCPI.
                                       Prescribed: Percentage of patients
                                       aged 18 years and older with a
                                       diagnosis of chronic hepatitis C who
                                       were prescribed at a minimum
                                       peginterferon and ribavirin therapy
                                       within the 12month reporting period.

[[Page 69276]]

 
0398/87.............................  Hepatitis C: HCV Ribonucleic Acid (RNA)  AMA-PCPI.
                                       Testing at Week 12 of Treatment:
                                       Percentage of patients aged 18 years
                                       and older with a diagnosis of chronic
                                       hepatitis C who are receiving
                                       antiviral treatment for whom
                                       quantitative HCV RNA testing was
                                       performed at no greater than 12 weeks
                                       from the initiation of antiviral
                                       treatment.
0401/89.............................  Hepatitis C: Counseling Regarding Risk   AMA-PCPI.
                                       of Alcohol Consumption: Percentage of
                                       patients aged 18 years and older with
                                       a diagnosis of hepatitis C who were
                                       counseled about the risks of alcohol
                                       use at least once within 12-months.
0394/90.............................  Hepatitis C: Counseling Regarding Use    AMA-PCPI.
                                       of Contraception Prior to Antiviral
                                       Therapy: Percentage of female patients
                                       aged 18 through 44 years and all men
                                       aged 18 years and older with a
                                       diagnosis of chronic hepatitis C who
                                       are receiving antiviral treatment who
                                       were counseled regarding contraception
                                       prior to the initiation of treatment.
0399/183............................  Hepatitis C: Hepatitis A Vaccination in  AMA-PCPI.
                                       Patients with HCV: Percentage of
                                       patients aged 18 years and older with
                                       a diagnosis of hepatitis C who
                                       received at least one injection of
                                       hepatitis A vaccine, or who have
                                       documented immunity to hepatitis A.
0400/184............................  Hepatitis C: Hepatitis B Vaccination in  AMA-PCPI.
                                       Patients with HCV: Percentage of
                                       patients aged 18 years and older with
                                       a diagnosis of hepatitis C who
                                       received at least one injection of
                                       hepatitis B vaccine, or who have
                                       documented immunity to hepatitis B.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through both claims and registry-based reporting.
This measures group is available for reporting beginning in 2013.


                                 Table 105--Heart Failure (HF) Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
0081/5..............................  Heart Failure: Angiotensin-Converting    AMA-PCPI/ACCF/AHA.
                                       Enzyme (ACE) Inhibitor or Angiotensin
                                       Receptor Blocker (ARB) Therapy for
                                       Left Ventricular Systolic Dysfunction
                                       (LVSD): Percentage of patients aged 18
                                       years and older with a diagnosis of
                                       heart failure and LVSD (LVEF <40%) who
                                       were prescribed ACE inhibitor or ARB
                                       therapy.
0083/8..............................  Heart Failure: Beta-Blocker Therapy for  AMA-PCPI/ACCF/AHA.
                                       Left Ventricular Systolic Dysfunction
                                       (LVSD): Percentage of patients aged 18
                                       years and older with a diagnosis of
                                       heart failure who also have LVSD (LVEF
                                       <40%) and who were prescribed beta-
                                       blocker therapy.
0079/198............................  Heart Failure: Left Ventricular          AMA-PCPI/ACCF/AHA.
                                       Ejection Fraction (LVEF) Assessment:
                                       Percentage of patients aged 18 years
                                       and older with a diagnosis of heart
                                       failure for whom the quantitative or
                                       qualitative result (of a recent or
                                       prior [any time in the past] LVEF
                                       assessment) is documented within a 12
                                       month period.
0028/226............................  Preventive Care and Screening: Tobacco   AMA-PCPI.
                                       Use: Screening and Cessation
                                       Intervention: Percentage of patients
                                       aged 18 years and older who were
                                       screened for tobacco use one or more
                                       times within 24 months AND who
                                       received cessation counseling
                                       intervention if identified as a
                                       tobacco user.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through registry-based reporting only.
This measures group is available for reporting beginning in 2013.


                            Table 106--Coronary Artery Disease (CAD) Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
0067/6..............................  Coronary Artery Disease (CAD):           AMA-PCPI/ACCF/AHA.
                                       Antiplatelet Therapy: Percentage of
                                       patients aged 18 years and older with
                                       a diagnosis of coronary artery disease
                                       seen within a 12 month period who were
                                       prescribed aspirin or clopidogrel.
0074/197............................  Coronary Artery Disease (CAD): Lipid     AMA-PCPI/ACCF/AHA.
                                       Control: Percentage of patients aged
                                       18 years and older with a diagnosis of
                                       coronary artery disease seen within a
                                       12 month period who have a LDL-C
                                       result <100 mg/dL OR patients who have
                                       a LDL-C result >=100 mg/dL and have a
                                       documented plan of care to achieve LDL-
                                       C <100 mg/dL, including at a minimum
                                       the prescription of a statin.
0028/226............................  Preventive Care and Screening: Tobacco   AMA-PCPI.
                                       Use: Screening and Cessation
                                       Intervention: Percentage of patients
                                       aged 18 years and older who were
                                       screened for tobacco use one or more
                                       times within 24 months AND who
                                       received cessation counseling
                                       intervention if identified as a
                                       tobacco user.
N/A/242.............................  Coronary Artery Disease (CAD): Symptom   AMA-PCPI/ACCF/AHA.
                                       Management: Percentage of patients
                                       aged 18 years and older with a
                                       diagnosis of coronary artery disease
                                       seen within a 12-month period and with
                                       results of an evaluation of level of
                                       activity AND an assessment for the
                                       presence or absence of anginal
                                       symptoms, with a plan of care to
                                       manage anginal symptoms, if present.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through registry-based reporting only.
This measures group is available for reporting beginning in 2013.


[[Page 69277]]


                           Table 107--Ischemic Vascular Disease (IVD) Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
0073/201............................  Ischemic Vascular Disease (IVD): Blood   NCQA.
                                       Pressure Management Control:
                                       Percentage of patients aged 18 years
                                       and older with ischemic vascular
                                       disease (IVD) who had most recent
                                       blood pressure in control (less than
                                       140/90 mmHg).
0068/204............................  Ischemic Vascular Disease (IVD): Use of  NCQA.
                                       Aspirin or Another Antithrombotic:
                                       Percentage of patients aged 18 years
                                       and older with ischemic vascular
                                       disease (IVD) with documented use of
                                       aspirin or other antithrombotic.
0028/226............................  Preventive Care and Screening: Tobacco   AMA-PCPI.
                                       Use: Screening and Cessation
                                       Intervention: Percentage of patients
                                       aged 18 years and older who were
                                       screened for tobacco use one or more
                                       times within 24 months AND who
                                       received cessation counseling
                                       intervention if identified as a
                                       tobacco user.
0075/241............................  Ischemic Vascular Disease (IVD):         NCQA.
                                       Complete Lipid Panel and Low Density
                                       Lipoprotein (LDL-C) Control:
                                       Percentage of patients aged 18 years
                                       and older with Ischemic Vascular
                                       Disease (IVD) who received at least
                                       one lipid profile within 12 months and
                                       whose most recent LDL-C level was in
                                       control (less than 100 mg/dL).
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through both claims and registry-based reporting.
This measures group is available for reporting beginning in 2013.


                                      Table 108--HIV/AIDS Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
0404/159............................  HIV/AIDS: CD4+ Cell Count or CD4+        AMA-PCPI/NCQA.
                                       Percentage: Percentage of patients
                                       aged 6 months and older with a
                                       diagnosis of HIV/AIDS for whom a CD4+
                                       cell count or CD4+ cell percentage was
                                       performed at least once every 6 months.
0405/160............................  HIV/AIDS: Pneumocystis Jiroveci          AMA-PCPI/NCQA.
                                       Pneumonia (PCP) Prophylaxis:
                                       Percentage of patients aged 6 years
                                       and older with a diagnosis of HIV/AIDS
                                       and CD4+ cell count < 200 cells/mm3
                                       who were prescribed PCP prophylaxis
                                       within 3 months of low CD4+ cell count.
0406/161............................  HIV/AIDS: Adolescent and Adult Patients  AMA-PCPI/NCQA.
                                       with HIV/AIDS Who Are Prescribed
                                       Potent Antiretroviral Therapy:
                                       Percentage of patients with a
                                       diagnosis of HIV/AIDS aged 13 years
                                       and older: who have a history of a
                                       nadir CD4+ cell count below 350/mm3 or
                                       who have a history of an AIDS-defining
                                       condition, regardless of CD4+ cell
                                       count; or who are pregnant, regardless
                                       of CD4+ cell count or age, who were
                                       prescribed potent antiretroviral
                                       therapy.
0407/162............................  HIV/AIDS: HIV RNA Control After Six      AMA-PCPI/NCQA.
                                       Months of Potent Antiretroviral
                                       Therapy: Percentage of patients aged
                                       13 years and older with a diagnosis of
                                       HIV/AIDS who are receiving potent
                                       antiretroviral therapy, who have a
                                       viral load below limits of
                                       quantification after at least 6 months
                                       of potent antiretroviral therapy or
                                       patients whose viral load is not below
                                       limits of quantification after at
                                       least 6 months of potent
                                       antiretroviral therapy and have
                                       documentation of a plan of care.
0409/205............................  HIV/AIDS: Sexually Transmitted Disease   AMA-PCPI/NCQA.
                                       Screening for Chlamydia and Gonorrhea:
                                       Percentage of patients aged 13 years
                                       and older with a diagnosis of HIV/AIDS
                                       for whom chlamydia and gonorrhea
                                       screenings were performed at least
                                       once since the diagnosis of HIV
                                       infection.
0413/206............................  HIV/AIDS: Screening for High Risk        AMA-PCPI/NCQA.
                                       Sexual Behaviors: Percentage of
                                       patients aged 13 years and older with
                                       a diagnosis of HIV/AIDS who were
                                       screened for high risk sexual
                                       behaviors at least once within 12
                                       months.
0415/207............................  HIV/AIDS: Screening for Injection Drug   AMA-PCPI/NCQA.
                                       Use: Percentage of patients aged 13
                                       years and older with a diagnosis of
                                       HIV/AIDS who were screened for
                                       injection drug use at least once
                                       within 12 months.
0410/208............................  HIV/AIDS: Sexually Transmitted Disease   AMA-PCPI/NCQA.
                                       Screening for Syphilis: Percentage of
                                       patients aged 13 years and older with
                                       a diagnosis of HIV/AIDS who were
                                       screened for syphilis at least once
                                       within 12 months.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through registry-based reporting only.
This measures group is available for reporting beginning in 2013.


                                       Table 109--Asthma Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
0047/53.............................  Asthma: Pharmacologic Therapy for        AMA-PCPI/NCQA.
                                       Persistent Asthma: Percentage of
                                       patients aged 5 through 50 years with
                                       a diagnosis of mild, moderate, or
                                       severe persistent asthma who were
                                       prescribed either the preferred long-
                                       term control medication (inhaled
                                       corticosteroid) or an acceptable
                                       alternative treatment.
0001/64.............................  Asthma: Assessment of Asthma Control:    AMA-PCPI/NCQA.
                                       Percentage of patients aged 5 through
                                       50 years with a diagnosis of asthma
                                       who were evaluated during at least one
                                       office visit within 12 months for the
                                       frequency (numeric) of daytime and
                                       nocturnal asthma symptoms.
N/A/231.............................  Asthma: Tobacco Use: Screening--         AMA-PCPI/NCQA.
                                       Ambulatory Care Setting: Percentage of
                                       patients (or their primary caregiver)
                                       aged 5 through 50 years with a
                                       diagnosis of asthma who were queried
                                       about tobacco use and exposure to
                                       second hand smoke within their home
                                       environment at least once during the
                                       one-year measurement period.

[[Page 69278]]

 
N/A/232.............................  Asthma: Tobacco Use: Intervention--      AMA-PCPI/NCQA.
                                       Ambulatory Care Setting: Percentage of
                                       patients (or their primary caregiver)
                                       aged 5 through 50 years with a
                                       diagnosis of asthma who were
                                       identified as tobacco users (patients
                                       who currently use tobacco AND patients
                                       who do not currently use tobacco, but
                                       are exposed to second hand smoke in
                                       their home environment) who received
                                       tobacco cessation intervention at
                                       least once during the one-year
                                       measurement period.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through both claims and registry-based reporting.
This measures group is available for reporting beginning in 2013.


                    Table 110--Chronic Obstructive Pulmonary Disease (COPD) Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
0091/51.............................  Chronic Obstructive Pulmonary Disease    AMA-PCPI.
                                       (COPD): Spirometry Evaluation:
                                       Percentage of patients aged 18 years
                                       and older with a diagnosis of COPD who
                                       had spirometry evaluation results
                                       documented.
0102/52.............................  Chronic Obstructive Pulmonary Disease    AMA-PCPI.
                                       (COPD): Bronchodilator Therapy:
                                       Percentage of patients aged 18 years
                                       and older with a diagnosis of COPD and
                                       who have an FEV1/FVC less than 70
                                       percent and have symptoms who were
                                       prescribed an inhaled bronchodilator.
0041/110............................  Preventive Care and Screening:           AMA-PCPI.
                                       Influenza Immunization: Percentage of
                                       patients aged 6 months and older who
                                       received an influenza immunization
                                       during the flu season (October 1
                                       through March 31).
0043/111............................  Preventive Care and Screening:           NCQA.
                                       Pneumonia Vaccination for Patients 65
                                       Years and Older: Percentage of
                                       patients aged 65 years and older who
                                       have ever received a pneumococcal
                                       vaccine.
0028/226............................  Preventive Care and Screening: Tobacco   AMA-PCPI.
                                       Use: Screening and Cessation
                                       Intervention: Percentage of patients
                                       aged 18 years and older who were
                                       screened for tobacco use one or more
                                       times within 24 months AND who
                                       received cessation counseling
                                       intervention if identified as a
                                       tobacco user.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through both claims and registry-based reporting.
This measures group is available for reporting beginning in 2013.


                          Table 111--Inflammatory Bowel Disease (IBD) Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
0028/226............................  Preventive Care and Screening: Tobacco   AMA-PCPI.
                                       Use: Screening and Cessation
                                       Intervention: Percentage of patients
                                       aged 18 years and older who were
                                       screened for tobacco use one or more
                                       times within 24 months AND who
                                       received cessation counseling
                                       intervention if identified as a
                                       tobacco user.
N/A/269.............................  Inflammatory Bowel Disease (IBD): Type,  AGA.
                                       Anatomic Location and Activity All
                                       Documented: Percentage of patients
                                       aged 18 years and older with a
                                       diagnosis of inflammatory bowel
                                       disease who have documented the
                                       disease type, anatomic location and
                                       activity, at least once during the
                                       reporting period.
N/A/270.............................  Inflammatory Bowel Disease (IBD):        AGA.
                                       Preventive Care: Corticosteroid
                                       Sparing Therapy: Percentage of
                                       patients aged 18 years and older with
                                       a diagnosis of inflammatory bowel
                                       disease who have been managed by
                                       corticosteroids greater than or equal
                                       to 10mg/day for 60 or greater
                                       consecutive days that have been
                                       prescribed corticosteroid sparing
                                       therapy in the last reporting year.
N/A/271.............................  Inflammatory Bowel Disease (IBD):        AGA.
                                       Preventive Care: Corticosteroid
                                       Related Iatrogenic Injury--Bone Loss
                                       Assessment: Percentage of patients
                                       aged 18 years and older with a
                                       diagnosis of inflammatory bowel
                                       disease who have received dose of
                                       corticosteroids greater than or equal
                                       to 10 mg/day for 60 or greater
                                       consecutive days and were assessed for
                                       risk of bone loss once per the
                                       reporting year.
N/A/272.............................  Inflammatory Bowel Disease (IBD):        AGA.
                                       Preventive Care: Influenza
                                       Immunization: Percentage of patients
                                       aged 18 years and older with a
                                       diagnosis of inflammatory bowel
                                       disease for whom influenza
                                       immunization was recommended,
                                       administered or previously received
                                       during the reporting year.
N/A/273.............................  Inflammatory Bowel Disease (IBD):        AGA.
                                       Preventive Care: Pneumococcal
                                       Immunization: Percentage of patients
                                       aged 18 years and older with a
                                       diagnosis of inflammatory bowel
                                       disease that had pneumococcal
                                       vaccination administered or previously
                                       received.
N/A/274.............................  Inflammatory Bowel Disease (IBD):        AGA.
                                       Testing for Latent Tuberculosis (TB)
                                       Before Initiating Anti-TNF (Tumor
                                       Necrosis Factor) Therapy: Percentage
                                       of patients aged 18 years and older
                                       with a diagnosis of inflammatory bowel
                                       disease for whom a tuberculosis (TB)
                                       screening was performed and results
                                       interpreted within 6 months prior to
                                       receiving a first course of anti-TNF
                                       (tumor necrosis factor) therapy.
N/A/275.............................  Inflammatory Bowel Disease (IBD):        AGA.
                                       Assessment of Hepatitis B Virus (HBV)
                                       Status Before Initiating Anti-TNF
                                       (Tumor Necrosis Factor) Therapy:
                                       Percentage of patients aged 18 years
                                       and older with a diagnosis of
                                       inflammatory bowel disease who had
                                       Hepatitis B Virus (HBV) status
                                       assessed and results interpreted
                                       within one year prior to receiving a
                                       first course of anti-TNF (tumor
                                       necrosis factor) therapy.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through registry-based reporting only.

[[Page 69279]]

 
This measures group is available for reporting beginning in 2013.


                                     Table 112--Sleep Apnea Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
N/A/276.............................  Sleep Apnea: Assessment of Sleep         AMA-PCPI/NCQA.
                                       Symptoms: Percentage of visits for
                                       patients aged 18 years and older with
                                       a diagnosis of obstructive sleep apnea
                                       that includes documentation of an
                                       assessment of symptoms, including
                                       presence or absence of snoring and
                                       daytime sleepiness.
N/A/277.............................  Sleep Apnea: Severity Assessment at      AMA-PCPI/NCQA.
                                       Initial Diagnosis: Percentage of
                                       patients aged 18 years and older with
                                       a diagnosis of obstructive sleep apnea
                                       who had an apnea hypopnea index (AHI)
                                       or a respiratory disturbance index
                                       (RDI) measured at the time of initial
                                       diagnosis.
N/A/278.............................  Sleep Apnea: Positive Airway Pressure    AMA-PCPI/NCQA.
                                       Therapy Prescribed: Percentage of
                                       patients aged 18 years and older with
                                       a diagnosis of moderate or severe
                                       obstructive sleep apnea who were
                                       prescribed positive airway pressure
                                       therapy.
N/A/279.............................  Sleep Apnea: Assessment of Adherence to  AMA-PCPI/NCQA.
                                       Positive Airway Pressure Therapy:
                                       Percentage of visits for patients aged
                                       18 years and older with a diagnosis of
                                       obstructive sleep apnea who were
                                       prescribed positive airway pressure
                                       therapy who had documentation that
                                       adherence to positive airway pressure
                                       therapy was objectively measured.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through registry-based reporting only.
This measures group is available for reporting beginning in 2013.


                                      Table 113--Dementia Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
N/A/280.............................  Dementia: Staging of Dementia:           AMA-PCPI.
                                       Percentage of patients, regardless of
                                       age, with a diagnosis of dementia
                                       whose severity of dementia was
                                       classified as mild, moderate or severe
                                       at least once within a 12 month period.
N/A/281.............................  Dementia: Cognitive Assessment:          AMA-PCPI.
                                       Percentage of patients, regardless of
                                       age, with a diagnosis of dementia for
                                       whom an assessment of cognition is
                                       performed and the results reviewed at
                                       least once within a 12 month period.
N/A/282.............................  Dementia: Functional Status Assessment:  AMA-PCPI.
                                       Percentage of patients, regardless of
                                       age, with a diagnosis of dementia for
                                       whom an assessment of patient's
                                       functional status is performed and the
                                       results reviewed at least once within
                                       a 12 month period.
N/A/283.............................  Dementia: Neuropsychiatric Symptom       AMA-PCPI.
                                       Assessment: Percentage of patients,
                                       regardless of age, with a diagnosis of
                                       dementia and for whom an assessment of
                                       patient's neuropsychiatric symptoms is
                                       performed and results reviewed at
                                       least once in a 12 month period.
N/A/284.............................  Dementia: Management of                  AMA-PCPI.
                                       Neuropsychiatric Symptoms: Percentage
                                       of patients, regardless of age, with a
                                       diagnosis of dementia who have one or
                                       more neuropsychiatric symptoms who
                                       received or were recommended to
                                       receive an intervention for
                                       neuropsychiatric symptoms within a 12
                                       month period.
N/A/285.............................  Dementia: Screening for Depressive       AMA-PCPI.
                                       Symptoms: Percentage of patients,
                                       regardless of age, with a diagnosis of
                                       dementia who were screened for
                                       depressive symptoms within a 12 month
                                       period.
N/A/286.............................  Dementia: Counseling Regarding Safety    AMA-PCPI.
                                       Concerns: Percentage of patients,
                                       regardless of age, with a diagnosis of
                                       dementia or their caregiver(s) who
                                       were counseled or referred for
                                       counseling regarding safety concerns
                                       within a 12 month period.
N/A/287.............................  Dementia: Counseling Regarding Risks of  AMA-PCPI.
                                       Driving: Percentage of patients,
                                       regardless of age, with a diagnosis of
                                       dementia or their caregiver(s) who
                                       were counseled regarding the risks of
                                       driving and driving alternatives
                                       within a 12 month period.
N/A/288.............................  Dementia: Caregiver Education and        AMA-PCPI.
                                       Support: Percentage of patients,
                                       regardless of age, with a diagnosis of
                                       dementia whose caregiver(s) were
                                       provided with education on dementia
                                       disease management and health behavior
                                       changes AND referred to additional
                                       sources for support within a 12 month
                                       period.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through claims and registry-based reporting.
This measures group is available for reporting beginning in 2013.


                                 Table 114--Parkinson's Disease Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
N/A/289.............................  Parkinson's Disease: Annual Parkinson's  AAN.
                                       Disease Diagnosis Review: All patients
                                       with a diagnosis of Parkinson's
                                       disease who had an annual assessment
                                       including a review of current
                                       medications (e.g., medications than
                                       can produce Parkinson- like signs or
                                       symptoms) and a review for the
                                       presence of atypical features (e.g.,
                                       falls at presentation and early in the
                                       disease course, poor response to
                                       levodopa, symmetry at onset, rapid
                                       progression [to Hoehn and Yahr stage 3
                                       in 3 years], lack of tremor or
                                       dysautonomia) at least annually.
N/A/290.............................  Parkinson's Disease: Psychiatric         AAN.
                                       Disorders or Disturbances Assessment:
                                       All patients with a diagnosis of
                                       Parkinson's disease who were assessed
                                       for psychiatric disorders or
                                       disturbances (e.g., psychosis,
                                       depression, anxiety disorder, apathy,
                                       or impulse control disorder) at least
                                       annually.
N/A/291.............................  Parkinson's Disease: Cognitive           AAN.
                                       Impairment or Dysfunction Assessment:
                                       All patients with a diagnosis of
                                       Parkinson's disease who were assessed
                                       for cognitive impairment or
                                       dysfunction at least annually.

[[Page 69280]]

 
N/A/292.............................  Parkinson's Disease: Querying about      AAN.
                                       Sleep Disturbances: All patients with
                                       a diagnosis of Parkinson's disease (or
                                       caregivers, as appropriate) who were
                                       queried about sleep disturbances at
                                       least annually.
N/A/293.............................  Parkinson's Disease: Rehabilitative      AAN.
                                       Therapy Options: All patients with a
                                       diagnosis of Parkinson's disease (or
                                       caregiver(s), as appropriate) who had
                                       rehabilitative therapy options (e.g.,
                                       physical, occupational, or speech
                                       therapy) discussed at least annually.
N/A/294.............................  Parkinson's Disease: Parkinson's         AAN.
                                       Disease Medical and Surgical Treatment
                                       Options Reviewed: All patients with a
                                       diagnosis of Parkinson's disease (or
                                       caregiver(s), as appropriate who had
                                       the Parkinson's disease treatment
                                       options (e.g., non-pharmacological
                                       treatment, pharmacological treatment,
                                       or surgical treatment) reviewed at
                                       least once annually.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through registry-based reporting only
This measures group is available for reporting beginning in 2013.


                                    Table 115--Hypertension Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
N/A/295.............................  Hypertension: Appropriate Use of         ABIM.
                                       Aspirin or Other Antiplatelet or
                                       Anticoagulant Therapy: Percentage of
                                       patients aged 15 through 90 years old
                                       with a diagnosis of hypertension who
                                       were prescribed aspirin or other
                                       anticoagulant/antiplatelet therapy.
N/A/296.............................  Hypertension: Complete Lipid Profile:    ABIM.
                                       Percentage of patients aged 15 through
                                       90 years old with a diagnosis of
                                       hypertension who received a complete
                                       lipid profile within 24 months.
N/A/297.............................  Hypertension: Urine Protein Test:        ABIM.
                                       Percentage of patients aged 15 through
                                       90 years old with a diagnosis of
                                       hypertension who either have chronic
                                       kidney disease diagnosis documented or
                                       had a urine protein test done within
                                       36 months.
N/A/298.............................  Hypertension: Annual Serum Creatinine    ABIM.
                                       Test: Percentage of patients aged 15
                                       through 90 years old with a diagnosis
                                       of hypertension who had a serum
                                       creatinine test done within 12 months.
N/A/299.............................  Hypertension: Diabetes Mellitus          ABIM.
                                       Screening Test: Percentage of patients
                                       aged 15 through 90 years old with a
                                       diagnosis of hypertension who had a
                                       diabetes screening test within 36
                                       months.
N/A/300.............................  Hypertension: Blood Pressure Control:    ABIM.
                                       Percentage of patients aged 15 through
                                       90 years old with a diagnosis of
                                       hypertension who had most recent blood
                                       pressure level under control (at goal).
N/A/301.............................  Hypertension: Low Density Lipoprotein    ABIM.
                                       (LDL-C) Control: Percentage of
                                       patients aged 15 through 90 years old
                                       with a diagnosis of hypertension who
                                       had most recent LDL cholesterol level
                                       under control (at goal).
N/A/302.............................  Hypertension: Dietary and Physical       ABIM.
                                       Activity Modifications Appropriately
                                       Prescribed: Percentage of patients
                                       aged 15 through 90 years old with a
                                       diagnosis of hypertension who received
                                       dietary and physical activity
                                       counseling at least once within 12
                                       months.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through registry-based reporting only.
This measures group is available for reporting beginning in 2013.


                              Table 116--Cardiovascular Prevention Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
0064/2..............................  Diabetes Mellitus: Low Density           NCQA.
                                       Lipoprotein (LDL-C) Control in
                                       Diabetes Mellitus: Percentage of
                                       patients aged 18 through 75 years with
                                       diabetes mellitus who had most recent
                                       LDL-C level in control (less than 100
                                       mg/dL).
0068/204............................  Ischemic Vascular Disease (IVD): Use of  NCQA.
                                       Aspirin or Another Antithrombotic:
                                       Percentage of patients aged 18 years
                                       and older with ischemic vascular
                                       disease (IVD) with documented use of
                                       aspirin or other antithrombotic.
0028/226............................  Preventive Care and Screening: Tobacco   AMA-PCPI.
                                       Use: Screening and Cessation
                                       Intervention: Percentage of patients
                                       aged 18 years and older who were
                                       screened for tobacco use one or more
                                       times within 24 months AND who
                                       received cessation counseling
                                       intervention if identified as a
                                       tobacco user.
0018/236............................  Hypertension (HTN): Controlling High     NCQA.
                                       Blood Pressure: Percentage of patients
                                       aged 18 through 85 years of age who
                                       had a diagnosis of hypertension (HTN)
                                       and whose BP was adequately controlled
                                       (< 140/90 mmHg).
0075/241............................  Ischemic Vascular Disease (IVD):         NCQA.
                                       Complete Lipid Panel and Low Density
                                       Lipoprotein (LDL-C) Control:
                                       Percentage of patients aged 18 years
                                       and older with Ischemic Vascular
                                       Disease (IVD) who received at least
                                       one lipid profile within 12 months and
                                       whose most recent LDL-C level was in
                                       control (less than 100 mg/dL).
N/A/317.............................  Preventive Care and Screening:           CMS/QIP.
                                       Screening for High Blood Pressure:
                                       Percentage of patients aged 18 and
                                       older who are screened for high blood
                                       pressure.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through both claims and registry-based reporting.
This measures group is available for reporting beginning in 2013.


[[Page 69281]]


                                      Table 117--Cataracts Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
0565/191............................  Cataracts: 20/40 or Better Visual        AMA-PCPI/NCQA.
                                       Acuity within 90 Days Following
                                       Cataract Surgery: Percentage of
                                       patients aged 18 years and older with
                                       a diagnosis of uncomplicated cataract
                                       who had cataract surgery and no
                                       significant ocular conditions
                                       impacting the visual outcome of
                                       surgery and had best-corrected visual
                                       acuity of 20/40 or better (distance or
                                       near) achieved within 90 days
                                       following the cataract surgery.
0564/192............................  Cataracts: Complications within 30 Days  AMA-PCPI/NCQA.
                                       Following Cataract Surgery Requiring
                                       Additional Surgical Procedures:
                                       Percentage of patients aged 18 years
                                       and older with a diagnosis of
                                       uncomplicated cataract who had
                                       cataract surgery and had any of a
                                       specified list of surgical procedures
                                       in the 30 days following cataract
                                       surgery which would indicate the
                                       occurrence of any of the following
                                       major complications: Retained nuclear
                                       fragments, endophthalmitis, dislocated
                                       or wrong power IOL, retinal
                                       detachment, or wound dehiscence.
N/A/303.............................  Cataracts: Improvement in Patient's      AAO.
                                       Visual Function within 90 Days
                                       Following Cataract Surgery: Percentage
                                       of patients aged 18 years and older in
                                       sample who had cataract surgery and
                                       had improvement in visual function
                                       achieved within 90 days following the
                                       cataract surgery, based on completing
                                       a pre-operative and post-operative
                                       visual function survey.
N/A/304.............................  Cataracts: Patient Satisfaction within   AAO.
                                       90 Days Following Cataract Surgery:
                                       Percentage of patients aged 18 years
                                       and older in sample who had cataract
                                       surgery and were satisfied with their
                                       care within 90 days following the
                                       cataract surgery, based on completion
                                       of the Consumer Assessment of
                                       Healthcare Providers and Systems
                                       Surgical Care Survey.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through registry-based reporting only.
This measures group is available for reporting beginning in 2013.


                                      Table 118--Oncology Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                     Measure title and description               Measure developer
----------------------------------------------------------------------------------------------------------------
0387/71.............................  Breast Cancer: Hormonal Therapy for      AMA-PCPI/ASCO/NCCN.
                                       Stage IC-IIIC Estrogen Receptor/
                                       Progesterone Receptor (ER/PR) Positive
                                       Breast Cancer: Percentage of female
                                       patients aged 18 years and older with
                                       Stage IC through IIIC, ER or PR
                                       positive breast cancer who were
                                       prescribed tamoxifen or aromatase
                                       inhibitor (AI) during the 12-month
                                       reporting period.
0385/72.............................  Colon Cancer: Chemotherapy for Stage     AMA-PCPI/ASCO/NCCN.
                                       III Colon Cancer Patients: Percentage
                                       of patients aged 18 years and older
                                       with Stage IIIA through IIIC colon
                                       cancer who are referred for adjuvant
                                       chemotherapy, prescribed adjuvant
                                       chemotherapy, or have previously
                                       received adjuvant chemotherapy within
                                       the 12-month reporting period.
0041/110............................  Preventive Care and Screening:           AMA-PCPI.
                                       Influenza Immunization: Percentage of
                                       patients aged 6 months and older who
                                       received an influenza immunization
                                       during the flu season (October 1
                                       through March 31).
0419/130............................  Documentation of Current Medications in  CMS/QIP.
                                       the Medical Record: Percentage of
                                       specified visits for patients aged 18
                                       years and older for which the eligible
                                       professional attests to documenting a
                                       list of current medications to the
                                       best of his/her knowledge and ability.
                                       This list must include ALL
                                       prescriptions, over-the-counters,
                                       herbals, vitamin/mineral/dietary
                                       (nutritional) supplements AND must
                                       contain the medications' name, dosage,
                                       frequency and route.
0384/143............................  Oncology: Medical and Radiation--Pain    AMA-PCPI.
                                       Intensity Quantified: Percentage of
                                       patient visits, regardless of patient
                                       age, with a diagnosis of cancer
                                       currently receiving chemotherapy or
                                       radiation therapy in which pain
                                       intensity is quantified.
0383/144............................  Oncology: Medical and Radiation--Plan    AMA-PCPI.
                                       of Care for Pain: Percentage of
                                       patient visits, regardless of patient
                                       age, with a diagnosis of cancer
                                       currently receiving chemotherapy or
                                       radiation therapy who report having
                                       pain with a documented plan of care to
                                       address pain.
0386/194............................  Oncology: Cancer Stage Documented:       AMA-PCPI/ASCO.
                                       Percentage of patients, regardless of
                                       age, with a diagnosis of breast,
                                       colon, or rectal cancer who are seen
                                       in the ambulatory setting who have a
                                       baseline AJCC cancer stage or
                                       documentation that the cancer is
                                       metastatic in the medical record at
                                       least once within 12 months.
0028/226............................  Preventive Care and Screening: Tobacco   AMA-PCPI.
                                       Use: Screening and Cessation
                                       Intervention: Percentage of patients
                                       aged 18 years and older who were
                                       screened for tobacco use one or more
                                       times within 24 months AND who
                                       received cessation counseling
                                       intervention if identified as a
                                       tobacco user.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through registry-based reporting only
This measures group is available for reporting beginning in 2013.


                                    Table 119--Osteoporosis Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                             Measure title                       Measure developer
----------------------------------------------------------------------------------------------------------------
0046/39.............................  Osteoporosis: Screening or Therapy for   AMA.
                                       Osteoporosis for Women Aged 65 Years
                                       and Older: Percentage of female
                                       patients aged 65 years and older who
                                       have a central dual-energy X-ray
                                       absorptiometry (DXA) measurement
                                       ordered or performed at least once
                                       since age 60 or pharmacologic therapy
                                       prescribed within 12 months.
0049/41.............................  Osteoporosis: Pharmacologic Therapy for  AMA.
                                       Men and Women Aged 50 Years and Older:
                                       Percentage of patients aged 50 years
                                       and older with a diagnosis of
                                       osteoporosis who were prescribed
                                       pharmacologic therapy within 12 months.

[[Page 69282]]

 
AQA Selected/154....................  Falls: Risk Assessment for Falls:        NCQA.
                                       Percentage of patients aged 65 years
                                       and older with a history of falls who
                                       had a risk assessment for falls
                                       completed within 12 months.
AQA Selected/155....................  Falls: Plan of Care for Falls:           NCQA.
                                       Percentage of patients aged 65 years
                                       and older with a history of falls who
                                       had a plan of care for falls
                                       documented within 12 months.
N/A/TBD.............................  Osteoporosis: Status of Participation    ABIM.
                                       in Weight-Bearing Exercise and Weight-
                                       bearing Exercise Advice: Percentage of
                                       patients aged 18 and older with a
                                       diagnosis of osteoporosis, osteopenia,
                                       or prior low impact fracture; women
                                       age 65 and older; or men age 70 and
                                       older whose status regarding
                                       participation in weight-bearing
                                       exercise was documented and for those
                                       not participating regularly who
                                       received advice within 12 months to
                                       participate in weight-bearing exercise.
N/A/TBD.............................  Osteoporosis: Current Level of Alcohol   ABIM.
                                       Use and Advice on Potentially
                                       Hazardous Drinking Prevention:
                                       Percentage of patients aged 18 and
                                       older with a diagnosis of
                                       osteoporosis, osteopenia, or prior low
                                       impact fracture; women age 65 and
                                       older; or men age 70 and older whose
                                       current level of alcohol use was
                                       documented and for those engaging in
                                       potentially hazardous drinking who
                                       received counseling within 12 months.
N/A/TBD.............................  Osteoporosis: Screen for Falls Risk      ABIM.
                                       Evaluation and Complete Falls Risk
                                       Assessment and Plan of Care:
                                       Percentage of patients aged 18 and
                                       older with a diagnosis of
                                       osteoporosis, osteopenia, or prior low
                                       impact fracture; women age 65 and
                                       older; or men age 70 and older who had
                                       a screen for falls risk evaluation
                                       within the past 12 months and for
                                       those reported as having a history of
                                       two or more falls, or fall-related
                                       injury who had a complete risk
                                       assessment for falls and a falls plan
                                       of care within the past 12 months.
N/A/TBD.............................  Osteoporosis: Dual-Emission X-ray        ABIM.
                                       Absorptiometry (DXA) Scan: Percentage
                                       of patients aged 18 and older with a
                                       diagnosis of osteoporosis, osteopenia,
                                       or prior low impact fracture; women
                                       age 65 and older; or men age 70 and
                                       older who had a DXA scan and result
                                       documented.
N/A/TBD.............................  Osteoporosis: Calcium Intake Assessment  ABIM.
                                       and Counseling: Percentage of patients
                                       aged 18 and older with a diagnosis of
                                       osteoporosis, osteopenia, or prior low
                                       impact fracture; women age 65 and
                                       older; or men age 70 and older who had
                                       calcium intake assessment and
                                       counseling at least once within 12
                                       months.
N/A/TBD.............................  Osteoporosis: Vitamin D Intake           ABIM.
                                       Assessment and Counseling: Percentage
                                       of patients aged 18 and older with a
                                       diagnosis of osteoporosis, osteopenia,
                                       or prior low impact fracture; women
                                       age 65 and older; or men age 70 and
                                       older who had vitamin D intake
                                       assessment and counseling at least
                                       once within 12 months.
N/A/TBD.............................  Osteoporosis: Pharmacologic Therapy:     ABIM.
                                       Percentage of patients aged 18 and
                                       older with a diagnosis of
                                       osteoporosis, osteopenia, or prior low
                                       impact fracture; women age 65 and
                                       older; or men age 70 and older who
                                       were prescribed pharmacologic therapy
                                       approved by the Food and Drug
                                       Administration.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through claims and registry-based reporting.
This measures group is available for reporting beginning in 2014.


                               Table 120--Total Knee Replacement Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                             Measure title                       Measure developer
----------------------------------------------------------------------------------------------------------------
N/A/TBD.............................  Total Knee Replacement: Coordination of  AAHKS/AMA-PCPI.
                                       Post Discharge Care: Percentage of
                                       patients undergoing total knee
                                       replacement who received written
                                       instructions for post discharge care
                                       including all the following: Post
                                       discharge physical therapy, home
                                       health care, post discharge deep vein
                                       thrombosis (DVT) prophylaxis and
                                       follow-up physician visits.
N/A/TBD.............................  Total Knee Replacement: Venous           AAHKS/AMA-PCPI.
                                       Thromboembolic and Cardiovascular Risk
                                       Evaluation: Percentage of patients
                                       undergoing a total knee replacement
                                       who are evaluated for the presence or
                                       absence of venous thromboembolic and
                                       cardiovascular risk factors within 30
                                       days prior to the procedure including
                                       history of deep vein thrombosis (DVT),
                                       pulmonary embolism (PE), myocardial
                                       infarction (MI), arrhythmia and stroke.
N/A/TBD.............................  Total Knee Replacement: Preoperative     AAHKS/AMA-PCPI.
                                       Antibiotic Infusion with Proximal
                                       Tourniquet: Percentage of patients
                                       undergoing a total knee replacement
                                       who had the prophylactic antibiotic
                                       completely infused prior to the
                                       inflation of the proximal tourniquet.
N/A/TBD.............................  Total Knee Replacement: Identification   AAHKS/AMA-PCPI.
                                       of Implanted Prosthesis in Operative
                                       Report: Percentage of patients
                                       undergoing total knee replacement
                                       whose operative report identifies the
                                       prosthetic implant specifications
                                       including the prosthetic implant
                                       manufacturer, the brand name of
                                       prosthetic implant and the size of
                                       prosthetic implant.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through and registry-based only.
This measures group is available for reporting beginning in 2014.


                             Table 121--Radiation Dose Optimization Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                             Measure title                       Measure developer
----------------------------------------------------------------------------------------------------------------
TBD/TBD.............................  Radiation Dose Optimization:             AMA-PCPI.
                                       Utilization of a Standardized
                                       Nomenclature for CT Imaging
                                       Description: Percentage of computed
                                       tomography (CT) imaging reports for
                                       all patients, regardless of age, with
                                       the imaging study named according to a
                                       standardized nomenclature (e.g.,
                                       RadLex[supreg]) and the standardized
                                       nomenclature is used in institutions
                                       computer systems.

[[Page 69283]]

 
TBD/TBD.............................  Radiation Dose Optimization: Cumulative  AMA-PCPI.
                                       Count of Potential High Dose Radiation
                                       Imaging Studies: Computed Tomography
                                       (CT) Scans and Cardiac Nuclear
                                       Medicine Scans: Percentage of CT and
                                       cardiac nuclear medicine (myocardial
                                       perfusion) imaging reports for all
                                       patients, regardless of age, that
                                       document a count of known previous CT
                                       studies (any type of CT) and cardiac
                                       nuclear medicine (myocardial perfusion
                                       studies) studies that the patient has
                                       received in the 12-month period prior
                                       to the current study.
TBD/TBD.............................  Radiation Dose Optimization: Reporting   AMA-PCPI.
                                       to a Radiation Dose Index Registry:
                                       Percentage of total computed
                                       tomography (CT) studies performed for
                                       all patients, regardless of age, that
                                       are reported to a radiation dose index
                                       registry AND that include at a minimum
                                       selected data elements.
TBD/TBD.............................  Radiation Dose Optimization: Images      AMA-PCPI.
                                       Available for Patient Follow-up and
                                       Comparison Purposes: Percentage of
                                       final reports for imaging studies
                                       performed for all patients, regardless
                                       of age, which document that Digital
                                       Imaging and Communications in Medicine
                                       (DICOM) format image data are
                                       available reciprocally to non-
                                       affiliated external entities on a
                                       secure, media-free, searchable basis
                                       with patient authorization for at
                                       least a 12-month period after the
                                       study.
TBD/TBD.............................  Radiation Dose Optimization: Search for  AMA-PCPI.
                                       Prior Imaging Studies Through a
                                       Secure, Authorized, Media-Free, Shared
                                       Archive: Percentage of final reports
                                       of imaging studies performed for all
                                       patients, regardless of age, which
                                       document that a search for Digital
                                       Imaging and Communications in Medicine
                                       (DICOM) format images was conducted
                                       for prior patient imaging studies
                                       completed at non-affiliated external
                                       entities within the past 12 months and
                                       are available through a secure,
                                       authorized, media-free, shared archive
                                       prior to an imaging study being
                                       performed.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through both claims and registry-based reporting.
This measures group is available for reporting beginning in 2014.


                                Table 122--Preventive Cardiology Measures Group *
----------------------------------------------------------------------------------------------------------------
              NQF/PQRS                             Measure title                       Measure developer
----------------------------------------------------------------------------------------------------------------
N/A/TBD.............................  Preventive Cardiology Composite: Blood   ABIM.
                                       Pressure at Goal: Percentage of
                                       patients in the sample whose most
                                       recent blood pressure reading was at
                                       goal.
N/A/TBD.............................  Preventive Cardiology Composite: Low     ABIM.
                                       Density Lipids (LDL) Cholesterol at
                                       Goal: Percentage of patients in the
                                       sample whose LDL cholesterol is
                                       considered to be at goal, based upon
                                       their coronary heart disease (CHD)
                                       risk factors.
N/A/TBD.............................  Preventive Cardiology Composite: Timing  ABIM.
                                       of Lipid Testing Complies with
                                       Guidelines: Percentage of patients in
                                       the sample whose timing of lipid
                                       testing complies with guidelines
                                       (lipid testing performed in the
                                       preceding 12-month period (with a 3-
                                       month grace period) for patients with
                                       known coronary heart disease (CHD) or
                                       CHD risk equivalent (prior myocardial
                                       infarction (MI), other clinical CHD,
                                       symptomatic carotid artery disease,
                                       peripheral artery disease, abdominal
                                       aortic aneurysm, diabetes mellitus);
                                       or in the preceding 24-month period
                                       (with a 3-month grace period) for
                                       patients with >= 2 risk factors for
                                       CHD (smoking, hypertension, low high
                                       density lipid (HDL), men >= 45 years,
                                       women >= 55 years, family history of
                                       premature CHD; HDL >= 60 mg/dL acts as
                                       a negative risk factor); or in the
                                       preceding 60-month period (with a 3-
                                       month grace period) for patients with
                                       <= 1 risk factor for CHD).
N/A/TBD.............................  Preventive Cardiology Composite:         ABIM.
                                       Diabetes Documentation or Screen Test:
                                       Percentage of patients in the sample
                                       who had a screening test for type 2
                                       diabetes or had a diagnosis of
                                       diabetes.
N/A/TBD.............................  Preventive Cardiology Composite:         ABIM.
                                       Correct Determination of Ten-Year Risk
                                       for Coronary Death or Myocardial
                                       Infarction (MI): Number of patients in
                                       the sample whose ten-year risk of
                                       coronary death or MI is correctly
                                       assessed and documented.
N/A/TBD.............................  Preventive Cardiology Composite:         ABIM.
                                       Counseling for Diet and Physical
                                       Activity: Percentage of patients in
                                       the sample who received dietary and
                                       physical activity counseling.
N/A/TBD.............................  Preventive Cardiology Composite:         ABIM.
                                       Appropriate Use of Aspirin or Other
                                       Antiplatelet/Anticoagulant Therapy:
                                       Percentage of patients in the sample
                                       who are: 1) taking aspirin or other
                                       anticoagulant/antiplatelet therapy, or
                                       2) under age 30, or 3) age 30 or older
                                       and who are documented to be at low
                                       risk. Low-risk patients include those
                                       who are documented with no prior
                                       coronary heart disease (CHD) or CHD
                                       risk equivalent (prior myocardial
                                       infarction (MI), other clinical CHD,
                                       symptomatic carotid artery disease,
                                       peripheral artery disease, abdominal
                                       aortic aneurysm, diabetes mellitus)
                                       and whose ten-year risk of developing
                                       CHD is < 10%.
N/A/TBD.............................  Preventive Cardiology Composite:         ABIM.
                                       Smoking Status and Cessation Support:
                                       Percentage of patients in the sample
                                       whose current smoking status is
                                       documented in the chart, and if they
                                       were smokers, were documented to have
                                       received smoking cessation counseling
                                       during the reporting period.
----------------------------------------------------------------------------------------------------------------
* This measures group is reportable through both claims and registry-based reporting.
This measures group is available for reporting beginning in 2014.


[[Page 69284]]

(5) Physician Quality Reporting System Measures for Eligible 
Professionals and Group Practices That Report Using Administrative 
Claims for the 2015 Payment Adjustment
    We proposed 19 measures--including 15 process and 4 outcome 
measures derived from administrative claims--for eligible professionals 
and group practices that report using administrative claims for the 
2015 and 2016 payment adjustments (see Table 63 of the CY 2013 PFS 
proposed rule, 77 FR 44981). Our proposals on how to attribute 
beneficiaries to groups of physicians that elect the administrative 
claims option were discussed in the value-based payment modifier in 
section III.K. of the proposed rule. We considered all of the 28 
process measures included in the program year 2010 individual Physician 
Feedback reports that can be calculated using administrative claims but 
proposed only a subset of the measures that were included in the 
program year 2010 individual Physician Feedback reports. We proposed 
this subset of measures for both the PQRS payment adjustment and the 
value-based modifier because we believe these measures are clinically 
meaningful, focus on highly prevalent conditions among beneficiaries, 
have the potential to differentiate physicians, and be statistically 
reliable (77 FR 44980). We also sought comment on whether to include 
any of the remaining 13 measures included in the program year 2010 
individual Physician Feedback Reports (77 FR 44998) (see Table 65 of 
the CY 2013 PFS proposed rule, 77 FR 45000). The utilization of the 
administrative claims measures will allow PQRS to implement different 
reporting options which capture a wider venue of participants without 
using the traditional methods of reporting.
    We invited public comment on these proposed measures. The following 
is a summary of the comments we received regarding the proposed 
measures for eligible professionals and group practices that report 
using the administrative claims-based reporting mechanism for the 2015 
and/or 2016 PQRS payment adjustments. Please note that, since we are 
not finalizing an administrative claims-based reporting option for the 
2016 PQRS payment adjustment, they will only be available for the 
purpose of reporting for the 2015 PQRS payment adjustment.
    Comment: Most commenters agreed with assessing performance rates 
for the measures in the PQRS administrative claims-based reporting 
option at the TIN level.
    Response: We thank commenters for their support for this proposal 
and we are finalizing our proposal to calculate the Administrative 
Claims based measures at the single TIN level and applying the TIN's 
performance to the TIN or to an individual NPI that elects the 
Administrative Claims option at the individual level.
    Comment: One commenter opposed assessing ophthalmologists against 
the proposed administrative claims-based measures. The commenter notes 
that only 1 proposed administrative claims-based measure is applicable 
to ophthalmology. Although an ophthalmologist would be able to elect 
the administrative claims option and meet the measure targets based on 
the care their patients received from other physicians, the commenter 
does not believe it is appropriate for CMS to attribute care of non-eye 
conditions by other physicians to the ophthalmologist.
    Response: We appreciate the commenter's feedback and realize that 
the proposed administrative claims-based measures may not adequately 
assess the specific scope of care furnished by ophthalmologists or 
other specialists to their patients. However, we believe this reporting 
option promotes shared accountability and care coordination for the 
quality of care furnished to beneficiaries and therefore provides 
important and actionable information for physicians about their 
beneficiaries. We also expect physicians and groups of physicians to 
report data on quality measures that reflect the care they furnish. We 
are therefore allowing ophthalmologists and other specialists to elect 
to be assessed against the administrative claims-based measures for 
purposes of the 2015 PQRS payment adjustment, both to provide 
ophthalmologists and other specialists with multiple options to meet 
the criteria for satisfactory reporting for the 2015 PQRS payment 
adjustment and to provide them with actionable information about shared 
accountability and care coordination important to their beneficiaries. 
We note that establishing the administrative claims-based reporting 
option for eligible professionals does not preclude ophthalmologists 
and other specialists to participate in PQRS using other reporting 
mechanisms and reporting other PQRS measures.
    Process Quality Measures. Of the 19 measures we proposed for 
reporting under the administrative claims-based reporting mechanism, 15 
of these proposed measures were process measures. The following is a 
summary of the comments we received on these proposed process measures.
    Comment: Most commenters supported the Administrative Claims option 
and proposed process measures and saw it as a ``low burden method to 
avoid the PQRS and value-based payment modifier adjustment,'' although 
many expressed their dissatisfaction with administrative-claims-based 
measures in general, since these measures are derived from billing data 
and, as a result, lack the nuances of clinical data. Other commenters 
noted that the proposed measures were most applicable to the care of 
chronic conditions and preventive care and would not apply to the 
practice of many specialists and subspecialists. Commenters recommended 
that CMS include only measures that are NQF endorsed and that they be 
endorsed at the physician and/or group practice level.
    Response: We thank the commenters for their suggestions. As 
commenters stated, while administrative claims-based measures have 
shortcomings for clinical process measurement due to their lack of 
clinical data, we have chosen to preferentially use claims-based 
process measures that have NQF endorsement and were found to have high 
reliability in the program year 2010 physician feedback reports. As we 
have stated above, by providing physicians with information about their 
beneficiaries outside of their specialty, we are promoting shared 
accountability and care coordination for beneficiaries, which we 
believe are important domains promoted by the National Quality 
Strategy. We are finalizing 13 of the proposed 15 process measures and 
are adding NQF 0022, ``Use of High Risk Medicines in the Elderly,'' 
which we had used in the 2010 physician feedback reports. We agree with 
the comments that we should, where possible, use NQF-endorsed measures 
for this reporting option, but we do not believe that CMS should change 
or update measures that have been endorsed. We believe updating measure 
specifications is the responsibility of the measure steward. With that 
being said, we do plan to monitor NQF endorsement activity and will 
adjust the measures in the Administrative Claims option in future years 
accordingly.
    We are not finalizing NQF 0021 measure titled ``Annual Monitoring 
for Beneficiaries on Persistent Medications,'' for the Administrative 
Claims option. The measure steward, NCQA, has withdrawn this measure 
from consideration during NQF Steering Committee review and will update 
and resubmit the measure at a later date. Instead, we will substitute 
NQF 0022 ``Use of High Risk Medicines in the

[[Page 69285]]

Elderly,'' which was included in Table 65 of the CY 2013 PFS proposed 
rule (77 FR 45000) and on which we had sought comment for including in 
the administrative claims option. Like NQF 0021, this process measure 
is a patient safety measure for medication management in the elderly. 
Additionally, the measure was suggested for inclusion by several 
commenters due to its importance in beneficiary care and broad 
applicability to physicians. Additionally, based on our 2010 analysis 
of its use in the physician feedback program, it has a high level of 
reliability. Unlike NQF 0021, NQF 0022 remains endorsed by NQF.
    Comment: Some commenters identified attribution of patients to 
physicians and risk adjustment as challenges with administrative 
claims-based measures in general. Others noted that the current 
administrative claims-based measure set is primary care oriented and 
lacks measures appropriate for specialists.
    Response: We appreciate these comments and have acknowledged above 
the challenges commenters associated with administrated claims-based 
measures that make them an imperfect data source for measuring certain 
aspects of quality. Administrative claims-based measures will likely 
continue to comprise part of the measure set for the value-based 
modifier, such as the cost measures and measures that extend across the 
continuum of care. CMS developed the administrative claims option to 
create an opportunity for physician practices that have not yet 
invested in the infrastructure and capabilities otherwise required to 
participate in PQRS to engage meaningfully in quality measurement and 
quality improvement. Ultimately, we believe that physician practices 
should actively gather and report quality data, such as through EHRs or 
registries. Thus, we do not anticipate that an option to participate in 
PQRS and the value-based payment modifier exclusively using 
administrative claims will continue beyond the first few years of the 
program.
    Comment: Commenters also suggested removing NQF 0549 measure titled 
``Pharmacotherapy Management of COPD Exacerbation,'' because not all 
COPD patients should receive a corticosteroid and the measure does not 
take into account if a patient has possession of the medication at 
home.
    Response: We are not finalizing NQF 0549 ``Pharmacotherapy 
Management of COPD Exacerbation.'' This measure was submitted and 
reviewed by NQF this year and was not recommended for continued 
endorsement due to questions raised about the measure's validity.
    Comment: Commenters suggested removing the proposed NQF 0576 
measure titled ``Follow-up After Hospitalization for Mental Illness'' 
from the administrative claims-based measure set, because the measure 
would have minimal potential to distinguish physicians who are not 
mental health specialists from those who are thus making attribution a 
concern.
    Response: We appreciate this comment and concur that psychiatrists 
treating patients who have been hospitalized for mental illness should 
be held accountable for ensuring appropriate follow up after discharge. 
However, we believe that our objective of effective care coordination 
and safe care transitions for patients with mental illness are best 
served when all physicians and providers involved in the care of a 
patient with mental illness who has been discharged from an inpatient 
care setting share accountability for effective care coordination. We 
are therefore finalizing this measure in the claims-based option as 
supported by many other commenters.
    Comment: Commenters suggested removing the proposed NQF 0543 
measure titled ``Statin Therapy for Beneficiaries with Coronary Artery 
Disease'' from the administrative claims-based measure set, because 
there are multiple influences on why patients may not obtain the 
medication.
    Response: We recognize that physicians play a critical role in 
influencing patient medical adherence, and the point made would obviate 
the use of all medication measures. We are therefore finalizing this 
measure in the claims-based option as supported by many other 
commenters.
    Outcome Measures. Of the 19 measures we proposed for reporting 
using the administrative claims-based reporting mechanism, 4 of these 
proposed measures were outcome measures--All Cause Readmission, 30 day 
Post Discharge Visit, and the Acute and Chronic Preventive Quality 
Indicator (PQI) Composites. The following is a summary of the comments 
received on the proposed outcome measures available for the 
administrative claims-based reporting mechanism.
    Comment: Many commenters were opposed to the four outcome measures 
due to lack of NQF endorsement at the group or physician level, 
inadequate risk adjustment, lack of ability for verification by the 
physician group using their own data, or the lack of actionability by 
the physician groups. The PQIs were cited as population level measures, 
unlikely to be valid at the provider or smaller group level. Other 
commenters stated that planned hospital readmissions may constitute 
appropriate care. And for the 30-day post-discharge follow-up visit 
measures, commenters pointed out that surgeons are subject to the 90-
day global payment period and cannot generate a claim for a 30-day 
post-discharge follow-up visit, thus questioning the accuracy of the 
measure. Commenters also indicated that there may be other ways to 
ensure sufficient care coordination after a hospitalization that does 
not involve a visit within 30 days of discharge. Many commenters 
suggested four recently NQF endorsed care coordination measures to 
replace these four care coordination outcome measures.
    A substantial number of commenters from the consumer advocacy and 
physician value community supported all four of the outcome measures as 
moving quality measurement in the forward direction and in particular 
singled out the use of composite scores as a method to increase 
reliability.
    Response: We appreciate the commenters' suggestions. We are 
finalizing the all cause readmission measure and the Acute and Chronic 
Preventive Quality Indicator composites for use in the PQRS 
Administrative Claims option and for all groups of physicians subject 
to the value-based payment modifier (see discussion below in Section 
III.K.2). The all cause readmission measure is NQF endorsed at the 
hospital level, has been respecified for groups of physicians, and we 
are using the all-cause readmission measure in the Medicare Shared 
Savings Program. Likewise, the individual PQI measures, while currently 
endorsed at the population level, have been respecified for medical 
groups and used in the physician feedback reports. Furthermore, we are 
collaborating with AHRQ, the measure steward for the PQIs, about our 
use of PQI composite measures. We will be seeking NQF endorsement of 
the respecified all cause readmission measure and PQI composite 
measures. Both the all-cause readmission measure and the PQI measures 
have been respecified using rigorous risk adjustment methods. We are 
redesigning our physician feedback reports to allow groups of 
physicians to verify who the patients included in these measures are, 
so that they can take appropriate actions. We are persuaded by the 
comments about the 30-day post-discharge visit measure and we will not 
finalize that measure.

[[Page 69286]]

    We believe an effective Administrative Claims option and a 
meaningful value-based payment modifier in the long-run will place 
greater emphasis on outcome measures and we believe it is important to 
include outcome measures that highlight key areas for achieving better 
care for beneficiaries.
    With regard to the suggestions to replace these outcome measures 
for four recently endorsed AMA-PCPI care coordination measures that 
were recently NQF endorsed, we note that these suggested care 
coordination measures are all process measures, and they will be 
considered for the claims option of the PQRS program in 2014 in future 
rulemaking.
    Therefore, based on the comments received, as specified in Tables 
123 and 124, we are finalizing 17 measures, comprised of 14 process and 
3 outcome measures (2 of which are PQI composite measures), for 
inclusion in the PQRS administrative claims-based measure set for 
reporting for the 2015 PQRS payment adjustment only.

   Table 123--Process Measures for Eligible Professionals and Group Practices Who Report Using Administrative
                                   Claims for the 2015 PQRS Payment Adjustment
                            [Measures for the Administrative Claims Options for 2015]
----------------------------------------------------------------------------------------------------------------
          NQF No.                Measure title             Measure steward                 Domain of care
----------------------------------------------------------------------------------------------------------------
0576.......................  Follow-Up After        NCQA.........................  Care Coordination.
                              Hospitalization for
                              Mental Illness.
                             Percentage of
                              discharges for
                              patients who were
                              hospitalized for
                              treatment of
                              selected mental
                              health disorders and
                              who had an
                              outpatient visit, an
                              intensive outpatient
                              encounter, or
                              partial
                              hospitalization with
                              a mental health
                              practitioner..
0022.......................  Use of High-Risk       NCQA.........................  Patient Safety.
                              Medications in the
                              Elderly: (a)
                              Patients Who Receive
                              At Least One Drug To
                              Be Avoided.
                             Percentage of
                              patients ages 65
                              years and older who
                              received at least
                              one high-risk
                              medication in the
                              measurement year..
                             (b) Patients Who
                              Receive At Least Two
                              Different Drugs To
                              Be Avoided.
                             Percentage of
                              patients 65 years of
                              age and older who
                              received at least
                              two different high-
                              risk medications in
                              the measurement year.
0555.......................  Lack of Monthly INR    CMS..........................  Patient Safety.
                              Monitoring for
                              Beneficiaries on
                              Warfarin.
                             Average percentage of
                              40-day intervals in
                              which Part D
                              beneficiaries with
                              claims for warfarin
                              do not receive an
                              INR test during the
                              measurement period..
0577.......................  Use of Spirometry      NCQA.........................  Clinical Care.
                              Testing to Diagnose
                              COPD.
                             Percentage of
                              patients at least 40
                              years old who have a
                              new diagnosis or
                              newly active chronic
                              obstructive
                              pulmonary disease
                              (COPD) who received
                              appropriate
                              spirometry testing
                              to confirm the
                              diagnosis..
0543.......................  Statin Therapy for     CMS..........................  Clinical Care.
                              Beneficiaries with
                              Coronary Artery
                              Disease.
                             Medication Possession
                              Ratio (MPR) for
                              statin therapy for
                              individuals over 18
                              years of age with
                              coronary artery
                              disease..
0583.......................  Lipid Profile for      Resolution Health............  Clinical Care.
                              Beneficiaries Who
                              Started Lipid-
                              Lowering Medications.
                             Percentage of
                              patients age 18 or
                              older starting lipid-
                              lowering medication
                              during the
                              measurement year who
                              had a lipid panel
                              checked within 3
                              months after
                              starting drug
                              therapy..
0053.......................  Osteoporosis           NCQA.........................  Clinical Care.
                              Management in Women
                              >= 67 Who Had a
                              Fracture.
                             Percentage of women
                              67 years and older
                              who suffered a
                              fracture and who had
                              either a bone
                              mineral density
                              (BMD) test or
                              prescription for a
                              drug to treat or
                              prevent osteoporosis
                              in the 6 months
                              after the date of
                              fracture..
0055.......................  Dilated Eye Exam for   NCQA.........................  Clinical Care.
                              Beneficiaries <= 75
                              with Diabetes.
                             Percentage of adult
                              patients with
                              diabetes aged 18-75
                              years who received a
                              dilated eye exam by
                              an ophthalmologist
                              or optometrist
                              during the
                              measurement year, or
                              had a negative
                              retinal exam (no
                              evidence of
                              retinopathy) by an
                              eye care
                              professional in the
                              year prior to the
                              measurement year..
0057.......................  HbA1c Testing for      NCQA.........................  Clinical Care.
                              Beneficiaries <= 75
                              with Diabetes.
                             Percentage of adult
                              patients with
                              diabetes aged 18-75
                              years receiving one
                              or more A1c test(s)
                              per year..
0062.......................  Urine Protein          NCQA.........................  Clinical Care.
                              Screening for
                              Beneficiaries <= 75
                              with Diabetes.
                             Percentage of adult
                              diabetes patients
                              aged 18-75 years
                              with at least one
                              test nephropathy
                              screening test
                              during the
                              measurement year or
                              who had evidence
                              existing nephropathy
                              (diagnosis of
                              nephropathy or
                              documentation of
                              microalbuminuria or
                              albuminuria)..
0063.......................  Lipid Profile for      NCQA.........................  Clinical Care.
                              Beneficiaries <= 75
                              with Diabetes.
                             Percentage of adult
                              patients with
                              diabetes aged 18-75
                              who had an LDL-C
                              test performed
                              during the
                              measurement year..
0075.......................  Lipid Profile for      NCQA.........................  Clinical Care.
                              Beneficiaries with
                              Ischemic Vascular
                              Disease.
                             Percentage of
                              patients 18 years of
                              age and older who
                              were discharged
                              alive for acute
                              myocardial
                              infarction (AMI),
                              coronary artery
                              bypass graft (CABG)
                              or percutaneous
                              coronary
                              interventions (PCI)
                              from January 1-
                              November 1 of the
                              year prior to the
                              measurement year, or
                              who had a diagnosis
                              of ischemic vascular
                              disease (IVD) during
                              the measurement year
                              and the year prior
                              to measurement year,
                              who had a complete
                              lipid profile during
                              the measurement
                              year..
0105.......................  Antidepressant         NCQA.........................  Clinical Care.
                              Treatment for
                              Depression.
                             Percentage of
                              patients who were
                              diagnosed with a new
                              episode of
                              depression and
                              treated with
                              antidepressant
                              medication and who
                              remained on an
                              antidepressant
                              medication treatment
                              for: (a) At least 84
                              days (12 weeks) and
                              (b) 180 days (6
                              months)..

[[Page 69287]]

 
0031.......................  Breast Cancer          NCQA.........................  Clinical Care.
                              Screening for Women
                              <= 69.
                             Percentage of
                              eligible women 40-69
                              who receive a
                              mammogram in during
                              the measurement year
                              or in the year prior
                              to the measurement
                              year..
----------------------------------------------------------------------------------------------------------------


   Table 124--Outcome Measures for Eligible Professionals and Group Practices Who Report Using Administrative
                                   Claims for the 2015 PQRS Payment Adjustment
----------------------------------------------------------------------------------------------------------------
           NQF No.                   Measure title          Measure steward              Domain of care
----------------------------------------------------------------------------------------------------------------
N/A..........................  1. Composite of Acute     N/A                    Care Coordination.
                                Prevention Quality
                                Indicators (PQIs).
0279.........................  Bacterial Pneumonia.....  AHRQ                   ................................
                               The number of admissions
                                for bacterial pneumonia
                                per 100,000 population..
0281.........................  UTI.....................  AHRQ                   ................................
                               The number of discharges
                                for urinary tract
                                infection per 100,000
                                population Age 18 Years
                                and Older in a one year
                                time period..
0280.........................  Dehydration.............  AHRQ                   ................................
                               The number of admissions
                                for dehydration per
                                100,000 population..
N/A..........................  2. Composite of Chronic   N/A                    Care Coordination.
                                Prevention Quality
                                Indicators (PQIs).
                               Diabetes Composite        .....................  ................................
0638.........................  Uncontrolled diabetes...  AHRQ                   ................................
                               The number of discharges
                                for uncontrolled
                                diabetes per 100,000
                                population Age 18 Years
                                and Older in a one year
                                time period..
0272.........................  Short Term Diabetes       AHRQ                   ................................
                                complications.
                               The number of discharges
                                for diabetes short-term
                                complications per
                                100,000 Age 18 Years
                                and Older population in
                                a one year period..
0274.........................  Long term diabetes        AHRQ                   ................................
                                complications..
                               The number of discharges
                                for long-term diabetes
                                complications per
                                100,000 population Age
                                18 Years and in a one
                                year time period..
0285.........................  Lower extremity           AHRQ                   ................................
                                amputation for diabetes.
                               The number of discharges
                                for lower-extremity
                                amputation among
                                patients with diabetes
                                per 100,000 population
                                Age 18 Years in a one
                                year time period..
0275.........................  COPD....................  AHRQ                   ................................
                               The number of admissions
                                for chronic obstructive
                                pulmonary disease
                                (COPD) per 100,000
                                population..
0277.........................  Heart Failure...........  AHRQ                   ................................
                               Percent of the
                                population with
                                admissions for CHF..
N/A..........................  3. All Cause Readmission  CMS                    Care Coordination.
                               The rate of provider
                                visits within 30 days
                                of discharge from an
                                acute care hospital per
                                1,000 discharges among
                                eligible beneficiaries
                                assigned..
----------------------------------------------------------------------------------------------------------------

7. Maintenance of Certification Program Incentive: Self-Nomination and 
Qualification Process for Entities Wishing To Be Qualified for the 2013 
and 2014 Maintenance of Certification Program Incentives
    We proposed that new and previously qualified entities wishing to 
become qualified to provide their members with an opportunity to earn 
the 2013 and/or 2014 Maintenance of Certification Program incentives 
undergo a self-nomination and qualification process (77 FR 44982). Once 
qualified, we proposed that the entity would be able to submit data on 
behalf of its eligible professionals.
    Maintenance of Certification Program Incentive: Self-Nomination 
Process. For the self-nomination process, we proposed that an entity 
wishing to be qualified for the 2013 and/or 2014 Maintenance of 
Certification Program incentive would be required to submit a self-
nomination statement containing all of the following information via 
the web:
     Provide detailed information regarding the Maintenance of 
Certification Program with reference to the statutory requirements for 
such program.
     Indicate the organization sponsoring the Maintenance of 
Certification Program, and whether the Maintenance of Certification 
Program is sponsored by an American Board of Medical Specialties (ABMS) 
board. If not an ABMS board, indicate whether and how the program is 
substantially equivalent to the ABMS Maintenance of Certification 
Program process.
     Indicate that the program is in existence as of January 1 
the year prior to the year in which the entity seeks to be qualified 
for the Maintenance of Certification Program incentive. For example, to 
be qualified for the 2013 Maintenance of Certification Program 
incentive, the entity would be required to be in existence by January 
1, 2012.
     Indicate that the program has at least one (1) active 
participant.
     The frequency of a cycle of Maintenance of Certification 
for the specific Maintenance of Certification Program of the sponsoring 
organization, including what constitutes ``more frequently'' for both 
the Maintenance of Certification Program itself and the practice 
assessment for the specific Maintenance of Certification Program of the 
sponsoring organization.
     Confirmation from the board that the practice assessment 
will occur and be completed in the year the physician is participating 
in the Maintenance of Certification Program Incentive.

[[Page 69288]]

     What was, is, or will be the first year of availability of 
the Maintenance of Certification Program practice assessment for 
completion by an eligible professional.
     What data is collected under the patient experience of 
care survey and how this information would be provided to CMS.
     Describe how the Maintenance of Certification program 
monitors that an eligible professional has implemented a quality 
improvement process for their practice.
     Describe the methods, and data used under the Maintenance 
of Certification Program, and provide a list of all measures used in 
the Maintenance of Certification Program for the year prior to which 
the entity seeks to be qualified for the Maintenance of Certification 
Program incentive (for example, measures used in 2012 for the 2013 
Maintenance of Certification Program incentive), including the title 
and descriptions of each measure, the owner of the measure, whether the 
measure is NQF endorsed, and a link to a Web site containing the 
detailed specifications of the measures, or an electronic file 
containing the detailed specifications of the measures.
    We invited but received no public comment on our proposed self-
nomination process for entities who wish to be qualified for the 2013 
and 2014 Maintenance of Certification Program incentive. Therefore, we 
are finalizing the self-nomination process for boards wishing to 
participate in the Maintenance of Certification Program incentive, as 
proposed.
    Maintenance of Certification Program Incentive: Qualification 
Process. For the qualification process, we proposed that an entity must 
meet all of the following requirements to be considered for 
qualification for purposes of the 2013 and 2014 Maintenance of 
Certification Program incentives (77 FR 44983):
     The name, NPI and applicable TINs of eligible 
professionals who would like to participate for the 2013 and/or 2014 
Maintenance of Certification Program incentives.
     Attestation from the board that the information provided 
to CMS is accurate and complete.
     The board has signed documentation from eligible 
professional(s) that the eligible professional wishes to have the 
information released to us.
     Information from the patient experience of care survey.
     Information certifying the eligible professional has 
participated in a Maintenance of Certification Program for a year, 
``more frequently'' than is required to qualify for or maintain board 
certification status, including the year the physician met the board 
certification requirements for the Maintenance of Certification 
Program, and the year the eligible professional participated in the 
Maintenance of Certification Program ``more frequently'' than is 
required to maintain or qualify for board certification.
     Information certifying the eligible professional has 
completed the Maintenance of Certification Program practice assessment 
at least one time each year the eligible professional participates in 
the Maintenance of Certification Program Incentive.
    We proposed this self-nomination and qualification process because 
the process is identical to the self-nomination and qualification 
process finalized for the 2011 and 2012 Maintenance of Certification 
Program incentives and we felt such requirements remain appropriate. 
Because the incentives only run through 2014, we felt it was important 
to keep the requirements consistent with what has been required for the 
2011 and 2012 Maintenance of Certification Program incentives.
    We invited public comment on the proposed qualification process for 
entitles entities who wish to be qualified for the 2013 and 2014 
Maintenance of Certification Program incentive. The following is 
summary of the comments we received regarding these proposals.
    Comment: One commenter suggested that those entities that have 
previously undergone the qualification process and were previously 
qualified to participate in this Maintenance of Certification Program 
incentive be automatically qualified for the following year.
    Response: We agree with the commenter's suggestion to allow boards 
that were fully qualified in a prior program year and successfully 
submitted data to be fully qualified after CMS review of their 
application. Since the qualification process is the same from year to 
year, CMS believes that requiring boards to undergo this process every 
year is redundant. CMS agrees that this will allow more time for 
returning boards to encourage participation with their diplomats.
    Comment: One commenter suggested that newly participating boards be 
allowed to bypass the qualification process if they administer a 
qualified registry.
    Response: We agree with the commenter's suggestion. The data 
submission process for Maintenance of Certification entities is similar 
to the registry data submission process. Therefore, it would seem 
redundant for a specialty board that already possesses a qualified 
registry to have to undergo another separate qualification process to 
participate in the Maintenance of Certification Program incentive, as 
the entity's products and characteristics have already been vetted when 
it submitted its registry for qualification under PQRS. Therefore, we 
do not believe it is necessary for specialty boards that administer 
PQRS qualified registries to undergo a separate qualification process 
for purposes of the Maintenance of Certification Program incentive. 
Therefore, we are not requiring boards who wish to participate in the 
Maintenance of Certification Program incentive for the first time to 
undergo the Maintenance of Certification Program incentive 
qualification process if they also maintain a PQRS qualified registry. 
However, we note that these specialty boards must still self-nominate 
for each year the specialty board wishes to participate in Maintenance 
of Certification Program incentive.
    Comment: One commenter believed that the requirements for receiving 
a Maintenance of Certification incentive payment are too onerous for 
both physicians and participating boards.
    Response: We appreciate the commenter's feedback. We understand 
that physicians already participating in Maintenance of Certification 
programs are already taking proactive steps to maintain their clinical 
skills and education. In fact, we defer to the boards for what is 
necessary to demonstrate a physician's ability to maintain 
certification. However, given the requirement that a physician 
participate in a Maintenance of Certification program ``more 
frequently'' than is required to maintain board certification, we 
believe that earning an additional Maintenance of Certification 
incentive under PQRS involves extra effort by the physician. Please 
note that we work with the participating boards to determine what extra 
steps are necessary to earn this incentive.
    Comment: One commenter seeks clarification on how physicians are to 
participate in a Maintenance of Certification Program ``more 
frequently'' than is required to maintain or qualify for board 
certification.
    Response: Please note that more information and guidance about how 
to participate in a Maintenance of Certification Program incentive 
``more frequently'' for purposes of the Maintenance of Certification 
Program incentive is available on the PQRS Web site at http://
www.cms.gov/Medicare/

[[Page 69289]]

Quality-Initiatives-Patient-Assessment-Instruments/PQRS/index.html.
    Comment: One commenter requested that CMS explore opportunities to 
leverage the Maintenance of Certification structure that exists within 
the specialty boards to reduce redundant reporting requirements and 
enhance the value of PQRS for physicians and their patients.
    Response: We appreciate the commenter's feedback. CMS has worked 
closely with the specialty boards to establish requirements for earning 
the additional Maintenance of Certification Program incentive under 
PQRS. In fact, the boards provide the guidelines for determining what 
is necessary to demonstrate a physician's ability to maintain 
certification.
    Based on the comments received and for the reasons discussed above, 
we are finalizing the qualification process for boards wishing to 
become qualified to participate in the Maintenance of Certification 
Program incentive. However, boards that were previously qualified as a 
Maintenance of Certification Program entity or newly participating 
boards that utilize a previously qualified registry for their 
Maintenance of Certification Program data will not need to undergo the 
qualification process annually. Rather, these entities will be 
qualified after these entities complete their self-nomination 
statements. However, please note that previously qualified boards or 
boards that use a previously qualified registry must still self-
nominate to participate in the Maintenance of Certification Program 
incentive for each year the boards wish to participate. For boards 
wishing to newly become qualified, we note that, due to a delay in the 
availability of the testing tool to qualify the boards, this 
qualification process will occur later in time for 2013. Please note 
that we are also making technical changes in Sec.  414.90(d) due to 
changes in the composition of Sec.  414.90(c) to specify the incentive 
amounts for the 2013 and 2014 PQRS incentives. We are also making a 
technical change at Sec.  414.90(d)(1)(iii)(B)(2)(i), as this section 
incorrectly references (d)(2)(11); the correct reference is 
(d)(1)(iii).
8. Informal Review
    We established an informal review process for 2012 and beyond in 
the CY 2012 Medicare PFS final rule (76 FR 73390). In this final rule 
with comment period, we addressed the additional parameters we proposed 
for eligible professionals and group practices subject to a PQRS 
payment adjustment requesting an informal review. For eligible 
professionals and group practices that are subject to the payment 
adjustments that wish to request an informal review, in addition to the 
requirements we previously established, we proposed the following:
     An eligible professional electing to utilize the informal 
review process must request an informal review by February 28 of the 
year in which the payment adjustment is being applied. For example, if 
an eligible professional requests an informal review related to the 
2015 payment adjustment, the eligible professional would be required to 
submit his/her request for an informal review by February 28, 2015. We 
felt this deadline provided ample time for eligible professionals and 
group practices after their respective claims begin to be adjusted due 
to the payment adjustment.
     Where we find that the eligible professional or group 
practice did satisfactorily report for the payment adjustment, we would 
to cease application of the payment adjustment and reprocess all claims 
that have been erroneously adjusted to date (77 FR 44983).
    We invited public comment on our proposals for the PQRS informal 
review process. The following is a summary of the comments we received 
regarding the proposed additional parameters for the PQRS informal 
review process.
    Comment: Several commenters supported our proposal to establish an 
informal review process for the PQRS payment adjustment.
    Response: We appreciate the commenters' feedback and are finalizing 
an informal review process for the PQRS payment adjustments that is 
similar to the informal review process established for the PQRS 
incentives.
    Comment: One commenter supported our proposed deadline of February 
28 of the payment adjustment year for eligible professionals and group 
practices to request an informal review of the PQRS payment adjustment.
    Response: Based on the comments received, we are finalizing a 
deadline of February 28 of the payment adjustment year for eligible 
professionals and group practices to request an informal review of the 
PQRS payment adjustment.
    Comment: One commenter supported CMS' proposal to provide written 
responses to those eligible professionals and group practices seeking 
an informal review request.
    Response: We appreciate the commenter's feedback and we are 
finalizing our proposal to provide a timely, written response to 
eligible professionals and group practices seeking an informal review 
of the applicability of the PQRS payment adjustment.
    Comment: One commenter supported our proposal to make eligible 
professionals and group practices whole should CMS find error.
    Response: We believe it is important to rectify error should CMS 
find that an error has occurred in application of the PQRS payment 
adjustment during the informal review process. Therefore, where we find 
that the eligible professional or group practice did satisfactorily 
report for the payment adjustment, we will cease application of the 
payment adjustment and reprocess all claims that have been erroneously 
adjusted to date.
    Based on the comments received and for the reasons stated 
previously, we are finalizing these additional parameters for the PQRS 
informal review process as it relates to the PQRS payment adjustments. 
We are finalizing changes to Sec.  414.90 to reflect the PQRS informal 
review process for the PQRS incentives and payment adjustments.
H1. The Electronic Prescribing (eRx) Incentive Program
    We established the requirements for the 2013 and 2014 eRx Incentive 
Program in the CY 2012 Medicare PFS final rule (76 FR 73393). This 
section addresses additional final requirements for the 2013 and 2014 
eRx Incentive Program.
    Please note that, during the comment period following the proposed 
rule, we received comments that were not related to our specific 
proposals for the eRx Incentive Program in the CY 2013 Medicare PFS 
proposed rule. While we appreciate the commenters' feedback and intend 
to use these comments to better develop the eRx Incentive Program, 
these comments will not be specifically addressed in this CY 2013 
Medicare PFS final rule.
1. Definition of Group Practice
    Under Sec.  414.92(b) a group practice is one that, defined at 
Sec.  414.90(b), that is participating in the Physician Quality 
Reporting System; or in a Medicare-approved demonstration project or 
other Medicare program, under which Physician Quality Reporting System 
requirements and incentives have been incorporated; and has indicated 
its desire to participate in the electronic prescribing group practice 
option. Please note that the definition of group practice for the eRx 
Incentive Program is therefore tied to the definition of group practice 
under PQRS. Since we are changing the definition of group practice in 
PQRS to allow groups of 2-24 eligible professionals to participate

[[Page 69290]]

in PQRS as a group practice, accordingly, group practices of 2-24 
eligible professionals will be able to participate in the eRx Incentive 
Program as a group practice in 2013 (that is, for the 2013 incentive 
and 2014 payment adjustment).
    In addition, we would like to clarify the requirement under Sec.  
414.92(b) that a group practice under the eRx Incentive Program must be 
``participating in the Physician Quality Reporting System''. We 
developed this definition in light of our goals for group practices to 
report under both programs, as well as operational considerations for 
administering the group practice reporting option under the PQRS and 
ERx Incentive Program. In particular, we expect that group practices 
participating in the eRx Incentive Program as a group practice will 
also be participating in PQRS as a group practice. With regard to 
``participation,'' we note that we have never required nor indicated 
that group practices under the eRx GPRO must report PQRS quality 
measures to demonstrate participation in the PQRS for purposes of this 
definition. In the past, we have required that group practices wishing 
to participate in the eRx Incentive Program under the group practice 
reporting option (eRx GPRO) must complete a self-nomination statement 
stating the group practice's intent to participate in PQRS as a group 
practice. We have viewed that as an example of ``participation.'' 
However, because we believe submission of a self-nomination statement 
for PQRS as an extra administrative step we have required in order for 
group practices to participate in the eRx GPRO, in 2013, we no longer 
view completion of a self-nomination statement to participate in PQRS 
under the PQRS group practice reporting option (PQRS GPRO) as necessary 
to demonstration ``participation'' by group practices under the eRx 
Incentive Program. Therefore, the statement to be ``participating in 
the Physician Quality Reporting System'' is merely an indication but 
not a requirement that we expect that group practices participating in 
the eRx Incentive Program as a group practice will also be 
participating in PQRS as a group practice.
2. Alternative Self-Nomination Process for Certain Group Practices 
Under the eRx GPRO
    In the CY 2012 Medicare PFS final rule (76 FR 73394), we 
established that a group practice wishing to participate in the eRx 
Incentive Program under the eRx GPRO must self-nominate via the web. 
However, we proposed an alternative submission mechanism for self-
nomination by groups participating in the Medicare Shared Savings 
Program, Pioneer ACO, PGP Demonstration, or other Medicare-approved 
demonstration project or other Medicare program (77 FR 44983). 
Specifically, we proposed that the participating TINs within these 
groups that wish to participate in the eRx Incentive Program using the 
eRx GPRO would be required to submit a self-nomination statement by 
sending a letter indicating its intent to participate in the eRx 
Incentive Program under the eRx GPRO. We also proposed that the group 
practice would be required to submit an XML file describing the 
eligible professionals included in the group practice. We proposed this 
alternative submission mechanism for group practices that are 
participating as groups in the Medicare Shared Savings Program, Pioneer 
ACO, or PGP Demonstration because it is not technically feasible for 
CMS to receive this information from these group practices via the web. 
We invited public comment on this proposed alternative mechanism for 
submitting self-nomination statements for groups participating in the 
Medicare Shared Savings Program, Pioneer ACO, and PGP demonstration and 
the proposed requirement to provide an XML file to CMS for the types of 
group practices identified above that want to participate in the eRx 
Incentive Program using the eRx GPRO. We received no comments regarding 
these proposed alternative methods related to the self-nomination 
process for group practices participating in the Medicare Shared 
Savings Program, Pioneer ACO, and PGP demonstration that wish to 
participate in the eRx Incentive Program using the eRx GPRO. Therefore, 
we are finalizing an alternative self-nomination process for these 
aforementioned groups. However, as we believe that it would be more 
efficient to accept self-nomination statements electronically, we will 
not accept these self-nomination statements via U.S. mail. Rather, we 
will accept these self-nomination statements via email. We are also not 
finalizing the requirement that these group practices provide an XML 
file to CMS. The XML file typically provides CMS with a list of the 
eligible professionals (defined by their individual rendering National 
Provider Identification numbers or NPIs) within the group practice. 
Since we do not need NPI-level information to analyze group practice 
reporting, we no longer need this XML file.
    In addition, in the CY 2012 PFS final rule with comment period, we 
stated we would accept self-nomination statements for group practices 
that want to participate in the GPROs for PQRS and the eRx Incentive 
Program via the web (76 FR 73315 and 76 FR 73394). We note that this 
Web page is only available for those group practices who wish to submit 
a self-nomination statement to participate in both the PQRS and eRx 
Incentive Program under the respective GPROs. Therefore, it will not be 
technically feasible to accept self-nomination statements via this Web 
page from group practices who wish to submit a self-nomination 
statement to participate in the eRx GPRO only. Group practices wishing 
to submit a separate GPRO self-nomination statement to participate in 
the eRx Incentive Program only must follow the alternative self-
nomination process that group practices participating in the Medicare 
Shared Savings Program using the eRx GPRO follow (76 FR 73395).
    We also note that, in the CY 2012 Medicare PFS final rule, we 
established a deadline of January 31 of the applicable program year 
(for example, January 31, 2013 for the 2013 program year) for group 
practices to submit a self-nomination statement to participate in the 
eRx GPRO (76 FR 73316). Although, as discussed in section III.G, we 
have extended the deadline for group practices wishing to participate 
in the GPRO in PQRS to the Fall of the applicable program year (for 
example, Fall 2013 for the 2013 program year), for operational reasons, 
group practices wishing to participate in the eRx Incentive Program 
under the eRx GPRO for 2013 must submit its self-nomination statement 
by January 31, 2013 as finalized in the CY 2012 Medicare PFS final 
rule. We understand that having two separate deadlines for submitting 
GPRO self-nomination statements for PQRS and the eRx Incentive Program 
may cause confusion for group practices who have submitted self-
nomination statements for PQRS and eRx simultaneously in previous 
years. However, because the 2014 6-month payment adjustment reporting 
period (that is, January 1, 2013-June 30, 2013) occurs prior to Fall 
2013, we must maintain a deadline of January 31, 2013 for those group 
practices wishing to participate in the eRx Incentive Program as a 
group practice using the eRx GPRO for reporting periods occurring 2013.
    We realize that having two separate self-nomination dates of 
January 31, 2013 and Fall 2013 for self-nominating to participate in 
the GPRO for the eRx Incentive Program and PQRS respectively may cause 
additional administrative concerns, such as situations where a group 
practice may change its TIN between June 30, 2013

[[Page 69291]]

(after the 6-month 2014 payment adjustment reporting period) and Fall 
2013. We will try to work with group practices so that they are aware 
of the applicable deadlines and procedure.
2. The 2013 Incentive: Criterion for Being a Successful Electronic 
Prescriber for Groups Comprised of 2-24 Eligible Professionals Selected 
To Participate Under the eRx GPRO
    We proposed to add another criterion for becoming a successful 
electronic prescriber under the program for the 2013 Incentive for 
groups of 2-24 eligible professionals that may now participate in the 
eRx Incentive Program using the eRx GPRO in 2013 (77 FR 44983-44984). 
(For the other criteria we previously adopted for the eRx GPRO, please 
see 76 FR 73407). Specifically, we proposed the following criterion for 
being a successful electronic prescriber for group practices 
participating in the eRx GPRO comprised of 2-24 eligible professionals 
for purposes of the 2013 eRx incentive: Report the electronic 
prescribing measure's numerator code during a denominator-eligible 
encounter for at least 225 times during the 12-month 2013 incentive 
reporting period (January 1, 2013-December 31, 2013). We proposed a 
lower criterion for group practices participating under the eRx GPRO 
with 2-24 eligible professionals because we understand that their 
smaller sizes necessitate a lower reporting threshold. We proposed this 
reporting threshold because this reporting threshold is familiar to 
group practices, as this was the threshold established for group 
practices comprised of 11-25 eligible professionals that participated 
in the GPRO II in 2011 (75 FR 73509).
    We invited public comment on our proposed criterion for being a 
successful electronic prescriber for the 2013 incentive for groups 
comprised of 2-24 eligible professionals. The following is a summary of 
the comments we received on this proposal.
    Comment: Several commenters generally supported our proposal to 
establish criteria for being a successful electronic prescriber for 
group practices comprised of 2-24 eligible professionals. However, some 
commenters stated that our proposed reporting threshold for a group 
practice of 2-24 eligible professionals to become a successful 
electronic prescriber is too high, particularly for a group comprised 
of 2 eligible professionals. One commenter suggested applying a 
percentage threshold, similar to the electronic prescribing criteria 
established under the EHR Incentive Program. Other commenters suggested 
a tiered approach similar to the criteria for becoming a successful 
electronic prescriber previously established under eRx GPRO II (75 FR 
73509). One of these commenters also suggested that, in the 
alternative, the proposed threshold be lowered. Commenters stated that 
group practices of 2-24 eligible professionals should be required 
report the electronic prescribing measure at least 75 times to become a 
successful electronic prescriber for the 2013 incentive.
    Response: We believe it is important to establish an electronic 
prescribing threshold that group practices of 2-24 eligible 
professionals can reasonably attain to become successful electronic 
prescribers. As we explain in greater detail further below, we agree 
with the commenters' suggestion and therefore, we are finalizing a 
reporting threshold of 75 times.
    For the suggestion to adopt a percentage threshold, we prefer to 
establish a reporting count as the established criteria for becoming a 
successful electronic prescriber for larger groups utilize a reporting 
count rather than a percentage. Therefore, we would like to remain 
consistent in the reporting criteria that were previously established 
for larger group practices participating in the eRx GPRO.
    For the tiered approach, we believe that adding several tiers for 
reporting for smaller group practices would add to the complexity of 
the eRx Incentive Program. To streamline the requirements for becoming 
a successful electronic prescriber for the eRx Incentive Program, we 
prefer one criterion for all group practices of 2-24 eligible 
professionals using the eRx GPRO. We believe that the proposed 
threshold of 75 offered by commenters is reasonable, particularly 
because the eRx Incentive Program previously required group practices 
of 2-10 eligible professionals participating in the eRx GPRO II to 
report the electronic prescribing measure at least 75 times (75 FR 
73509). We note that our proposed threshold of reporting the electronic 
prescribing measure was also consistent with criteria we established 
under GPRO II in 2011, but we understand the desire to lower the 
threshold to 75. We believe that the reporting threshold of 75 also 
achieves the program goal of ensuring that eligible professionals are 
generating prescriptions electronically. Therefore, based on the 
comments received, we are finalizing a lower threshold for reporting 
the electronic prescribing measure of 75 rather than 225. To be a 
successful electronic prescriber for the 2013 incentive, group 
practices comprised of 2-24 eligible professionals that are 
participating in the eRx GPRO must report the electronic prescribing 
measure at least 75 times during the applicable 12-month reporting 
period (that is, January 1, 2013-December 31, 2013) for the 2013 
incentives.
3. The 2014 Payment Adjustment: Criterion for Being a Successful 
Electronic Prescriber for Group Practices Comprised of 2-24 Eligible 
Professionals Selected To Participate Under the eRx GPRO
    We proposed to change the minimum group practice size from 25 to 2 
accordingly with PQRS and proposed to add another criterion for being a 
successful electronic reporter under the program for the 2014 payment 
adjustment (77 FR 44984). (For the other criteria we previously adopted 
for the eRx GPRO Reporting Option, please see 76 FR 73412-73414). 
Specifically, we proposed the following criterion for being a 
successful electronic prescriber for purposes of the 2014 payment 
adjustment for group practices comprised of 2-24 eligible professionals 
participating under the eRx GPRO: Report the electronic prescribing 
measure's numerator code at least 225 times for the 6-month 2014 
payment adjustment reporting period (January 1, 2013-June 30, 2013). We 
proposed this lower criterion for group practices participating under 
the eRx GPRO with 2-24 eligible professionals because we understand 
that their smaller sizes necessitate a lower reporting threshold. In 
addition, we noted that this reporting threshold is familiar to group 
practices, as this was the threshold established for group practices 
comprised of 11-25 eligible professionals that participated in the GPRO 
II in 2011 (75 FR 73509).
    We invited public comment on the proposed criterion for being a 
successful electronic prescriber for the 2014 eRx payment adjustment 
for the 6-month payment adjustment reporting period for group practices 
composed of 2-24 eligible professionals. The following is a summary of 
comments we received regarding this proposal.
    Comment: Commenters generally provided the same comments regarding 
this proposed criterion for becoming a successful electronic prescriber 
for the 2014 payment adjustment as provided for the proposed criterion 
for becoming a successful electronic prescriber for the 2013 incentive. 
Specifically, several commenters generally supported our proposal to 
establish criteria for becoming a successful electronic prescriber for 
group practices comprised of 2-24 eligible professionals. However, some 
commenters stated that our proposed reporting threshold for a

[[Page 69292]]

group practice of 2-24 eligible professionals to become a successful 
electronic prescriber is too high. One commenter suggested applying a 
percentage threshold, similar to the electronic prescribing criteria 
established under the EHR Incentive Program. Other commenters suggested 
a tiered approach similar to the criteria for becoming a successful 
electronic prescriber previously established under eRx GPRO II (75 FR 
73509). One of these commenters also suggested that, in the 
alternative, the proposed threshold be lowered. Group practices of 2-24 
eligible professionals should be required report the electronic 
prescribing measure at least 75 times to become a successful electronic 
prescriber for the 2014 payment adjustment.
    In addition to these comments, some commenters supported our 
proposed criteria to report the electronic prescribing measure at least 
225 times to become a successful electronic prescriber for the 2013 
incentive but believed that this 225 threshold is too high for the 2014 
payment adjustment, as group practices will only have 6 months as 
opposed to 12 months to meet this threshold. The commenters added that 
the threshold is especially high for dermatologists who may not see 
this many Medicare Part B patients during the 6-month 2014 payment 
adjustment reporting period.
    Response: For the same reasons we discussed above with regard to 
the threshold for the 2013 incentive, we agree with the points raised 
by commenters. In addition, for reporting under the eRx GPRO, it is our 
desire to keep with the trend of establishing similar criteria for the 
incentives as payment adjustments. It is our desire to finalize the 
same criterion for the 2014 payment adjustment as finalized for the 
2013 incentive. Therefore, based on the comments received and for the 
reasons we stated for establishing a lower threshold of 75 for the 2013 
incentive, we are finalizing a lower threshold for reporting the 
electronic prescribing measure for the 2014 payment adjustment of 75 
instead of 225. To be a successful electronic prescriber for the 2014 
payment adjustment, group practices comprised of 2-24 eligible 
professionals that are participating in the eRx GPRO must report the 
electronic prescribing measure at least 75 times during the applicable 
2014 6-month payment adjustment reporting period.
4. Analysis for the Claims-Based Reporting Mechanism
    We understand that, in certain instances, it is permissible for an 
eligible professional to have their Medicare Part B claims reprocessed. 
However, we raised concerns about eligible professionals resubmitting 
claims for the sole reason of attaching a G-code for purposes of 
reporting under the eRx Incentive Program (rather than reporting such 
data at the time the claim was initially submitted). Therefore, we 
proposed to modify Sec.  414.92 to indicate that under the eRx 
Incentive Program, if an eligible professional re-submits a claims for 
reprocessing, the eligible professional may not attach a G-code at that 
time. The following is a summary of comments we received on this 
proposal.
    Comment: Some commenters disagreed with our proposal to modify 
Sec.  414.92 to indicate that G-codes cannot be attached to claims that 
are re-submitted for reprocessing for purposes of the eRx Incentive 
Program. Commenters urged us to allow the reopening or resubmission of 
claims for the sole purpose of attaching a reporting code on a claim.
    Response: To avoid the reprocessing of claims solely to report 
quality measure for the eRx Incentive Program, we believe such a policy 
is needed and therefore, we are finalizing our change to the regulation 
at Sec.  414.92. In addition, we note that even though professionals 
may prefer this practice, it is not practically feasible to allow 
eligible professionals and group practices to resubmit a claim for the 
sole purpose of attaching a reporting code on a claim for purposes of 
the eRx Incentive Program. Allowing eligible professionals to resubmit 
claims for reporting purposes opens the potential for the reprocessing 
of millions of claims, which would be overly burdensome and costly for 
CMS. Therefore, we are finalizing our proposal to add Sec.  
414.92(f)(2)(i)(A) to indicate if an eligible professional re-submits a 
Medicare Part B claim for reprocessing, the eligible professional may 
not attach a G-code at that time for reporting on the electronic 
prescribing measure. We note that has been CMS' policy not to accept 
quality data from claims that were resubmitted since the inception of 
PQRS (where the electronic prescribing measure was first available for 
reporting) in 2007.
5. Proposed Significant Hardship Exemptions
    Section 1848(a)(5)(B) of the Act provides that the Secretary may, 
on a case-by-case basis, exempt an eligible professional from the 
application of the payment adjustment, if the Secretary determines, 
subject to annual renewal, that compliance with the requirement for 
being a successful electronic prescriber would result in a significant 
hardship. In the CY 2012 final rule with comment period, we finalized, 
as set forth at Sec.  414.92(c)(2)(ii)(B), four circumstances under 
which an eligible professional or eRx GPRO can request consideration 
for a significant hardship exemption for the 2013 and 2014 eRx payment 
adjustments (76 FR 73413):
     The eligible professional or group practice practices in a 
rural area with limited high speed internet access.
     The eligible professional or group practice practices in 
an area with limited available pharmacies for electronic prescribing.
     The eligible professional or group practice is unable to 
electronically prescribe due to local, state, or Federal law or 
regulation.
     The eligible professional or group practice has limited 
prescribing activity, as defined by an eligible professional generating 
fewer than 100 prescriptions during a 6-month reporting period.
    We have received feedback from stakeholders requesting significant 
hardship exemptions from application of the payment adjustment based on 
participation in the EHR Incentive Program, a program which requires a 
certain level of electronic prescribing activity. Under the EHR 
Incentive Program, eligible professionals \4\ may receive incentive 
payments beginning in CY 2011 for successfully demonstrating 
``meaningful use'' of Certified EHR Technology (CEHRT) and will be 
subject to payment adjustments beginning in CY 2015 for failure to 
demonstrate meaningful use. For further explanation of the statutory 
authority and regulations for the EHR Incentive Program, we refer 
readers to the EHR Incentive Program--Stage 1 final rule (75 FR 44314) 
and the EHR Incentive Program--Stage 2 final rule (77 FR 53968). As a 
result of such feedback, we believe that in certain circumstances it 
may be a significant hardship for eligible professionals and group 
practices who are participants of the EHR Incentive Program to comply 
with the successful electronic prescriber requirements of the eRx 
Incentive Program. Therefore, we proposed to revise the regulation at 
Sec.  414.92(c)(2)(ii)(B) (77 FR 44984) to add the following two 
additional significant hardship exemption categories for the 2013 and 
2014 payment adjustments:
---------------------------------------------------------------------------

    \4\ ``Eligible professional'' is defined for the EHR Incentive 
Program at 42 CFR 495.4, 495.100, and 495.304.
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     Eligible professionals or group practices who achieve 
meaningful use during certain eRx payment adjustment reporting periods.

[[Page 69293]]

     Eligible professionals or group practices who demonstrate 
intent to participate in the EHR Incentive Program and adoption of 
Certified EHR Technology.
    The following is a summary of general comments we received 
regarding our proposal to add these two additional significant hardship 
exemption categories for the 2013 and 2014 payment adjustments:
    Comment: One commenter opposed our proposal to add two new 
additional significant hardship exemption categories related to 
participation in the EHR Incentive Program. The commenter notes that 
CMS implemented the eRx Incentive Program in 2009 and eligible 
professionals have had sufficient time in which to make arrangements to 
implement the program. The commenter is concerned these two new 
hardship exemptions may have the unintended consequence of discouraging 
eligible providers' rapid participation in the electronic prescribing 
program.
    Response: We appreciate the commenter's concern and note that it is 
not our intention to discourage participation in the eRx Incentive 
Program through the establishment of these significant hardship 
exemption categories. We note that incentives under the eRx Incentive 
Program are available until 2013 and hope that the potential to earn an 
incentive under the eRx Incentive Program will encourage eligible 
professionals who are not also receiving incentives under the Medicare 
EHR Incentive Program to participate in the eRx Incentive Program.
    With respect to the argument that eligible professionals have had 
adequate time to acquire systems capable for electronic prescribing, we 
note that although the eRx Incentive Program was established in 2009, 
and has transitioned from bonus incentives to payment adjustments 
beginning in 2012, we believe that with the establishment of the EHR 
Incentive Program, which also includes an electronic prescribing 
objective, eligible professionals and group practices choosing to 
participate in the eRx Incentive Program and the EHR Incentive Program 
may have had difficulties with regard to searching for products that 
had the capabilities to meet requirements for both programs. As we 
noted in the proposed rule (77 FR 44984), we received stakeholder 
feedback regarding the difficulties of choosing, purchasing, and 
setting up an EHR system that is capable for use for both programs. 
Therefore, we believe that these significant hardship exemption 
categories are appropriate for eligible professionals and group 
practices such as these.
    Comment: Several commenters supported our proposed two additional 
significant hardship exemption categories related to participation in 
the EHR Incentive Program for the 2013 and 2014 payment adjustments.
    Response: We agree with the commenters' general support of these 
two additional significant hardship exemptions. Therefore, based on the 
comments received and for the reasons stated previously, we are 
finalizing, as discussed in greater detail, these two additional 
significant hardship exemptions related to participation in the EHR 
Incentive Program for the 2013 and 2014 payment adjustments.
a. Eligible Professionals or Group Practices Who Achieve Meaningful Use 
During the 2013 and 2014 Payment Adjustment Reporting Periods
    Under Stage 1 of meaningful use for the EHR Incentive Program, an 
eligible professional is required to meet certain objectives and 
associated measures to achieve meaningful use. One of these objectives 
is for the eligible professional to generate and transmit permissible 
prescriptions electronically, and the measure of whether the eligible 
professional has met this objective is more than 40 percent of all 
permissible prescriptions written by the eligible professional are 
transmitted electronically using Certified EHR Technology (Sec.  
495.6(d)(4)). We note that the EHR Incentive Program and the eRx 
Incentive Program share a common goal of encouraging electronic 
prescribing and the adoption of technology that enables eligible 
professionals to electronically prescribe. This goal is advanced under 
each program via the respective program requirements--the electronic 
prescribing objective under the EHR Incentive Program and the 
requirement that an EP be a ``successful electronic prescriber'' under 
the eRx Incentive Program. Indeed, both programs require that the 
eligible professionals indicate their electronic prescribing activity. 
Under the EHR Incentive Program, an eligible professional must attest 
to the percentage of his or her permissible prescriptions that were 
generated and transmitted electronically using Certified EHR Technology 
during the applicable EHR reporting period, which must exceed 40 
percent. Under the eRx Incentive Program, to avoid the payment 
adjustment, an eligible professional must be a successful electronic 
prescriber, which is achieved by the reporting of the eRx quality 
measure a certain number of instances during the applicable reporting 
period (each instance of reporting of the eRx quality measure, which 
includes reporting of specific quality data codes, signifies that the 
professional generated an electronic prescription for a specified 
service or encounter). In most cases, we believe the electronic 
prescribing objective of meaningful use would be a more rigorous 
standard for eligible professionals to meet than the standard adopted 
under the eRx Incentive Program (as demonstrated via the reporting of 
the eRx quality measure). In addition, there seems to be no added 
benefit with regard to reporting (presumably lower) electronic 
prescribing activity under the eRx Incentive Program given that the 
identical goals (encouraging electronic prescribing) of both programs 
would have been fulfilled through the eligible professional's 
achievement of meaningful use. For those reasons, we believe it may 
pose a significant hardship for eligible professionals who are 
meaningful EHR users to additionally comply with the requirements of 
being a successful electronic prescriber under the eRx Incentive 
program.
    For the reasons stated, under this proposed significant hardship 
category, we proposed that individual eligible professionals (and every 
eligible professional member of a group practice using the eRx GPRO for 
the 2014 payment adjustment only) would need to achieve meaningful use 
of Certified EHR Technology for a continuous 90-day EHR reporting 
period (as defined for the EHR Incentive Program) that falls within the 
6-month reporting period (January 1-June 30, 2012) for the 2013 eRx 
payment adjustment or the 12- or 6-month reporting periods (January 1-
December 31, 2012 or January 1-June 30, 2013, respectively) for the 
2014 eRx payment adjustment to be eligible for this significant 
hardship exemption (77 FR 44985). We also proposed that for purposes of 
the 2013 and 2014 eRx payment adjustments this hardship exemption 
category would apply to individual EPs and group practices (that is, 
every member of the group) who instead achieve meaningful use of 
Certified EHR Technology for an EHR reporting period that is the full 
CY 2012.
    We invited public comment on this proposed significant hardship 
exemption category. The following is a summary of the comments received 
related to the proposed significant hardship exemption category: 
Eligible professionals or group practices who achieve meaningful use 
during the 2013 and 2014 payment adjustment reporting periods.
    Comment: One commenter specifically supported this proposed

[[Page 69294]]

significant hardship exemption category. The commenter noted that 
establishing this significant hardship exemption category will help 
alleviate concerns from eligible professionals and group practices that 
are transitioning their EHR systems.
    Response: We appreciate the commenter's positive feedback and are 
finalizing this significant hardship exemption category.
    Comment: One commenter took exception that this significant 
hardship exemption category would only apply to those eligible 
professionals participating in the EHR Incentive Program for the first 
time. The commenter requested that CMS expand the applicability of this 
significant hardship exemption category to all eligible professionals 
who achieve meaningful use regardless of when an eligible professional 
first participated in the EHR Incentive Program.
    Response: We appreciate the commenter's feedback. This significant 
hardship exemption category was intended to be applicable to eligible 
professionals and group practices who achieve meaningful use during 
certain 2013 and 2014 eRx payment adjustment reporting periods, 
regardless of whether it is the first time the EP (or EPs in a group 
practice) achieves meaningful use under the EHR Incentive Program. 
Therefore, we clarify that this significant hardship exemption category 
will apply regardless of whether an EP has previously achieved 
meaningful use under the EHR Incentive Program.
    Comment: Some commenters suggested that this significant hardship 
exemption category include EPs who have achieved meaningful use in 
2011, 2012, and 2013.
    Response: We appreciate the commenters' feedback. We proposed that 
individual EPs or EPs within a group practice would be eligible for 
this significant hardship exemption category if the eligible 
professionals achieve meaningful use for an EHR reporting period that 
falls within (1) the 6-month 2013 payment adjustment reporting period 
(January 1-June 30, 2012) for the 2013 payment adjustment and/or (2) 
the 12-month (January 1-December 31, 2012) or 6-month (January 1-June 
30, 2013) 2014 payment adjustment reporting period for the 2014 payment 
adjustment. We also proposed that for the 2013 and 2014 payment 
adjustments, individual EPs or EPs within a group practice would be 
eligible for this significant hardship exemption category if they 
achieve meaningful use for an EHR reporting period that is the full CY 
2012. As such, our proposal covers those EPs who achieved meaningful 
use under the EHR Incentive Program in 2012 and the first 6 months of 
2013. For expanding this significant hardship exemption category to 
cover EPs who have achieved meaningful use in 2011, we understand the 
desire for EPs who achieved meaningful use in 2011 to be exempt from 
the 2013 payment adjustment. Since 2011 was the 12-month payment 
adjustment reporting period for the 2013 payment adjustment, and as 
proposed this significant hardship exemption category would cover EPs 
who achieve meaningful use during the 12- and 6-month payment 
adjustment reporting periods for the 2014 payment adjustment, for the 
reasons previously stated for proposing this significant hardship 
category, we will extend this category to include individual EPs and 
EPs within a group practice who achieve meaningful use under the EHR 
Incentive Program for an EHR reporting period that fell within 2011 
(that is, during the 12-month 2013 payment adjustment reporting 
period).
    We cannot expand this significant hardship exemption category for 
the 2014 payment adjustment to include eligible professionals who 
achieve meaningful use during the last 6 months of 2013 (July 1, 2013-
December 31, 2013) because the last 6 months of 2013 do not coincide 
with the 2014 payment adjustment reporting period.
    Based on the comments received and for the reasons previously 
stated, we are finalizing this significant hardship exemption 
category--eligible professionals or group practices who achieve 
meaningful use during the 2013 and 2014 payment adjustment reporting 
periods--as follows: To qualify for a significant hardship exemption 
under this category for the 2013 payment adjustment, an eligible 
professional (or every eligible professional in a group practice 
participating in the eRx GPRO for the 2013 payment adjustment) must 
have achieved meaningful use of Certified EHR Technology under the EHR 
Incentive Program for a continuous 90-day EHR reporting period that 
fell within the 12-month (January 1, 2011-December 31, 2011) or 6-month 
(January 1, 2012-June 30, 2012) payment adjustment reporting period or 
for an EHR reporting period that is the full CY 2012. To qualify for a 
significant hardship exemption under this category for the 2014 payment 
adjustment, an eligible professional (or every eligible professional in 
a group practice participating in the eRx GPRO) must achieve meaningful 
use of Certified EHR Technology under the EHR Incentive Program for a 
continuous 90-day EHR reporting period that falls within the 12-month 
(January 1, 2012-December 31, 2012) or 6-month (January 1, 2013-June 
30, 2013) payment adjustment reporting period or for an EHR reporting 
period that is the full CY 2012.
b. Eligible Professionals or Group Practices Who Demonstrate Intent To 
Participate in the EHR Incentive Program and Adoption of Certified EHR 
Technology
    We note that we finalized at Sec.  414.92(c)(2)(ii)(A)(3) a 
significant hardship exemption category for the 2012 eRx payment 
adjustment, under which eligible professionals and group practices 
seeking consideration for an exemption were required to register to 
participate in the EHR Incentive Program and adopt CEHRT (76 FR 54958). 
That significant hardship category addressed significant hardships 
relating to the selection, purchase and adoption of eRx technology (for 
example, potential significant financial hardship of purchasing two 
sets of eRx equipment for both programs) that may have occurred as a 
result of the timing of the release of the standards and requirements 
for CEHRT and the Certified Health IT Product List, the establishment 
of the respective program requirements for the eRx and EHR Incentive 
Programs, and the 2012 eRx payment adjustment reporting periods. Given 
that eligible professionals have had adequate time to identify EHR 
products that have been certified and that the requirements for these 
programs have been implemented and, various stages of reporting are 
underway, we do not believe this significant hardship exemption 
category would continue to be applicable for the 2013 and 2014 eRx 
payment adjustments. We understand, however, that although an eligible 
professional may now have the requisite information about requirements 
for CEHRT and each respective program, there may nevertheless exist a 
significant hardship with regard to compliance with the requirements 
for being a successful electronic prescriber under the eRx Incentive 
Program, given the nature of CEHRT and how it is used/implemented in 
one's practice.
    When an eligible professional or eligible professional in a group 
practice first adopts CEHRT, we understand significant changes may be 
required with regard to how the eligible professional's practice 
operates. Further, necessary steps are involved in fully implementing 
CEHRT once it has been adopted, including: Installation, configuration, 
customization, training, workflow redesign and the establishment of 
connectivity with entities that facilitate electronic health

[[Page 69295]]

information exchange (such as for electronic prescriptions). Thus, we 
believe it would be difficult for an eligible professional or eligible 
professional in a group practice who has adopted CEHRT to be able to 
begin electronically prescribing on day one. Rather, we expect a 
natural lag time would likely occur between an eligible professional's 
adoption of CEHRT and the point at which CEHRT has been fully 
implemented such that an eligible professional could begin 
electronically prescribing. We believe this implementation timeline may 
pose a significant hardship for an eligible professional or group 
practice who seeks to comply with the requirements for being a 
successful electronic prescriber under the eRx Incentive Program and 
also participate for the first time in the EHR Incentive Program. Under 
the EHR Incentive Program, an eligible professional who is 
demonstrating meaningful use of CEHRT for the first time must do so for 
any continuous 90-day period within the calendar year (the ``EHR 
reporting period''). In the absence of this significant hardship 
exemption category, eligible professionals or group practices who 
choose a 90-day EHR reporting period that falls later in the year may 
potentially have to adopt two systems (for example, a stand-alone 
electronic prescribing system for purposes of participating in the eRx 
Incentive Program, and CEHRT for purposes of participating in the EHR 
Incentive Program), which could be financially burdensome. 
Alternatively, such eligible professionals who wish to use CEHRT for 
purposes of participating in both programs may potentially have to 
adopt and implement CEHRT well in advance of their 90-day EHR reporting 
period to meet an earlier reporting period for the eRx Incentive 
Program.
    Therefore, for the 2013 and 2014 payment adjustments, we proposed a 
significant hardship exemption category to address this situation (77 
FR 44985). We believe, however, that for this category it is necessary 
for eligible professionals and group practices to show they intend to 
participate in the EHR Incentive Program for the first time and have 
adopted CEHRT. Therefore, to be eligible for consideration for an 
exemption under this proposed significant hardship exemption category 
for the 2013 and 2014 payment adjustments, we proposed that eligible 
professionals or group practices must register to participate in the 
Medicare or Medicaid EHR Incentive Programs and adopt CEHRT by a date 
specified by CMS. We further note that, given the nature of the 
significant hardship at issue under this category, this proposal would 
be limited to eligible professionals and group practices (that is, 
every individual eligible professional of the group practice): (1) Who 
have not previously adopted CEHRT or received an incentive payment 
under the Medicare or Medicaid EHR Incentive Programs; and (2) who 
attempt to participate in the Medicare or Medicaid EHR Incentive 
Programs from January 2, 2012 through October 15, 2012, or the 
effective date of the final rule (which includes the 6-month 2013 eRx 
payment adjustment reporting period of January 1, 2012-June 30, 2012) 
for the 2013 eRx payment adjustment, or during the 6-month payment 
adjustment reporting period for the 2014 eRx payment adjustment 
(January 1, 2013 through June 30, 2013).
    For eligible professionals or group practices who intend to adopt 
EHR technology in the future or have not yet taken the steps required 
to apply for this significant hardship exemption, we believe that mere 
intent to adopt CEHRT or attest at a later date does not sufficiently 
demonstrate that an eligible professional will adopt CEHRT to 
participate in the Medicare or Medicaid EHR Incentive Programs. Unlike 
those eligible professionals who would have registered for the Medicare 
or Medicaid EHR Incentive Programs and have adopted CEHRT available for 
immediate use, we would have to monitor and provide oversight over 
those eligible professionals who have not yet taken these steps to 
participate in the Medicare or Medicaid EHR Incentive Programs. We also 
do not believe that such eligible professionals or group practices 
would necessarily be facing a significant hardship as contemplated in 
this proposed exemption category. Accordingly, all of the proposed 
requirements to qualify for an exemption under this significant 
hardship exemption category would need to be met by the time the 
eligible professional requests an exemption. In section III.H1.5.b. 
below, we discuss the proposed deadlines and procedures for requesting 
consideration of an exemption under this proposed significant hardship 
exemption category.
    We invited public comment on this proposed significant hardship 
exemption category for the 2013 and 2014 payment adjustments. The 
following is a summary of the comments received specific to this 
proposed significant hardship exemption category: Eligible 
professionals or group practices who demonstrate intent to participate 
in the EHR Incentive Program and adoption of Certified EHR Technology.
    Comment: One commenter suggested that this significant hardship 
exemption category apply to eligible professionals who register for the 
EHR Incentive Program in 2011, 2012, and 2013.
    Response: This significant hardship exemption category does not 
apply to eligible professionals who in 2011 demonstrated intent to 
participate in the EHR Incentive Program and adopted Certified EHR 
Technology. We note that this significant hardship exemption category 
was intended to apply to eligible professionals and group practices 
dealing with issues related to fully implementing CEHRT once it has 
been adopted, including: Installation, configuration, customization, 
training, workflow redesign and the establishment of connectivity with 
entities that facilitate electronic health information exchange (such 
as for electronic prescriptions). We believe these eligible 
professionals and group practices who adopted CEHRT and demonstrated 
intent to participate in the EHR Incentive Program in 2011 would have 
had ample time to fully implement their CEHRT in time for the payment 
adjustment reporting periods for the 2013 and 2014 payment adjustments. 
Therefore, this significant hardship exemption category does not apply 
to eligible professionals or group practices that adopted CEHRT and 
demonstrated intent to participate in the EHR Incentive Program in 
2011.
    For the 2013 payment adjustment, it was our intent to apply this 
significant hardship exemption category to eligible professionals or 
group practices that adopt CEHRT as well as demonstrate intent to 
participate in the EHR Incentive Program during a certain timeframe in 
2012. We proposed that, for the 2013 payment adjustment, an eligible 
professional would be required to meet the qualifications for this 
significant hardship exemption category by October 15, 2012 or the 
effective date of this final rule, whichever is later.
    For the 2014 payment adjustment, it was our intent to apply this 
significant hardship exemption category to eligible professionals or 
group practices that adopt CEHRT, as well as demonstrate intent to 
participate in the EHR Incentive Program during a certain timeframe in 
2013. We proposed that an eligible professional would be required to 
meet the qualifications for this significant hardship exemption 
category by the end of the 6-month 2014 payment adjustment reporting 
period (January 1, 2013-June 30, 2013). We established this deadline as 
it coincides with the deadline for requesting exemptions

[[Page 69296]]

under the four previously established significant hardship exemption 
categories. Therefore, we decline to extend this significant hardship 
exemption category beyond June 30, 2013.
    Based on the comments received and for the reasons stated above, we 
are finalizing this significant hardship exemption category--eligible 
professionals or group practices who demonstrate intent to participate 
in the EHR Incentive Program and adoption of Certified EHR Technology. 
However, to provide CMS with additional time to gather information on 
who qualifies for a significant hardship exemption under this category, 
we are extending the proposed deadline. For the 2013 payment 
adjustment, this significant hardship exemption category would apply to 
eligible professionals (or every eligible professional in a group 
practice participating in the eRx GPRO) who demonstrate intent to 
participate in the EHR Incentive Program by registering for the program 
between January 2, 2012 and January 31, 2013 and adopt Certified EHR 
Technology. We note that eligible professionals who achieved meaningful 
use of Certified EHR Technology under the EHR Incentive Program for an 
EHR reporting period that ended on or before June 30, 2012, or for an 
EHR reporting period that is the full CY 2012, are not eligible for 
this significant hardship exemption category (nor is a group practice 
participating in the eRx GPRO eligible if any of its member eligible 
professionals achieved meaningful use during those timeframes).
    For the 2014 payment adjustment, this significant hardship 
exemption category applies to eligible professionals (or every eligible 
professional in a group practice participating in the eRx GPRO) who 
demonstrate intent to participate in the EHR Incentive Program by 
registering for the program between January 1, 2013 and June 30, 2013 
and adopting Certified EHR Technology. Eligible professionals who 
achieve meaningful use of Certified EHR Technology under the EHR 
Incentive Program for an EHR reporting period that ends on or before 
June 30, 2013, or for an EHR reporting period that is the full CY 2013, 
are not eligible for this significant hardship exemption category (nor 
is a group practice participating in the eRx GPRO eligible if any of 
its member eligible professionals achieve meaningful use during those 
timeframes). Please note that, should the deadline for submitting 
requests for the four previously established significant hardship 
exemption categories be extended for any reason, it is our intent that 
the deadline for this significant hardship exemption category would be 
extended accordingly with all other significant hardship exemption 
categories to the 2014 payment adjustment.
c. Deadlines and Procedures for Requesting Significant Hardship 
Exemptions
    In the CY 2012 final rule with comment period, we established a 
process whereby eligible professionals would submit significant 
hardship exemptions for the existing significant hardship exemption 
categories for the eRx payment adjustments (76 FR 54963). 
Unfortunately, for submitting these proposed significant hardship 
exemptions for the 2013 payment adjustment, it would not be 
operationally feasible to accept significant hardship exemption 
requests in the manner we previously established. Therefore, we 
proposed that, to request a significant hardship under the two proposed 
significant hardship exemption categories for the 2013 eRx payment 
adjustment, CMS would analyze the information provided to us in the 
Registration and Attestation System under the EHR Incentive Program to 
determine whether the eligible professional or group practice (that is, 
every EP member of the group practice) has either (1) achieved 
meaningful use under the EHR Incentive Program during the applicable 
reporting periods we noted previously, or (2) registered to participate 
in the EHR Incentive Program via the Registration and Attestation 
system for the EHR Incentive Program (located at https://ehrincentives.cms.gov/hitech/login.action) and adopted CEHRT, or both, 
if applicable. We understand that providing an eligible professional's 
CEHRT product number is an optional field in the Registration Page. We 
noted that if requesting a significant hardship exemption under 
proposed category 2, the eligible professional must provide its CEHRT 
product number when registering for the EHR Incentive Program. In the 
event that it is not operationally feasible to accept this information 
via the Registration and Attestation system for the EHR Incentive 
Program, we proposed that we would accept requests for significant 
hardship exemptions under these two proposed categories via a mailed 
letter to CMS to the following address: Centers for Medicare & Medicaid 
Services, Office of Clinical Standards and Quality, Quality Measurement 
and Health Assessment Group, 7500 Security Boulevard, Mail Stop S3-02-
01, Baltimore, MD 21244-1850.
    We also proposed that eligible professionals would be required to 
submit this significant hardship request by October 15, 2012 or the 
effective date of the final rule for this provision, whichever is 
later. For those eligible professionals who request a significant 
hardship exemption based on achieving meaningful use under the EHR 
Incentive Program during the 12- or 6-month reporting periods for the 
2013 payment adjustment, we also proposed that the eligible 
professional would be required to have attested under the EHR Incentive 
Program by October 15th of 2012 (or if later, the effective date of the 
final rule), to qualify for a significant hardship exemption for the 
2013 payment adjustment. For those eligible professionals requesting a 
significant hardship exemption for the 2013 eRx payment adjustment 
under the second proposed significant hardship exemption category (that 
is, intent to participate in the EHR Incentive Program and adoption of 
CEHRT), we proposed that these eligible professionals who intend to 
participate in the EHR Incentive Program from January 1, 2011 through 
October 15, 2012 or the effective date of the final rule would be 
required to register for the EHR Incentive Program and adopt CEHRT by 
the same deadline noted above, to qualify for a significant hardship 
exemption for the 2013 payment adjustment. We note that we proposed a 
later deadline of October 15, 2012 (or the effective date of the final 
rule, if later) for the submission of these requests because the 
deadline for submitting requests under other previously established 
significant hardship exemption categories to the 2013 eRx payment 
adjustment (June 30, 2012) has passed and other similar dates we might 
choose would likely have passed by the time the final rule is 
effective.
    For submitting exemption requests for the two significant hardship 
exemption categories for the 2014 payment adjustment, we proposed the 
following method for submitting a request for a significant hardship 
exemption: Via the Communication Support Page (which is the method 
established for submitting the established significant hardship 
exemption categories).
    In addition, we considered accepting significant hardship exemption 
requests for the two proposed significant hardship exemption categories 
for the 2014 payment adjustment by CMS receiving eligible 
professionals' information through the Registration and Attestation 
System for the EHR Incentive Program (similar to our proposed 
submission process for the

[[Page 69297]]

2013 payment adjustment) and via a mailed letter to CMS using the 
following address: Centers for Medicare & Medicaid Services, Office of 
Clinical Standards and Quality, Quality Measurement and Health 
Assessment Group, 7500 Security Boulevard, Mail Stop S3-02-01, 
Baltimore, MD 21244-1850. We invited public comment on these considered 
submission options.
    We proposed that the deadline for submitting these significant 
hardship exemption requests for the 2014 payment adjustment would be 
June 30, 2013, which is the same deadline established for submitting a 
significant hardship exemption request for the existing significant 
hardship exemption categories. Additionally, and consistent with our 
proposal for the 2013 payment adjustment, we proposed that an eligible 
professional or group practice (that is, all members of the practice) 
that achieves meaningful use under the EHR Incentive Program during the 
6- or 12-month reporting periods for the 2014 payment adjustment would 
be required to attest by June 30, 2013. Similarly, for eligible 
professionals requesting a significant hardship exemption for the 2014 
payment adjustment under the second proposed significant hardship 
exemption category (that is, intent to participate in the EHR Incentive 
Program and adoption of CEHRT), we proposed that eligible professionals 
who intend to participate in the EHR Incentive Program during the last 
6 months of 2013 would be required to register for the EHR Incentive 
Program and adopt CEHRT by June 30, 2013, to qualify for a significant 
hardship exemption for the 2014 payment adjustment. We noted that we 
understood that these deadlines may exclude some eligible professionals 
who attested or registered for the EHR Incentive Program at later 
dates, but these deadlines were necessary to avoid the reprocessing of 
claims. We note, however, that these proposed deadlines would not 
extend any deadlines applicable under the EHR Incentive Program. That 
is, for purposes of the EHR Incentive Program, an eligible professional 
would still be required to attest to being a meaningful user by the 
deadline established under the EHR Incentive Program, even if such 
deadline fell prior to the proposed eRx Incentive program significant 
hardship exemption deadline.
    We noted that we only proposed submission of requests for 
significant hardship exemptions under these two categories under an 
individual eligible professional level only because it is not 
technically feasible for us to operationally analyze information on the 
EHR Incentive Program's Registration and Attestation page using the 
TIN, as the information stored in this system is stored by NPI. 
However, we stated we would not preclude eligible professionals in an 
eRx GPRO for 2012 from submitting requests for significant hardship 
exemptions under these two categories. Therefore, to allow the 
submission of significant hardship requests for the 2013 eRx payment 
adjustment under these two proposed categories, we proposed that 
eligible professionals within an eRx GPRO must each request a 
significant hardship exemption under these two categories.
    We invited public comment on this proposed process for submitting 
significant hardship exemption requests under these two proposed 
categories. The following is a summary of the comments received related 
to these proposals.
    Comment: Several commenters requested that CMS utilize information 
contained in the EHR Incentive Program's Registration and Attestation 
page to determine who would qualify for the two additional significant 
hardship exemption categories for the 2013 and 2014 payment adjustment. 
Another commenter recommended that the process for requesting a 
significant hardship exemption under these two categories be 
streamlined. One commenter requested that CMS provide as many options 
as possible for eligible professionals to submit requests for 
significant hardship exemptions under the two proposed categories. One 
commenter suggested that requests be submitted electronically, not via 
U.S. mail. Overall, most commenters believe that using information 
already collected by CMS from the EHR Incentive Program's Registration 
and Attestation page to exempt eligible professionals from the 2013 and 
2014 payment adjustment would reduce burden on eligible professionals 
and group practices as they would not be required to actively request a 
significant hardship exemption via the web.
    Response: We agree that basing applicability of these two 
significant hardship exemption categories on information collected from 
the EHR Incentive Program's Registration and Attestation page for the 
2013 and 2014 payment adjustments would relieve burden on eligible 
professionals as they would not be required to actively request a 
significant hardship exemption via the web. Based on the comments 
received, we are finalizing our proposal to use information collected 
from the EHR Incentive Program's registration and attestation page to 
exempt eligible professionals from the 2013 payment adjustment under 
these two additional significant hardship exemption categories. In 
addition, based on the comments received, we will use this same method 
to exempt eligible professionals from the 2014 payment adjustment under 
these two additional significant hardship exemption categories rather 
than requiring eligible professionals to request exemptions under these 
two significant hardship exemption categories via the web. We are not 
finalizing any other options for requesting an exemption under these 
two categories, because we believe that this method is the most 
efficient way to exempt eligible professionals. We note that we are 
able to internally analyze this data for the two additional significant 
hardship exemption categories, and not the other previously established 
four significant hardship exemption categories, because, unlike the 
previous four categories, CMS already has access to the information 
needed under the EHR Incentive Program's Registration and Attestation 
page to make our determination on whether an eligible professional 
should be exempt from the 2013 and/or 2014 payment adjustments under 
these two significant hardship exemption categories.
    Comment: Some commenters requested that CMS extend the proposed 
deadline to submit requests for significant hardship exemptions under 
these two additional categories. One commenter requested that eligible 
professionals and group practices be allowed at least 90 days to submit 
such a request. Other commenters suggested a deadline of October 31, 
2012 to apply exemptions under these two proposed significant hardship 
exemptions for the 2013 payment adjustment. In addition, since the 
proposed deadlines for qualifying for these two additional significant 
hardship exemption categories are later than the established deadline 
for the four previously established significant hardship exemption 
categories, the commenter requested that the deadline for requesting 
exemptions under the four previously established significant hardship 
exemption categories be extended to coincide with the established 
deadline for these two additional significant hardship categories.
    Response: For applying these two proposed significant hardship 
exemptions for the 2013 payment adjustment, we proposed a deadline of 
October 15, 2012 or the effective date of the rule, whichever is later. 
Since our proposed deadline date of October 15,

[[Page 69298]]

2012 as well as the commenter's proposed deadline date of October 31, 
2012 has passed, we considered finalizing our proposed deadline of the 
effective date of the CY 2013 Medicare PFS final rule. However, it is 
our understanding that certain eligible professionals that achieve 
meaningful use may have until February 28 of the following year to 
attest that they met the CQM component of achieving meaningful use. 
Although it is not practically feasible to extend the deadline for 
qualifying for the first significant hardship exemption category 
(related to achieving meaningful use under the EHR Incentive Program) 
due to the need to minimize the reprocessing of claims, it is feasible 
to extend the deadline for qualifying for this significant hardship 
exemption category to January 31, 2013. To afford eligible 
professionals with more time to qualify for this exemption, we are 
therefore finalizing a deadline of January 31, 2013 to qualify for this 
significant hardship exemption category related to achieving meaningful 
use under the EHR Incentive Program. So that the deadlines for 
qualifying for these two additional significant hardship exemptions 
coincide, we are also finalizing a deadline of January 31, 2013 to 
qualify for the second significant hardship exemption category related 
to demonstrating intent to participate in the EHR Incentive Program. 
Therefore, for the 2013 payment adjustment, eligible professionals must 
qualify for consideration under these two additional significant 
hardship exemption categories by January 31, 2013.
    We received no public comment regarding the proposed deadline for 
qualifying for an exemption under these two additional significant 
hardship exemption categories for the 2014 payment adjustment. Based on 
the reasons stated previously, we are finalizing this proposal. We 
note, however, that in the event that the deadlines for requesting a 
significant hardship exemption under the four previously established 
exemption categories are extended, we intend to extend this deadline to 
coincide with the deadline for requesting exemptions under these other 
four categories. Additionally, we may extend this deadline should we 
run into operational concerns, such as receiving data from the EHR 
Incentive Program's Registration and Attestation page.
    With respect to extending the deadline to submit exemption requests 
under the four previously established significant hardship exemption 
categories for the 2013 payment adjustment, we will allow the extension 
of the deadline to request exemptions under these four previously 
established exemption categories to January 31, 2013. We finalized a 
deadline of June 30, 2012 to submit requests for exemptions under these 
four significant hardship categories primarily to avoid having to 
reprocess claims. Since we are extending this deadline to January 31, 
2013, we anticipate that, in some cases, particularly in instances 
where eligible professionals submit significant hardship exemption 
requests closer towards the deadline, we may not be able to complete 
our review of the requests before the claims processing systems updates 
are made to begin reducing eligible professionals' and group practices' 
PFS amounts in 2013. In such cases, if we ultimately approve the 
eligible professional or group practice's request for a significant 
hardship exemption after January 1, 2013, we would need to reprocess 
all claims for services furnished up to that point in 2013 that were 
paid at the reduced PFS amount, which we anticipate may take several 
months. To avoid the reprocessing of claims, we encourage eligible 
professionals who would be submitting a significant hardship exemption 
request under these four significant hardship exemption categories to 
do so as soon as possible, rather than waiting until the deadline to 
submit such a request.
    We note that we would like to be able to process all such requests 
before we begin making the claims processing systems changes to adjust 
eligible professionals' or group practices' payments starting on 
January 1, 2013 or 2014. However, we anticipate that, in some cases, 
particularly in instances where eligible professionals submit 
significant hardship exemption requests closer towards the deadline, we 
may not be able to complete our review of the requests before the 
claims processing systems updates are made to begin reducing eligible 
professionals' and group practices' PFS amounts in 2013. In such cases, 
if we ultimately approve the eligible professional or group practice's 
request for a significant hardship exemption after January 1, 2013 or 
2014, we would need to reprocess all claims for services furnished up 
to that point in 2013 that were paid at the reduced PFS amount, which 
we anticipate may take several months. To avoid the reprocessing of 
claims, we encourage eligible professionals who would be submitting a 
significant hardship exemption request under these two categories to do 
so as soon as possible, rather than waiting until the deadline to 
submit such a request.
    Tables 125 and 126 provide a summary of the significant hardship 
exemption categories that are available to eligible professionals and 
group practices for the 2013 and 2014 payment adjustments.

                           Table 125--Summary of Significant Hardship Exemption Categories for the 2013 eRx Payment Adjustment
--------------------------------------------------------------------------------------------------------------------------------------------------------
 Significant hardship exemption category                   Method of submission                          Deadline for submitting exemption request
--------------------------------------------------------------------------------------------------------------------------------------------------------
The eligible professional or group        Web-based Communication Support Page..................  Extended to January 31, 2013.
 practice practices in a rural area with
 limited high speed internet access.
The eligible professional or group        Web-based Communication Support Page..................  Extended to January 31, 2013.
 practice practices in an area with
 limited available pharmacies for
 electronic prescribing.
The eligible professional or group        Web-based Communication Support Page..................  Extended to January 31, 2013.
 practice is unable to electronically
 prescribe due to local, state, or
 Federal law or regulation.
The eligible professional or group        Web-based Communication Support Page..................  Extended to January 31, 2013.
 practice has limited prescribing
 activity, as defined by an eligible
 professional generating fewer than 100
 prescriptions during a 6-month
 reporting period.
* Eligible professionals or group         EHR Incentive Program's Registration and Attestation    January 31, 2013.
 practices who achieve meaningful use      Page.
 during the 2013 12- and 6-month eRx
 payment adjustment reporting periods
 (that is, January 1, 2011-June 30,
 2012).

[[Page 69299]]

 
* Eligible professionals or group         EHR Incentive Program's Registration and Attestation    January 31, 2013.
 practices who demonstrate intent to       Page.
 participate in the EHR Incentive
 Program and adoption of Certified EHR
 Technology.
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Eligible professionals participating in the eRx Incentive Program under the eRx GPRO are eligible for these significant hardship exemption categories.
  However, each eligible professional in the eRx GPRO wishing to have this exemption applied must individually have provided the requisite information
  on the EHR Incentive Program's Registration and Attestation page.


                           Table 126--Summary of Significant Hardship Exemption Categories for the 2014 eRx Payment Adjustment
--------------------------------------------------------------------------------------------------------------------------------------------------------
 Significant hardship exemption category                   Method of submission                          Deadline for submitting exemption request
--------------------------------------------------------------------------------------------------------------------------------------------------------
The eligible professional or group        Web-based Communication Support Page..................  June 30, 2013.
 practice practices in a rural area with
 limited high speed internet access.
The eligible professional or group        Web-based Communication Support Page..................  June 30, 2013.
 practice practices in an area with
 limited available pharmacies for
 electronic prescribing.
The eligible professional or group        Web-based Communication Support Page..................  June 30, 2013.
 practice is unable to electronically
 prescribe due to local, state, or
 Federal law or regulation.
The eligible professional or group        Web-based Communication Support Page..................  June 30, 2013.
 practice has limited prescribing
 activity, as defined by an eligible
 professional generating fewer than 100
 prescriptions during a 6-month
 reporting period.
* Eligible professionals or group         EHR Incentive Program's Registration and Attestation    June 30, 2013.
 practices who achieve meaningful use      Page.
 during the 2014 12- and 6-month eRx
 payment adjustment reporting periods
 (that is, January 1, 2012-June 30,
 2013).
* Eligible professionals or group         EHR Incentive Program's Registration and Attestation    June 30, 2013.
 practices who demonstrate intent to       Page.
 participate in the EHR Incentive
 Program and adoption of Certified EHR
 Technology.
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Eligible professionals participating in the eRx Incentive Program under the eRx GPRO are eligible for these significant hardship exemption categories.
  However, each eligible professional in the eRx GPRO wishing to have this exemption applied must individually have provided the requisite information
  on the EHR Incentive Program's Registration and Attestation page.

6. Informal Review
    To better facilitate issues surrounding the issuance of incentives 
and payment adjustments, we proposed to establish an informal review 
process for the eRx Incentive Program (77 FR 44987). We proposed an 
informal review process similar to the informal review process 
established for the PQRS (76 FR 73390), because eligible professionals 
and group practices are already familiar with this process. We proposed 
the informal review process would only be available for the 2013 
incentive payments and the 2014 payment adjustment.
    For an informal review regarding the 2013 incentive, we proposed 
that an eligible professional or group practice must request an 
informal review within 90 days of the release of his or her feedback 
report, irrespective of when an eligible professional or group practice 
actually accesses his/her feedback report.
    For an informal review regarding the 2014 payment adjustment, we 
proposed that an eligible professional or group practice must request 
an informal review by January 31, 2013 (77 FR 44988). We believed this 
deadline would provide ample time for eligible professionals and group 
practices to discover that their respective claims are being adjusted 
due to the 2014 payment adjustment and seek informal review.
    We proposed that the request be submitted in writing and summarize 
the concern(s) and reasons for requesting an informal review. In his or 
her request for an informal review, an eligible professional may also 
submit other information to assist in the review. We proposed that an 
eligible professional may request an informal review through the web. 
We believe use of the web would provide a more efficient way for CMS to 
record informal review requests, as the web would guide the eligible 
professional through the creation of an informal review requests. For 
example, the web-based tool would prompt an eligible professional of 
any necessary information he or she must provide. Should it be 
technically not feasible to receive requests for informal reviews via 
the web, we proposed that an eligible professional would be able to 
request an informal review via email (77 FR 44988).
    We further proposed that we would make our determination and 
provide the eligible professional or group practice with a written 
response to his or her request for an informal review within 90 days of 
receiving the request.
    Based on our informal review and once we have made a determination, 
we proposed that we would provide the eligible professional or group 
practice a written response. Where we find that the eligible 
professional or group practice did successfully report for the 2013 
incentive, we would provide the eligible professional or group practice 
with the applicable incentive payment. Where we find that the eligible 
professional or group practice did successfully report (that is, meet 
criteria for being a successful electronic prescriber) for purposes of 
the 2014 payment adjustment, we would cease application of the 2014 
payment adjustment and reprocess all claims that have been adjusted. We 
further proposed that decisions based on the informal review would be 
final, and there would be no further review or appeal.
    We invited public comment on our proposals for the eRx Incentive 
Program informal review process for the 2013 incentive and the 2014 
payment adjustment. The following is a summary of comments we received 
on these proposals:
    Comment: Several commenters supported our proposal to establish an 
informal review process for the 2013

[[Page 69300]]

incentive and 2014 payment adjustment.
    Response: We appreciate the commenters' feedback and are finalizing 
our proposal to establish an informal review process for the 2013 
incentive and 2014 payment adjustment.
    Comment: One commenter urged CMS to create a more formal appeals 
process that provides eligible professionals with concurrent feedback 
on reporting.
    Response: We appreciate the commenter's feedback. We note that the 
informal review process we have proposed has deadlines and a process 
similar to formal review processes. We believe the informal review 
process we are establishing is appropriate for this program and is an 
adequate venue for eligible professionals and group practices to seek a 
review of their eRx incentive or payment adjustment applicability. With 
respect to providing concurrent feedback on reporting, for the 2012 and 
2013 incentives, feedback reports will be available to eligible 
professionals and group practices prior to the start of the informal 
review process. With respect to the 2013 and 2014 payment adjustments, 
with respect to reporting during the 12-month 2013 and 2014 payment 
adjustment reporting periods (that is, January 1, 2011-December 31, 
2011 and January 1, 2012-December 31, 2012 respectively), we note that 
these feedback reports, which are the same feedback reports given for 
the 2011 and 2012 incentives respectively, will be provided prior to 
the start of the informal review process. While it may not be 
technically feasible to have feedback reports for the 6-month 2013 and 
2014 payment adjustment reporting periods (that is, January 1, 2012-
June 30, 2012 and January 1, 2013-June 30, 2013 respectively), we note 
that we anticipate that payment adjustment status notifications to 
eligible professionals who report the electronic prescribing measure 
will be made available prior to the start of the informal review 
process.
    Comment: One commenter urged that we align the PQRS and eRx 
informal review processes.
    Response: To the extent possible, it is our intention to align the 
informal review processes for the eRx Incentive Program and PQRS. We 
established the same deadline for requesting an informal review under 
the eRx Incentive Program and PQRS. However, we stress that these two 
programs are separate and require separate methods of review. For 
example, the eRx Incentive Program involves the reporting of one 
measure, whereas PQRS involves the reporting of hundreds of measures. 
Therefore, the PQRS informal review process would require more 
intensive resources than the eRx Incentive Program's informal review 
process.
    Comment: In addition to supporting our proposal to establish an 
informal review process for the 2013 eRx incentive and 2014 eRx payment 
adjustment, some commenters urged us to establish a similar informal 
review process for the 2012 eRx incentive and 2012 and 2013 eRx payment 
adjustments. The commenters believed that extending this informal 
review process would allow eligible professionals or group practices 
who have had administrative, operational, or technological issues to 
present their case to CMS.
    Response: We understand the desire to establish a similar informal 
review process for the 2012 eRx incentive and 2012 and 2013 eRx payment 
adjustments. As for establishing an informal review process for the 
2012 eRx payment adjustment, we note that we have already reviewed 
cases where an eligible professional or group practice has sought a 
review of their 2012 eRx payment adjustment applicability. We also note 
that it is not operationally feasible to establish an informal review 
process for the 2012 eRx payment adjustment until 2013, after the 
cessation of the application of the 2012 eRx payment adjustment for 
eligible professionals who were not successful electronic prescribers. 
However, we believe it will be operationally feasible to establish an 
informal review process for the 2012 eRx incentive and 2013 eRx payment 
adjustment. Therefore, we are finalizing an informal review process for 
the 2012 and 2013 eRx incentives and 2013 and 2014 eRx payment 
adjustments. The process and deadlines for the informal review process 
for the 2012 eRx incentive and 2013 eRx payment adjustment will mirror 
our established process and deadlines for the 2013 eRx incentive and 
2014 eRx payment adjustment.
    Comment: Some commenters recommended that eligible professionals be 
given until March 31, 2014 to request an informal review relating to 
issues surrounding the 2012 and 2013 eRx incentives and 2012, 2013 and 
2014 eRx payment adjustments. The commenters noted that eligible 
professionals and group practices need ample time to keep up with 
informal review deadlines that vary from program to program.
    Response: We understand the need to provide eligible professionals 
with ample time to learn about the informal review process. However, it 
is not operationally feasible to establish an informal review request 
deadline of March 31, 2014 for the 2012 and 2013 eRx incentives and 
2012, 2013, and 2014 eRx payment adjustments. This would be overly 
burdensome and costly for CMS, as CMS would then have to potentially 
process claims from 2012-2014 for those who receive a favorable 
decision. To minimize the reprocessing of claims, the informal review 
process (which includes the time for submitting a request as well as 
the processing time to review these requests) would need to occur 
within the year the eligible professional or group practice's payments 
are being adjusted (for example, in 2013 for the 2013 payment 
adjustment). However, we believe it is feasible to extend the deadline 
for requesting an informal review past January 31. Therefore, we are 
finalizing a deadline of February 28, 2013 to request an informal 
review related to issues surrounding the 2012 eRx incentive and 2013 
eRx payment adjustment. We are finalizing a deadline of February 28, 
2014 to request an informal review related to issues surrounding the 
2013 eRx incentive and 2014 eRx payment adjustment. Please note that 
February 28 is the same deadline we established for the PQRS payment 
adjustment informal review process, thereby alleviating the issue of 
eligible professionals and group practices needing to keep up with 
different informal review request deadlines.
    Comment: Some commenters supported our proposal to receive informal 
review requests via the web.
    Response: We appreciate the commenter's feedback. Unfortunately, it 
is not technically feasible for us to accept informal review requests 
via an online tool. However, we believe that accepting informal review 
requests electronically will be the most efficient way to facilitate 
the informal review process as opposed to receiving mailed requests. 
Therefore, we will accept informal review requests via an email to CMS.
    To summarize what we have finalized, we are establishing an 
informal review process for the 2012 and 2013 eRx incentives and 2013 
and 2014 eRx payment adjustments. As such, we are also finalizing our 
proposed modifications to Sec.  414.92 that address the informal review 
process we are establishing. Eligible professionals and group practices 
wishing to request an informal review must do so via email. For the 
2012 eRx incentive and 2013 eRx incentives, eligible professionals and 
group practices must submit a request for an informal review 90 days 
after the receipt of the

[[Page 69301]]

respective feedback reports. For the 2013 and 2014 eRx payment 
adjustments, eligible professionals and group practices must submit a 
request for an informal review by February 28, 2013 and February 28, 
2014, respectively. CMS will provide a written response to each 
informal review request. More information regarding this informal 
review process will be available on the eRx Incentive Program's Web 
site at http://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/ERxIncentive/index.html?redirect=/ERXincentive.

H2. The PQRS-Medicare EHR Incentive Pilot

    The Medicare EHR Incentive Program provides incentive payments to 
eligible professionals (EPs) who demonstrate meaningful use of 
certified EHR technology (CEHRT). EPs who fail to demonstrate 
meaningful use will be subject to payment adjustments beginning in 
2015. We established a phased approach to meaningful use, which we 
expect will include three stages (77 FR 53973), and all EPs are 
currently in Stage 1. In the CY 2012 Medicare PFS final rule, we 
established the PQRS-Medicare EHR Incentive Pilot in an effort to pilot 
the electronic submission of CQMs for the Medicare EHR Incentive 
Program and move towards the alignment of quality reporting 
requirements between Stage 1 of the Medicare EHR Incentive Program and 
the PQRS (76 FR 73422). We refer readers to the final rule for further 
explanation of the requirements of the Pilot (76 FR 73422-73425). 
Specifically, we established that an EP participating in the PQRS-
Medicare EHR Incentive Pilot would be able to report clinical quality 
measures (CQMs) data extracted from Certified EHR Technology via use of 
a PQRS qualified direct EHR product or PQRS qualified EHR data 
submission vendor (76 FR 73422). We proposed to modify Sec.  495.8 to 
extend this Pilot for CY 2013 as it was finalized for CY 2012. We also 
proposed to remove from Sec.  495.8(a)(2)(v) the cross-reference to 
Sec.  495.6(d)(10) to conform to the proposed changes to Sec.  495.6(d) 
that were included in the EHR Incentive Program--Stage 2 NPRM (77 FR 
53976). This proposal includes the following:
     For 2013 only, EPs intending to participate in the PQRS-
Medicare EHR Incentive Pilot may use a PQRS qualified EHR data 
submission vendor that would submit CQM data extracted from the EP's 
CEHRT to CMS. Under this option, identical to the submission process 
used for the Pilot in 2012, the PQRS qualified EHR data submission 
vendor would calculate the CQMs from the EP's CEHRT and then submit the 
calculated results to CMS on the EP's behalf via a secure portal for 
purposes of this Pilot.
     For 2013 only, identical to the submission process used 
for the Pilot in 2012, EPs intending to participate in the PQRS-
Medicare EHR Incentive Pilot may use a PQRS qualified direct EHR 
product to submit CQM data directly from his or her CEHRT to CMS via a 
secure portal using the infrastructure of the PQRS EHR-based reporting 
mechanism.
    In addition, for 2013, we proposed to extend the use of attestation 
as a reporting method for the CQM component of meaningful use for the 
EHR Incentive Program. For 2013, EPs would be able to continue to 
report by attesting CQM results as calculated by CEHRT, as they did for 
2011 and 2012. For further explanation of the CQM reporting criteria 
for EPs and reporting by attestation, we refer readers to the EHR 
Incentive Program--Stage 2 final rule (77 FR 54049 through 54089) and 
the EHR Incentive Program--Stage 1 final rule (75 FR 44386-44411, 
44430-44434).
    We invited public comment on our proposal to extend to 2013 the 
PQRS-Medicare EHR Incentive Pilot as it was established for 2012 as 
well as reporting CQMs by attestation. The following is a summary of 
the comments we received regarding our proposals.
    Comment: Several commenters supported our proposal to extend the 
PQRS-Medicare EHR Incentive Pilot to 2013. The commenters do not 
believe that there was sufficient participation in 2012 to move beyond 
the Pilot stage in 2013. The commenters noted that the extension of the 
Pilot will continue to encourage the adoption of health information 
technology (HIT).
    Response: We appreciate the commenters' feedback and agree with the 
commenters. Based on the comments received and for the reasons 
previously stated, we are finalizing our proposal to extend the PQRS-
Medicare EHR Incentive Pilot to CY 2013 as proposed. We are also 
finalizing our proposal to extend the use of attestation to CY 2013 as 
a reporting method for the CQM component of meaningful use for the EHR 
Incentive Program. We are also finalizing our proposed revisions to 
Sec.  495.8 as proposed. Please note we are only extending the Pilot 
for 2013 because in the EHR Incentive Program--Stage 2 final rule (77 
FR 53968), we established a policy that will require all EPs 
participating in the Medicare EHR Incentive Program that are beyond 
their first year of meaningful use to electronically submit CQM data.

I. Medicare Shared Savings Program

1. Medicare Shared Savings Program and Physician Quality Reporting 
System Payment Adjustment
    Under section 1899 of the Act, CMS has established a Medicare 
Shared Savings Program (Shared Savings Program) to facilitate 
coordination and cooperation among providers to improve the quality of 
care for Medicare Fee-For-Service (FFS) beneficiaries and reduce the 
rate of growth in healthcare costs. Eligible groups of providers and 
suppliers, including physicians, hospitals, and other healthcare 
providers, may participate in the Shared Savings Program by forming or 
participating in an Accountable Care Organization (ACO). The final rule 
implementing the Shared Savings Program appeared in the Federal 
Register on November 2, 2011 (Medicare Shared Savings Program: 
Accountable Care Organizations Final Rule (76 FR 67802)).
    Section 1899(b)(3)(D) of the Act affords the Secretary discretion 
to ``* * * incorporate reporting requirements and incentive payments 
related to the physician quality reporting initiative (PQRI), under 
section 1848 of the Act, including such requirements and such payments 
related to electronic prescribing, electronic health records, and other 
similar initiatives under section 1848 * * *'' and permits the 
Secretary to ``use alternative criteria than would otherwise apply 
[under section 1848 of the Act] for determining whether to make such 
payments.'' Under this authority, we incorporated certain Physician 
Quality Reporting System (PQRS) reporting requirements and incentive 
payments into the Shared Savings Program (76 FR 67902). In the Shared 
Savings Program final rule, we finalized the following requirements 
with regard to PQRS incentive payments under the Shared Savings 
Program: (1) The 22 GPRO quality measures identified in Table 1 of the 
final rule (76 FR 67889-67890); (2) reporting via the GPRO web 
interface (76 FR 67893); (3) criteria for satisfactory reporting (76 FR 
67900); and (4) January 1 through December 31 as the reporting period. 
The regulation governing the incorporation of PQRS incentives and 
reporting requirements under the Shared Savings Program is set forth at 
Sec.  425.504.
    Under Sec.  425.504(a)(1), ACOs, on behalf of their ACO provider/
suppliers who are eligible professionals, must submit the measures 
determined under Sec.  425.500 using the GPRO web interface established 
by CMS, to qualify on behalf

[[Page 69302]]

of their eligible professionals for the PQRS incentive under the Shared 
Savings Program. ACO providers/suppliers that are eligible 
professionals constitute a group practice for purposes of qualifying 
for a PQRS incentive under the Shared Savings Program. Under Sec.  
425.504(a)(2)(ii), an ACO, on behalf of its ACO providers/suppliers who 
are eligible professionals, must satisfactorily report the measures 
determined under the Shared Savings Program during the reporting period 
according to the method of submission established by CMS to receive a 
PQRS incentive under the Shared Savings Program. For the years in which 
a PQRS incentive is available, if eligible professionals that 
participate in an ACO as ACO providers/suppliers qualify for a PQRS 
incentive payment under the Medicare Shared Savings Program, the ACO 
participant TIN(s) under which those ACO providers/suppliers bill, will 
receive an incentive payment based on the allowed charges of those ACO 
providers/suppliers. Under Sec.  425.504(a)(4), ACO participant TINs 
and individual ACO providers/suppliers who are eligible professionals 
cannot earn a PQRS incentive outside of the Medicare Shared Savings 
Program. The PQRS incentive under the Medicare Shared Savings Program 
is equal to 0.5 percent of the Secretary's estimate of the ACO's 
eligible professionals' total Medicare Part B PFS allowed charges for 
covered professional services furnished during the calendar year 
reporting period from January 1 through December 31, for years 2012 
through 2014.
    As discussed in section III.G of this final rule with comment 
period, as required by section 1848(a)(8) of the Act, a payment 
adjustment will apply under the PQRS beginning in 2015. For eligible 
professionals who are not satisfactory reporters, the PFS amount for 
covered professional services furnished by the eligible professional 
during 2015 shall be equal to 98.5 percent (and 98 percent for 2016 and 
each subsequent year) of the fee schedule amount that would otherwise 
apply to such services. Therefore, consistent with our authority under 
section 1899(b)(3)(D) of the Act, we proposed to amend Sec.  425.504 to 
incorporate reporting requirements for the PQRS payment adjustment 
under the Shared Savings Program for eligible professionals that are 
ACO providers/suppliers (77 FR 44989).
    We proposed to incorporate requirements for the PQRS payment 
adjustment that are consistent with requirements for PQRS incentives 
that we previously adopted in the Shared Savings Program final rule. 
Specifically, for purposes of the PQRS payment adjustment, we proposed 
to incorporate the same PQRS GPRO under the Shared Savings Program that 
is currently used for purposes of the PQRS incentive under the Shared 
Savings Program. Under this proposal, eligible professionals that are 
ACO providers/suppliers would constitute a group practice that would 
report quality measures via the GPRO data collection tool for purposes 
of both the PQRS incentive under the Shared Savings Program and the 
PQRS payment adjustment under the Shared Savings Program (77 FR 44989).
    For purposes of the payment adjustment, we proposed to use the 
final GPRO quality measures adopted under the Shared Shavings Program 
that appear in Table 1 of the Shared Savings Program final rule (76 FR 
67899-67890). We further proposed to incorporate the same criteria for 
satisfactory reporting that were finalized for the PQRS incentive under 
the Shared Savings Program, which are described in the Shared Savings 
Program final rule (76 FR 67900). Specifically:
     An ACO on behalf of its eligible professionals must report 
on all measures included in the GPRO data collection tool under the 
Shared Savings Program final rule.
     Beneficiaries would be assigned to the ACO using the 
methodology described in Sec.  425.400. As a result, the GPRO tool 
would be populated based on a sample of the ACO-assigned beneficiary 
population. ACOs must complete the tool for the first 411 consecutively 
ranked and assigned beneficiaries in the order in which they appear in 
the group's sample for each domain, measures set, or individual measure 
if a separate denominator is required such as in the case of preventive 
care measures which may be specific to one sex. If the pool of eligible 
assigned beneficiaries is less than 411, the ACO must report on 100 
percent of assigned beneficiaries for the domain, measures set, or 
individual measure.
     The GPRO data collection tool must be completed for all 
domains, measure sets and measures described in Table 1 of the of the 
Shared Savings Program final rule (76 FR 67889-67890).
    Under this proposal, ACOs would need to satisfactorily report the 
22 GPRO quality measures identified in Table 1 of the Shared Savings 
Program final rule (76 FR 67889-67890) and would not need to report the 
other 11 Shared Savings Program quality performance measures for 
purposes of satisfactory reporting for the PQRS payment adjustment. 
However, under this proposal, the ACO would still be required to 
satisfy the ACO quality performance standards for purposes of 
determining eligibility for shared savings, as described in Sec.  
425.502.
    We note that the proposal that ACOs report the same quality 
measures for purposes of satisfactory reporting for both the PQRS 
payment adjustment and incentive payments under the Shared Savings 
Program was consistent with the proposal under the traditional PQRS 
GPRO Web Interface reporting option that the criteria for satisfactory 
reporting for the payment adjustments align with the satisfactory 
reporting requirements for the incentive payments (77 FR 44824).
    Comment: We received a number of comments supporting the proposal 
to incorporate the same PQRS GPRO measures used for the PQRS incentive 
payment under the Shared Savings Program and Shared Savings Program 
quality performance standards. We also received support for accepting 
quality data at the ACO level rather than requiring each ACO provider 
and supplier who is an eligible professional to submit measure data 
separately to PQRS outside of the Medicare Shared Savings Program. We 
did not receive any comments opposing our proposal or suggesting 
alternatives.
    Response: We appreciate commenters' support and are finalizing our 
proposal to use the final GPRO quality measures adopted under the 
Shared Shavings Program that appear in Table 1 of the Shared Savings 
Program final rule (76 FR 67899-67890) for purposes of the PQRS payment 
adjustment satisfactory reporting criteria with the following 
modifications. Instead of requiring ACOs to report on all of the ACO 
GPRO quality measures for purposes of satisfactory reporting for the 
2015 PQRS payment adjustment under the Shared Savings Program, ACOs 
must only report one of the ACO GPRO measures that were finalized for 
the PQRS incentive under the Shared Savings Program, as described above 
and in the Shared Savings Program final rule (76 FR 67900). As the 
intent of our proposal was to align with the traditional PQRS GPRO Web 
Interface reporting option policy regarding the PQRS payment 
adjustment, this policy for ACOs participating in PQRS under the Shared 
Savings Program, as finalized under Sec.  425.504(b), is consistent 
with the criteria for satisfactory reporting that we are finalizing for 
group practices that select the PQRS GPRO Web Interface reporting 
option, for the 2015 payment adjustment, as discussed in section III.G. 
of this final rule. We believe that aligning the satisfactory reporting

[[Page 69303]]

requirements for the 2015 PQRS payment adjustment under the Medicare 
Shared Savings Program with the satisfactory reporting requirements for 
the payment adjustment under the traditional PQRS GPRO Web Interface 
reporting option is important for encouraging participation in the 
Medicare Shared Savings Program. That is, we do not wish to create a 
disincentive for eligible professionals to join an ACO or participate 
in the Medicare Shared Savings Program by setting the satisfactory 
reporting criteria for the 2015 PQRS payment adjustment at a higher 
level under the Medicare Shared Savings Program than under the 
traditional PQRS. We believe it is appropriate to set the satisfactory 
reporting criteria higher for purposes of the PQRS incentive than for 
the PQRS payment adjustment, under the Shared Savings Program, for the 
same reasons discussed in section III.G. of this final rule.
    While satisfactorily reporting one measure would be required for 
purposes of avoiding the 2015 PQRS payment adjustment under the 
Medicare Shared Savings Program, we note that ACOs are still required 
to report all 22 GPRO measures for purposes of the PQRS incentive under 
the Shared Savings Program and for purposes of assessing ACOs' quality 
performance under the Shared Savings Program and determining the 
percentage of shared savings that ACOs are eligible to receive. In 
addition, under the Shared Savings Program regulations at Sec.  
425.500(e)(3), ACOs are required to report on all of the quality 
measures established by CMS, and the failure to report on those quality 
measures accurately, completely, and timely may subject the ACO to 
termination or other sanctions. Therefore, we expect PQRS eligible 
professionals who are ACO providers/suppliers to meet the satisfactory 
reporting criteria for the 2015 PQRS payment adjustment, since they 
would need to continue to report beyond the one measure for purposes of 
the PQRS incentive payment and Shared Savings Program shared savings. 
Satisfactory reporting criteria for the PQRS payment adjustment under 
the Shared Savings Program for 2016 and beyond will be discussed in 
future rulemaking.
    Although we proposed to use the same timeframe of January 1 through 
December 31 that we adopted for the PQRS incentive under the Shared 
Savings Program as the reporting period for the PQRS payment 
adjustment, we proposed that the timing of the reporting period would 
differ for purposes of the PQRS payment adjustment (77 FR 44990). 
Specifically, we proposed that the reporting period for the payment 
adjustment would fall 2 years prior to when the payment adjustment 
would be assessed. For example, under the Shared Savings Program, the 
reporting period for the 2015 payment adjustment would be from January 
1, 2013 through December 31, 2013.
    We also noted that this policy results in overlapping reporting 
periods for both the PQRS incentive and payment adjustment. For 
example, the measure data collected for the 2013 calendar year 
reporting period (January 1, 2013-December 31, 2013) would be used for 
purposes of both the Physician Quality Reporting System 2013 incentive 
and 2015 payment adjustment under the Shared Savings Program. We 
believed that using the same reporting period for purposes of both the 
incentive and payment adjustment would result in less reporting burden 
and that ACOs would perceive this as more efficient than requiring one 
set of measures reported during one timeframe for purposes of the PQRS 
incentive and another set during another timeframe for purposes of the 
payment adjustment.
    Comments: We received several comments in support of the reporting 
period proposed for assessing the PQRS payment adjustment under the 
Shared Savings Program. Some of these commenters supported the 
proposal, because it aligned with the same reporting period proposed 
for group practices participating in the PQRS GPRO. We did not receive 
any comments opposing this proposal or suggesting alternatives.
    Response: We appreciate the commenters' support and are finalizing 
our proposal that the reporting period for the payment adjustment fall 
2 years prior to when the payment adjustment is assessed. For example, 
under the Shared Savings Program, the reporting period for the 2015 
payment adjustment is from January 1, 2013 through December 31, 2013.
    It is necessary for us to use a reporting period that precedes the 
year in which the payment adjustment is applicable to avoid retroactive 
payments and the reprocessing of claims. In addition, it is not 
operationally feasible for us to use a full calendar year reporting 
period that falls closer to the year in which the payment adjustment is 
applicable because we need sufficient time to determine if the 
requirements for satisfactory reporting have been met and to adjust our 
claims systems prior to the start of the applicable year. We note that 
the length and timing of the reporting period that we are finalizing 
for the PQRS payment adjustment under the Shared Savings Program is 
consistent with the one finalized for the traditional PQRS (76 FR 
73392).
    Since the publication of the Shared Savings Program final rule, we 
have received a number of inquiries regarding whether ACO participant 
TINs need to self-nominate or register to participate in PQRS GPRO 
under the Shared Savings Program, since there are such registration and 
self-nomination requirements under the traditional PQRS GPRO. We wish 
to clarify that no registration or self-nomination is required for ACO 
providers/suppliers that are eligible professionals to earn a PQRS 
incentive or avoid the payment adjustment under the Shared Savings 
Program.
    Finally, just as ACO providers/suppliers that are eligible 
professionals in an ACO may only participate under their ACO 
participant TIN as a group practice under the PQRS GPRO under the 
Shared Savings Program for purposes of receiving an incentive under 
that TIN (76 FR 67903), we proposed that ACO providers/suppliers that 
are eligible professionals within an ACO must participate under the ACO 
participant TIN as a group practice under the PQRS GPRO under the 
Shared Savings Program for purposes of the PQRS payment adjustment (77 
FR 44990). Thus, ACO providers/suppliers who are eligible professionals 
may not seek to avoid the payment adjustment by reporting either as an 
individual under the traditional PQRS or under the traditional PQRS 
GPRO.
    We recognize that some eligible professionals may move across 
programs and reporting options from year to year. For instance, an 
eligible professional that is an ACO provider/supplier and participates 
in the PQRS under the Shared Savings Program in 2013 may later exit the 
Shared Savings Program and participate in PQRS individual reporting in 
2014. Alternatively, a group practice participating in the traditional 
PQRS GPRO in 2013 may be an ACO participant in 2014. In instances in 
which eligible professionals change their PQRS reporting option from 
year to year, we believe that as long as the eligible professional 
satisfactorily reported for purposes of the payment adjustment during 
the applicable reporting period, then the eligible professional should 
not be subject to the payment adjustment even if the eligible 
professional was reporting under a different reporting method than at 
the time the payment adjustment would be assessed.

[[Page 69304]]

    Comment: We received one comment applauding our recognition that 
providers may shift across programs and reporting options from year to 
year. Several commenters supported our proposal that as long as an 
eligible professional satisfactorily reported for purposes of the 
payment adjustment during the applicable reporting period, then the 
eligible professional would not be subject to the payment adjustment 
even if the eligible professional was reporting under a different 
reporting method than at the time the payment adjustment would be 
assessed. We did not receive any comments against our proposal or 
suggesting alternatives.
    Response: We appreciate commenters' support and are finalizing our 
proposal that ACO providers/suppliers that are eligible professionals 
must participate under the ACO participant TIN as a group practice 
under the PQRS GPRO under the Shared Savings Program for purposes of 
the PQRS payment adjustment and that such ACO providers/suppliers who 
are eligible professionals may not seek to avoid the payment adjustment 
by reporting either as an individual under the traditional PQRS or 
under the traditional PQRS GPRO. For group practices and ACOs that may 
reorganize and individual providers and groups of providers that may 
move in and out of ACOs from year to year, as long as the eligible 
professional satisfactorily reported for purposes of the payment 
adjustment during the applicable reporting period, then the eligible 
professional will not be subject to the payment adjustment even if the 
eligible professional was reporting under a different reporting method 
than at the time the payment adjustment is assessed, as long as that 
eligible professional is still billing under the same TIN at the time 
the payment adjustment is assessed as they were during the applicable 
reporting period. We believe this approach offers maximum flexibility 
for eligible professionals and groups of providers to make appropriate 
decisions regarding their participation in an ACO and allows ACOs to 
recruit new participants, by eliminating any risk that eligible 
professionals will be assessed with the payment adjustment as a result 
of such changes. We also believe it would be unfair to assess the 
payment adjustment on an eligible professional on the basis of the 
decision to either join or leave an ACO, if the eligible professional 
had satisfactorily reported during the applicable reporting period.
    Accordingly, we are finalizing the proposed amendment to the 
regulations at Sec.  425.504(b) with two modifications. We have revised 
Sec.  425.504(b)(2)(ii) to provide that an ACO, on behalf of its ACO 
providers/suppliers who are eligible professionals, must satisfactorily 
report one of the GPRO measures during the reporting period according 
to the method of submission established by CMS under the Shared Savings 
Program for purposes of the 2015 Physician Quality Reporting System 
payment adjustment. Satisfactory reporting criteria for the PQRS 
payment adjustment under the Shared Savings Program for 2016 and beyond 
will be discussed in future rulemaking.
    Please note that, in this final rule with comment period, we also 
address final policies for ACO data to be publicly reported on 
Physician Compare in section III.G. of this final rule with comment 
period and under Medicare Shared Savings Program regulations at Sec.  
425.308. ACOs and the Value-Based Modifier are discussed in section 
III.I of this final rule with comment period.

J. Discussion of Budget Neutrality for the Chiropractic Services 
Demonstration

    Section 651 of MMA requires the Secretary to conduct a 
demonstration for up to 2 years to evaluate the feasibility and 
advisability of expanding coverage for chiropractic services under 
Medicare. Current Medicare coverage for chiropractic services is 
limited to treatment by means of manual manipulation of the spine to 
correct a subluxation described in section 1861(r)(5) of the Act 
provided such treatment is legal in the state or jurisdiction where 
performed. The demonstration expanded Medicare coverage to include: 
``(A) care for neuromusculoskeletal conditions typical among eligible 
beneficiaries; and (B) diagnostic and other services that a 
chiropractor is legally authorized to perform by the State or 
jurisdiction in which such treatment is provided.'' The demonstration 
was conducted in four geographically diverse sites, two rural and two 
urban regions, with each type including a Health Professional Shortage 
Area (HPSA). The two urban sites were 26 counties in Illinois and Scott 
County, Iowa, and 17 counties in Virginia. The two rural sites were the 
States of Maine and New Mexico. The demonstration, which ended on March 
31, 2007, was required to be budget neutral as section 651(f)(1)(B) of 
MMA mandates the Secretary to ensure that ``the aggregate payments made 
by the Secretary under the medicare program do not exceed the amount 
which the Secretary would have paid under the medicare program if the 
demonstration projects under this section were not implemented.''
    In the CY 2006, 2007, and 2008 PFS final rules with comment period 
(70 FR 70266, 71 FR 69707, 72 FR 66325, respectively), we included a 
discussion of the strategy that would be used to assess budget 
neutrality (BN) and the method for adjusting chiropractor fees in the 
event the demonstration resulted in costs higher than those that would 
occur in the absence of the demonstration. We stated that BN would be 
assessed by determining the change in costs based on a pre-post 
comparison of total Medicare costs for beneficiaries in the 
demonstration and their counterparts in the control groups and the rate 
of change for specific diagnoses that are treated by chiropractors and 
physicians in the demonstration sites and control sites. We also stated 
that our analysis would not be limited to only review of chiropractor 
claims because the costs of the expanded chiropractor services may have 
an impact on other Medicare costs for other services.
    In the CY 2010 PFS final rule with comment period (74 FR 61926), we 
discussed the evaluation of this demonstration conducted by Brandeis 
University and the two sets of analyses used to evaluate BN. In the 
``All Neuromusculoskeletal Analysis,'' which compared the total 
Medicare costs of all beneficiaries who received services for a 
neuromusculoskeletal condition in the demonstration areas with those of 
beneficiaries with similar characteristics from similar geographic 
areas that did not participate in the demonstration, the total effect 
of the demonstration on Medicare spending was $114 million higher costs 
for beneficiaries in areas that participated in the demonstration. In 
the ``Chiropractic User Analysis,'' which compared the Medicare costs 
of beneficiaries who used expanded chiropractic services to treat a 
neuromusculoskeletal condition in the demonstration areas, with those 
of beneficiaries with similar characteristics who used chiropractic 
services as was currently covered by Medicare to treat a 
neuromusculoskeletal condition from similar geographic areas that did 
not participate in the demonstration, the total effect of the 
demonstration on Medicare spending was a $50 million increase in costs.
    As explained in the CY 2010 PFS final rule, we based the BN 
estimate on the ``Chiropractic User Analysis'' because of its focus on 
users of chiropractic services rather than all Medicare beneficiaries 
with neuromusculoskeletal conditions, as the latter included those who 
did not use chiropractic services

[[Page 69305]]

and who may not have become users of chiropractic services even with 
expanded coverage for them (74 FR 61926 through 61927). Users of 
chiropractic services are most likely to have been affected by the 
expanded coverage provided by this demonstration. Cost increases and 
offsets, such as reductions in hospitalizations or other types of 
ambulatory care, are more likely to be observed in this group.
    As explained in the CY 2010 PFS final rule (74 FR 61927), because 
the costs of this demonstration were higher than expected and we did 
not anticipate a reduction to the PFS of greater than 2 percent per 
year, we finalized a policy to recoup $50 million in expenditures from 
this demonstration over a 5-year period, from CYs 2010 through 2014 (74 
FR 61927). Specifically, we are recouping $10 million for each such 
year through adjustments to the chiropractic CPT codes. Payment under 
the PFS for these codes will be reduced by approximately 2 percent. We 
believe that spreading this adjustment over a longer period of time 
will minimize its potential negative impact on chiropractic practices.
    For the CY 2012 PFS, our Office of the Actuary (OACT) estimated 
chiropractic expenditures to be approximately $470 million, which 
reflected the statutory 29.4 percent reduction to physician payments 
scheduled to take effect that year. As noted above, the statute was 
subsequently amended to impose a zero percent update for CY 2012 
instead of the 29.4 percent reduction. OACT now estimates CY 2012 
chiropractic expenditures to be approximately $630 million. We are 
currently recouping $10 million through adjustments to the chiropractic 
CPT codes in CY 2012, and the percent of this reduction is 
approximately 1.5 percent.
    We are continuing the implementation of the required BN adjustment 
by recouping $10 million in CY 2013. Our Office of the Actuary 
estimates chiropractic expenditures in CY 2013 will be approximately 
$470 million based on Medicare spending for chiropractic services for 
the most recent available year and reflecting an approximate 30.9 
percent reduction to physician payments scheduled to take effect under 
current law. To recoup $10 million in CY 2013, the payment amount under 
the PFS for the chiropractic CPT codes (CPT codes 98940, 98941, and 
98942) will be reduced by approximately 2 percent. We are reflecting 
this reduction only in the payment files used by the Medicare 
contractors to process Medicare claims rather than through adjusting 
the relative value units (RVUs). Avoiding an adjustment to the RVUs 
would preserve the integrity of the PFS, particularly since many 
private payers also base payment on the RVUs.
    Therefore, as finalized in the CY 2010 PFS regulation and 
reiterated in the CYs 2011-2012 PFS regulations, we are implementing 
this methodology and recouping from the chiropractor fee schedule codes 
set forth above. Our methodology meets the statutory requirement for BN 
and appropriately impacts the chiropractic profession that is directly 
affected by the demonstration.
    The following is a summary of the comments we received and our 
responses.
    Comment: One commenter, representing chiropractors, indicated that 
they continue to oppose our methodology for assuring budget neutrality 
under the demonstration. Instead of the application of an adjustment to 
the national chiropractor fee schedule, the commenter believes the 
Congressional intent was for CMS to make an adjustment to the totality 
of services payable under the Part B Trust Fund because of the language 
in Section 651(f)(A) of the MMA, which directs the Secretary to 
``provide for the transfer from the Federal Supplementary Insurance 
Trust Fund * * * of such funds as are necessary for the costs of 
carrying out the demonstration projects under this section.''
    Response: Section 651(f)(1)(B) of the MMA requires that the 
Secretary ``shall ensure that the aggregate payments made by the 
Secretary under the medicare program do not exceed the amount which the 
Secretary would have paid under the medicare program if the 
demonstration projects under this section were not implemented.'' The 
statute does not specify a particular methodology for ensuring budget 
neutrality, but leaves that decision to the Secretary. In the CY 2010 
Payment Policies under the Physician Fee Schedule and other Revisions 
to Part B for CY 2010 final rule with comment period (74 FR 61738, 
61926-61928), we discussed our strategy for assessing budget neutrality 
and finalized the methodology for reducing the payment amount of the 
chiropractic CPT codes under the Physician Fee Schedule in order to 
ensure the demonstration is budget neutral. See also the CY 2006, 2007, 
and 2008 Physician Fee Schedule final rules with comment period (70 FR 
70266-70267, 71 FR 69707-69708, 72 FR 66325-66326, respectively). Our 
methodology for reducing the payment of the chiropractic CPT codes 
(98940, 98941, and 98942) ensures budget neutrality, meets the 
statutory requirements in Sec.  651(f)(1) of the MMA, and appropriately 
impacts the chiropractic profession that is directly affected by the 
demonstration. The final evaluation report, which describes, among 
other things, our methodology for calculating budget neutrality for 
this demonstration, is located on our Web site at http://www.cms.gov/reports/downloads/Stason_ChiroDemoEvalFinalRpt_2010.pdf.
    Comment: The commenter referenced in the previous comment also 
noted that the increase in costs from the demonstration was completely 
due to the Illinois site, and not the other four sites. The commenter 
``has concerns that the Chicago area did not meet the criteria for an 
appropriate demonstration site for this project.'' The commenter 
believes it is ``premature to use demonstration findings to estimate 
the cost of a national roll out of the expansion of chiropractic 
services without further analysis of the demonstration project data.''
    Response: Section 651(c)(1) of the Act required the demonstration 
be conducted in 4 geographically diverse sites, specifically two rural 
and two urban regions, with each type including a Health Professional 
Shortage Area (HPSA). We discussed the design of this demonstration 
with the chiropractic industry and others prior to implementation. 
Based on these discussions, we included additional criteria for site 
selection in the design of this demonstration. The Chicago area met the 
site selection criteria for this demonstration. We refer readers to the 
January 28, 2005 Notice (70 FR 4130) for a discussion of our site 
selection criteria and the sites selected for participation based on 
these criteria.
    Regardless of the differences in the costs associated with the 
demonstration areas, the evaluation conducted by Brandeis University 
found that expanding coverage for chiropractic services under the 
demonstration resulted in increased Medicare expenditures, and the 
Secretary must recoup these costs in order to meet the budget 
neutrality requirement of the law.
    In response to the comment suggesting that the data from this 
demonstration should not be used to estimate the cost of a national 
rollout of the expansion of chiropractic services, we note the 
following. At the time of the final Report to Congress on the 
Chiropractic Services Demonstration, we estimated the costs of a 
national rollout of the expansion of chiropractic services. We based 
our estimate on the best available data at the time which

[[Page 69306]]

was data from the demonstration. Further, data from the demonstration 
was the only information CMS had at the time of the Report to Congress 
for estimating the costs of a national rollout.
    After consideration of the public comments received, we are 
continuing the implementation of the required budget neutrality 
adjustment by recouping $10 million in CY 2013 by reducing the payment 
amount under the PFS for chiropractic codes (that is, CPT codes 98940, 
98941, and 98942) by approximately 2 percent.

K. Physician Value-Based Payment Modifier and the Physician Feedback 
Reporting Program

1. Overview
    Section 1848(p) of the Act requires that we establish a value-based 
payment modifier and apply it to specific physicians and groups of 
physicians the Secretary determines appropriate starting January 1, 
2015 and to all physicians and groups of physicians by January 1, 2017. 
On or after January 1, 2017, the section 1848(p)(7) of the Act provides 
the Secretary discretion to apply the value-based payment modifier to 
eligible professionals as defined in section 1848(k)(3)(B) of the Act. 
Based on our initial experience with the program, we will consider 
whether to expand the application of the value-based payment modifier 
to additional eligible professionals as permitted by the Act.
    We proposed to apply the value-based payment modifier (a) to groups 
of physicians of 25 or more eligible professionals, (b) to align 
quality measurement for purposes of the value-based payment modifier 
with the reporting requirements for data on quality measures under the 
Physician Quality Reporting System (PQRS), and (c) to implement the 
value-based payment modifier so that it does not affect payment for 
those groups that satisfactorily report information on quality measures 
under the PQRS unless the group of physicians expressly elect further 
assessment using a quality-tiering option. The statute requires the 
value-based payment modifier to be budget neutral.
    We are finalizing our overall approach to the value-based payment 
modifier in which the value-based payment modifier adjustment is based 
on participation in the PQRS. Although we are refining many of the 
proposed value-based payment modifier policies in response to comments 
received, the major change from our proposals is that we will apply the 
value-based payment modifier to groups of physicians of 100 or more 
eligible professionals rather than to groups of physicians of 25 or 
more eligible professionals. We believe this change in policy is 
necessary in order for us to gain additional experience with, and to be 
able to produce data to enhance physician acceptance of, our 
methodologies and approach. We emphasize that even with this change we 
are committed to applying the value-based payment modifier to all 
physicians and groups of physicians by 2017 as required by Section 
1848(p) of the Act. We urge solo practitioners and physicians in 
smaller groups to participate in the PQRS now, because when we propose 
in future rulemaking to apply the value-based payment modifier to 
smaller groups and solo practitioners, we anticipate basing the quality 
composite on PQRS quality data reported by such physicians. We also 
anticipate that we would propose to increase the amount of payment at 
risk under the value-based payment modifier as we gain additional 
experience with the methodologies used to assess the quality of care 
furnished, and the cost of care, by physicians and groups of 
physicians.
2. Value-Based Payment Modifier Overview
    In the CY 2013 PFS proposed rule, we stated that the value-based 
payment modifier has the potential to help transform Medicare from a 
passive payer to an active purchaser of higher quality, more efficient 
and effective healthcare by providing upward payment adjustments under 
the PFS to high performing physicians (and groups of physicians) and 
downward adjustments for low performing physicians (and groups of 
physicians) (77 FR 44993). We recognize, however, that physicians are 
at the forefront of care delivery and that changes in payment policy 
can directly affect the medical care that physicians furnish to 
Medicare beneficiaries. Consistent with the National Quality Strategy, 
our aim is to promote preventive care and improve, rather than impede, 
the care that beneficiaries currently receive, especially for the 
chronically ill and those with the most complicated cases.
    We explained in the CY 2013 PFS proposed rule (77 FR 42908) that 
Medicare is beginning to implement value-based payment adjustments for 
other types of services, including inpatient hospital services. We have 
also outlined in reports to Congress strategies to implement value-
based purchasing for skilled nursing facilities, home health services, 
and ambulatory surgical center services. In implementing value-based 
purchasing initiatives generally, we would meet the following goals:
     Recognize and reward high quality care and quality 
improvements.
    ++ Value-based payment systems and public reporting should rely on 
a mix of standards, processes, outcomes, and patient experience 
measures, including measures of care transitions and changes in patient 
functional status. Across all programs, we would move as quickly as 
possible to the use of outcome and patient experience measures. To the 
extent practicable and appropriate, we believe these outcome and 
patient experience measures should be adjusted for risk or other 
appropriate patient population or provider characteristics.
    ++ To the extent possible, and recognizing differences in payment 
system readiness and statutory requirements and authorities, measures 
should be aligned across Medicare and Medicaid's public reporting and 
payment systems. We would seek to evolve a focused core set of measures 
appropriate to each specific provider category that reflects the level 
of care and the most important areas of service and measures for that 
provider.
    ++ The collection of information should minimize the burden on 
providers to the extent possible. As part of that effort, we will 
continuously seek to align our measures with the adoption of meaningful 
use standards for health information technology (HIT), so the 
collection of performance information is part of care delivery.
    ++ To the extent practicable, the measures we use should be 
nationally endorsed by a multi-stakeholder organization. Measures 
should be aligned with best practices among other payers and the needs 
of the end users of the measures.
     Promote more efficient and effective care through the use 
of evidence based measures, less rework and duplication, and less 
fragmented care.
    ++ Providers should be accountable for the costs of care, being 
both rewarded for reducing unnecessary expenditures and responsible for 
excess expenditures.
    ++ In reducing excess expenditures, providers should continually 
improve and maintain the quality of care they deliver.
    ++ To the extent possible, and recognizing differences in payers' 
value-based purchasing initiatives, providers should redesign care 
processes to deliver higher quality and more efficient care to their 
entire patient population.
    Because of the centrality of physicians to high-quality, efficient, 
patient-

[[Page 69307]]

centered care furnished in multiple settings, we believe that in the 
long run the value-based payment modifier should rely on measuring 
physician performance (both quality of care and cost) at four levels 
(to the extent practicable)--the individual physician level, the group 
practice level, the facility level (for example, hospital), and the 
community level. Physicians make decisions on a patient-by-patient 
basis as to what services are indicated and furnished. These decisions 
are made independently by physicians within multiple settings (that is, 
individual office practice, group practice, and hospital) and are 
dependent, in part, on how care is organized in a community. 
Consequently, physicians have the potential to drive both quality of 
care and costs at all levels of the health system and these decisions 
have an impact on patient outcomes and costs for populations of 
patients. We envision a physician value-based payment modifier in the 
future that blends performance at each of these levels (as applicable) 
and reinforces our objectives to encourage and reward physicians for 
furnishing high-quality, efficient, patient-centered clinical care.
    Given this long range objective, we proposed that the following 
specific principles should govern the implementation of the value-based 
payment modifier.
     A focus on measurement and alignment. It is difficult to 
maintain high quality care and improve quality and performance without 
measurement. Therefore, the value-based payment modifier should 
incorporate performance on more quality measures than those that we 
finalized in the CY 2012 PFS final rule (76 FR 73429 through 73432). 
These additional measures for the value-based payment modifier should 
consistently reflect differences in performance among physicians and 
physician groups and reflect the diversity of services furnished. These 
measures should be consistent with the National Quality Strategy and 
other CMS quality initiatives, including the PQRS, the Medicare Shared 
Savings Program, and the Medicare EHR Incentive Program.
     A focus on physician choice. Physicians should be able to 
choose the level at which their performance will be assessed reflecting 
physicians' choice over their practice configurations. The choice of 
level should align with the requirements of other physician quality 
reporting programs, such as the PQRS and the Medicare EHR Incentive 
program to reduce administrative burden and encourage greater program 
participation.
     A focus on shared accountability. CMS has a role in 
fostering high value care for individual beneficiaries, but also 
focusing on how that beneficiary interacts with the healthcare system 
generally. We believe that the value-based payment modifier can 
facilitate shared accountability by assessing performance at the group 
practice level and by focusing on the total costs of care, not just the 
costs of care furnished by an individual physician.
     A focus on actionable information. In conjunction with 
adjusting payment based on performance, CMS should provide meaningful 
and actionable information to help physicians identify clinical areas 
where they are doing well as well as areas in which performance could 
be improved. The Physician Feedback reports can serve this purpose and 
we plan to continue to provide groups of physicians with feedback 
reports on the quality and cost of care they furnish to their patients.
     A focus on a gradual implementation. We believe that the 
value-based payment modifier should focus initially on outliers (that 
is, those groups of physicians that are demonstrably high or low 
performers as compared to their peers that treat like beneficiaries). 
We also believe that groups of physicians should be able to elect how 
the value-based payment modifier would apply to their payment under the 
PFS starting in 2015 as we phase-in the value-based payment modifier. 
As we gain more experience with physician measurement tools and 
methodologies, we can broaden the scope of measures assessed to 
organize them around medical condition, refine physician peer groups to 
focus on how like beneficiaries are treated, create finer payment 
distinctions that focus on increasing value, and provide greater 
payment incentives for high performance.
    We solicited comments on these principles as guides to our 
implementation of the value-based payment modifier. The following is a 
summary of the comments we received and our response.
    Comment: Commenters generally supported the five principles that we 
proposed would govern the implementation of the value-based payment 
modifier. However, some commenters expressed concerns that the proposed 
implementation of the value-based payment modifier did not support all 
of the principles.
    One commenter stated that the proposed value-based modifier program 
was designed for large multispecialty group practices, not small single 
specialty groups. Another commenter indicated that long term care 
physicians currently lack the infrastructure to be able to achieve the 
proposed principles within the timeline proposed. Other commenters were 
concerned about the lag between the performance year (2013) and the 
application of the payment adjustment (2015) and urged CMS to further 
explore ways to realistically achieve the goal cited under ``Focus on 
actionable information.'' One of the commenters also raised several 
concerns related to group reporting of the quality data.
    Some of the commenters' recommendations included providing the 
Physician Feedback reports to all physicians sooner so they have 
information before implementation of the value-based payment modifier; 
making group reporting optional; expanding the reporting options for 
large groups; and evaluating the implementation proposals on small 
single specialty group practices and settings such as long term care 
settings.
    Response: We appreciate the commenters' support of the five 
principles that we believe should govern the implementation of the 
value-based payment modifier. We address the narrower concerns raised 
by commenters later in this final rule with comment period, but 
continue to believe that the five principles we have identified here 
should guide the implementation of the value-based payment modifier.
3. Proposals for the Value-Based Payment Modifier
    In the proposed rule, we described our proposals for each component 
of the value-based payment modifier (77 FR 44995). In this final rule 
with comment period, we discuss our proposed policies for each 
component of the value-based payment modifier, the comments received, 
our responses to the comments, and a brief statement of our final 
policy.
a. Application of the Value-Based Payment Modifier
    Section 1848(p)(4)(B)(iii) of the Act requires the Secretary to 
apply the value-based payment modifier to items and services furnished 
under the Medicare Physician Fee Schedule beginning on January 1, 2015, 
for specific physicians and groups of physicians the Secretary 
determines appropriate, and beginning not later than January 1, 2017 
for all physicians and groups of physicians. For purposes of the value-
based payment modifier we are finalizing in this final rule with 
comment period, physicians are defined in section 1861(r) of the Act to 
include

[[Page 69308]]

doctors of medicine or osteopathy, doctors of dental surgery or dental 
medicine, doctors of podiatric medicine, doctors of optometry, and 
chiropractors.
(1) Definition of a Group, Group Size, and Application of the Value-
Based Payment Modifier to the Paid Amount
    We proposed to apply the value-based payment modifier beginning in 
calendar year 2015 to all groups of physicians with 25 or more eligible 
professionals (77 FR 44995). For purposes of establishing group size, 
we proposed to use the definition of an eligible professional as 
specified in section 1848(k)(3)(B) of the Act. This section defines an 
eligible professional as any of the following: (1) A physician; (2) a 
practitioner described in section 1842(b)(18)(C) of the Act; (3) a 
physical or occupational therapist or a qualified speech-language 
pathologist; or (4) a qualified audiologist. We proposed to define a 
group of physicians as ``a single Tax Identification Number (TIN).'' We 
chose this definition in order to align with the reporting requirements 
for group practices and the definitions used in the PQRS. We also 
proposed to assess whether a group of physicians has 25 or more 
eligible professionals at the time the group of physicians is selected 
to participate under the PQRS GPRO.
    In addition, we proposed to apply the value-based payment modifier 
to the Medicare paid amounts for the items and services billed under 
the PFS at the TIN level so that beneficiary cost-sharing would not be 
affected. We also proposed to apply it to the items and services billed 
by physicians under the TIN, not to other eligible professionals that 
also may bill under the TIN. Application of the value-based payment 
modifier at the TIN level means that we would not ``track'' or 
``carry'' an individual physician's performance from one TIN to another 
TIN. In other words, if a physician changes groups from TIN A in the 
performance period (calendar year 2013) to TIN B in the payment 
adjustment period (calendar year 2015), we would apply TIN B's value-
based payment modifier to the physician's payments for items and 
services billed under TIN B during 2015. We made this proposal for two 
reasons (77 FR 44995). First, payment at the group practice (TIN level) 
promotes shared accountability for the quality of care furnished at the 
group practice level. Second, we believed it will be more 
straightforward for groups of physicians to understand how the value-
based payment modifier affects their TIN's payment in the payment 
adjustment period if all physicians billing under the TIN received the 
same value-based payment modifier.
    Comment: Some commenters supported CMS' proposal to apply the 
value-based payment modifier to only groups of 25 or more eligible 
professionals. They typically based their support on their agreement 
with the points CMS made in the proposed rule, stating that it would be 
premature to extend the value modifier to groups smaller than 25. 
However, many other commenters recommended that CMS apply the value-
based payment modifier only to larger, multi-specialty groups, such as 
those with 100 or more physicians (MDs/DOs). Some of these commenters 
suggested that if single specialty or smaller groups were to be 
included, they should be limited to those groups that specifically 
request to be included. They reasoned that it would be important for 
CMS to devote resources to ensuring the program is successful with 
large groups before including smaller groups and solo practitioners. 
They stated that several issues are still untested and thus in need of 
further development (for example, attribution for cost purposes, new 
quality reporting methods, cost measure comparisons, and physician 
awareness). These commenters expressed concern, based on prior 
experience with CMS' confidential feedback reports, about the ability 
of CMS to notify and sign up a large number of groups by the proposed 
deadline. They stated that applying the value-based payment modifier 
initially only to larger groups would reduce the number of physicians 
and groups that would need to be notified and would focus on practices 
that are most likely to follow the federal regulatory process and have 
staff devoted to value-based performance initiatives. Further, those 
commenters opined that tying the group size determination to the number 
of MDs and DOs rather than to all PQRS-eligible professionals would 
also eliminate potential misunderstanding about the groups that are 
subject to the value-based payment modifier. Commenters also suggested 
that removing single specialty groups could mitigate a number of 
problems such as a lack of relevant quality measures available for many 
specialties under the group reporting options.
    On the other hand, a few commenters suggested we apply the value-
based payment modifier to additional physicians, such as those in 
groups of 10 or more. This suggestion was based on a view that 
increasing participation in the value-based payment modifier for the 
first 2 years of the program could facilitate a smoother transition to 
all physicians in 2017 (as required by law) and gain physician 
participation in the first few years. Another commenter recommended 
that CMS allow smaller practices to participate in the modifier in 2015 
if they meet certain criteria, such as being Meaningful Users (MU) of 
certified Electronic Health Records (EHRs), or practicing in a rural 
state or other area where there are relatively few groups with 25 or 
more eligible professionals (for example, Health Professional Shortage 
Areas). These commenters reasoned that incorporating smaller practices 
into the value-based payment modifier would encourage all physicians, 
not only larger groups, to focus on high-quality, affordable care, 
reinforcing current private and other payers' payment incentives. 
Commenters stated a belief that a broader definition of physician group 
is imperative if the value-based payment modifier is to promote value 
on a wide scale, given that most physicians practice in groups of less 
than 10 physicians. Further, they argued that it would be feasible to 
include smaller practices in the value-based payment modifier because 
many of these smaller practices are participating in the EHR Incentive 
Program and they are currently reporting many of the same measures that 
are available to eligible professionals under the PQRS. In addition, it 
was also noted that some states with a high proportion of rural and 
other under-served areas may have comparatively few groups of 25 or 
more eligible professionals and thus be under-represented in the value-
based payment modifier unless smaller groups are included.
    Response: We are persuaded by the commenters that recommended we 
apply the value-based payment modifier only to larger groups. We agree 
with commenters that suggested the minimum group size be defined as 
groups of physicians with 100 or more eligible professionals as a first 
step. We believe it would be reasonable to focus on groups with 100 or 
more eligible professionals before expanding the application of the 
value-based payment modifier to more groups. We believe that increasing 
the group size from 25 to 100, we would be addressing the concerns 
raised by commenters regarding attribution, new group reporting 
mechanisms, and cost comparisons. We also agree with commenters that we 
will be more successful in notifying and informing these large groups 
about the requirements of the value-based payment modifier than if we 
were to include groups of less than 100 eligible

[[Page 69309]]

professionals. We do not agree, however, that the group size should be 
determined only by the number of physicians (MDs, DOs), because we 
still seek to align with the quality measure reporting criteria in the 
PQRS; that is, under the PQRS, group practices are defined by the 
number of eligible professionals as defined under section 
1848(k)(3)(B), not just physicians. We believe it would be confusing to 
have the same group size (for example, 100) be calculated different 
ways (one way for the PQRS and another way for the value-based payment 
modifier), because the group's participation in the PQRS informs how 
they are treated for the value-based payment modifier.
    Comment: Some commenters believed it was essential for CMS to 
provide additional flexibility to allow groups to define themselves 
rather than using our proposed definition of a group of physicians as 
``a single Tax Identification Number (TIN).'' For example, some 
commenters urged us to allow groups to aggregate TINs for the value 
modifier, indicating that due to a variety of business reasons 
unrelated to quality reporting, some practices have multiple TINs. In 
these practices, such as some faculty practice plans, the departments 
share common services and are perceived by the public as being part of 
the same practice. Other commenters suggested that CMS allow certain 
practices, such as large practices that operate under a single TIN, an 
option to disaggregate the TIN into separate component sub-groups in a 
way that represents how the groups functionally operate.
    Response: We are finalizing our proposal to identify the group by 
its Medicare-enrolled TIN. Using TINs makes it possible for us to take 
advantage of infrastructure and methodologies already developed for 
PQRS group-level reporting and evaluation. We believe this approach 
affords us flexibility and statistical stability for monitoring and 
evaluating quality and outcomes for beneficiaries assigned to the group 
for quality reporting purposes. In contrast, adopting approaches 
suggested by some commenters to allow the disaggregation of a TIN (or 
aggregation of a collection of TINs) would create much greater 
operational complexity by requiring us to establish and maintain 
additional organizational IDs under each TIN (for disaggregation 
purposes) or among TINs (for aggregation purposes). It would be 
difficult operationally to maintain such an approach to accommodate 
future organizational changes among physicians and their practices. 
TINs are relatively stable over time, but still allow for some 
flexibility as individual physicians make choices about what TINs they 
establish. Despite these challenges and our decision to define a group 
of physicians as a ``single TIN,'' we intend to examine whether it is 
possible in future years to allow for the aggregation or disaggregation 
of TINs in order to better reflect physician group organization as 
suggested by the commenters.
    Comment: Some commenters disagreed with the proposal to apply the 
value-based payment modifier to the items and services billed by 
eligible professionals who are physicians under the TIN and not to 
other eligible professionals that also may bill under the TIN. They 
reasoned it is inconsistent to apply the value-based payment modifier 
only to items or services billed by eligible professionals who are 
physicians, given that under the proposal CMS would count all eligible 
professionals for purposes of determining group size. These commenters 
generally requested consistency between the assessment of group size 
and application of the value-based payment modifier. By contrast, we 
also received suggestions that we ought to exclude non-physicians in 
the group size determination but apply the modifier to all eligible 
professionals within a medical group practice. These commenters argued 
that this approach would be more consistent with the view that high 
quality and coordinated care is a team effort.
    Response: Section 1848(p)(7) of the Act requires us to apply the 
value-based payment modifier beginning in 2015 only to physicians as 
defined in section 1861(r) of the Act. On or after January 1, 2017, the 
Act provides the Secretary discretion to apply the value-based payment 
modifier to a broader set of eligible professionals (as defined in 
section 1848(k)(3)(B) of the Act). Thus, we are unable at this time to 
apply the value-based payment modifier to Medicare FFS payments paid to 
eligible professionals who are not physicians as suggested by the 
commenters. Based on our initial experience with the value-based 
payment modifier, we plan to consider whether to expand its application 
to additional eligible professionals in future years. As discussed 
previously, we believe it is important to use the same definition of 
group size (that is, eligible professionals) as the PQRS both to align 
the two programs (the PQRS and the value-based payment modifier) and to 
help avoid physicians' confusion as they determine the method by which 
they will participate in the PQRS.
    Comment: We received few comments on our proposals to apply the 
value-based payment modifier to the Medicare paid amounts for the items 
and services billed under the PFS so that beneficiary cost-sharing or 
coinsurance would not be affected. These commenters generally agreed 
with the proposal to apply the value-based payment modifier to the 
Medicare paid amounts for the items and services billed under the PFS 
at the TIN level so that beneficiary cost-sharing would not be 
affected.
    Response: We agree with these comments. We continue to believe it 
is important that beneficiary cost-sharing not be affected by the 
value-based payment modifier.
    Comment: Several commenters requested clarification of when and how 
we would determine group size if the group of physicians did not 
participate in the PQRS. This determination is important, they 
reasoned, because these groups would be subject to the -1.0 percent 
value-based payment downward adjustment under the value-based payment 
modifier if they were a group of physicians meeting the value-based 
payment modifier size requirement and they had not participated in the 
PQRS.
    Response: We had proposed to assess the size of a group of 
physicians at the time the group of physicians is selected to 
participate under the PQRS GPRO. As discussed above with respect to the 
PQRS GPRO self-nomination process (section III.G.1) and below with 
respect to the election of the quality-tiering approach, we have 
extended to October 15, 2013, the time period for groups of physicians 
to submit their self-nomination statement to select their PQRS 
reporting method and to elect the quality-tiering methodology. As such, 
we will query Medicare's Provider Enrollment, Chain, and Ownership 
System (PECOS) as of October 15, 2013, to identify the groups of 
physicians with 100 or more eligible professionals. This query will 
produce a list of the groups of physicians that are subject to the 
value-based payment modifier. To ensure that the groups of physicians 
on this list have 100 or more eligible professionals during the 
performance period, we will analyze the group's (TIN's) claims 
submitted for services furnished during the performance year, including 
at least a 60-day claims runout (that is, we will analyze claims 
submitted through at least February 28, 2014 for services furnished 
during the calendar year 2013 performance year). We will remove a group 
of physicians from this list if the group does not have at least 100 
eligible professionals that billed under the group's TIN during the 
performance period. We note that we

[[Page 69310]]

will not add groups to the October 15 list based on this claims 
analysis, rather we will only remove groups that, based on claims, do 
not have 100 or more eligible professionals. We also will engage in 
education and outreach during the performance year to encourage all 
groups of physicians, not just those to which the value-based payment 
modifier applies during 2015, to participate in the PQRS.
    In response to the comments, we are finalizing that beginning in 
calendar year 2015 we will apply the value-based payment modifier to 
groups of physicians of 100 or more eligible professionals. We also are 
finalizing the following proposed policies related to the definition of 
a group and group size:
     For purposes of establishing group size only, we use the 
definition of an eligible professional as specified in section 
1848(k)(3)(B) of the Act;
     We apply the value-based payment modifier to the Medicare 
paid amounts for the items and services billed under the PFS at the TIN 
level so that beneficiary cost-sharing is not be affected; and
     We apply the value-based payment modifier to the items and 
services billed by physicians under the TIN, not to other eligible 
professionals that also may bill under the TIN.
     We identify the groups of physicians subject to the value-
based payment modifier (groups of 100 or more eligible professionals) 
based on a query of PECOS on October 15, 2013, and we remove any groups 
from this October 15 list if, based on a claims analysis, the group of 
physicians did not have 100 or more eligible professionals that 
submitted claims during the performance period.
(2) Approach to Setting the Value-Based Payment Modifier Adjustment 
Based on PQRS Participation and the Quality-Tiering Option
    We explained in the proposed rule that our proposals would allow 
groups of 25 or more eligible professionals to decide how the value-
based payment modifier would be applied to their PFS payments (77 FR 
44995). We proposed that in light of our desire to align CMS quality 
improvement programs, the value-based payment modifier methodology 
relies, in part, on the data submitted on quality measures by groups of 
physicians through the PQRS. We explained that quality measurement is 
necessary, but not sufficient, for quality improvement and a focus on 
value. Thus, we proposed to categorize groups of physicians eligible 
for the value-based payment modifier into two categories depending upon 
whether they had met the criteria for satisfactory reporting of data on 
the PQRS GRPO quality measures for the 2013 and 2014 incentive payments 
under the PQRS or the criteria for satisfactory reporting using the 
administrative claims-based reporting mechanism, which was proposed for 
the 2015 and 2016 PQRS payment adjustment. For those groups of 
physicians that met either of these PQRS satisfactory reporting 
criteria and requested that their value-based payment modifier be 
calculated using a quality-tiering approach, we proposed to use the 
performance rates on the quality measures reported through any of these 
PQRS reporting mechanisms available to them.
    We proposed that the second category include those groups of 
physicians with 25 or more eligible professionals that have not met the 
PQRS satisfactory reporting criteria identified above (77 FR 44996). 
Because we would not have quality measure performance rates on which to 
assess the quality of care furnished by these groups, we proposed to 
apply a value-based payment modifier of -1.0 percent, meaning they 
would receive 99.0 percent of the paid amounts for the items and 
services billed under the PFS in CY 2015.
    We explained that we were concerned, however, that some groups of 
physicians may attempt to submit data on PQRS quality measures and fail 
to meet the criteria for satisfactory reporting for the PQRS incentive 
and thus be placed into the second category of groups of physicians 
and, therefore, be subject to the -1.0 percent value-based payment 
modifier downward adjustment. To address this issue, we solicited 
comments on whether to assess performance on the measures included in 
the PQRS administrative claims-based reporting option as a default if a 
group of physicians attempts to participate in one of the PQRS GPRO 
reporting mechanisms and does not meet the PQRS criteria for 
satisfactory reporting.
    Comments: The majority of commenters supported CMS' use of the PQRS 
system as the foundation for the measurement of performance rates for 
physician groups for the value-based payment modifier. Many commenters 
stated this approach was a way to better align reporting requirements 
across physician programs and decrease burden. They also believed it 
was reasonable to phase-in the value-based payment modifier using this 
two-category structure. By contrast, some commenters suggested that 
applying the -1.0 percent downward adjustment to groups of physicians 
in the second category was penalizing these groups twice (once by the 
PQRS payment adjustment and once by the value-based payment modifier) 
for the same action, namely failure to report satisfactorily under the 
PQRS. Other commenters opposed allowing the use of performance rates on 
the quality measures reported through PQRS reporting mechanisms. They 
expressed concern that PQRS reporting methods are ``overwhelming given 
the multiple methods of reporting, varying reporting periods, differing 
reporting requirements for each reporting mechanism.'' One commenter 
stated that while it supported streamlining CMS quality programs, it 
had longstanding concerns with the PQRS program and as a result, 
opposed the concept of tying participation in the value-based payment 
modifier to participation in the PQRS. One commenter requested a value-
based modifier of 0.0 percent be applied in 2015 for pathologists as 
there would be no applicable PQRS measures.
    Response: We continue to believe that the two-category approach is 
a reasonable way to phase-in the value-based payment modifier in 2015. 
It is difficult to maintain high-quality care and improve quality and 
performance without measurement. We agree with commenters who stated 
that we should seek to align quality reporting mechanisms across 
physician programs. CMS has one physician quality reporting system and 
we intend to use it as the foundation for the value-based payment 
modifier. Although not satisfactorily reporting data under the PQRS 
will subject physicians and groups of physicians to a PQRS payment 
adjustment, the lack of quality data also prevents us from fully 
assessing the quality of care furnished compared to cost. At the same 
time, we also believe we should not affect the payment of those groups 
of physicians that have taken steps to participate in the PQRS and have 
developed systems within their practices to report data for quality 
measurement. Thus, in response to comments, we have decided to modify 
the two categories that we proposed and instead, we are finalizing a 
policy to apply the -1.0 percent downward value-based payment modifier 
adjustment only to those groups of physicians that do not participate 
in the PQRS in CY 2013 as described below.
    Comment: Many commenters urged CMS to hold groups harmless from the 
-1.0 percent value-based payment modifier downward adjustment if the 
group of physicians attempts, but is not a satisfactory reporter for 
the PQRS incentive payment. Commenters felt this was a good way to 
transition physician

[[Page 69311]]

groups with little experience with PQRS reporting to do so without the 
threat of being subject to the value-based payment modifier and PQRS 
payment adjustments. Also, commenters stated that given the complexity 
of the PQRS, medical groups would be deterred from reporting data if 
they did not have a safety net to avoid being subject to both the 
value-based payment modifier and PQRS payment adjustments.
    Response: We agree with commenters that we should encourage groups 
of physicians to participate in the PQRS GPRO. Accordingly, we are 
expanding the first category of groups of physicians to which we would 
apply a value-based payment modifier adjustment of 0.0 percent to 
include those groups that self-nominate for the PQRS GPRO and report at 
least one measure. Further, if such group of physicians had elected the 
quality-tiering option and did not meet the satisfactory reporting 
criteria for the PQRS payment incentive using the reporting method they 
selected in their self-nomination statement under the PQRS GPRO (such 
that we would not have performance information to create a quality 
composite), we will develop and use the group's performance on the 
administrative claims-based reporting option as the basis for 
determining the group's quality composite for purposes of the value-
based payment modifier. We believe this policy will encourage groups to 
put systems in place in their practices to become satisfactory PQRS 
reporters.
    Based upon the comments received, we are adopting our proposed 
policy, with one modification, to categorize groups of physicians 
eligible for the value-based payment modifier into two categories. 
Specifically, the first category of groups of physicians includes those 
that (a) have self-nominated for the PQRS as a group and reported at 
least one measure or (b) have elected the PQRS administrative claims 
option for CY 2013 We note that groups in category (a) also include 
those groups that have self-nominated and have met the satisfactory 
reporting criteria for the PQRS incentive payment. The value-based 
payment modifier for the groups of physicians in this first category 
(both (a) and (b)) will be 0.0 percent, meaning no payment adjustment 
will be applied to physicians in these groups for CY2015. For those 
groups of physicians within this first category that have requested 
that their value-based payment modifier be based on quality-tiering and 
have either met the satisfactory reporting criteria for the PQRS 
incentive or have chosen the administrative claims-based option, we 
will use the performance rates on the quality measures reported through 
these reporting mechanisms (that is, GPRO registries, web-interface, or 
administrative claims) to calculate their value-based payment modifier. 
Otherwise, we will use the group's performance on the administrative 
claims measures for quality-tiering, because although the group self-
nominated and reported at least one measure, we would not have 
sufficient quality information to construct a quality composite under 
the quality-tiering approach.
    The second category includes those groups of physicians with 100 or 
more eligible professionals that do not fall within either of the two 
subcategories of category 1 described above. The value-based payment 
modifier for these groups of physicians will be -1.0 percent in CY 
2015.
    Comment: Commenters requested that we clarify whether physicians 
that are reporting PQRS measures at the individual level and are 
members of groups subject to the value-based payment modifier would be 
able to continue to report as individuals using their currently 
preferred PQRS option at the individual level. They explained that they 
already have systems in place and staff that understands how to report 
under the PQRS at the individual level. They also opined that such 
flexibility allowed physicians in the group to choose PQRS measures 
that were most applicable to their practice and patients.
    Response: We appreciate commenters' support for the use of the PQRS 
as the foundation for quality reporting for the value-based payment 
modifier. We agree with the commenters that we should continue to 
encourage physicians in groups subject to the value-based modifier and 
who are already satisfactorily reporting PQRS measures as individuals 
to have the option to remain individual PQRS reporters. We wish to 
clarify that in our proposals we did not intend to preclude individual 
participation in the PQRS. We specifically proposed that groups of 
physicians subject to the value-based payment modifier could elect the 
PQRS administrative-claims based option. Therefore, we are adopting a 
policy that physicians in groups of 100 or more eligible professionals 
that wish to report data for quality measures in the PQRS as 
individuals rather than as a group for the PQRS payment incentive must, 
as a group, elect the administrative claims-based reporting method 
under the PQRS by October 15, 2013. By doing so, the group of 
physicians would fall with category 1(b) and avoid the -1.0 percent 
downward value-based payment modifier. In future rulemaking, we 
anticipate proposing whether and how to combine quality measures 
reported at the individual level into a group quality score for the 
value-based payment modifier.
    Comment: We received a substantial number of comments in support of 
the optional nature of having us evaluate performance based on the 
quality of care performance. One commenter recommended that quality-
tiering remain voluntary until CMS has more confidence in its measures 
and composites. But we also received several comments that quality-
tiering should not be optional.
    Response: We agree with commenters that application of the quality-
tiering methodology for calculating the value-based payment modifier 
should be optional. There will be many groups of physicians 
participating in the PQRS for the first time in 2013, many of them 
using the new group reporting mechanisms under the PQRS that are 
described in Table 92 above. We believe it is reasonable for them to 
gain experience in reporting data for quality measurement under the 
PQRS. In addition, we will be establishing national benchmarks for the 
first time for the quality measures in the PQRS and we will be using 
these benchmarks in the quality-tiering calculation. We believe groups 
of physicians should have time to understand how their performance 
compares to these benchmarks, and to have time to adjust their 
performance based on these comparisons, before their payment is 
adjusted. Although we recognize the need to improve the quality of care 
furnished compared to cost, we believe it is unreasonable to make 
quality-tiering mandatory in the first year of the phase-in for the 
value-based payment modifier. We anticipate for future years, as we 
collectively learn from our experiences with quality measurement and 
the value-based payment modifier, we will consider making quality-
tiering mandatory.
(3) Individual Physicians
    We proposed that, starting in 2017, we would apply the value-based 
payment modifier to all physicians and groups of physicians as required 
by the statute (77 FR 44996). We also solicited comments on whether we 
should offer individual physicians and groups of physicians with fewer 
than 25 eligible professionals an option that their value-based payment 
modifier be calculated using a quality-tiering approach starting in 
2015 (77 FR 44996). If we did so, we indicated that we could calculate 
a value-based payment modifier for groups of physicians with as few as 
two

[[Page 69312]]

eligible professionals and apply the value-based payment modifier at 
the TIN level in the manner described in these proposals for groups of 
25 or more eligible professionals. Likewise, we solicited comments on 
how to adapt our proposals to calculate a value-based payment modifier 
at the TIN level for physicians in solo practices (TINs comprised of 
one NPI).
    Comment: There were a few commenters that supported application of 
the value-based payment modifier to individual physicians or EPs. For 
example, a commenter indicated that we should allow individuals that 
meet PQRS reporting requirements the option to participate in the 
quality-tiering option as early as possible as all physicians will be 
subject to the payment adjustment in 2017. However, most commenters 
agreed with the proposal to only apply the value-based payment modifier 
to groups at this time for the reasons outlined in the proposed rule 
(77 FR 44996).
    Response: We appreciate the comments that were provided on this 
issue and will consider them further as we develop future plans to 
apply the value-based payment modifier to individual physicians.
    As discussed above, we are adopting a policy to apply the value-
based payment modifier to groups of physicians of 100 or more eligible 
professionals. We will not offer smaller groups of physicians and 
individual physicians the ability to elect quality-tiering for the 2015 
value-based payment modifier as suggested by some commenters. Although 
we recognize that we must apply the value-based payment modifier to all 
physicians and groups of physicians starting January 1, 2017, we 
believe it is important to phase-in the value-based payment modifier to 
larger groups of physicians as we gain experience with the 
methodologies used in the value-based payment modifier. We want to 
emphasize, however, that in future rulemaking we anticipate proposing 
for smaller groups and for individual physicians a value-based payment 
modifier structure similar to the policies we are adopting for groups 
of physicians of 100 or more eligible professionals. Importantly, we 
expect the value-based payment modifier structure for smaller groups 
and individuals would also be aligned with the PQRS. Thus, we strongly 
encourage smaller groups of physicians and individual physicians to 
participate in the PQRS so that they can prepare themselves and their 
practices for the application of value-based payment modifier in later 
years.
(4) Hospital-Based Physicians
    We also solicited comments on whether we should develop a value-
based payment modifier option for hospital-based physicians to elect to 
be assessed based on the performance of the hospital at which they are 
based (77 FR 44996). In particular, hospital performance could be 
assessed using the measure rates for the quality measures in the 
Inpatient Quality Reporting (IQR) and the Outpatient Quality Reporting 
(OQR) programs. We solicited comments on which IQR and OQR measures 
(and applicable reporting period) would be appropriate to include in 
such an option and a way to identify and verify whether physicians are 
hospital-based.
    The following is a summary of the comments we received regarding 
whether we should develop a value-based payment modifier option for 
hospital-based physicians.
    Comment: A few commenters, including some that represent or employ 
physicians that practice in hospital settings, submitted comments on 
this issue. These commenters generally agreed that CMS should develop a 
value-based payment modifier option for hospital-based physicians, some 
noting that this option should be voluntary and based on self-
nomination. They believed this hospital-based option could create a 
shared incentive between hospital-based physician groups and their 
institutions to augment physician involvement in quality improvement 
initiatives relating to inpatient care. This alignment, particularly 
for hospitalists who are directly involved in the quality improvement 
efforts of the hospital, could enhance and refine the safety and 
quality of hospital care.
    Some commenters urged CMS to be judicious when selecting measures 
from the IQR and OQR programs to ensure that hospitalist care is 
measured in a valid way. Some potential areas for performance measures 
were identified, such as to include transitions of care/discharges and 
common diagnoses like congestive heart failure (CHF), acute myocardial 
infarction (AMI), pneumonia and stroke. A number of these commenters 
requested that physicians and group practices should be able to 
identify themselves as ``hospitalists'' ensuring that they are compared 
to like-groups within the value-based payment modifier. Some commenters 
were concerned that our proposed beneficiary attribution approach and 
our total per capita cost measures could result in hospitalists being 
inaccurately measured, as they could be attributed the total cost of 
the patients' stay at a hospital, when the hospitalist may have only 
been responsible for discharging the patient. Therefore, a commenter 
recommended that an attribution methodology be developed to accurately 
capture the role of hospitalists in patient care.
    Response: We appreciate the comments received and will consider 
them as we develop future proposals for the value-based payment 
modifier as they relate to hospital-based physicians.
(5) Quality-Tiering Election Process
    We solicited comments on how best to ascertain whether a group of 
physicians subject to the value-based payment modifier requests the 
option that their value-based payment modifier be calculated using a 
quality-tiering approach (77 FR 44996). We are seeking to establish a 
system that is as simple as possible to reduce administrative burden on 
physicians and enable these groups of physicians to indicate how they 
plan to submit data on quality measures through the PQRS for purposes 
of the value-based payment modifier. We described three possible 
approaches to accomplish these objectives: (a) Build off of the self-
nomination process that we have proposed for groups of physicians to 
participate in the PQRS GPRO and which requires groups to submit a 
self-nomination application by January 31, 2013 for the 2013 
performance period, (b) create a separate web-based registration system 
that permits groups of physicians to, throughout calendar year 2013, 
request that their value-based payment modifier be calculated using the 
quality-tiering approach, or (c) require that groups of physicians 
submit a letter (in a prescribed format) to CMS in a timely manner.
    Comment: Commenters indicated that they appreciated that CMS is 
seeking to reduce administrative burden when identifying the way groups 
of physicians would indicate that they request their value-based 
payment modifier to be calculated using a quality-tiering approach. 
These commenters generally support using a web-based registration 
system or other simple online approach to opt into the quality-tiering 
that allows for ongoing registration by groups throughout the relevant 
calendar year.
    Response: We thank commenters for their comments. To ease 
administrative burden and to align the quality-tiering election process 
with the self-nomination processes under the PQRS (as described in 
section III.G.1.b.(2) and III.G.1.c above), we are finalizing a web-
based system for groups of physicians to

[[Page 69313]]

request the quality-tiering methodology. Under this policy, groups of 
physicians would access the same web-based system to request the 
quality-tiering approach that they use either to submit their PQRS GPRO 
self-nomination statement or to elect administrative claims option. We 
also are finalizing a contingency plan to accept groups of physicians' 
statements indicating their quality-tiering election via mail in the 
event the web-based functionality is not available in time to accept 
these statements, or in the event we experience issues with accepting 
self-nomination statements via the web. For the same reasons we 
discussed above with regard to other deadlines we are adopting under 
the PQRS, such quality-tiering elections must be received by October 
15, 2013. We believe utilizing the same processes and deadlines 
finalized by the PQRS will ease administrative burden and facilitate 
the election of the quality-tiering option.
    We want to emphasize that if a group of physicians with 100 or more 
eligible professionals does not self-nominate to participate in the 
PQRS GPRO or elect the administrative claims option for groups for CY 
2013, its value-based payment modifier in CY 2015 will be -1.0 percent.
(6) Participants in the Medicare Shared Savings Program and Center for 
Medicare and Medicaid Innovation initiatives
    We proposed that groups of physicians that are participating in the 
Medicare Shared Savings Program or the testing of the Pioneer ACO 
model, assuming they meet the PQRS satisfactory reporting criteria, 
would not have the option that their value-based payment modifier be 
calculated using the quality-tiering approach (77 FR 44996-44997). We 
made this proposal because we were mindful that the physicians and 
groups of physicians that are, or will be, participating in the Shared 
Savings Program and the testing of the Pioneer ACO model have made 
sizable investments to redesign care processes based on the incentives 
created by these programs and did not wish to unintentionally disturb 
these investments. Therefore, we solicited comments on ways to 
structure the value-based payment modifier starting in 2017 so it does 
not create incentives that conflict with the goals of the Shared 
Savings Program and the Pioneer ACO model. We also solicited comments 
on whether groups of physicians that are participating in these two 
initiatives should have the option that their value-based payment 
modifier be calculated using a quality-tiering approach and applied to 
their payments under the PFS starting in 2015.
    Comment: Many commenters supported the proposal. A few commenters, 
especially those that supported broader opportunities for participation 
in the value-based payment modifier, likewise recommended that ACOs of 
both types (Shared Savings Program and Pioneer ACO model) should be 
permitted, but not required, to participate in the value-based payment 
modifier. Some recommended that ACOs be permitted to participate in the 
value-based payment modifier starting January 1, 2015. Such commenters 
believed that to the extent these groups furnish high-quality, low-cost 
care, they should have the opportunity to be rewarded for the value 
they furnish. They also believed that having a broader array of 
participants in the early years of the value-based payment modifier 
would facilitate the full-scale implementation in later years. Some 
commenters also noted that providing ACOs this option would also 
promote alignment with the Hospital Value-Based Purchasing Program in 
which hospitals participating in ACOs are permitted to participate. 
Another commenter encouraged CMS to further explore how to apply a 
value modifier to ACO-participating groups' PFS payments prior to 2017; 
for example, perhaps CMS could apply a value modifier to PFS payments 
for all patients who are not attributed to the ACO. A commenter noted 
that they were aware of several commercial plans with ACO-type 
contracts that simultaneously maintain ACO and pay-for-performance 
initiatives. In one case, the type of incentive follows the patient: 
providers receive the ACO program's incentives for patients attributed 
to that arrangement, and pay-for-performance incentives are based on 
care furnished to other patients the practice treats, but who do not 
meet the ACO's attribution criteria. The commenter believed this 
approach would avoid CMS's concern about unintentionally disturbing 
providers' ACO investments while encouraging a single standard of high-
quality, affordable care for all patients seen by the practice. Several 
commenters that are participating in the Innovation Center's 
Comprehensive Primary Care Initiative also suggested that we not apply 
the value-based payment modifier to them and/or not offer the quality-
tiering approach, because they are collecting quality information, are 
eligible for shared savings, and are being held to a different 
programmatic structure with different incentives.
    Response: We are finalizing and clarifying our proposal not to 
apply the value-based payment modifier for 2015 and 2016 to groups of 
physicians that are participating in the Shared Savings Program or the 
testing of the Pioneer ACO model. This policy means that such groups of 
physicians also will not have the option to elect quality-tiering 
because we will not apply the value-based payment modifier to them. At 
this early stage of the Medicare Shared Savings Program and the 
Innovation Center initiatives, we do not wish to unintentionally 
disturb their investments in implementing these programs. In addition, 
we also will not apply the value-based payment modifier in 2015 and 
2016 to groups of physicians that are participating in other Innovation 
Center initiatives, such as the Comprehensive Primary Care initiative, 
or other CMS programs which also involve shared savings and 
participants making substantial investments to report quality measures 
and to furnish higher quality, more efficient and effective healthcare.
    In sum, we will not apply the value-based payment modifier for 2015 
and 2016 to groups of physicians that are participating in the Medicare 
Shared Savings Program, the testing of the Pioneer ACO model, or other 
similar Innovation Center or CMS initiatives.
b. Performance Period
    We previously finalized CY 2013 as the initial performance period 
for the value-based payment modifier that will be applied in CY 2015 
(76 FR 73436). This means that we will use performance on quality and 
cost measures during CY 2013 to calculate the value-based payment 
modifier that we would apply to items and services for which payment is 
made under the PFS during CY 2015. Likewise, we proposed that 
performance on quality and cost measures in CY 2014 be used to 
calculate the value-based payment modifier that is applied to items and 
services for which payment is made under the PFS during CY 2016 (77 FR 
44997).
    As we explained in the CY 2012 PFS final rule with comment period 
(76 FR 73435), we explored different options to close the gap between 
the performance period (that is, 2013) and the payment adjustment 
period (that is, 2015), but found that none of them would have 
permitted sufficient time for physicians and groups of physicians to 
report measures or have their financial performance measured over a 
meaningful period, or for us to calculate

[[Page 69314]]

a value-based payment modifier and notify physicians and groups of 
physicians of their quality and cost performance and value-based 
payment modifier prior to the payment adjustment period. We also 
explained that a system that adjusted payments to take into account the 
value-based payment modifier after claims have been paid would be 
onerous on physicians and beneficiaries. We continued to explore ways 
to provide more timely feedback to physicians and to narrow the gap 
between the performance period and the payment adjustment period and 
solicited comments on practical alternatives that we could implement to 
do so. We solicited comments on our proposal to use CY 2014 as the 
performance period for the 2016 value-based payment modifier (77 FR 
44997).
    Comment: Although we did not seek comment on the use of 2013 as the 
performance period for the value-based payment modifier starting in 
2015, a number of commenters expressed concern that it was premature to 
use 2013 as the initial performance period for the 2015 value-based 
modifier. These commenters suggested that under the proposal, CMS in 
effect advanced the statutory implementation date by 2 years. They 
expressed concern that there will be insufficient time for CMS to 
communicate to all of the affected physicians and groups that they must 
sign-up to participate in the PQRS GPRO in the 3-month span between the 
publication of this final rule and the proposed self-nomination 
deadline for participating in the PQRS GPRO. In addition, some 
commenters stated that additional testing and analysis is required to 
further refine the methodology and ensure that the modifier is fair and 
reliable. They suggested that CMS could and should use the time between 
now and 2015 to do further testing and refinement of the modifier's 
components rather than establish 2013 as the initial performance 
period. In addition, commenters objected to the lag between the 
performance period (2013 or 2014) and the payment adjustment period 
(2015 or 2016, respectively).
    Response: As previously noted, we already finalized our proposal to 
use 2013 as the performance period for the value-based payment modifier 
in 2015. For the reasons noted above and below, we are finalizing 
calendar year 2014 as the performance period for the value-based 
payment modifier in 2016. We have taken steps to phase-in the value-
based payment modifier in a very gradual and cautious manner, as 
further evidenced by the fact that we are adjusting our policy to apply 
the value-based payment modifier to groups of physicians of 100 or more 
eligible professionals (rather than to groups of physicians of 25 or 
more eligible professionals) and the policy to allow such groups to 
select whether the quality-tiering approach would apply to the 
calculation of the value-based payment modifier. As we discussed above, 
our first principle guiding implementation of the value-based payment 
modifier is a focus on measurement. Thus, we believe it is essential to 
encourage greater reporting and we believe this activity should not be 
delayed. Although we agree with commenters suggestions to analyze 
different ways to structure and implement the value-based payment 
modifier, we need data on quality to do so. Thus, we believe it is 
imperative to begin phasing in the value-based payment modifier with an 
emphasis on encouraging all physicians and groups of physicians to 
participate in the PQRS. Moreover, given that all physicians will have 
to report data on quality measures under the PQRS or else be subject to 
the PQRS payment adjustment, we believe it is reasonable to align the 
programs to encourage greater reporting participation. Finally as 
discussed above in section III.G.1.b above, we have extended to October 
15, 2013 the time period during which groups of physicians subject to 
the value-based payment modifier can indicate their preferred PQRS 
reporting mechanism and whether they choose the quality-tiering 
approach. Therefore, we are finalizing our proposal to use CY 2014 as 
the performance period for the 2016 value-based payment modifier.
c. PQRS Quality Reporting Methods and Quality Measures
    In this section we discuss our policies to align quality measure 
reporting for the value-based payment modifier with the PQRS reporting 
methods, and to expand the range of quality measures that we will use 
for the value-based payment modifier.
(1) Alignment of Quality Reporting Options With the PQRS
    In the proposed rule we proposed to categorize groups of physicians 
eligible for the value-based payment modifier into two categories 
depending upon their participation in the PQRS (77 FR 44997). We 
further elaborated on these proposals and proposed that groups of 
physicians subject to the value-based payment modifier would be able to 
submit data on quality measures using one of the following proposed 
PQRS reporting mechanisms: PQRS GPRO using the web-interface, claims, 
registries, or EHRs; or PQRS administrative claims-based option. We 
also sought comment on which PQRS reporting mechanisms we should offer 
to individual physicians if we were to apply the value-based payment 
modifier to their payments under the PFS starting in 2015 and 2016.
    Comment: As discussed previously, the majority of commenters 
supported CMS' use of the PQRS as the foundation for measurement of the 
performance rates for groups of physicians subject to the value-based 
payment modifier. Several commenters, however, suggested using one PQRS 
reporting mechanism (rather than multiple mechanisms with varying 
criteria for becoming a satisfactory reporter for the PQRS incentive 
payment. They cited ``significant problems when comparing data 
submitted via claims-based CPT II codes and data gathered from an EHR 
data submission vendor or a registry'' due to the difference in 
reporting requirements.
    Response: We appreciate the commenters' suggestions. We agree with 
commenters who stated that we should seek to align quality reporting 
mechanisms across physician programs. We intend to use the PQRS as the 
foundation for the value-based payment modifier. We also believe that 
if a group of physicians subject to the value-based payment modifier 
reports data for quality measurement using one of the available 
reporting mechanisms under the PQRS, then we should use performance on 
those quality measures for the value-based payment modifier. Thus, the 
PQRS reporting mechanisms available to groups of physicians subject to 
the value-based modifier will be available for these groups to report 
measures for purposes of the value-based payment modifier. Although we 
proposed to include four methods for groups of physicians to 
participate in the PQRS GPRO (web-interface, claims, registries, and 
EHRs), as discussed in section III.G (Table 92), we are finalizing for 
the PQRS the web-interface and registries methods for CY2013. Thus, to 
align with the PQRS, we will finalize the same reporting methods for 
the value-based payment modifier. We recognize commenters' concern 
about the comparability of performance rates on measures reported 
through different reporting mechanisms. We intend to examine this issue 
more fully, especially as more physicians and groups of physicians 
utilize EHRs, to determine whether we should adjust our policies in 
future rulemaking.
    In summary, we are finalizing and clarifying our proposal that the 
groups

[[Page 69315]]

of physicians subject to the value-based payment may utilize the PQRS 
GPRO reporting mechanisms available to them in Tables 92, as well as 
the PQRS administrative claims option as a group, for purposes of the 
value-based payment modifier. In addition, if physicians in a group of 
physicians subject to the value-based payment modifier wish to report 
data for quality measures in the PQRS as individuals for the PQRS 
payment incentive rather than as a group practice, the group must elect 
the PQRS administrative claims-based reporting method as a group by 
October 15, 2013 in order for the group to avoid the -1.0 percent 
downward value-based payment modifier adjustment.
(2) Quality Measure Alignment With the PQRS
    We proposed to include all individual measures in the PQRS GPRO 
web-interface, claims, registries, and EHR reporting mechanisms for 
2013 and beyond for the value-based payment modifier. We proposed to 
include the measures in the PQRS administrative claims-based reporting 
option as well (77 FR 44998). We also proposed that four of the quality 
measures in the PQRS administrative claims-based reporting option (the 
four outcome measures) be used in the value-based payment modifier for 
all groups of physicians subject to the value-based payment modifier 
(77 FR 45001-02). Finally, we solicited comments on the quality 
measures that we should propose for individual physicians if we were to 
provide individual physicians the ability to elect to have the value-
based payment modifier apply to their payments under the PFS starting 
in 2015 or 2016 (77 FR 44998). In addition, we sought comment on the 
inclusion of community level measures in the value-based payment 
modifier (77 FR 45002).
    Comment: The majority of commenters appreciated the flexibility of 
choice in reporting individual measures. The clinical community cited 
that allowing physician groups to report on the entire spectrum of PQRS 
measures ``recognizes the diversity of services provided among 
physicians and physician groups and allows for more appropriate 
assessments of quality.'' Other commenters objected to the PQRS system 
because groups can ``cherry pick'' measures and consequently felt that 
PQRS did not provide a strong enough incentive for improving 
performance. A couple of commenters did not support including all 
measures from the 2013 GPRO interface in the value-based payment 
modifier and suggested we exclude both measures new to the GPRO web 
interface and measures which were not NQF-endorsed for physicians or 
group practices. One of these commenters also expressed concern about 
measures in the web interface with absolute thresholds and measures 
that do not allow a clinician to indicate that a patient has declined 
the service. Other commenters cited a lack of measures for many 
specialties and sub-specialties within PQRS as a cause for concern in 
using performance rates from PQRS quality measures in 2015.
    Response: We agree with the majority of commenters that physician 
groups should have flexibility in which measures to report for the 
value-based payment modifier. We are finalizing all of the individual 
measures under the PQRS for 2013 and beyond for the value-based payment 
modifier. These measures are discussed in Tables 94, 95, 123, and 124 
in section III.G above. We disagree with the commenters' suggestion to 
exclude measures new to the GPRO web interface, measures which were not 
NQF-endorsed, measures with absolute thresholds, and measures that do 
not allow a clinician to indicate the patient has declined the service 
in the value-based payment modifier. We believe we have provided groups 
of physicians with sufficient flexibility to choose the quality 
reporting method as well as the measures on which to report 
information. Moreover, we reiterate that the quality-tiering election 
we are finalizing is optional, thus ensuring no payment consequences 
for potentially poor performance on such quality measures.
    In addition as we described above in section III.G.6, we plan on 
expanding the specialty measures available in the PQRS in order to more 
accurately measure the performance on quality of care furnished by 
specialists. The expansion of the GPRO to registries in 2013 and to 
EHRs in 2014 means that sub-specialists may participate in the PQRS as 
members of a group practice, such that the group can report data on 
measures of broad applicability. We believe group reporting can 
ameliorate the commenters' concerns that the current set of PQRS 
measures does not capture all of the clinical care that some 
specialists and sub-specialists furnish. We also recognize that the 
rules governing the PQRS are flexible in terms of the quality measures 
physicians and groups of physicians report and the methods by which 
they report them. Although some commenters stated this flexibility 
would lead to ``cherry-picking'' measures, we believe these two 
features of the PQRS are beneficial given that the first principle 
governing the value-based payment modifier is to encourage greater 
reporting of information for quality purposes by physicians and groups 
of physicians.
    Comment: CMS received many comments about how to phase-in the 
value-based payment modifier at the individual level (for example, a 
solo practitioner) to allow them to report measures within any of the 
PQRS mechanisms for individual reporting (claims, registry, EHR) or by 
the method they had systems in place to report. Commenters supported 
the idea of flexibility of choice in reporting measures as stated 
above.
    Response: The vast majority of commenters have agreed with the 
application of the value-based payment modifier at the group level for 
the initial implementation of the program. We are not finalizing an 
option for solo practitioners to participate in the value-based payment 
modifier for 2015. We plan to make proposals for how the value-based 
payment modifier would apply to individual physicians and to smaller 
groups in future rulemaking.
d. Cost Measures
    Section 1848(p)(3) of the Act requires us to evaluate costs, to the 
extent practicable, based on a composite of appropriate measures of 
costs. In the CY 2012 PFS final rule with comment period (76 FR 73434), 
we finalized use of total per capita cost measures and per capita cost 
measures for beneficiaries with four specific chronic conditions 
(chronic obstructive pulmonary disease, heart failure, coronary artery 
disease, and diabetes) for the value-based payment modifier. Total per 
capita costs include payments under both Part A and Part B. Total per 
capita costs do not include Medicare payments under Part D for drug 
expenses. We proposed to use at least a 60-day claims run out with a 
completion factor from our Office of the Actuary (for example, claims 
paid through March 1 of the year following December 31, the close of 
the performance period) to calculate the total per capita cost measures 
(77 FR 45002).
    As described more fully in the composite scoring methodology 
discussion below, we proposed to make cost comparisons among groups of 
physicians using a similar beneficiary attribution methodology such 
that we make ``apples to apples'' comparisons. We believe that this 
would be an appropriate approach to using the total per capita cost 
measure in the value-based payment modifier. We sought comment on these 
proposals.

[[Page 69316]]

    The following is a summary of the comments we received regarding 
these proposals.
    Comment: A number of commenters expressed support for CMS' proposal 
to implement the total per capita cost measure and per capita cost 
measures for the four chronic conditions. One commenter noted that the 
four chronic conditions align with the proposed quality measures. Some 
commenters who expressed support for the proposed cost measures 
encouraged CMS to refine and improve its cost measures in a transparent 
manner, including by working with specialty societies and other 
interested parties to fine tune the existing measures and potentially 
add other chronic conditions. One commenter encouraged CMS to continue 
looking into how to incorporate Medicare Part D data into physician 
cost measures.
    One commenter expressed concerns that the value-based payment 
modifier was based on ``crude'' per capita measures, while a number of 
specialists expressed concern that the cost measures are inappropriate 
for some specialties, particularly single specialty practices. A number 
of specialists objected to basing physician cost measures on total 
amount billed per patient, since the specialist is assumed to be held 
responsible for care and treatment decisions of the patient for which 
they have little control and for which they have limited ability to 
modify their practice to reduce costs. Commenters indicated that 
attribution of no costs or little costs to specialists is possible 
under any attribution method since the majority of specialists do not 
treat one of the four chronic conditions, so measuring costs using per 
capita measures would not create incentives to change behavior. Some 
commenters stated that Medicare Part A costs should be excluded from 
cost comparisons, because physicians cannot control Part A (for 
example, hospital) costs. A number of specialists supported CMS working 
closely with physicians to refine the cost measures prior to 
implementation of the value-based payment modifier.
    Response: In the CY 2012 PFS final rule, we established a policy to 
use total per capita cost measures and per capita cost measures for 
beneficiaries with four specific chronic conditions (COPD, coronary 
artery disease, diabetes, and heart failure) in the value-based payment 
modifier to be implemented in 2015. We continue to believe that these 
measures are useful measures of the total volume of healthcare services 
furnished to Medicare beneficiaries attributed to a group of 
physicians. Moreover, use of total per capita cost measures reinforces 
one of the five principles governing implementation of the value-based 
payment modifier to encourage shared accountability for beneficiary 
care. We agree with specialty societies and other interested parties 
that suggested we continue to look for ways to refine the current 
measures and potentially add other chronic conditions. We will continue 
to explore the feasibility of including Part D data in the cost 
measures.
    Comment: Many commenters suggested that CMS focus on episode-based 
cost measures in the value-based payment modifier, and some explicitly 
mentioned the importance of CMS' work related to development of the 
Medicare Episode Grouper. A number of commenters agreed with CMS' 
recommendation to first incorporate episode costs from the Medicare 
Episode Grouper in the Physician Feedback program prior to applying the 
measures to the value-based payment modifier. Some commenters 
recommended that CMS focus on chronic or high priority episode types 
during the initial states of the value-based payment modifier. 
Commenters suggested that CMS meet with specialty groups and other 
stakeholders to obtain feedback on the development and application of 
the Medicare Episode Grouper data and urged transparency through means 
other than just rulemaking.
    Response: We agree with commenters about the potential value of 
episode-based cost measures in the value modifier, and we also agree 
with those that support our recommendation to first incorporate episode 
costs from the Medicare Episode Grouper in the Physician Feedback 
program before applying these measures to the value-based payment 
modifier. CMS plans to engage stakeholders through events that will 
provide details of the episode grouper methodology and to obtain 
feedback on episode based costs and utilization.
    Comment: Several commenters noted that it would be useful to look 
at costs over a sufficiently long time period (for example, several 
years) to ensure that the full benefits of using the technology, 
diagnostic testing, or drug were captured. Some commenters also noted 
that per capita cost measures do not reflect savings in Medicare Part A 
that are due to the physician's or groups' care. Other commenters 
suggested that cost measures should be aligned with appropriate 
outcomes or quality measures.
    Response: We agree that it would be useful to incorporate benefits 
of technology and drugs that might be realized in future years, and we 
may examine ways to measure costs, and changes in cost, over multiple 
years in the future for the value-based payment modifier. We believe 
that Part A savings during the performance year will be reflected in 
lower total per capita costs, and thus we disagree with the comments 
that suggest we should not include Part A costs in the total per capita 
cost measures.
    Comment: A number of commenters recommended that all value-based 
payment modifier cost measures be submitted to NQF for endorsement. 
Some commenters stated that CMS should include only NQF-endorsed cost 
measures in the value-based payment modifier. They also suggested that 
CMS delay implementation of the value-based payment modifier until 
measure testing and the NQF process was complete.
    Response: We plan to submit the total per capita cost measures and 
the four chronic condition-focused per capita measures for NQF 
endorsement. Although we generally agree that NQF-endorsed measures are 
preferable, we do not agree that we should only use NQF-endorsed 
measures for the value-based payment modifier. The development of cost 
measures is in its infancy and we believe that conditioning use of cost 
measures for the value-based payment modifier on NQF-endorsement would 
unduly delay implementation of the value-based payment modifier.
    Comment: We received no comments specifically on using at least a 
60-day claims run out, but one supporter of the five per capita cost 
measures noted that the run out period should be established such that 
an extension of the time period would only minimally improve accuracy.
    Response: We are finalizing our proposal to use at least a 60-day 
run out with a completion factor from CMS' Office of the Actuary to 
calculate the total per capita cost measures, because we believe it 
will provide an accurate calculation of these measures.
    As a result of the comments and for the reasons we articulated 
previously, we are finalizing the total per capita cost measures and 
per capita cost measures for beneficiaries with four specific chronic 
conditions (COPD, coronary artery disease, diabetes, and heart failure) 
in the 2015 value-based payment modifier and to use at least a 60-day 
claims run out.
(1) Proposed Payment Standardization Methodology for Cost Measures
    Section 1848(p)(3) of the Act requires that ``* * * costs shall be 
evaluated, to

[[Page 69317]]

the extent practicable, based on a composite of appropriate measures of 
costs established by the Secretary (such as the composite measure under 
the methodology established under section 1848(n)(9)(C)(iii)) that 
eliminate the effect of geographic adjustments in payment rates (as 
described in subsection (e)) * * *'' We have interpreted this directive 
to require us to standardize Medicare payments to ensure fair 
comparisons of costs across geographic areas.
    Payment standardization removes local or regional price differences 
that may cause cost variation a physician cannot influence through 
practicing efficient care. In Medicare, an effective payment 
standardization methodology would exclude Medicare geographic 
adjustment factors such as the geographic practice cost index (GPCI) 
and the hospital wage index so that, for example, per capita costs for 
beneficiaries in Atlanta, Georgia can be compared to those of 
beneficiaries in Lincoln, Nebraska. Payment standardization, therefore, 
allows fair comparisons of resource use costs for physicians to those 
of peers who may practice in locations or facilities where Medicare 
payments are higher or lower.
    With industry input, we developed a Medicare payment 
standardization methodology that excludes such geographic payment rate 
differences. We update this methodology annually to reflect any change 
in CMS payment systems. We proposed to use the same standardization 
methodology as in the 2011 Physician Feedback reports and the Medicare 
Spending per Beneficiary (MSPB) measure that is used in CMS' feedback 
reports to hospitals (77 FR 45003).
    The following is a summary of the comments we received regarding 
the payment standardization proposal.
    Comment: Commenters expressed support for removing geographic and 
other adjustments when calculating cost measures. Several commenters 
agreed that cost measures in the value-based payment modifier must be 
standardized and explicitly supported the removal of indirect medical 
education (IME) and disproportionate share hospital (DSH) payments from 
the inpatient resource calculations.
    Multiple commenters expressed concern about the Geographic Price 
Cost Indices (GPCIs). They stated that the GPCI results in downward 
adjustments that do not reflect the actual cost of physician practice. 
Some commenters referred to concerns about CMS cost measurement 
methodology issues that were raised in the May 2011 and July 2012 
Institute of Medicine reports that questioned CMS policies regarding 
geographic adjustment.\5\ These commenters claimed that, although the 
standardization method reverses the effects of the GPCI, it results in 
the perpetuation of some of the inaccuracies of the GPCI inputs that 
reduce payments for some regions. Some commenters stated that payment 
standardization does not account for regional differences in spending, 
so CMS should establish cost measures at the regional and national 
level. One commenter described concerns about efforts of poor physician 
supply on local cost measures. Several commenters noted that some areas 
might have high costs but lower rates of spending growth than 
nationally.
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    \5\ See http://iom.edu/Reports/2011/Geographic-Adjustment-in-Medicare-Payment-Phase-I-Improving-Accuracy.aspx (May 2011; revised 
September 2011) and http://iom.edu/eports/2012/Geographic-Adjustment-in-Medicare-Payment-Phase-II.aspx (July 2012).
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    Response: We agree that standardization is important to ensure that 
groups of physicians' cost measures are not higher or lower due to 
geographic differences and other adjustments (IME, DSH, etc.) that 
affect actual Medicare Part A and Part B payments. We note that the 
effects of the GPCIs are removed from payments under the CMS payment 
standardization methodology,\6\ so services that would be subject to 
the GPCIs under Medicare payment rules are priced at the same level 
across all physicians within the same setting, regardless of geographic 
area in which they practice. Commenters' concerns about the 
effectiveness of our geographic adjustment policies in general are 
outside the scope of this rulemaking. Commenters' concern about the 
proposed standardization methodology not taking account of regional 
differences in spending appears to misinterpret our approach to 
standardization. The per capita cost measures themselves will show 
regional differences in Medicare spending, but the standardization 
process ensures that differences in cost measures do not reflect 
differences in Medicare's price indices such as the GPCI. Finally, 
standardization is not meant to measure growth in spending.
---------------------------------------------------------------------------

    \6\ See Quality Net, Measure Methodology Reports, available at: 
http://www.qualitynet.org/dcs/ContentServer?c=Page&pagename=QnetPublic%2FPage%2FQnetTier4&cid=1228772057350.
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    As a result of the comments and for the reasons specified above, we 
are finalizing our proposal to apply the CMS payment standardization 
methodology, and any annual updates to the methodology, to the cost 
measures used for the value-based payment modifier.
(2) Risk Adjustment Methodology for Cost Measures
    Section 1848(p)(3) of the Act requires that costs be adjusted to 
``* * * take into account risk factors[,] such as socioeconomic and 
demographic characteristics, ethnicity, and health status of 
individuals (such as to recognize that less healthy individuals may 
require more intensive interventions) and other factors determined 
appropriate by the Secretary.''
    Risk adjustment accounts for differences in patient characteristics 
not directly related to patient care, but that may increase or decrease 
the costs of care. In the Physician Feedback reports, after 
standardizing per capita costs for geographic factors, we also adjusted 
them based on the unique mix of patients attributed to the physician or 
group of physicians. Costs for beneficiaries with high risk factors 
(such as a history of chronic diseases, disability, or increased age) 
are adjusted downward, and costs for beneficiaries with low risk 
factors are adjusted upward. Thus, for individual physicians or 
physician groups who have a higher than average proportion of patients 
with serious medical conditions or other higher-cost risk factors, risk 
adjusted per capita costs are lower than the unadjusted costs, because 
costs of higher-risk patients are adjusted downward. Similarly, for 
individual physicians or physician groups who treated comparatively 
lower-risk patients, risk adjusted per capita costs were higher than 
unadjusted costs, because costs for lower-risk patients were adjusted 
upwards.
    We proposed to use the HCC model, which assigns prior year ICD-9-CM 
diagnosis codes to 70 high-cost clinical conditions (each with similar 
disease characteristics and costs) to capture medical condition risk 
(77 FR 45003-45004). The HCC risk scores also incorporate patient age, 
gender, reason for Medicare eligibility (age or disability), and 
Medicaid eligibility status, which is in part a proxy for socioeconomic 
status and reflects the greater resources typically used by 
beneficiaries eligible for both Medicare and Medicaid. The risk 
adjustment model also includes the beneficiary's end stage renal 
disease (ESRD) status. More information about the risk adjustment model 
is on the CMS Web site at http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeedbackProgram/Downloads/122111_Slide_Presentation.pdf.

[[Page 69318]]

    We proposed to use the same risk adjustment model for risk 
adjusting total per capita costs and the total per capita costs for 
beneficiaries with four chronic diseases (coronary artery disease, 
COPD, diabetes, and heart failure) as we have used for the group and 
individual 2010 Physician Feedback reports.
    The following is a summary of the comments we received regarding 
the risk adjustment proposal.
    Comment: A number of commenters supported the HCC risk adjustment 
methodology, with one commenter stating that the risk adjustment 
approach that was used for the 2010 physician feedback reports is the 
best currently available approach to risk adjustment of the value-based 
payment modifier with the best proxies for health status and 
socioeconomic status being used. Other commenters noted the need for or 
importance of risk adjustment of cost measures without explicitly 
stating support of the CMS method, with one commenter urging CMS to 
proceed with caution so that risk adjustment does not penalize 
physicians that treat sicker, more costly patients.
    Many commenters expressed concerns about the proposed risk 
adjustment method. Some commenters indicated that they had long-
standing concerns with the HCC risk adjuster that should be addressed 
before the value-based payment modifiers is applied to small and mid-
sized practices, and they urged CMS to consider new approaches that 
have been suggested by MedPAC and by the Medicare Episode Grouper 
contractor. Some concerns about the HCC model that commenters expressed 
include that it does not fare as well with acute costs associated with 
surgeries that are not predictable. Some commenters argued that 
socioeconomic factors and compliance are not adequately captured in the 
model, and that the Medicaid dual eligible status alone does not 
capture these differences in risk. Commenters suggested including 
different factors to capture socioeconomic status, including poverty 
status, education, literacy, race, ethnicity, English proficiency, 
homelessness, and religion. A number of commenters urged that CMS do 
further analysis in testing and refining risk adjusters that address 
comorbid conditions or new disease onset, and suggested that CMS work 
with physician groups.
    Response: We continue to believe that the current risk adjustment 
methodology, which is based on the HCC model \7\ and supported by a 
number of commenters, should be used in the value-based payment 
modifier. The HCC model is calibrated on Medicare fee for service 
beneficiaries and is accurate in predicting these costs. Moreover, one 
of the benefits of the HCC model is that CMS updates it regularly to 
reflect changes in treatment patterns and costs. In addition, CMS is 
exploring how to incorporate additional aspects of coding completeness 
and quality. The result of these efforts would inform how to weigh the 
future model design to predict costs and to capture conditions that are 
present in clinical conditions.\8\
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    \7\ See RTI, ``Evaluation of the CMS-HCC Risk Adjustment 
Methodology,'' (March 2011), available at: https://www.cms.gov/MedicareAdvtgSpecRateStats/downloads/Evaluation_Risk_Adj_Model_2011.pdf.
    \8\ See ``Advance Notice of Methodological Changes for Calendar 
Year (CY) 2013 for Medicare Advantage (MA) Capitation Rates, Part C 
and Part D Payment Policies and 2013 Call Letter.''
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    Commenters did not present evidence that the risk adjustment model 
systematically disadvantages physicians or groups that see certain 
patient types, nor did they present reliable data sources we could use 
in our risk adjustment model to account for recommended factors such as 
socioeconomic status, education, literacy, English proficiency, 
homelessness, and religion. We agree with commenters that patient 
compliance could be a relevant issue, but commenters did not present a 
method about how to incorporate such compliance into the risk 
adjustment model using existing beneficiary data.
    After consideration of the comments and for the reasons discussed 
above, we are finalizing our proposed approach to risk adjustment of 
the cost measures included in the value-based payment modifier.
e. Attribution of Quality and Cost Measures
    Calculation of administrative claims-based quality and cost measure 
performance rates requires us to attribute Medicare beneficiaries to 
groups of physicians. We proposed to use a plurality of care method to 
attribute beneficiaries to a group of physicians (77 FR 45005). In this 
method, we attributed Medicare FFS beneficiaries to the group practice 
that billed a larger share of office and other outpatient Evaluation 
and Management (E/M) services (based on dollars) than any other group 
of physician practice (that is, the plurality). In addition, 
beneficiaries had to have at least two E/M services furnished by the 
group of physicians.
    We sought comments on two possible alternative attribution 
approaches for the value-based payment modifier (77 FR 45005). First, 
we sought comment on whether we should use an attribution approach 
based on the methodology used in the Medicare Shared Savings Program to 
assign a beneficiary to an Accountable Care Organization (ACO). As 
discussed in the CY 2013 proposed FFS rule (77 FR 44819), this 
attribution approach would involve a two-step process that emphasizes 
primary care services furnished by a physician or group of physicians. 
Second, we sought comment on whether we instead should apply the 
``degree of involvement'' attribution method. We used the ``degree of 
involvement'' method to attribute beneficiaries for cost purposes to 
individual physicians in the CY 2010 Physician Feedback reports. Under 
this attribution method, we classified the patients for which a 
physician submitted at least one Medicare FFS Part B claim into three 
categories (directed, influenced, and contributed) based on the amount 
of physician involvement with the patient.\9\ For directed and 
influenced patients, the physician billed for 35 percent or more of the 
patient's office or other outpatient evaluation and management (E/M) 
visits or for 20 percent or more of the patient's total professional 
costs, whereas for contributed patients, the physician billed for fewer 
than 35 percent of the patient's outpatient E&M visits and for less 
than 20 percent of the patient's total professional costs.
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    \9\ CMS, ``Detailed Methodology for Individual Physician 
Reports'' (2012), available at http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeedbackProgram/Downloads/QRURs_for_Individual_Physicians.pdf.
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    The following is a summary of the comments we received regarding 
the attribution proposal.
    Comment: We received several comments on attribution. Of the many 
commenters who expressed a preference for one of the attribution 
methods, the majority expressed support for the plurality of care 
method or the plurality of primary care services method used in the 
Medicare Shared Savings Program (Shared Savings Program). Arguments in 
favor of a plurality of care attribution method include consistency 
with 2010 group feedback reports, administrative simplicity, 
transparency, credibility, understandability, and its emphasis on role 
of treatment of chronic conditions. One commenter supported using a 
plurality of care method, but stated that CMS should encourage 
beneficiaries to choose a primary care physician and adopt an 
attribution method that includes greater consideration of annual 
wellness visits. Another commenter suggested that CMS adopt either a 
plurality of care or plurality of primary

[[Page 69319]]

care services as included in the Shared Savings Program, as it would 
provide a better transition to episodes of care than the degree of 
involvement method.
    Although commenters were more favorable of the plurality of care or 
plurality of primary care method than the degree of involvement 
attribution method, some commenters expressed concerns about using an 
attribution method based on plurality of care. Some commenters agreed 
with CMS that the plurality of care method, which depends on E/M 
frequency, would not work for certain specialists, with one commenter 
stating that plurality unfairly attributes costs to certain specialties 
over others and other commenters agreeing with CMS that plurality will 
not be applicable to single specialty groups. One commenter expressed 
concern that the plurality method may be too restrictive for some 
practices. Another commenter noted that plurality of care attribution 
in the performance year is a problem when used with risk adjustment 
that is based on claims that are submitted in years prior to the 
performance year, and noted that multiple attribution or degree of 
involvement may alleviate some, but not all, of the issues. One 
commenter asked how the plurality of care method accommodates 
specialists who do not furnish the plurality of a patient's care.
    CMS asked for comment on the plurality of primary care attribution 
approach that is similar to what is used in the Shared Savings Program. 
Although fewer commenters discussed this method than the plurality of 
care method, most who did discuss this method expressed general support 
for this approach, either as their preferred attribution method or one 
that was at least at the same level of acceptability as the plurality 
of care method. Some commenters stated that, while the plurality of 
care method would be consistent with the attribution method proposed 
for the PQRS GPRO web-interface, the plurality of primary care 
attribution method is comparable to that used in the Shared Savings 
Program and would create consistency across these programs. One 
specialist group indicated that a patient that sees a specialist for 
management of chronic conditions and receives a plurality of primary 
care services from the specialist would be appropriately attributed 
under this method. One medical center supported the Shared Savings 
Program-like approach over the plurality of care method because most 
group reporting measures are primary care based, so attribution under 
this method would be to the primary care physician whereas, under 
plurality of care attribution, the beneficiaries could be assigned 
incorrectly to higher cost specialists.
    Response: We are persuaded by the comments that we should not 
finalize the plurality of care method, but should instead align the 
attribution methodology with the methodology used for the Shared 
Savings Program. Given that we are applying the value-based payment 
modifier to groups of physicians of 100 or more eligible professionals, 
we believe it is important to align attribution methods with the one 
being used for the Shared Savings Program and the PQRS. Because the 
cost measures we are using for the value-based payment modifier focus 
on total per capita costs, we believe it is reasonable to attribute 
beneficiaries to those groups of physicians that are most responsible 
for the delivery of primary care services and have the ability to 
furnish it in a cost-effective manner.
    We recognize that certain large single specialty groups--such as 
those limited to emergency medicine, diagnostic radiology, pathology, 
and anesthesiology--will not be attributed beneficiaries under this 
attribution methodology. Indeed, neither the plurality of care 
attribution methodology nor the Shared Savings Program methodology 
would attribute beneficiaries to certain single specialty groups. 
However, after we have had the opportunity to examine the issue further 
and gain more experience with the value-based payment modifier we 
anticipate addressing this issue in future rulemaking. We believe that 
as we continue to phase in the value-based payment modifier, we will 
refine our attribution methods to assign beneficiaries to these 
physicians and groups of physicians within these specialties.
    Comment: Support for the degree of involvement method was mixed, 
with a high percentage of commenters of this method suggesting that it 
needed to be studied further and explained to physicians. Some 
commenters argued that the degree of involvement method was more 
comprehensive and a better alternative in the long run; allows 
physicians who contribute to the care of a patient to be recognized for 
their services; and is preferable for attribution for individual 
physicians (rather than groups). One commenter supported the degree of 
involvement method, but disagreed with the idea of combining the 
directed and influenced categories because of the differences in 
accountability between the two categories. Similarly, another commenter 
indicated that if CMS selected the degree of involvement method over 
its preferred method of plurality of care, only the directed category 
should be used, since influenced patients are not sufficiently under 
the physicians' care. Another commenter suggested that CMS study the 
effects of the degree of involvement method and consider whether to 
exclude certain specialists from attribution because they should not be 
treating patients with certain conditions.
    A number of commenters expressed either concern or confusion about 
the degree of involvement attribution method. Several commenters 
suggested that CMS use data from the Physician Feedback reports to 
examine the impact of different methods on groups' cost and quality 
scores. Some commenters questioned how the degree of involvement 
classification would translate into how much would be attributed to a 
physician or a group. One commenter indicated that the degree of 
involvement method would be problematic in many cases and would need to 
evolve over time, with consideration for physicians who see patients at 
multiple facilities. Emergency physicians expressed concern about their 
ability to influence overall costs through coordination, although they 
might be attributed the costs under this method.
    Response: We thank commenters for their views on the degree of 
involvement attribution methodology, but as discussed above, we are 
finalizing the attribution methodology used in the Medicare Shared 
Savings Program. We will continue to study this methodology for it may 
continue to have applicability when we make proposals to apply the 
value-based payment modifier to individual physicians.
    Comment: Some commenters expressed concerns about attribution 
methods in general, stating that the current models do not address 
attribution appropriately when a patient sees multiple physicians, with 
some costs within a physician's control and other costs not within the 
physician's control. Another commenter suggested that CMS explore the 
option of a set of billing codes to make explicit the scope and nature 
of responsibility between the physician and patient. Another commenter 
indicated that attribution methods for specialists must account for 
care furnished because the original physician did not take sufficient 
preventive steps or because the patient was referred to a specialist. 
One commenter stated that attribution of the entire cost of surgeries 
should be attributed to the performing surgeon.
    Response: We thank commenters for their views and will consider 
them

[[Page 69320]]

when developing future proposals to design an attribution methodology 
for those groups of physicians that will not have beneficiaries 
attributed to them under the finalized attribution methodology 
discussed above for the 2013 performance period.
    Comment: Many commenters indicated that CMS should study the impact 
of different attribution methods on physicians/physician groups' costs 
and share the results to solicit stakeholder feedback, possibly through 
future rulemaking. A number of commenters expressed a willingness to 
work with CMS on attribution. Commenters wanted to understand how the 
results change when the attribution methodology changes, and some 
suggested that CMS delay the value-based payment modifier until CMS has 
tested and implemented a meaningful system for attribution to 
specialists. Some commenters discussed the RAND study to prove their 
point that the attribution methodology can affect how physicians and 
groups of physicians are characterized for cost and quality purposes. 
This study, which used claims on adults age 18-65 that were 
continuously enrolled in four Massachusetts commercial plans in the 
years 2004 and 2005, created 12 attribution rules and found that about 
22 percent of physicians would be assigned to the wrong cost category 
given a change in attribution rules.\10\
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    \10\ See RAND, Is Physician Cost Profiling Ready for Prime Time? 
Available at: http://www.rand.org/pubs/research_briefs/RB9523-1/index1.html.
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    Response: We agree with commenters that it would be informative to 
study the results of different attribution methods using the same data 
and share the results with physicians. We do not agree with the 
commenters' suggestion to delay implementation of the value-based 
payment modifier. We believe it is critical for physicians and groups 
of physicians to report data for quality measures through the PQRS. A 
delay of the value-based payment modifier would undermine this 
objective. Moreover, because the quality-tiering calculation 
methodology is optional, we believe we have provided a reasonable way 
to implement the value-based payment modifier so that groups of 
physicians can obtain information on how their payment could be 
modified in the future and take appropriate action.
    As a result of the comments, we are not finalizing the proposed 
plurality of care method, but instead, as described above, we will 
apply the same attribution rule as that used for the Medicare Shared 
Savings Program and the PQRS GPRO web interface. This methodology is 
described at http://www.gpo.gov/fdsys/pkg/FR-2011-11-02/pdf/2011-27461.pdf. See also 45 CFR 425.400 through 425.402.
f. Composite Scores for the Value-Based Payment Modifier
    Section 1848(p)(2) of the Act requires that quality of care be 
evaluated, to the extent practicable, based on a composite of measures 
of the quality of care furnished. Likewise, section 1848(p)(3) of the 
Act requires that costs in the value-based payment modifier be 
evaluated, to the extent practicable, based on a composite of 
appropriate measures of costs.
(1) Quality of Care and Cost Domains
    We proposed to align the quality measures used in the value-based 
payment modifier with the national priorities established in the 
National Quality Strategy (77 FR 45006). The National Quality Strategy 
outlined six priorities including:
     Make care safer by reducing harm caused in the delivery of 
care (patient safety).
     Ensure that care engages each person and family as 
partners (patient experience).
     Promote effective communication and coordination of care 
(care coordination).
     Promote the most effective prevention and treatment 
practices for leading causes of mortality (clinical care).
     Work with communities to promote wide use of best practice 
to enable healthy living (population/community health).
     Make quality care more affordable for individuals, 
families, employers, and governments by developing and spreading new 
health care delivery models (efficiency).\11\
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    \11\ National Quality Strategy, http://www.healthcare.gov/law/resources/reports/nationalqualitystrategy032011.pdf.
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    We proposed to classify each of the quality measures that we 
proposed for the value-based payment modifier into one of these six 
domains. We proposed to weight each domain equally to form a quality of 
care composite. We believe this is a straightforward approach that 
recognizes the importance of each domain. Within each domain, we 
proposed to weight each measure equally so that groups of physicians 
have equal incentives to improve care delivery on all measures. To the 
extent that a domain does not contain quality measures, the remaining 
domains would be equally weighted to form the quality of care 
composite. For example, if only three domains contain quality 
information, each domain would be weighted at 33.3 percent to form the 
quality composite while the remaining three domains would not be 
included.
    In terms of the cost composite, we finalized in the CY 2012 PFS 
final rule (76 FR 73434) five per capita cost measures: Total per 
capita costs (Parts A and B) and total per capita costs for 
beneficiaries with four chronic diseases (diabetes, CAD, COPD, heart 
failure). We proposed to group these five per capita cost measures into 
two separate domains: Total overall costs (one measure) and total costs 
for beneficiaries with specific conditions (four measures). A separate 
domain for costs for beneficiaries with specific conditions highlights 
our desire to incentivize efficient care for beneficiaries with these 
conditions.
    Similar to the quality of care composite, we proposed to weight 
each cost domain equally to form the cost composite and within the cost 
domains we proposed to weight each measure equally. In those instances 
in which we cannot calculate a particular cost measure, for example, 
due to too few cases, we proposed to weight the remaining cost measures 
in the domain equally.
    Comment: We received comments both in support of and in opposition 
to our proposed composite score methodology. Some commenters expressed 
support for quality of care and cost composites, with one noting their 
view that composite scores are more meaningful for purchasers than are 
other measures. Some commenters expressed concerns with the proposed 
composite measures. For example, one commenter observed that quality of 
care and cost composites might mask significant variation in 
performance across disease categories. That is, a physician could 
demonstrate high quality and low costs for one disease category, but 
lower quality and higher costs for others; however, this would not be 
detected within a composite measure. This commenter also recommended 
that the internal validity of measures should be demonstrated before 
multiple measures are combined into a single composite. Another 
commenter expressed concern that few measures within the composites 
were applicable to their particular specialty.
    Comments on our proposed domains and weighting methodology were 
also mixed. One commenter expressed support for our proposal to equally 
weight domains, but recommended that attention be given to the number 
of measures in each domain so that they were weighted to support our 
policy

[[Page 69321]]

goals. Another commenter expressed concern about establishing separate 
domains when some of these had no measures in place (for example, 
population/community health) while others had only a handful of 
measures, which could cause differential weighting among measures.
    We also received varying views on how to weight various measures. 
One commenter suggested that quality outcome measures should receive 
more weight than other measure types; another comment suggested that 
outcome measures be weighted lower than the PQRS measures as the latter 
are likely to be more direct indicators of a physician's performance, 
particularly for specialty physicians. Alternatively, one commenter 
suggested that CMS weight existing PQRS measures within the efficiency 
domain for those who successfully report or assess costs on a measure-
by-measure basis.
    Response: We appreciate the comments in support of, and suggestions 
to improve upon, our proposals. We believe that forming each group of 
physicians' quality and cost composites by equally weighting quality 
measures in equally weighted domains makes the most sense when groups 
of physicians have flexibility to choose which measures they will 
report. It also is a transparent method and easily understood by 
physicians. We recognize that some groups may not report measures in 
certain proposed domains, such as community/population health, 
efficiency, and patient experience. We wish to clarify that our 
proposal intended to establish an overall framework for how we would 
weight measures, and that as more measures are included in this and the 
PQRS programs, they would be incorporated into our framework. As we 
stated in the proposed rule (77 FR 45006), in cases where a group does 
not report measures in one or two of the domains the remaining domains 
will be weighted equally. If the group only reports measures in a 
single domain, the domain would be weighted 100 percent. Moreover, all 
measures in a domain would be equally weighted.
    We agree with the commenters' recommendation that we continue to 
monitor and examine our policy to form the quality and cost composites. 
We believe this monitoring will be facilitated with the data reported 
by those participating in value-based payment modifier and the PQRS 
programs. As part of this monitoring, we will be able to examine 
whether the quality and cost composites are masking performance 
variation within a group as suggested by the commenters.
    Accordingly, we are finalizing our proposal to construct the 
quality composite by classifying each group's quality measures into one 
of the six National Quality Strategy domains, to weight each measure 
equally within each domain, and to weight the domains equally to form 
the quality composite. Likewise, we are finalizing our proposals to 
construct the cost composite by classifying each group's per capita 
cost measures into two domains--all patients and all patients with four 
specific chronic conditions, to weight each measure equally within each 
domain, and to weight the domains equally to form the cost composite.
(2) Value-Based Payment Modifier Scoring Methods
    We proposed a scoring approach that focuses on how the group of 
physicians' performance differs from the benchmark on a measure-by-
measure basis because we proposed to provide flexibility to groups of 
physicians as to the quality measures they report (77 FR 45007). We 
explained that the scoring methodology needs to be able to compare 
``apples to apples.'' For each quality and cost measure, we proposed to 
divide the difference between a group of physicians' performance rate 
and the benchmark by the measure's standard deviation. The benchmarks, 
as further described below, are the national means of the quality or 
cost measure. This step produces a score for each measure that is 
expressed in standardized units.
    Comment: The comments we received on this issue supported our 
proposal to establish standardized scores for performance measures to 
ensure fair comparisons among groups of physicians.
    Response: After consideration of the comments, we are finalizing 
our proposal to establish standardized scores for the value-based 
modifier performance measures. We believe that this approach achieves 
our policy objective to distinguish clearly between high and low 
performance and to allow us to create composites of quality of care for 
groups of physicians that report different quality measures. We will be 
considering the effects of our methodology over the next several years 
as we implement this program and may consider changes to the policy 
through future rulemaking.
(3) Benchmarks and Peer Groups for Quality Measures
    We proposed that the benchmark for each quality measure be the 
national mean of each measure's performance rate during the performance 
period (77 FR 45008). We proposed to unify the calculation of the 
benchmark by weighting the performance rate of each physician and group 
of physicians submitting data on the quality measure by the number of 
beneficiaries used to calculate the performance rate so that group 
performance is weighted appropriately.
    In addition, we proposed that the benchmarks for quality measures 
in the PQRS administrative claims-based reporting option be the 
national mean of each quality measure's performance rate calculated at 
the TIN level. We proposed to calculate the national mean by including 
all TINs of groups of physicians with 25 or more eligible 
professionals. We proposed to weight the TIN's performance rate by the 
number of beneficiaries used to calculate the quality measure.
    To help groups of physicians understand how their quality measure 
performance affects their quality of care composite score, we proposed 
to publish the previous years' performance rates (and standardized 
scores) on each quality measure.
    Comment: We received several comments supporting our proposed 
national benchmark. Some commenters highlighted their view that 
national benchmarks were a fair way to both (1) reward high-quality, 
low-cost groups of physicians while (2) providing targets for 
improvement to underperforming groups of physicians. Although generally 
supporting our proposal, one commenter expressed the concern that 
benchmarks might be skewed and inconsistent across years because 
physicians could choose the measures on which they reported rather than 
requiring that they report on the full distribution of performance. 
Accordingly, this commenter recommended that all groups of physicians 
should report on a common set of measures.
    Other commenters reported concerns about the proposed national 
benchmark and, as an alternative, suggested that comparisons should be 
within regions, physician or to some other appropriate peer group, for 
example, considering patient risk. One commenter encouraged CMS to set 
performance standards higher in subsequent years.
    Some commenters suggested that CMS explore and conduct analyses on 
a variety of benchmarking options. For example, one suggested that CMS 
examine the advantages of initially using a regional or blended 
benchmark that gradually moves to a national benchmark. In their view, 
this could be a means to encourage physician buy-in while not 
disadvantaging certain regions

[[Page 69322]]

based on their historical performance levels.
    One commenter suggested that for a pay-for-performance system to be 
effective, it must have clarity and credibility with front-line 
practitioners. This commenter observed that under our proposals, 
physicians receiving a payment adjustment are unlikely to understand 
why their payments are getting adjusted and what they need to do to 
improve their value modifier.
    Response: We appreciate the comments we received in support of our 
proposed national benchmarks as well as suggested alternatives. Given 
that Medicare is a national program, we concur with comments that a 
national benchmark is most appropriate. Medicare beneficiaries should 
receive high quality and low cost care regardless of their location. 
Moreover, we use national benchmarks for other Medicare programs aimed 
at improving the quality and cost of care, for example, the Medicare 
Shared Savings program.
    Because we are allowing flexibility on the quality measures that 
groups of physicians can report, we believe the most appropriate peer 
group consists of other physicians and physician groups reporting the 
same measure regardless of specialty. Under this approach, we expect 
physicians and physician groups will report data on the quality 
measures that best reflect the care they furnish.
    We also believe that the optional nature of the quality-tiering 
approach to calculating the value-based payment modifier will encourage 
physician buy-in while not disadvantaging certain regions based on 
their historical performance levels, thus we will not develop regional 
benchmarks for each quality measure.
    Further, we believe transparency is a key component to establish 
credibility among physicians, namely, physicians need to understand why 
their payments are being adjusted in order to improve their 
performance. Thus, we are modifying our proposal to establish 
benchmarks based on the year prior to the performance year so that 
groups of physicians have information on national benchmarks prior to 
the end of the performance year. For example, the benchmark for the 
2013 performance year will be based on 2012. We intend that these 
benchmarks would be available publicly to inform a group of physicians' 
choice of PQRS reporting method for the applicable performance year.
    Accordingly, we are finalizing our proposal for national benchmarks 
and we will unify the calculation of the benchmark by weighting the 
performance rate of each physician and group of physicians submitting 
data (through any PQRS reporting method) on the quality measure by the 
number of beneficiaries used to calculate the performance rate. In 
addition, the benchmarks for quality measures in the PQRS 
administrative claims-based reporting option are the national mean of 
each quality measure's performance rate calculated at the TIN level. We 
will weight the TIN's performance rate by the number of beneficiaries 
used to calculate the quality measure. We also will use the year prior 
to the performance year as the year for calculating the benchmark. If a 
measure is new to the PQRS, we will be unable to calculate a benchmark, 
and hence, performance on that measure will not be included in the 
quality composite. We will be considering the effects of our policies 
over the next several years as we implement this program and may 
consider changes and refinements through future rulemaking.
(4) Benchmarks and Peer Groups for Cost Measures
    To ensure fair cost comparisons that identify groups of physicians 
that are outliers (both high and low), we proposed that the methodology 
used to attribute beneficiaries to a group of physicians be the same as 
the methodology used to attribute beneficiaries in the peer group (77 
FR 45008). We explained that we seek to compare like groups of 
physicians that use the same cost attribution methodology to ensure we 
are making ``apples to apples'' comparisons among groups of physicians. 
As discussed above, we are finalizing a cost attribution methodology 
that we use in the Medicare Shared Savings Program and that relies on a 
two-step process. We sought comment, however, on whether the cost 
measure peer groups should change if we adopted the ``degree of 
involvement'' methodology for groups of physicians other than groups of 
physicians using the PQRS GPRO web-interface to submit data on quality 
measures. We also solicited comments on establishing cost benchmarks on 
a quality measure-by-quality measure basis.
    Comment: As discussed above, we received comments in support of our 
proposal for a national benchmark. We also received several suggestions 
that we implement regional cost benchmarks rather than national ones to 
account for regional variations in spending.
    Response: Consistent with our discussion above regarding the 
national basis of this program, we are finalizing our proposal to 
establish national benchmarks for the five cost measures based on data 
from the current performance year. Given that we are standardizing 
Medicare payments to eliminate regional payment differences to ensure 
fair national comparisons, we do not believe it is appropriate to 
establish regional benchmarks for the value-based payment modifier. We 
will be considering the effects of this policy over the next several 
years as we implement this program and may consider changes to these 
policies through future rulemaking.
(5) Reliability Standard
    We believe it is crucial that the value-based payment modifier be 
based on quality of care and cost composites that reliably measure 
performance. Statistical reliability is defined as the extent to which 
variation in the measure's performance rate is due to variation in the 
quality (or cost) furnished by the physicians (or group of physicians) 
rather than random variation due to the sample of cases observed. 
Potential reliability values range from zero to one, where one (highest 
possible reliability) signifies that all variation in the measure's 
rates is the result of variation in differences in performance across 
physicians (or groups of physicians). Generally, reliabilities in the 
0.40-0.70 range are often considered moderate and values greater than 
0.70 high.
    Therefore, we proposed to establish a minimum number of cases in 
order for a quality or cost measure to be included in the quality of 
care or cost composite (77 FR 45009). To the extent that a group of 
physicians fails to meet the minimum number of cases for a particular 
measure, the measure would not be counted and the remaining measures in 
the domain would be given equal weight. To the extent that we cannot 
develop either a reliable quality of care composite or cost composite 
because we do not have reliable domain information, we proposed that we 
would not calculate a value-based payment modifier and payment would 
not be affected.
    Based on an analysis of the individual CY 2010 Physician Feedback 
reports and on recent literature, we proposed a minimum case size of 20 
for both quality and cost measures to ensure high statistical 
reliability. We explained that the average reliability of the total per 
capita cost measure assessed at the individual level for physicians in 
all specialties was high (greater than 0.70) when the minimum case size 
was 20 or more. We also stated that reliability was high for nine of 
the 15 administrative claims based quality measures that we are 
proposing for purposes of the value-

[[Page 69323]]

based payment modifier for the PQRS administrative claims-based 
reporting option when the minimum case size was 20 or greater. We 
anticipate that statistical reliability of the quality and cost 
measures will increase when we assess physicians at the TIN level 
rather than NPI level, because, on average, a TIN will be attributed 
more beneficiaries than an NPI.
    Comment: We received a few comments on this proposal expressing 
support for strong reliability standards or a minimum case size 
threshold. We received a couple of comments recommending a higher 
minimum case size, for example, 30 rather than 20. One commenter sought 
clarification of our analysis of the reliability of the administrative 
claims based quality measures from the 2010 Individual Physician 
Feedback reports.
    Response: We appreciate the comments we received in support of 
strong reliability standards. Based upon our statistical analysis that 
we discussed in the proposed rule (77 FR 45009), we believe a minimum 
case size of 20 is sufficient for this purpose. As we stated in our 
proposal, nine of the 15 administrative claims quality measures were 
highly reliable at the individual level. The other six were either 
moderately reliable at the individual level or assessed clinical care 
in high priority areas. We anticipate that reliability will not be an 
issue given that our analysis was at the individual level and not for 
groups of 100 or more eligible professionals. Accordingly, we are 
finalizing our proposal for 20 cases as the minimum case size; however, 
we will monitor and examine this issue as we implement this program and 
may consider changes to this policy through future rulemaking as we 
broaden the value-based payment modifier to reach all physicians and 
groups of physicians in 2017.
g. Payment Adjustment Amount
    Section 1848(p) of the Act does not specify the amount of physician 
payment that should be subject to the adjustment for the value-based 
payment modifier; however, section 1848(p)(4)(C) of the Act requires 
the payment modifier be implemented in a budget neutral manner. Budget 
neutrality means that payments will increase for some groups of 
physicians based on high performance and decrease for others based on 
low performance, but the aggregate amount of Medicare spending in any 
given year for physicians' services will not change as a result of 
application of the value-based payment modifier.
    In making proposals about the amount of Medicare payment made under 
the PFS at risk for the value-based payment modifier, we considered 
that there are two other payment adjustments affecting physicians' 
Medicare payment in 2015 that could further decrease physician payments 
in 2016. Specifically, under the PQRS, a physician who does not submit 
data on quality measures to meet the satisfactory reporting criteria 
for the PQRS payment adjustment during the applicable reporting period 
in 2013 will have his or her fee schedule amount reduced by 1.5 percent 
for services furnished in 2015. This PQRS downward payment adjustment 
to the fee schedule will increase to 2 percent in 2016 (and thereafter) 
based on reporting periods that fall in CY 2014 (and thereafter, 
reporting period or periods that fall two years prior to the year in 
which the PQRS payment adjustment is assessed). The second payment 
adjustment is for physicians who do not achieve meaningful EHR use 
under the EHR Incentive program. Section 1848(a)(7) of the Act provides 
for a downward payment adjustment of 1 percent in 2015, 2 percent in 
2016, and 3 percent in 2017 . We note that the adjustment in 2015 for 
not achieving meaningful use is increased by 1 percentage point (to -2 
percent) if the physician was subject to the eRx Incentive Program 
payment adjustment for 2014.
    As discussed above, we have finalized our policy to allow groups of 
physicians of 100 or more eligible professionals to elect whether to 
have their value-based payment modifier based on the quality-tiering 
methodology. For those groups that elect quality-tiering, we proposed 
that the maximum payment adjustment be -1.0 percent for poor 
performance (75 FR 45010). We stated that due to the budget neutrality 
requirement, we did not propose the exact amount of the upward payment 
adjustments for high performance under the quality-tiering approach 
because the upward payment adjustments (in the aggregate) will have to 
balance the downward payment adjustments in order to achieve budget 
neutrality. Thus, we proposed to determine the projected aggregate 
amount of downward payment adjustments and then calculate the upward 
payment adjustment factor based on the amount of the projected 
aggregate upward payment adjustments.
    For groups of physicians subject to the value-based payment 
modifier that have not met the PQRS criteria for satisfactory reporting 
as described above (including those groups that have not participated 
in any of the PQRS reporting mechanisms), we proposed to set their 
value-based payment modifier at -1.0 percent (77 FR 45010). We arrived 
at our proposal for a -1.0 percent downward adjustment using the 
following rationale: Section 1848(p)(1) of the Act requires us to 
differentiate payment based on a comparison of quality of care 
furnished compared to cost. Because we do not have performance rates on 
which to assess the quality of care furnished by these groups, we can 
differentiate payment based on costs only rather than quality and cost 
as required by statute. Due to the fact that the value-based payment 
modifier is just starting in 2015, we do not wish to apply a greater 
downward payment adjustment for non-satisfactory reporters than we are 
proposing for the low quality/high cost groups that request that their 
value-based payment modifier be calculated using a quality-tiering 
approach.
    Comment: Commenters expressed general support for our proposal to 
limit the downside risk to -1.0 percent for groups not participating in 
the PQRS and to ensure that those groups that elected quality-tiering 
would not be penalized more than those who did not participate in the 
PQRS. For example, one commenter noted that absent a specified maximum 
penalty, practices would be unwilling to risk having their payments 
significantly cut under a voluntary program. Another commenter 
expressed appreciation for our proposal to limit payment reductions to 
1 percent, but also noted that with the potential for additional 
reductions for PQRS, e-Rx, and a 2 percent sequester-related reduction, 
the proposed 1 percent reduction still poses some risk. Similarly, some 
commenters requested a higher floor on downward payment adjustments, 
for example, -0.5 percent rather than -1.0 percent or even no negative 
adjustment for practices that opt into quality-tiering. One commenter 
raised a question as to whether participants in quality-tiering should 
be penalized at all given they had taken the minimum step of reporting 
PQRS data. As an alternative, this commenter recommended that CMS 
consider upward adjustments for groups that perform well with no 
adjustment for the remainder. Another commenter offered the view that 
with the possibility of a downward payment adjustment, only high 
quality/low cost physicians will participate in the program, which 
would result in a narrow range of comparisons that could be made and 
high performers being classified as being low. In their view, this 
would limit the ability to learn from the program.
    In contrast, however, we received many comments suggesting that the

[[Page 69324]]

proposed payment adjustments were insufficient to motivate change at 
the physician level. Hence, one commenter recommended that quality-
tiered scoring be mandatory for groups that report PQRS measures in 
2013 as not doing so effectively creates a one-year opt out. Further, 
they recommended that the maximum downward adjustment be increased to -
3.0 percent as it would both motivate change among lower performing 
physicians while better making available a sufficiently meaningful 
reward for good performance. Some commenters recommended that CMS apply 
higher payment differentials, some as high as  10 percent 
or more either in 2015 or subsequent years.
    Related to this, some commenters expressed concern that since the 
upward payment adjustment was yet unspecified, there was little 
incentive or clarity in terms of the advantages and risks for 
participating in the program. One commenter sought clarity on whether 
budget neutrality meant that groups that elect quality-tiering would be 
``vying to receive an upward modifier adjustment from a pool of funds 
derived from groups that received the -1.0 percent adjustment or would 
be competing against one another.
    Response: While we appreciate comments suggesting larger payment 
adjustments to more strongly encourage quality improvements, we are 
finalizing our proposed adjustments as we believe they better align 
with our goal to gradually phase in the value-based payment modifier. 
We anticipate that as we gain more experience with our value-based 
payment modifier methodologies, we will consider ways to increase the 
amount of payment at risk.
    We also appreciate concerns expressed about the uncertain of the 
amount of the upward payment adjustment; however, given statutory 
requirements for budget neutrality, we have not identified a way to 
specify an upward amount until all downward adjustments have been 
determined. We are open to comments on how we might be able to provide 
an upward payment amount for future rulemaking. We also wish to clarify 
that the total amount of upward payment adjustments is a fixed amount 
that is equal the amount made available through downward payment 
adjustments.
    In summary, we are finalizing our proposal to establish a -1.0 
value-based payment modifier adjustment for those groups of physicians 
of 100 or more eligible professionals that fall into category 2, which 
are those that neither (a) self-nominate for the PQRS as a group and 
report at least one measure nor (b) elect the PQRS administrative 
claims option for CY 2013. We also are finalizing our proposal to limit 
the downside payment adjustment for groups of physicians that elect the 
quality-tiering option at -1.0 percent.
h. Value-Based Payment Modifier Scoring Methodology
    Section 1848(p)(1) of the Act requires the Secretary to establish a 
payment modifier that provides for differential payment to a physician 
or group of physicians under the fee schedule based upon the quality of 
care furnished compared to cost during a performance period. As noted 
previously, the statute requires that quality of care furnished and 
cost shall be evaluated, to the extent practicable, based on composites 
of quality of care furnished and cost.
    In making our proposals, we developed two models that compare the 
quality of care furnished to costs: A quality-tiering model and a total 
performance score model. We proposed the quality-tiering model for the 
value-based payment modifier, and solicited comments on the total 
performance score model (77 FR 44010-12).
(1) Quality-Tiering Model
    The quality-tiering model compares the quality of care composite 
with the cost composite to determine the value-based payment modifier. 
To make this comparison, we proposed to classify the quality of care 
composites scores into high, average, and low quality of care 
categories based on whether they are statistically above, not different 
from, or below the mean quality composite score. We seek to ensure that 
those groups of physicians classified as high or low performers have 
performance that is meaningfully different from average performance (to 
be sure that no group of physicians is disadvantaged for performance 
only slightly different from the benchmark) and is precisely measured 
(to ensure that no group of physicians is disadvantaged by an 
inaccurate performance assessment). We proposed to assess meaningful 
differences as those performance scores that are at least one standard 
deviation from the mean. We proposed to assess precision by requiring a 
group of physicians' score to be statistically different from the mean 
at the 5.0 percent level of significance (that is, a 95 percent 
confidence interval).
    Likewise, we proposed to identify those groups of physicians that 
have cost composite scores that are statistically different from the 
mean cost composite score of all groups of physicians. We proposed to 
classify these groups of physicians into high, average, and low cost 
categories based on whether they are significantly above, not different 
from, or below the mean cost composite score as described above with 
reference to quality composite. We proposed to assess meaningful 
differences as those performance scores that are at least one standard 
deviation from the mean and we proposed to assess precision at the 5.0 
percent level of significance.
    We proposed to compare quality of care composite classification 
with the cost composite classification to determine the value-based 
payment modifier adjustment according to the amounts in Table 126.

                Table 126--Value-Based Payment Modifier Amounts for the Quality-Tiering Approach
----------------------------------------------------------------------------------------------------------------
            Quality/cost                      Low cost                Average cost              High cost
----------------------------------------------------------------------------------------------------------------
High quality........................  + 2.0x *                  + 1.0x *                 + 0.0%
Average quality.....................  + 1.0x *                  + 0.0%                   -0.5%
Low quality.........................  + 0.0%                    -0.5%                    -1.0%
----------------------------------------------------------------------------------------------------------------
* Groups of physicians eligible for an additional +1.0x if reporting measures and average beneficiary risk score
  in the top 25 percent of all risk scores.

    We proposed to establish the upward payment adjustment factor 
(``x'') after the performance period has ended based on the aggregate 
amount of downward payment adjustments. We also proposed to aggregate 
the downward payment adjustments in Table 126 with the downward 
adjustment for groups of physicians subject to the value-based payment 
modifier that are not satisfactory PQRS reporters and then to solve for 
the upward payment

[[Page 69325]]

adjustment factor (``x''). For example, after determining the aggregate 
projected amount of the downward payment adjustments, CMS could 
calculate that the payment adjustment factor (``x'') would be 0.75 
percent such that high quality/low cost groups of physicians would 
receive a 1.5 percent (2 x 0.75) upward payment adjustment during the 
payment adjustment period.
    We also proposed that the scoring methodology provide a greater 
upward payment adjustment (+1.0x) for groups of physicians that care 
for high-risk patients (as evidenced by the average HCC risk score of 
the attributed beneficiary population) and submit data on PQRS quality 
measures through PQRS via the GPRO using the web-interface, claims, 
registries, or EHRs. We proposed to increase the upward payment 
adjustment to +3x (rather than +2x) for groups of physicians classified 
as high quality/low cost and to +2x (rather than +1x) for groups of 
physicians that are either high quality/average cost or average 
quality/low cost if the group of physicians' attributed patient 
population has an average risk score that is in the top 25 percent of 
all beneficiary risk scores. In other words, we did not propose this 
additional upward payment adjustment (+1.0x) for groups of physicians 
that select the PQRS administrative claims-based reporting option.
    A second approach to scoring the value-based payment modifier is a 
total performance score approach. We sought comment on this approach. 
This approach allows us to develop a unique value-based payment 
modifier for each group of physicians. This approach results in a range 
of continuous payment adjustments rather than the thresholds proposed 
in the quality tier approach. This method would be similar to the 
approach we use in the Hospital Value-Based Purchasing program where we 
use a linear exchange function to develop a unique payment for each 
hospital. This approach results in a continuous array of unique value-
based payment modifiers such that there are no longer cut-off points 
between high and low performing groups of physicians.
    Comment: We received several comments in support of the quality-
tiering model. In some cases, commenters noted their support for 
quality-tiering as it was readily understandable or could provide an 
incentive to care for difficult-to-treat beneficiaries. MedPAC 
indicated support for CMS' proposal to apply the value modifier bonus 
or penalty only when a physician group's performance is significantly 
different from the national mean. Further, MedPAC indicated that it has 
supported an ``outlier'' approach for cost measures as a reasonable way 
to identify physicians or groups with extraordinarily higher or lower 
costs than average. In some cases, commenters suggested that we apply 
the quality-tiering model initially, but consider moving to the total 
performance score model over time. One commenter noted they had general 
concerns with quality-tiering, but would take a wait-and-see approach 
as long as it was voluntary rather than mandatory.
    We also received many comments supporting the total performance 
score methodology. Several commenters expressed their view that this 
methodology better aligned with the hospital value-based purchasing 
methodology than did quality-tiering or that it would be most 
appropriate for hospital-based physicians.
    Many of these commenters suggested that the total performance score 
methodology: (1) Offered greater incentives for groups to participate 
in the program or to improve their performance because they could be 
rewarded for either achievement or improvement; and (2) avoided ``cut 
off problems'' where groups are placed in high and low performing 
categories that occur under the quality-tiering approach. One commenter 
offered their view that applying a cutoff such as one standard 
deviation is crude in that a physician performing at 0.99 standard 
deviations below the mean would be considered average while another 
performing at 1.01 standard deviations below the mean would be 
considered low. Another commenter observed that since quality-tiering 
applies to only physician groups above or below one standard deviation, 
the methodology effectively removes two-thirds of practices from its 
effects. Another suggested that a focus on outliers does little to 
improve care as variation in performance within groups is hidden.
    Commenters also noted that CMS might not have sufficient historical 
data on all physicians to implement this methodology, and suggested 
that it could evolve from quality-tiering over time.
    Response: We appreciate the comments in support of the quality-
tiering model, and are finalizing our proposal to adopt this model. We 
agree with the commenters that this approach is a reasonable way to 
phase in the value-based payment modifier, especially as more groups of 
physicians report quality data and we can fine tune our methodology to 
identify high and low performers. Although we recognize the beneficial 
aspects of the total performance score model mentioned by the 
commenters (for example, incentives for continuous improvement and no 
cut-off issues), we believe that model may be inappropriate when groups 
of physicians have the ability to select the quality measures on which 
they report such that there is not a uniform yardstick by which to 
assess performance improvement. Moreover, at this initial stage of the 
value-based payment modifier, we believe a more reasonable approach is 
to focus on outliers rather than trying to adjust the payment of every 
group of physicians, despite the fact that a focus on outliers may mask 
performance variation within a group of physicians.
    Comment: Also, assuming adoption of the quality-tiering model, some 
commenters suggested a more stringent criterion than one standard 
deviation from the mean to differential outliers. For example, some 
commenters suggested that two or three standard deviations be used as a 
threshold for distinguishing groups. In particular, one commenter noted 
that a more stringent threshold should be used if and when the risk for 
downward adjustments increases.
    In other cases, commenters suggested alternatives to distinguishing 
groups by statistical comparison. For example, one commenter suggested 
that CMS explore a concept of ``meaningful clinical difference'' that 
is used in the domain of patient self-reported health status.
    Response: We thank this commenter for their suggestions on how to 
distinguish outliers, that is high and low performers, but are 
finalizing our proposal to use one standard deviation with a 5 percent 
level of confidence. We believe distinguishing outliers in this way 
provides substantial confidence to physicians that we will not 
misclassify groups as high or low performers when they actually are 
not. Allowing groups of physicians the option to elect quality-tiering 
also addresses the issues that we are being too stringent in 
identifying high and low performers. We will be considering the effects 
of this policy over the next several years as we implement this program 
and may consider changes to these policies through future rulemaking.
    Comment: Commenters were generally supportive of our proposal to 
offer additional incentives for groups caring for high-risk 
beneficiaries. Some commenters suggested that the high-risk incentives 
be expanded to include additional physician groups, for example, to 
those groups with average or high costs who also have average or above 
average quality scores. Another commenter recommended that we apply

[[Page 69326]]

the high-risk beneficiary upward adjustment to all practices 
participating in quality-tiering--not just those categorized as high 
quality/low-cost, high quality/average cost, or average quality/low 
cost tiers--particularly, if a penalty is assessed for the lowest 
performing tier. Another comment suggested that in a budget neutrality 
system, however, it was impossible to provide an upward bump-up in the 
payment adjustment for all groups caring for high-risk beneficiaries, 
because there would be fewer funds to distribute to high performing 
groups.
    Response: We thank commenters for their support and, for the 
reasons noted above, are finalizing our proposal to provide an upward 
payment adjustment for groups electing quality-tiering that are high 
performers and care for high-risk beneficiaries.
i. Proposed Informal Review and Inquiry Process
    Section 1848(p)(10) of the Act provides that there shall be no 
administrative or judicial review under section 1869 of the Act, 
section 1878 of the Act, or otherwise of the following:
     The establishment of the value-based payment modifier;
     The evaluation of the quality of care composite, including 
the establishment of appropriate measure of the quality of care;
     The evaluation of costs composite, including establishment 
of appropriate measures of costs;
     The dates of implementation of the value-based payment 
modifier;
     The specification of the initial performance period and 
any other performance period;
     The application of the value-based payment modifier; and
     The determination of costs.
    Despite the preclusion of administrative and judicial review, we 
believe it is useful for groups of physicians to understand how their 
payment under the PFS could be changed by the value-based payment 
modifier. We also believe that an informal mechanism is needed for 
groups of physicians to review and to identify any possible errors 
prior to application of the value-based payment modifier.
    Therefore, we intend to disseminate Physician Feedback reports 
containing calendar year 2013 data in the fall of 2014 to groups of 
physicians subject to these policies; these reports would be the basis 
of the value-based payment modifier in 2015. We proposed that these 
reports would contain, among other things, the quality and cost 
measures and measure performance and benchmarks used to score the 
composites, and quality of care and cost composite scores, and the 
value-based payment modifier amount (77 FR 45012).
    After the dissemination of the Physician Feedback reports in the 
fall of 2014, we proposed that physicians would be able to email or 
call a technical help desk to inquire about their report and the 
calculation of the value-based payment modifier. We envisioned this 
process to help educate and inform physicians about the value-based 
payment modifier, especially for those groups of physicians that have 
elected that their value-based payment modifier be calculated using a 
quality-tiering approach.
    In anticipation of the reports that we would produce in 2014, in 
the fall of 2013 we plan to produce and disseminate Physician Feedback 
reports at the TIN level to all groups of physicians with 25 or more 
eligible professionals based on 2012 data. These reports will include a 
``first look'' at the methodologies we proposed in this rule for the 
value-based payment modifier. We view these reports as a way to help 
educate groups of physicians about how the value-based payment modifier 
could affect their payment under the PFS.
    Comment: We received comments in support of making feedback 
available to participating physician groups and the opportunity to 
discuss this feedback with CMS. One commenter noted that the 
dissemination of physician feedback reports should be the first step in 
a large scale educational campaign on the implementation of the value-
based modifier. Further, in their view, the success of the program 
depends on physician practices believing in the data and acting on it 
to improve their performance. Some commenters recommended that data be 
shared with all satisfactory PQRS reporters. One commenter asked that 
CMS share or post sample data so that physician groups could model what 
the value-based modifier might mean for them financially as they decide 
whether or not to participate. Another commenter requested that 
patient-specific information should be available to assist practices in 
verifying the data. In contrast, another commenter offered the view 
that while these reports could be relevant to primary care physicians 
or large multi-specialty practices, they might be less so to single 
specialty practices such as podiatrists.
    A number of commenters noted the importance of making feedback 
reports available in a timely manner, and expressed concerns about the 
usefulness of data that are not current. For example, commenters 
reported that untimely data are not actionable and assessing payments 
on such data offer little incentive for change. One commenter suggested 
that data need to be timely or penalties should otherwise be waived.
    We also received comments expressing support for the availability 
of technical assistance, for example, through a technical help desk as 
well as an appeals or review process. One commenter suggested that CMS 
establish corrective action plans or some means to assist poorer 
performers before applying a payment adjustment. One commenter 
disagreed with the ``limited distribution of physician feedback reports 
prior to implementation of the value based modifier'' and suggested we 
provide feedback reports to all physicians in advance of payment 
adjustments.'' In addition, some commenters urged CMS to consider 
adopting a Corrective Action Plan, or similar program, for outliers/
poor performers prior to applying the value-based payment modifier.
    Response: We thank commenters for their support. We will provide 
physician feedback reports during the fall of 2014 for all groups of 
physicians affected by the value-based payment modifier in 2015 and, as 
discussed below, we will make a help desk available to address 
questions related to the reports. We also are planning on many 
enhancements and features suggested by the commenters so that the 
feedback reports provide meaningful and actionable information to 
physicians to improve the quality of care they furnish to Medicare 
beneficiaries.
(4) Physician Feedback Program
    Section 1848(n) of the Act requires us to provide confidential 
reports to physicians that measure the resources involved in furnishing 
care to Medicare FFS beneficiaries. Section 1848(n)(1)(A)(iii) of the 
Act also authorizes us to include information on the quality of care 
furnished to Medicare FFS beneficiaries. In September 2011, we produced 
and disseminated confidential feedback reports to physician groups that 
participated in the PQRS Group Practice Reporting Option (GPRO) in 
2010, and in March 2012 we produced and disseminated reports to 
physicians practicing in the following states: Iowa, Kansas, Missouri, 
and Nebraska.
    In the CY 2013 PFS proposed rule, we discussed that, in the fall of 
2012, we plan to disseminate Physician Feedback reports to physicians 
in nine states (California, Iowa, Illinois, Kansas,

[[Page 69327]]

Michigan, Minnesota, Missouri, Nebraska, and Wisconsin) based on 2011 
data. These reports will contain the PQRS measures that physicians in 
these states submitted via any of the PQRS reporting methods, as well 
as information on 28 administrative claims measures included in the 
2010 reports. We also will produce and disseminate Physician Feedback 
reports to the groups of physicians that reported measures through the 
PQRS GPRO web interface in 2011. We adjusted and improved the content 
and organization of the Physician Feedback reports that we plan to 
produce later this year based on the comments we received from the 
Program Year 2010 report recipients. We plan to increase our outreach 
efforts to encourage physicians to view their reports, to begin to 
understand the methodologies we have adopted in this final rule for the 
value-based payment modifier and that are included in the 2011 reports, 
and to provide suggestions on how we can make these reports more 
meaningful and actionable in the future.
    In the fall of 2013, we plan to produce and disseminate Physician 
Feedback reports at the TIN level to all groups of physicians with 25 
or more eligible professionals. These reports will include a ``first 
look'' at the methodologies that we have adopted in this final rule for 
the value-based payment modifier.
    In addition, section 1848(n) of the Act requires that we use the 
episode-based costs in the Physician Feedback reports beginning in 2013 
for the reports based on 2012 data. As discussed above in relation to 
the value-based payment modifier, we plan to include episode-based cost 
measures for several episode types in future Physician Feedback 
reports. In addition, we plan to consider adjusting the format and 
organization of the reports, to the extent practicable, to address the 
best practices outlined in the American Medical Association's 
Guidelines for Reporting Physician Data. We believe that this 
dissemination plan satisfies our obligations under the section 
1848(p)(4)(B)(ii)(II) of the Act to provide information to physicians 
and groups of physicians about the quality of care furnished to 
Medicare FFS beneficiaries.
    In the fall of 2014, we plan to disseminate Physician Feedback 
reports based on 2013 data that show the amount of the value-based 
payment modifier and the basis for its determination. We plan to 
provide these reports to all groups of physicians (at the TIN level) 
with 25 or more eligible professionals even though groups of physicians 
with 25 to 99 eligible professionals will not be subject to the value-
based payment modifier in 2015. We are examining whether we can provide 
reports to groups of physicians with fewer than 25 eligible 
professionals and individual level reports as well. These reports will 
contain, among other things, performance on the quality and cost 
measures used to score the composites and the value-based payment 
modifier amount. As discussed above, we anticipate providing an 
opportunity for review and correction as outlined in our value-based 
payment modifier proposals above.
    We received many comments on our future plans for the Physician 
Feedback reports. A summary of the comments and our responses to those 
comments are provided below.
    Comment: We received many suggestions from commenters on ways to 
improve the content, format, and distribution of the Physician Feedback 
reports (also termed the ``Quality and Resource Use Reports'' (QRURs)), 
with a focus on making the content more actionable for quality 
improvement.
    Response: We appreciate all of the suggestions on how to improve 
the Physician Feedback reports. We are working with the American 
Medical Association, state medical societies, specialty societies, and 
other stakeholders to address these issues in future feedback reports.
    Comment: A commenter stated that it was unclear whether the 
physician feedback reports will replace the PQRS reports that are 
released when incentive payments are distributed and would support the 
integration of the two reports.
    Response: We are looking at ways to streamline the reports 
supporting the PQRS and the physician value-based payment modifier 
programs in order to create one unified format for quality assessment.
    Comment: Commenters appreciated CMS' planned physician outreach 
activities to garner physician reaction to the information contained in 
the Physician Feedback reports and elicit physician input on ways to 
increase their utility in future years. Additionally, they suggested 
that CMS should:
     Work with national and state medical specialty societies 
to ensure that physicians understand these reports.
     Work with medical specialty societies to improve the 
Physician Feedback reports.
     Further increase physician awareness of and education for 
the value-based payment modifier and Physician Feedback Program.
     Provide a mechanism for interpretation of feedback reports 
and meaningful dialogue between physicians, specialty society staff, 
and CMS.
    Response: We appreciate the commenters' support of our outreach 
activities and are already undertaking the activities recommended by 
commenters.
    Comment: Several commenters stated that many practices did not 
receive reports for individual physicians within their practice or they 
received reports for physicians who are no longer in the practice due 
to inaccuracies. In addition, the commenters stated that some practices 
had a difficult time obtaining the reports. The commenters recommended 
that CMS should work to ensure that it is not difficult for physicians 
to obtain these reports--particularly if the information on the report 
is tied to penalties.
    Response: We are already aware of the concerns raised by these 
commenters. Accordingly, we have adjusted our procedures for 
disseminating the 2011 physician feedback reports later in 2012, in 
order to minimize the difficulties physicians may have in obtaining 
their reports and to ensure reports go to their intended recipients.
    Comment: A commenter expressed concern about possible unintended 
consequences that physician feedback reports may have for clinical 
practice. The commenter stated a belief that aspects of the program 
will lead physicians to avoid sicker, more complicated patients and 
expressed concern about the potential of the program to move physician 
attention toward program compliance and away from evaluating and 
addressing the concerns of patients during visits. The commenter states 
that this has the potential to reduce quality of care and patient 
satisfaction.
    Response: We do not agree that the Physician Feedback reports will 
have negative consequences on clinical practice. We believe that the 
Physician Feedback reports provide useful information to physicians 
about the quality of care furnished to Medicare beneficiaries and 
should be used by physicians to determine the areas where they need to 
make improvements in their clinical practice. Moreover, the cost 
measures in the Physician Feedback reports are risk adjusted so that we 
are controlling for preexisting health conditions and other patient 
factors when making comparisons in the reports.
    Comment: A number of commenters were concerned that the Physician 
Feedback reports would not be provided

[[Page 69328]]

in time to inform physicians about their 2015 utilization, which is the 
basis for the 2017 payment adjustment period.
    Response: As we stated above, in the fall of 2013, we plan to 
produce and disseminate Physician Feedback reports at the TIN level to 
all groups of physicians with 25 or more eligible professionals These 
reports will provide a ``first look'' at the methodologies that will be 
used to develop the value-based payment modifier. We view these reports 
as a way to help educate physicians about how the value-based payment 
modifier could affect their payment under the PFS. Even though we are 
applying the value-based payment modifier to groups of physicians of 
100 or more eligible professionals, we believe it is important to 
provide the Physician Feedback reports to a wider audience in 
anticipation of making proposals in future rulemaking on applying the 
value-based payment modifier to all physicians and groups of physicians 
starting January 1, 2017.
    Comment: Several commenters stated that CMS should make the 
Physician Feedback reports available to all physicians in 2014.
    Response: We will take the commenters' recommendation under 
consideration as we develop the policy for disseminating the 2014 
Physician Feedback reports. However, we believe it is important to 
prioritize our efforts on groups of physicians that would be subject to 
the value-based payment modifier in the near future first.
    Comment: A number of commenters stated that CMS should provide a 
mechanism for physicians to request the list of patients for which cost 
and quality measures are attributed in their Physician Feedback 
reports.
    Response: We agree that it would be useful for physicians to have a 
list of the patients who were attributed in the calculation of their 
cost and quality measures and are working to include this information 
as part of future Physician Feedback reports, recognizing that we seek 
to ensure that the data provided is used for quality improvement 
purposes and is consistent with privacy regulations.
    Comment: A commenter recommended that future Physician Feedback 
reports focus on the cost of the care provided by the physician 
receiving the report instead of the total cost of all care received by 
the beneficiary. The commenter indicated that this would be both more 
informative and more actionable for individual physicians than the 
current per capita cost measures.
    Response: As we stated earlier, one of the principles governing the 
implementation of the value-based payment modifier is a ``focus on 
shared accountability.'' Under this principle, we believe that the 
value-based payment modifier can facilitate shared accountability by 
assessing performance at the practice group level and by focusing on 
the total costs of care, not just the costs of care furnished by an 
individual physician. Physicians reporting measures at the group level 
are encouraged to seek innovative ways to furnish high-quality, 
patient-centered, and efficient care to the Medicare FFS beneficiaries 
they treat.

L. Medicare Coverage of Hepatitis B Vaccine

1. Modification of High Risk Groups Eligible for Medicare Part B 
Coverage of Hepatitis B Vaccine
a. Background and Statutory Authority--Medicare Part B Coverage of 
Hepatitis B Vaccine
    Section 1861(s)(10)(B) of the Act authorizes Medicare Part B 
coverage of hepatitis B vaccine and its administration if furnished to 
an individual who is at high or intermediate risk of contracting 
hepatitis B. High and intermediate risk groups are defined in 
regulations at Sec.  410.63.
    On December 23, 2011, the United States Centers for Disease Control 
and Prevention (CDC) published a Morbidity and Mortality Weekly Report 
(MMWR), which included an article entitled ``Use of Hepatitis B 
Vaccination for Adults with Diabetes Mellitus: Recommendations of the 
Advisory Committee on Immunization Practices (ACIP).'' The article 
stated that ``In the United States, since 1996, a total of 29 outbreaks 
of HBV [Hepatitis B virus] infection in one or multiple long-term care 
(LTC) facilities, including nursing homes and assisted-living 
facilities, were reported to CDC; of these, 25 involved adults with 
diabetes receiving assisted blood glucose monitoring. These outbreaks 
prompted the Hepatitis Vaccines Work Group of the Advisory Committee on 
Immunization Practices (ACIP) to evaluate the risk for HBV infection 
among all adults with diagnosed diabetes.''
    ``HBV is highly infectious and environmentally stable; HBV can be 
transmitted by medical equipment that is contaminated with blood that 
is not visible to the unaided eye. Percutaneous exposures to HBV occur 
as a result of assisted monitoring of blood glucose and other 
procedures involving instruments or parenteral treatments shared 
between persons. Lapses in infection control during assisted blood 
glucose monitoring that have led to HBV transmission include 
multipatient use of finger stick devices designed for single-patient 
use and inadequate disinfection and cleaning of blood glucose monitors 
between patients. Breaches have been documented in various settings, 
including LTC facilities, hospitals, community health centers, 
ambulatory surgical centers, private offices, homes, and health 
fairs.'' Additionally, in analyses of persons without hepatitis B-
related risk behaviors (that is, injection-drug use, male sex with a 
male, and sex with multiple partners), persons aged 23 through 59 years 
with diabetes had 2.1 times the odds of developing acute hepatitis B as 
those without diabetes; and the odds for hepatitis B infection were 1.5 
times as likely for persons aged 60 and older. (MMWR, December 23, 
2011).
    Based on the Hepatitis Vaccines Work Group findings, ACIP 
recommended that:
     Hepatitis B vaccination should be administered to 
unvaccinated adults with diabetes mellitus who are aged 19 through 59 
years.
     Hepatitis B vaccination may be administered at the 
discretion of the treating clinician to unvaccinated adults with 
diabetes mellitus who are aged 60 years and older.
b. Implementation
    Based on the ACIP recommendations, we proposed to modify Sec.  
410.63(a)(1), High Risk Groups, by adding new paragraph ``(viii) 
Persons diagnosed with diabetes mellitus.'' Since HBV can be 
transmitted by medical equipment (that is, finger stick devices and 
blood glucose monitors) that is contaminated with blood that is not 
visible to the unaided eye, we believe that persons diagnosed with 
diabetes mellitus should be added to the high risk group. Since lapses 
in infection control have been reported in both community and facility 
settings, the increased risk of contracting HBV is not limited to the 
facility setting. We believe that expanding coverage of Hepatitis B 
vaccinations and administration to those diagnosed with diabetes 
mellitus is supported by the findings and evidence reviewed by the 
Hepatitis Vaccines Work Group and the ACIP recommendations. Hepatitis B 
vaccination is a preventive measure that needs to occur before 
exposure. It is difficult to predict which diabetics will eventually be 
exposed in the circumstances that we discussed above. Therefore, we 
proposed to expand coverage for hepatitis B vaccine and its

[[Page 69329]]

administration to all individuals diagnosed with diabetes mellitus, not 
just those individuals with diabetes that are receiving glucose 
monitoring in facilities, for example, in nursing homes.
c. Summary of Public Comments
    We received 15 public comments that supported the proposed rule to 
expand coverage of hepatitis B vaccination and its administration to 
individuals diagnosed with diabetes mellitus. We did not receive any 
public comments that opposed our proposed expansion. In addition to 
their support of our proposal, below is a summary of additional 
comments received and our responses.
    Comment: One commenter suggested that coverage should be limited to 
individuals with diabetes when the treating physician recommends to the 
individual that he or she receive a hepatitis B vaccination, rather 
than having the vaccination be mandatory for all individuals diagnosed 
with diabetes mellitus.
    Response: We believe that our proposal provides the physician with 
flexibility to determine whether provision of hepatitis B vaccination 
to a patient is appropriate based on the individual patient's risk 
factors. Nothing in the proposed rule or this final rule mandates 
vaccination for individuals diagnosed with diabetes mellitus. 
Accordingly, we are not making the suggested changes in this final 
rule.
    Comment: Some commenters requested that we provide coverage under 
Medicare Part B for all ACIP-recommended immunizations, the herpes 
zoster vaccine, and hepatitis C virus screening, as Medicare preventive 
benefits.
    Response: These comments are outside the scope of this rulemaking, 
as our proposed rule specifically addressed Medicare coverage of 
Hepatitis B vaccine and its administration under a specific statute, 
Sec.  1861(s)(10)(B) of the Act. The commenters' requested expansions 
would not be based on this statute.
    Based on the overwhelming support of the public comments received, 
we are implementing this rule as proposed.

M. Updating Existing Standards for E-Prescribing Under Medicare Part D 
and Lifting the LTC Exemption

1. Background
a. Legislative History
    Section 101 of the Medicare Prescription Drug, Improvement, and 
Modernization Act of 2003 (MMA) (Pub. L. 108-173) amended title XVIII 
of the Act to establish a voluntary prescription drug benefit program 
at section 1860D-4(e) of the Act. Among other things, these provisions 
required the adoption of Part D e-prescribing standards. Prescription 
Drug Plan (PDP) sponsors and Medicare Advantage (MA) organizations 
offering Medicare Advantage-Prescription Drug Plans (MA-PD) are 
required to establish electronic prescription drug programs that comply 
with the e-prescribing standards that are adopted under this authority. 
There is no requirement that prescribers or dispensers implement e-
prescribing. However, prescribers and dispensers who electronically 
transmit prescription and certain other information for covered drugs 
prescribed for Medicare Part D eligible beneficiaries, directly or 
through an intermediary, are required to comply with any applicable 
standards that are in effect. The Medicare Part--D e-prescribing 
Program adopts standards that allow Eligible Professionals (EP) to 
participate in the eRx Incentive Payment program and Other CMS programs 
that require the reporting of electronic prescribing transactions.
    For a further discussion of the statutory basis for this final rule 
and the statutory requirements at section 1860D-4(e) of the Act, please 
refer to section I. (Background) of the E-Prescribing and the 
Prescription Drug Program proposed rule, published February 4, 2005 (70 
FR 6256).
b. Regulatory History
(1) Foundation and Final Standards
(a) Adopting and Updating
    CMS utilized several rounds of rulemaking to adopt standards for 
the Part D e-prescribing program. Its first rule, which was published 
on November 7, 2005 (70 FR 67568), adopted three standards that were 
collectively referred to as the ``foundation'' standards. One of these 
standards, the National Council for Prescription Drug Programs (NCPDP) 
SCRIPT Standard, Implementation Guide, Version 5, Release 0 (Version 
5.0), May 12, 2004 (excluding the Prescription Fill Status Notification 
Transaction and its three business cases; Prescription Fill Status 
Notification Transaction--Filled, Prescription Fill Status Notification 
Transaction--Not Filled, and Prescription Fill Status Notification 
Transaction--Partial Fill), hereafter referred to as the NCPDP SCRIPT 
5.0, is the subject of several of the changes effectuated by this and 
prior final rules. We issued a subsequent rule on April 7, 2008 (73 FR 
18918) that adopted additional standards which are referred to as 
``final'' standards. One of these standards, Version 1.0 of the NCPDP 
Formulary and Benefit standard, Implementation Guide, Version 1, 
Release 0, hereafter referred to as the NCPDP Formulary and Benefit 
1.0) is also the subject of another of the changes effectuated by this 
final rule. Please see the ``Initial Standards Versus Final Standards'' 
discussion at 70 FR 67568 in the November 7, 2005 rule for a more 
detailed discussion about ``foundation'' and ``final'' standards.
(b) Exemption From the NCPDP SCRIPT Standard in Long Term Care Settings 
(LTC)
    While prescribers and dispensers who electronically transmit 
prescription and certain other information for covered drugs prescribed 
for Medicare Part D eligible beneficiaries, directly or through an 
intermediary, are generally required to comply with any applicable Part 
D e-prescribing standards that are in effect at the time of their 
transmission, the early versions of the NCPDP SCRIPT standard did not 
support the complexities of the prescribing process for patients in 
long term care facilities where the prescribing process involves not 
only a prescriber and a pharmacy, but also a facility and its staff. As 
such, we exempted such entities from use of the NCPDP SCRIPT standard. 
That exemption, currently found at Sec.  423.160(a)(3)(iv), provides an 
exemption for entities transmitting prescriptions or prescription-
related information where the prescriber is required by law to issue a 
prescription for a patient to a non-prescribing provider (such as a 
nursing facility) that in turn forwards the prescription to a 
dispenser.
    For a more detailed discussion, see the November 7, 2005 final rule 
(70 FR 67583).
(2) Updating e-Prescribing Standards
    Transaction standards are periodically updated to take new 
knowledge, technology and other considerations into account. As CMS 
adopted specific versions of the standards when it adopted the 
foundation and final e-prescribing standards, there was a need to 
establish a process by which the standards could be updated or replaced 
over time to ensure that the standards did not hold back progress in 
the industry. CMS discussed these processes in its November 7, 2005 
final rule (70 FR 67579).
    The discussion noted that the rulemaking process will generally be 
used to retire, replace or adopt a new e-prescribing standard, but it 
also provided for a simplified ``updating

[[Page 69330]]

process'' when a standard could be updated with a newer ``backward-
compatible'' version of the adopted standard. In instances in which the 
user of the later version can accommodate users of the earlier version 
of the adopted standard without modification, it noted that notice and 
comment rulemaking could be waived, in which case the use of either the 
new or old version of the adopted standard would be considered 
compliant upon the effective date of the newer version's incorporation 
by reference in the Federal Register. We utilized this streamlined 
updating process when we published an interim final rule with comment 
on June 23, 2006 (71 FR 36020). That rule recognized NCPDP SCRIPT 8.1 
as a backward compatible update to the NCPDP SCRIPT 5.0, thereby 
allowing for use of either of the two versions in the Part D program. 
Then, on April 7, 2008, CMS used notice and comment rulemaking (73 FR 
18918) to finalize the identification of the NCPDP SCRIPT 8.1 as a 
backward compatible update of the NCPDP SCRIPT 5.0, and, effective 
April 1, 2009, retire NCPDP SCRIPT 5.0 and adopt NCPDP SCRIPT 8.1 as 
the official Part D e-prescribing standard. Finally, on July 1, 2010, 
CMS utilized the streamlined process to recognize NCPDP SCRIPT 10.6 as 
a backward compatible update of NCPDP SCRIPT 8.1 in an interim final 
rule (75 FR 38026).
    In contrast to the extensive updating that was done to the NCPDP 
SCRIPT standard in the Part D e-prescribing program, the original NCPDP 
Formulary and Benefit 1.0 is still in place as the official Part D e-
prescribing standard.
2. Proposals for Calendar Year 2013
a. Proposed Finalization of NCPDP SCRIPT 10.6 as a Backward Compatible 
Version of NCPDP SCRIPT 8.1, Retirement of NCPDP SCRIPT 8.1 and 
Adoption of NCPDP SCRIPT 10.6 as the Official Part D E-Prescribing 
Standard
    As described in the CY 2013 Physician Fee Schedule proposed rule 
(77 FR 45022-45023) we proposed to finalize our recognition of NCPDP 
SCRIPT 10.6 as a backward compatible version of the official Part D e-
prescribing standard NCPDP SCRIPT 8.1, effective from the effective 
date of the final rule through October 31, 2013, but, in response to 
the comments that were received to the interim final rule with comment, 
we also proposed to retire NCPDP SCRIPT 8.1 effective October 31, 2013, 
and we proposed to adopt NCPDP SCRIPT 10.6 as the official Part D e-
prescribing standard effective November 1, 2013. For further discussion 
on our NCPDP SCRIPT updating proposals please see CY 2013 Physician Fee 
Schedule proposed rule (77 FR 45022 through 45025).
    As such, we proposed to revise Sec.  423.160(b)(2)(ii) so as to 
limit its application to transactions on or before October 31, 2013 and 
add a new Sec.  423.160(b)(2)(iii) to require that, as of November 1, 
2013, providers and dispensers would use NCPDP SCRIPT 10.6 for the 
following electronic transactions that convey prescription or 
prescription related information:
     Get message transaction.
     Status response transaction.
     Error response transaction.
     New prescription transaction.
     Prescription change request transaction.
     Prescription change response transaction.
     Refill prescription request transaction.
     Refill prescription response transaction.
     Verification transaction.
     Password change transaction.
     Cancel prescription request transaction.
     Cancel prescription response transaction
     Fill status notification.
    Furthermore, we proposed to amend Sec.  423.160(b)(1) by adding a 
new 423.160(b)(1)(iii) to amend the information about which subsequent 
requirements in the section are applicable to which timeframes and 
amend Sec.  423.160(b)(1)(ii) to limit its application to transactions 
on or before October 31, 2013.
    The following is a summary of the comments we received regarding 
the finalization of NCPDP SCRIPT 10.6 as a backward compatible version 
of NCPDP SCRIPT 8.1, the proposed retirement of NCPDP SCRIPT 8.1, and 
the proposed adoption of NCPDP SCRIPT 10.6 as the official Part D E-
Prescribing standard. We received comments on all three proposals.
    Comment: All commenters agreed with our proposals to finalize NCPDP 
SCRIPT 10.6 as a backward compatible version of NCPDP SCRIPT 8.1 and to 
retire NCPDP SCRIPT 8.1. They also agreed that CMS should move forward 
with the adoption of NCPDP SCRIPT 10.6 as the official Part D e-
prescribing standard.
    Response: We appreciate the favorable feedback that we received on 
this proposal and are in agreement with the commenters who responded.
    Comment: Most commenters agreed on our timeline to retire NCPDP 
SCRIPT Version 8.1 on October 31, 2013 and adopt NCPDP SCRIPT Version 
10.6 as the official Part D e-prescribing standard on November 1, 2013.
    Response: We appreciate the feedback we received on the proposed 
timeline to retire NCPDP SCRIPT 8.1 on October 31, 2013 and finalize 
the adoption of NCPDP SCRIPT 10.6 on November 1, 2013 as the official 
Part D e-prescribing standard. We are in agreement with those 
commenters that responded to finalize NCPDP SCRIPT 10.6 as proposed.
    Comment: One commenter suggested that CMS finalize the adoption of 
the NCPDP SCRIPT Version 10.6 Part D e-prescribing standard effective 
January 1, 2014, which would coincide with the Office of the National 
Coordinator for Health IT (ONC) requirement for use of NCPDP SCRIPT 
10.6 for certification of electronic health record (EHR) technology. 
The commenter did not, however, note any harm that would result if we 
were to stick with the proposed effective date of November 1, 2013.
    Response: We appreciate the comment, but we do not believe that 
there is a compelling reason to change the proposed (November 1, 2013) 
effective date. As proposed, Part D e-prescribers will be free to use 
either version 8.1 or version 10.6 through October 31, 2013, after 
which time they will need to use version 10.6 when e-prescribing Part D 
covered drugs for Part D eligible individuals. As such, ONC's 2011 
Edition EHR certification criteria (which permit the certification of 
EHR technology to versions 8.1 or 10.6 and subsequently enable an 
eligible professional (EP)/eligible hospital (EH) to use either 
standard through the calendar year (CY)/fiscal year (FY) 2013 
meaningful use reporting period) and 2014 Edition EHR certification 
criteria (which requires EHR technology to be certified to only version 
10.6 and subsequently enables EPs/EHs to use EHR technology certified 
to such standard when they start their CY/FY 2014 meaningful use 
reporting) will never require use of a version of NCPDP SCRIPT that is 
not also an option under the Part D e-prescribing standards. 
Furthermore, NCPDP SCRIPT 10.6 is backwards compatible with version 
8.1, so version 10.6 EHR users will always be able to communicate with 
version 8.1 users, and vice versa.
    In light of the overwhelmingly positive comments that we received 
in response to our proposals to finalize the NCPDP SCRIPT 10.6 as a 
Backward Compatible Version of NCPDP SCRIPT 8.1 as of the effective 
date of this final rule, and retire NCPDP SCRIPT 8.1 and adopt NCPDP 
SCRIPT 10.6 as the official Part D e-Prescribing Standard

[[Page 69331]]

effective November 1, 2013, we are finalizing our proposals. To 
effectuate this, we revised Sec.  423.160(b)(1)(ii) to limit its 
applicability to transactions taking place between April 1, 2009 and 
October 31, 2013, added a new Sec.  423.160(b)(1)(iii) to cover 
transactions on or after November 1, 2013, and added a new Sec.  
423.160(b)(2)(iii) to cover the communication of a prescription or 
prescription-related information between prescribers and dispensers on 
or after November 1, 2013.
b. Proposed Recognition of NCPDP Formulary and Benefit Standard 3.0 as 
a Backward Compatible Version of the NCPDP Formulary and Benefit 
Standard 1.0, Proposed Retirement of NCPDP Formulary and Benefit 
Standard 1.0 and Proposed Adoption of NCPDP Formulary and Benefit 
Standard 3.0
    Formulary and Benefits standards provide a uniform means for 
pharmacy benefit payers (including health plans and PBMs) to 
communicate a range of formulary and benefit information to prescribers 
via point-of-care (POC) systems. These include:
     General formulary data (for example, therapeutic classes 
and subclasses);
     Formulary status of individual drugs (that is, which drugs 
are covered);
     Preferred alternatives (including any coverage 
restrictions, such as quantity limits and need for prior 
authorization); and
     Copayment (the copayments for one drug option versus 
another).
    The NCPDP Formulary and Benefits Standard 1.0 enables the 
prescriber to consider this information during the prescribing process, 
and make the most appropriate drug choice without extensive back-and-
forth administrative activities with the pharmacy or the health plan.
    As discussed above, the November 7, 2005 final rule (70 FR 67579) 
established the process of updating an official Part D e-prescribing 
standard with the recognition of ``backward-compatible'' versions of 
the official standard in instances in which the user of the later 
version can accommodate users of the earlier version of the adopted 
standard without modification. In these instances, notice and comment 
rulemaking could be waived, and use of either the new or old version of 
the adopted standard would be considered compliant with the adopted 
standard upon the effective date of the newer version's incorporation 
by reference in the Federal Register. This backward compatible version 
updating process allows for the standards' updating/maintenance to 
correct technical errors, eliminate technical inconsistencies, and add 
optional functions that provide optional enhancements to the specified 
e-prescribing transaction standard. Since the adoption of the NCPDP 
Formulary and Benefits 1.0 standard in the Part D e-prescribing 
program, NCPDP has updated its Formulary and Benefits standard. Changes 
were based upon industry feedback and business needs and ranged in 
complexity from creating whole new fields or lists within the standard 
to simply changing a particular field designation from mandatory to 
optional. Each time a change is made to a standard it is given a new 
version number. The current version of the Formulary and Benefits 
standard is Version 3.0.
    One of the major improvements between Version 1.0 and 3.0 involved 
the addition of Text message support for ``Coverage and Copay 
Information,'' the addition of the ``Text Message Type (A46-1S)'' field 
and the addition of ``Optional Prior Authorization Lists.'' Theses list 
were added for use in conveying prior authorization requirements.
    Other improvements included conversion of certain elements from 
optional to mandatory. Version 3.0 also provides for ``Formulary Status 
List Headers,'' which are fields that allow the sender to specify a 
default formulary status for non-listed drugs. Subsequent versions also 
allowed for the omission of ``Formulary Status Detail'' records when 
the non-listed formulary policies are used exclusively to convey the 
status of a drug on a formulary.
    Changes to a standard may also involve removing fields that are not 
widely used in industry. The removed fields are often replaced by new 
fields that better serve the business needs of the industry. For 
example, the following items have been removed through the various 
updates that led up to Version 3.0: ``Classification List'' and 
references to it (such as Drug Classification Information), ``Coverage 
Information Detail--Medical Necessity (MN),'' ``Coverage Information 
Detail-Resource Link-Summary Level (RS),'' and the Classification ID in 
the Cross Reference Detail.
    In place of these deleted fields, the following fields were added 
or amended to ultimately result in Version 3.0: The ``Formulary Status 
existing value 2'' field was changed to ``On Formulary/Non-Preferred,'' 
and ``The file load also enables payers to specify a single coverage-
related text message for each drug'' field was changed to ``A payer may 
send multiple quantity limits, step medications, text messages and 
resource links for the same drug.''
    We reviewed Version 3.0, and based on our findings, we have 
determined that NCPDP Formulary and Benefits 3.0 maintains full 
functionality of the official adopted Part D e-prescribing standard 
NCPDP Formulary and Benefits 1.0, and would permit the successful 
communication of the applicable transaction with entities that continue 
to use Version 1.0.
    While we would usually use the ``backward compatible'' waiver of 
notice and comment procedures that are described above to recognize 
Version 3.0 as a backward compatible version of the officially adopted 
Version 1.0, this would have to be done in an interim final rule with 
comment. As we cannot combine proposals and elements of a final rule in 
one rule, we elected this one time to formally propose recognizing a 
subsequent standard as a backward compatible version of an adopted 
standard through full notice and comment rulemaking to avoid having to 
publish two rules contemporaneously. We therefore proposed to recognize 
the use of either Version 1.0 or 3.0 as compliant with the adopted 
Version 1.0 effective 60 days after the publication of a final rule.
    As noted above, according to the November 7, 2005 final rule (70 FR 
67580), entities that voluntarily adopt later versions of standards 
that are recognized as backward compatible versions of the official 
Part D e-prescribing standard must still accommodate the earlier 
official Part D e-prescribing standard without modification. Therefore, 
as we used full notice and comment in place of the backward compatible 
methodology in this one instance, we also proposed to require users of 
3.0 to support users who are still using Version 1.0 until such time as 
Version 1.0 is officially retired as a Part D e-prescribing standard 
and Version 3.0 is adopted as the official Part D e-prescribing 
standard.
    To effectuate these proposals, we proposed to revise Sec.  
423.160(b)(5) by placing the existing material in a new subsection 
(b)(5)(i), and creating a second new subsection (b)(5)(ii) to reflect 
the use of Version 3.0. as a backward compatible version of the 
official Part D e-prescribing standard, effective 60 days after the 
publication of the final rule through October 31, 2013. We further 
proposed revising Sec.  423.160(b)(5) by adding a new section Sec.  
423.160(b)(5)(iii) to cover Formulary and Benefit transactions on or 
after November 1, 2013 We also needed to add an end date of January 15, 
2013 to Sec.  423.160(b)(5)(i). We solicited comments on our proposals, 
the timing

[[Page 69332]]

for these proposals, and when we ought to retire Version 1.0 as the 
official Part D e-prescribing standard, and adopt the NCPDP Formulary 
and Benefit Version 3.0. as the official Part D e-prescribing standard.
    The following is a summary of the comments we received regarding 
our proposal to recognize NCPDP Formulary and Benefit Standard 3.0 as a 
backward compatible version of the NCPDP Formulary and Benefit Standard 
1.0, the proposed retirement of NCPDP Formulary and Benefit Standard 
1.0 and the proposed adoption of NCPDP Formulary and Benefit Standard 
3.0.
    Comment: Commenters generally supported our proposals for effective 
dates for the use of NCPDP Formulary and Benefit Standard 3.0 as a 
backward compatible version of the adopted NCPDP Formulary and Benefit 
1.0 (60 days after the publication of the final rule), and the 
retirement of Version 1.0 as an official Part D e-prescribing standard 
as of November 1, 2013. However, one commenter suggested a Version 1.0 
sunset date of July 1, 2014 to coordinate the Part D e-prescribing 
standards with the date upon which NCPDP will cease to support Version 
1.0 .
    Response: We appreciate the overwhelming support from the 
commenters who agreed witt us in recognizing Version 3.0 as a backward 
compatible version of Version 1.0 and the retirement of Version 1.0 and 
the adoption of Version 3.0 as the official Part D e-prescribing 
standard effective November 1, 2013.We also appreciate the suggestion 
to alter the proposed retirement date for Version 1.0 to coincide with 
the date upon which NCPDP will cease to support that version of the 
standard. While maintaining Version 1.0 as a Part D e-prescribing 
standard would delay the industry's fully benefiting from the 
improvements found in Version 3.0, as Version 3.0 is a backward 
compatible version of Version 1.0, we would not anticipate significant 
added burden on the industry if we were to allow the continued use of 
Version 1.0 until it is no longer supported by NCPDP. As we aim to 
ensure that our regulations impose the minimum burden possible on the 
industry, we therefore believe that it would be appropriate to not 
finalize the adoption of Version 3.0 at this time. Although the 
commententer have shown support for our proposal we believe that there 
is ample time to finalize NCPDP Formulary and Benefits Version 3.0 at a 
later date in future rulemaking. We believe that allowing the use of 
Version 3.0 as a backward compatible verion of Version 1.0 would create 
some confusion because of the extended timeframe to adopt Version 3.0 
and the retirement of Version 1.0 as proposed by the commenters.
    As a result of the comments, It is our intention to keep NCPDP 
Formulary and Benefits Version 1.0 as the official standard for the 
Medicare Part D eprescribing program and hold off on finalizing Verison 
3.0 until future rulemaking.
c. Proposed Elimination of the Exemption for Non-Prescribing Providers 
(Long Term Care)
    In our November 16, 2007 proposed rule (72 FR 64902-64906), we 
discussed the inability of NCPDP SCRIPT versions 5.0 and 8.1 to support 
the workflows and legal responsibilities in the long-term care setting, 
that is, entities transmitting prescriptions or prescription-related 
information where the prescriber is required by law to issue a 
prescription for a patient to a non-prescribing provider (such as a 
nursing facility) that in turn forwards the prescription to a dispenser 
(``three-way prescribing communications'' between facility, physician, 
and pharmacy). As such, such entities were provided with an exemption 
from the requirement to use the NCPDP SCRIPT standard in transmitting 
such prescriptions or prescription-related information. On July 1, 2010 
we published an IFC (75 FR 38029) in which we conveyed that we would 
consider removing the LTC exemption when there was an NCPDP SCRIPT 
standard that could address the unique needs of long-term care 
settings. We noted that NCPDP SCRIPT Version 10.6 was available, and 
that we believed that it addressed the concerns of the LTC industry 
regarding their ability to successfully support their workflows when e-
prescribing. We solicited comments on the impact and timing of adopting 
version 10.6 as the official Part D e-prescribing standard and the 
removal of the long-term care facility exemption from the NCPDP SCIPT 
standard. For further background discussion on our proposal to lift the 
LTC exemption please refer to the proposed rule (77 FR 45024-45025).
    We proposed to eliminate the current exemption at Sec.  
423.160(a)(3)(iv) upon adoption of NCPDP SCRIPT 10.6 as the official 
Part D e-prescribing standard, which, as described above, was proposed 
to take place on November 1, 2013.
    We solicited comments on lifting the Long Term Care exemption, 
effective November 1, 2013 in conjunction with the effective date of 
NCPDP SCRIPT 10.6. We also solicited comments regarding the impact of 
these proposed effective dates on industry and other interested 
stakeholders, and whether an earlier or later effective date should be 
adopted.
    The following is summary of the comments we received regarding the 
proposal.
    Comment: The commenters agreed with our proposal to lift the 
current exemption for entities transmitting prescriptions or 
prescription-related information in the LTL setting. The commenters, 
however, did not agree with our proposed timeline for the lifting the 
current exemption. They suggested that CMS push the effective date 
until November 1, 2014 instead of the proposed November 1, 2013 
proposal.
    They stated that while they are supportive of moving to NCPDP 
SCRIPT 10.6 and encourage LTC providers to move toward a single 
standard, they fully expect that those entities currently using HL7 or 
propriety messaging will need additional time to make the transition. 
They also recommend an extended transition period to ensure that both 
vendors and providers are ready for the new requirements.
    Response: Upon review, we believe the commenters have made valid 
arguments in regards to moving the effective to November 1, 2014. We 
realize that many in the LTC community may need extra time to 
transition their IT systems to accommodate and support the current Part 
D e-prescribing standards. Based on industry comments we will lift the 
LTC exemption based on November 1, 2014 date as suggested by the 
commenters to give them more time to make the transition to a single 
standard for e-prescribing. Therefore, we will amend Sec.  
423.160(a)(3)(iv) to insert November 1, 2014 as the expiration of the 
exemption. We would note, however, that if a member of the LTC industry 
and their trading partner are ready to use this standard to prescribe 
electronically before the exemption is lifted on November 1, 2014, they 
are certainly free to use the standard, but they will not be required 
to do so under the Part D e-prescribing program.
    Comment: One commenter called on CMS to encourage state Boards of 
Pharmacy to reexamine the medication management process in the LTPAC 
settings and develop and allow more effective and efficient mechanisms 
for e-prescribing in LTPAC. The commenter stated that if the e-
prescribing system could be suitably, sufficiently and appropriately 
modified, such that the various state Boards of Pharmacy were to 
consider a physicians' order from a facility as a valid prescription, 
the

[[Page 69333]]

conditions would be in place for electronic medication management and 
e-prescribing to be more widely adopted in LTPAC settings. They also 
asked CMS to facilitate, encourage and work with regulators, industry 
and other stakeholders to resolve these issues.
    Response: We have prescribed legislative authority under the MMA to 
adopt Part D e-prescribing standards. The MMA outlines out the process 
through which we can adopt Part D e-prescribing standards to facilitate 
e-prescribing. We do not have the authority to facilitate, encourage, 
or work with the various state Boards of Pharmacy to change how they 
define the transaction from the LTC facility to the dispensing 
pharmacy. As a result of these comments, we are eliminating the 
exemption at Sec.  423.160(a)(3)(iv) effective November 1, 2014.

IV. Additional Provisions

A. Waiver of Deductible for Surgical Services Furnished on the Same 
Date as a Planned Screening Colorectal Cancer Test and Colorectal 
Cancer Screening Test Definition--Technical Correction

    Section 4104(c) of the Affordable Care Act amended section 1833(b) 
of the Act to waive the Part B deductible for colorectal cancer 
screening tests that become diagnostic in the course of the procedure 
or visit. Specifically, section 1833(b) of the Act waives the 
deductible for ``colorectal screening tests regardless of the code that 
is billed for the establishment of a diagnosis as a result of the test, 
or the removal of tissue or other matter or other procedure that is 
furnished in connection with, as a result of, and in the same clinical 
encounter as a screening test.'' We note that in the proposed rule, we 
referred in this discussion to section 1833(b)(1) of the Act; however, 
the relevant amendment was a new sentence added at the end of section 
1833(b). We have corrected the reference in this final rule with 
comment period. To implement this statutory provision, we proposed in 
the PFS proposed rule for CY 2011 that ``all surgical services 
furnished on the same date as a planned screening colonoscopy, planned 
flexible sigmoidoscopy, or barium enema be considered to be furnished 
in connection with, as a result of, and in the same clinical encounter 
as the screening test.'' After receiving public comment, this proposal 
was finalized in the CY 2011 final rule with comment period (75 FR 
73431) and the policy was implemented, effective January 1, 2011. 
However, we neglected to amend our regulations to reflect this policy.
    When a screening test becomes a diagnostic service, we instruct the 
practitioner to bill the procedure that is actually furnished and to 
append the PT modifier to the diagnostic procedure code that is 
reported. By use of this modifier, the practitioner signals that the 
procedure meets the criteria for the deductible to be waived.
    In the CY 2013 PFS proposed rule, we proposed to amend our 
regulations at Sec.  410.160, Part B annual deductible, to include 
colorectal screening tests that become diagnostic services in the list 
of services for which the deductible does not apply. Specifically, we 
proposed to add a new Sec.  410.160(b)(8) to read, ``Beginning January 
1, 2011, a surgical service furnished on the same date as a planned 
colorectal cancer screening test as described in Sec.  410.37.''
    The following is summary of the comments we received regarding the 
proposal to amend our regulations to the policy we adopted for CY 2011 
to implement the statutory amendment that waives the Part B deductible 
for a colorectal cancer screening test that becomes diagnostic.
    Comment: We received two comments on this proposal. One commenter 
was appreciative and supportive of the proposal. The other commenter 
stated that we had ``violated the intent of the Affordable Care Act'' 
and not implemented this provision consistent with the statute at 
section 1833(b) of the Act. The commenter stated that by using 
``surgical service'' in the proposed regulation when the statute 
referred to ``other procedure,'' we were inappropriately applying the 
deductible to pathology and anesthesia services when they are furnished 
in connection with a colorectal screening test that becomes a 
diagnostic procedure. The commenter also expressed concern with our 
covering procedures ``on the same date'' when the Act covers procedures 
``in the same clinical encounter.''
    Response: We thank the commenter who supported our proposal. We 
note that we did not propose to modify the policy we adopted as final 
in the CY 2011 PFS final rule with comment period, and which we have 
been applying in accordance with section 1833(b) of the statute since 
January 1, 2011. Rather, we proposed to codify our current policy in 
our regulations. Our current policy, as stated in the CY 2011 PFS final 
rule with comment period, is to waive the deductible for all surgical 
services furnished on the same date as a planned screening colonoscopy, 
planned flexible sigmoidoscopy, or barium enema (because these services 
are considered to be ``furnished in connection with, as a result of, 
and in the same clinical encounter as the screening test.'') We 
received and responded to comments similar to the second one noted 
above in the course of rulemaking for CY 2011. However, because the 
commenter questioned the language we used in the proposed text of the 
regulation, we discuss the issue in this final rule. After evaluating 
the comment regarding whether the deductible is appropriately applied 
to payments for anesthesia and biopsy services, we conclude that it is. 
We believe that the intent of section 1833(b) of the statute, as 
amended by section 4104(c) of the Affordable Care Act, is to waive the 
deductible for tests that are scheduled and begin as colorectal 
screening tests, but that become diagnostic in the course of the 
treatment, so that even though the test is no longer considered and 
billed as a screening test, the deductible is nonetheless waived as it 
would have been if the test had remained a screening test. Thus, we 
believe Congress intended to insure that we apply the deductible for 
these ``screening turned diagnostic'' tests consistently with the way 
it is applied to colorectal screening tests. When a colorectal 
screening test is furnished, the payment for moderate sedation is 
included in the payment for the procedure, and there would be no 
associated pathology service. The deductible is waived for these tests 
under section 1833(b) of the Act. As a result, the deductible would be 
waived for the typical sedation furnished in connection with a 
colorectal screening test (since it is included within the code); and 
there would be no need to waive any deductible for a pathology service. 
The proposed regulation applies the same policy to colorectal screening 
tests that become diagnostic. To the extent that moderate sedation is 
included in a procedure that is billed with the PT modifier, the 
beneficiary pays no deductible. When a beneficiary receives anesthesia 
other than moderate sedation with a colorectal screening test, a 
separate charge is incurred to which the deductible applies. The 
proposed regulation would specify that same policy for screening tests 
that become diagnostic.
    We also believe that the language of the Act is consistent with 
applying the deductible to pathology services. By the use of the term a 
``colorectal screening test regardless of the code that is billed,'' 
the statute waives the deductible for procedures that, in and of 
themselves, begin as colorectal screening tests. As noted above,

[[Page 69334]]

pathology services would not be part of a colorectal screening test.
    In regard to the commenter's concern about using ``same day,'' 
instead of ``same clinical encounter,'' this too is the policy we 
established through notice and comment rulemaking for CY 2011. We 
believe it would be exceedingly rare for a beneficiary to have 
additional procedures on the same date as a screening colorectal cancer 
test or a ``screening turned diagnostic'' colorectal procedure that are 
not in the same clinical encounter. Therefore, we believe ``same day'' 
is the practical equivalent of ``same clinical encounter.'' To the 
extent there is a difference between these two terms, the language we 
proposed would provide broader rather than more limited waiver of the 
deductible as the commenter asserted. Given the practical equivalence 
between the language in the statute and in the proposed regulation, and 
the fact that our claims processing system can easily distinguish 
``same day'' but not ``same clinical encounter,'' we will not modify 
our policy or the proposed regulation language as the commenter 
suggests.
    Based upon the comments we received, and further review of the 
policy we established to implement the statute, we are finalizing the 
proposed amendment to the regulation as initially proposed. 
Specifically, we will amend the regulation at Sec.  410.160, Part B 
annual deductible, to include colorectal screening tests that become 
diagnostic services in the list of services for which the Part B 
deductible does not apply and will add a new Sec.  410.160(b)(8), which 
will read, ``Beginning January 1, 2011, a surgical service furnished on 
the same date as a planned colorectal cancer screening test as 
described in Sec.  410.37.''
    Section 103 of the BIPA amended section 1861(pp)(1)(C) of the Act 
to permit coverage of screening colonoscopies for individuals not at 
high risk for colorectal cancer who meet certain requirements. To 
conform our regulations to section 1861(pp)(1)(C) of the Act, we 
proposed to modify Sec.  410.37(a)(1)(iii) of our regulations to define 
``Screening colonoscopies'' by removing the phrase ``In the case of an 
individual at high risk for colorectal cancer'' from this paragraph.
    We also proposed to delete paragraph (g)(1) from this section since 
Medicare no longer receives claims for dates of service between January 
1, 1998 and June 30, 2001, making this paragraph obsolete. We also 
proposed to redesignate paragraphs (g)(2) through (g)(4) and make 
technical changes to newly redesignated paragraph (g)(1) by replacing 
the reference to paragraph (g)(4) with a reference to newly 
redesignated paragraph (g)(3).
    Comment: We received no comments addressing the proposed 
modifications to Sec.  410.37.
    Response: We are finalizing the proposed regulation as initially 
proposed for Sec.  410.37. Specifically, Section 103 of the BIPA 
amended section 1861(pp)(1)(C) of the Act to permit coverage of 
screening colonoscopies for individuals not at high risk for colorectal 
cancer who meet certain requirements. To conform our regulations to 
section 1861(pp)(1)(C) of the Act, we will modify Sec.  
410.37(a)(1)(iii) to define ``Screening colonoscopies'' by removing the 
phrase ``In the case of an individual at high risk for colorectal 
cancer'' from this paragraph.
    Finally, we will delete paragraph (g)(1) from this section since 
Medicare no longer receives claims for dates of service between January 
1, 1998 and June 30, 2001, making this paragraph obsolete, will 
redesignate paragraphs (g)(2) through (g)(4) and make technical changes 
to newly redesignated paragraph (g)(1) by replacing the reference to 
paragraph (g)(4) with a reference to newly redesignated paragraph 
(g)(3).

B. Physician Self-Referral Prohibition: Annual Update to the List of 
CPT/HCPCS Codes

1. General
    Section 1877 of the Act prohibits a physician from referring a 
Medicare beneficiary for certain designated health services (DHS) to an 
entity with which the physician (or a member of the physician's 
immediate family) has a financial relationship, unless an exception 
applies. Section 1877 of the Act also prohibits the DHS entity from 
submitting claims to Medicare or billing the beneficiary or any other 
entity for Medicare DHS that are furnished as a result of a prohibited 
referral.
    Section 1877(h)(6) of the Act and Sec.  411.351 of our regulations 
specify that the following services are DHS:
     Clinical laboratory services.
     Physical therapy services.
     Occupational therapy services.
     Outpatient speech-language pathology services.
     Radiology services.
     Radiation therapy services and supplies.
     Durable medical equipment and supplies.
     Parenteral and enteral nutrients, equipment, and supplies.
     Prosthetics, orthotics, and prosthetic devices and 
supplies.
     Home health services.
     Outpatient prescription drugs.
     Inpatient and outpatient hospital services.
2. Annual Update to the Code List
a. Background
    In Sec.  411.351, we specify that the entire scope of four DHS 
categories is defined in a list of CPT/HCPCS codes (the Code List), 
which is updated annually to account for changes in the most recent CPT 
and HCPCS Level II publications. The DHS categories defined and updated 
in this manner are:
     Clinical laboratory services.
     Physical therapy, occupational therapy, and outpatient 
speech-language pathology services.
     Radiology and certain other imaging services.
     Radiation therapy services and supplies.
    The Code List also identifies those items and services that may 
qualify for either of the following two exceptions to the physician 
self-referral prohibition:
     Dialysis-related drugs furnished in or by an ESRD facility 
(Sec.  411.355(g)).
     Preventive screening tests, immunizations, or vaccines 
(Sec.  411.355(h)).
    The definition of DHS at Sec.  411.351 excludes services that are 
reimbursed by Medicare as part of a composite rate (unless the services 
are specifically identified as DHS and are themselves payable through a 
composite rate, such as home health and inpatient and outpatient 
hospital services).
    EPO and other dialysis-related drugs furnished by an ESRD facility 
(except drugs for which there are no injectable equivalents or other 
forms of administration) are currently being paid under the ESRD PPS 
(effective January 1, 2011) promulgated in the final rule published on 
August 12, 2010 in the Federal Register (75 FR 49030). Drugs for which 
there are no injectable equivalents or other forms of administration 
will be payable under the ESRD PPS beginning January 1, 2014.
    The Code List was last updated in Addendum J of the CY 2012 PFS 
final rule with comment period.
b. Response to Comments
    We received no public comments relating to the Code List that 
became effective January 1, 2012.
c. Revisions Effective for 2013
    The updated, comprehensive Code List effective January 1, 2013, 
appears on our Web site at http://www.cms.gov/Medicare/Fraud-and-Abuse/

[[Page 69335]]

PhysicianSelfReferral/List--of--Codes.html.
    Additions and deletions to the Code List conform it to the most 
recent publications of CPT and HCPCS Level II and to changes in 
Medicare coverage policy and payment status.
    Tables 127 and 128 identify the additions and deletions, 
respectively, to the comprehensive Code List that become effective 
January 1, 2013. Tables 127 and 128 also identify the additions and 
deletions to the list of codes used to identify the items and services 
that may qualify for the exception in Sec.  411.355(g) (regarding 
dialysis-related outpatient prescription drugs furnished in or by an 
ESRD facility) and in Sec.  411.355(h) (regarding preventive screening 
tests, immunizations, and vaccines).
    In Table 127, we specify additions that reflect new CPT and HCPCS 
codes that become effective January 1, 2013, or that became effective 
since our last update, including those additions that reflect changes 
in Medicare coverage policy or payment status. Table 128 reflects the 
deletions necessary to conform the Code List to the most recent 
publications of the CPT and HCPCS, and to changes in Medicare coverage 
policy and payment status.
    We will consider comments regarding the codes listed in Tables 127 
and 128. Comments will be considered if we receive them by the date 
specified in the ``DATES'' section of this final rule with comment 
period. We will not consider any comment that advocates a substantive 
change to any of the DHS defined in Sec.  411.351.

   Table 127--Additions to the Physician Self-Referral List of CPT \1\
                               HCPCS Codes
------------------------------------------------------------------------
 
-------------------------------------------------------------------------
CLINICAL LABORATORY SERVICES
    86152 Cell enumeration & id
    86153 Cell enumeration phys interp
------------------------------------------------------------------------
PHYSICAL THERAPY, OCCUPATIONAL THERAPY, AND OUTPATIENT SPEECH-LANGUAGE
 PATHOLOGY SERVICES
    {No additions{time}
------------------------------------------------------------------------
RADIOLOGY AND CERTAIN OTHER IMAGING SERVICES
    78012 Thyroid uptake measurement
    78013 Thyroid imaging w/blood flow
    78014 Thyroid imaging w/blood flow
    78071 Parathyrd planar w/wo subtrj
    78072 Parathyrd planar w/spect&ct
RADIATION THERAPY SERVICES AND SUPPLIES
    32701 Thorax stereo rad targetw/tx
DRUGS USED BY PATIENTS UNDERGOING DIALYSIS
    {No additions{time}
PREVENTIVE SCREENING TESTS, IMMUNIZATIONS AND VACCINES
    G0106 Colon CA screen;barium enema
    G0120 Colon ca scrn; barium enema
    G0118 Glaucoma scrn hgh risk direc
    Q2034 Agriflu vaccine
    90672 Flu vaccine 4 valent nasal
------------------------------------------------------------------------
\1\ CPT codes and descriptions only are copyright 2012 AMA. All rights
  are reserved and applicable FARS/DFARS clauses apply.


  Table 128--Deletions from the Physician Self-Referral List of CPT \1\
                               HCPCS Codes
------------------------------------------------------------------------
                      CLINICAL LABORATORY SERVICES
-------------------------------------------------------------------------
    0030T Antiprothrombin antibody
    0279T Ctc test
    0280T Ctc test w/i&r
PHYSICAL THERAPY, OCCUPATIONAL THERAPY, AND OUTPATIENT SPEECH-LANGUAGE
 PATHOLOGY SERVICES
    {No deletions{time}
RADIOLOGY AND CERTAIN OTHER IMAGING SERVICES
    78006 Thyroid imaging with uptake
    78007 Thyroid image mult uptakes
    78010 Thyroid imaging
    78011 Thyroid imaging with flow
RADIATION THERAPY SERVICES AND SUPPLIES
    {No deletions{time}
DRUGS USED BY PATIENTS UNDERGOING DIALYSIS
    {No deletions{time}
PREVENTIVE SCREENING TESTS, IMMUNIZATIONS AND VACCINES
    {No deletions{time}
------------------------------------------------------------------------
\1\ CPT codes and descriptions only are copyright 2012 AMA. All rights
  are reserved and applicable FARS/DFARS clauses apply.

V. Collection of Information Requirements

    Under the Paperwork Reduction Act of 1995, we are required to 
provide 60-day notice in the Federal Register and solicit public 
comment before a collection of information requirement is submitted to 
the Office of Management and Budget (OMB) for review and approval. In 
order to fairly evaluate whether an information collection should be 
approved by OMB, section 3506(c)(2)(A) of the Paperwork Reduction Act 
of 1995 requires that we solicit comment on the following issues:
     The need for the information collection and its usefulness 
in carrying out the proper functions of our agency.
     The accuracy of our estimate of the information collection 
burden.
     The quality, utility, and clarity of the information to be 
collected.

[[Page 69336]]

     Recommendations to minimize the information collection 
burden on the affected public, including automated collection 
techniques.
    In the CY 2013 PFS proposed rule, we solicited public comment on 
each of the section 3506(c)(2)(A)-required issues for the following 
information collection requirements (ICRs). No PRA-related comments 
were received.

A. ICRs Regarding Durable Medical Equipment Scope and Conditions (Sec.  
410.38(g))

    As a condition of payment for certain covered items of DME, Sec.  
410.38(g) specifies that a physician must have documented and 
communicated to the DME supplier that the physician or physician 
assistant (PA), nurse practitioner (NP), or clinical nurse specialist 
(CNS) has had a face-to-face encounter with the beneficiary no more 
than 6 months before the order is written.
    In the proposed rule, we proposed that when the face-to-face 
encounter is performed by a physician, the submission of the pertinent 
portion(s) of the beneficiary's medical record (portions containing 
sufficient information to document that the face-to-face encounter 
meets our requirements) would be considered sufficient and valid 
documentation of the face-to-face encounter when submitted to the 
supplier and made available to CMS or its agents upon request. While we 
believe that many of the practitioners addressed in this final rule 
with comment period are already conducting a needs assessment and 
evaluating or treating the beneficiary for conditions relevant to the 
covered item of DME, this final rule with comment period may require 
some changes in their procedures to ensure that their documentation 
fulfills Medicare's regulatory requirements. Suppliers should already 
be receiving written orders and documentation to support the 
appropriateness of certain items of DME.
    To promote the authenticity and comprehensiveness of the written 
order and as part of our efforts to reduce the risk of waste, fraud, 
and abuse, as a condition of payment, a written order must include the 
following: (1) The beneficiaries' name; (2) the item of DME ordered; 
(3) the signature of the prescribing practitioner; (4) the prescribing 
practitioner NPI; and (5) the date of the order.
    To determine costs, we utilized the Bureau of Labor Statistics mean 
hourly rates for the professional, analyzed for the year that the 
original data was received. The hourly rate for a physician, including 
fringe benefits and overhead is estimated at $118 per hour. The hourly 
rate, including fringe benefits and overhead, for a NP, PA, or CNS is 
estimated at $55 per hour. The hourly rate for administrative 
assistant, including fringe benefits and overhead, is estimated at $23 
per hour.
    Physicians are now required to document the face-to-face encounter 
if it was performed by a PA, NP, or CNS. To allow payment for this 
documentation, a G code is established for this service. Since the 
effective date for this regulation is July 1, 2013, only 6 months of 
year 1 are included in calendar year 2013. Likewise, it was assumed 
that about 500,000 of these documentation services would be billed in 
year 1. We estimate the time for a physician to review each one of 
these encounters that results in an order is 10 minutes. Therefore, we 
estimate that the physician documentation burden to review and document 
when a PA, NP or CNS performed the face-to-face encounter in year 1 
would be nearly 83,333 hours and a total of 483,333 hours over 5 years. 
The associated cost in year 1 is nearly $9.8 million and over 5 years 
has associated costs of nearly $57.03 million based on the growth rate 
of the Medicare population. The increase is slightly more than five-
fold because the number of Medicare beneficiaries would increase over 
time. The average annual burden over 5-years for 580,000 claims 
(2,900,000/5) is 96,667 hours at a cost of $11,406,667.

                  Table 129--Physician Time To Document Occurrence of a Face-To-Face Encounter
----------------------------------------------------------------------------------------------------------------
                                                       Year 1                              5 Years
----------------------------------------------------------------------------------------------------------------
Number of claims affected.............  500,000............................  2,900,000.
Time for physician review of each       10 min.............................  10 min.
 claim.
Total Time............................  83,333 hours.......................  483,333 hours.
Estimated Total Cost (Hours times       $9,833,333.........................  $57,033,333.
 $118).
----------------------------------------------------------------------------------------------------------------

    We assume it will take 3 minutes for a PA, NP, or CNS to prepare 
the medical record for the review of the face-to-face encounter. For 
the 500,000 orders used in the previous estimate, this creates a total 
of 25,000 hours at a cost of about $1.4 million in year 1 and nearly 
145,000 hours over 5 years at a cost of nearly $8 million based on the 
growth rate of the Medicare population. Though consistent with previous 
estimates, we believe that using a PA, NP, or CNS hourly rate creates a 
high burden impact estimate since most of these tasks would more than 
likely be completed by administrative personnel. We invited but 
received no public comments on our estimates related to the 
appropriateness of these estimates. The average annual burden over 5-
years for 580,000 claims (2,900,000/5) is 29,000 hours at a cost of 
$1,595,000.

              Table 130--Physician Assistant, Nurse Practitioner or Clinical Nurse Specialist Time
----------------------------------------------------------------------------------------------------------------
                                                       Year 1                              5 Years
----------------------------------------------------------------------------------------------------------------
Number of claims affected.............  500,000............................  2,900,000.
Time for PAs, NPs, or CNSs to gather    3 min..............................  3 min.
 and provide each claim.
Total Time............................  25,000 hours.......................  145,000 hours.
Estimated Total Cost (Hours times $55)  $1,375,000.........................  $7,975,000.
----------------------------------------------------------------------------------------------------------------

    This final rule with comment period creates only a minimal change 
in the normal course of business activities in regards to 
recordkeeping. Although we believe the documentation of a needs 
assessment, evaluation, and/or treatment of a beneficiary for a 
condition relevant to an item of DME is a common practice, it is 
possible that

[[Page 69337]]

some practitioners may not be documenting the results of all encounters 
so there may be additional impact for some practitioners.
    This regulation requires that the supplier have access to the 
documentation of the face-to-face encounter (required when CMS conducts 
an audit), CMS already accounts for the audit burden associated with 
the exchange of documentation for claims subject to prepayment review 
(approved under OCN 0938-0969). As a business practice we recognize 
that some suppliers may receive the documentation of the face-to-face 
for all applicable claims, voluntarily.
    We believe that the requirements that are set out in this final 
rule with comment period meet the utility and clarity standards. We 
invited but received no public comments on this assumption and on ways 
to minimize the burden on affected parties. The recordkeeping 
requirement in Sec.  410.38(g)(5) and the requirement to maintain and 
make the supplier's order/additional documentation available to CMS 
upon request is subject to the PRA, but we believe that these 
requirements are usual and customary business practices as defined in 5 
CFR 1320.3(b)(2) and, therefore, the associated burden is exempt from 
the PRA.

B. ICRs Regarding the Physician Quality Reporting System (Sec.  414.90)

    We are making several program revisions to the Physician Quality 
Reporting System for reporting periods that occur in 2013 and 2014, 
and, therefore, we are making several revisions to Sec.  414.90. All of 
the requirements and burden estimates are currently approved by OMB 
under OCN 0938-1059, and are not subject to additional OMB review under 
the authority of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et 
seq.).
    First, we are revising Sec.  414.90(e)--Use of Consensus-based 
Quality Measures. We are redesignating Sec.  414.90(e) as Sec.  
414.90(f) and then revising newly designated Sec.  414.90(f) to broadly 
define our use of consensus-based quality measures. The current 
regulation at Sec.  414.90(e) (now redesignated as Sec.  414.90(f)) 
states that we will publish a final list of measures every year. 
However, we finalized measures for 2013 and beyond this year. While 
Sec.  414.90(e) (now redesignated as Sec.  414.90(f)) contains 
information collection requirements regarding the input process and the 
endorsement of consensus-based quality measures, this rule would not 
revise any of the information collection requirements or burden 
estimates that are associated with those provisions.
    Second, we are revising Sec.  414.90(b)--Definitions under the 
Physician Quality Reporting System. Specifically, we are revising the 
definition of ``group practice'' to include groups of 2-24 eligible 
professionals in the definition. We are revising the definition of 
``qualified registry'' to indicate CMS' authority to disqualify 
registries. We are also eliminating the definition of ``qualified 
electronic health record product'' to more specifically address the 
EHR-based reporting mechanisms available under PQRS as ``direct 
electronic health record (EHR) product'' and ``electronic health record 
(EHR) data submission vendor.'' We are also adding the definition of 
``administrative claims,'' which is a newly-established reporting 
mechanism available under PQRS for the purpose of reporting quality 
measures for the 2015 and 2016 PQRS payment adjustments. In addition, 
we are adding the definition of ``group practice reporting option 
(GPRO) web-interface.'' While the GPRO web-interface was available as a 
reporting mechanism in CY 2012, we had not previously included a 
definition for the GPRO web-interface. While Sec.  414.90(b) contains 
information collection requirements regarding the input process and the 
endorsement of consensus-based quality measures, this rule would not 
revise any of the information collection requirements or burden 
estimates that are associated with Sec.  414.90(b).
    Third, we are revising Sec.  414.90(g) (formerly designated as 
414.90(f))--Requirements for the Incentive Payments. In this final 
rule, we are redesignating 414.90(f) as 414.90(g) and making changes to 
newly designated Sec.  414.90(g) to indicate the applicable incentive 
amounts and requirements for the 2013 and 2014 PQRS incentives. While 
Sec.  414.90(e) (newly designated in this final rule as Sec.  
414.90(f)) contains information collection requirements regarding the 
input process and the endorsement of consensus-based quality measures, 
this rule would not revise any of the information collection 
requirements or burden estimates that are associated with those 
provisions.
    Fourth, we are adding Sec.  414.90(e)--Requirements for the Payment 
Adjustments. We are adding Sec.  414.90(e) to indicate the applicable 
adjustment amounts and requirements for the 2015 and 2016 PQRS payment 
adjustments. While Sec.  414.90(e) contains information collection 
requirements regarding the input process and the endorsement of 
consensus-based quality measures, this rule would not revise any of the 
information collection requirements or burden estimates that are 
associated with those provisions. The impact of this revision to the 
current information collection requirements or burden estimates that 
are associated with those provisions are described here:
    The preamble of this final rule with comment period discusses the 
background of the PQRS, provides information about the measures and 
reporting mechanisms that will be available to eligible professionals 
and group practices who choose to participate in the 2013 and 2014 
PQRS, and provides the criteria for satisfactory reporting in CYs 2013 
and 2014 (for the 2013 and 2014 PQRS incentives and the 2015 and 2016 
PQRS payment adjustments).
a. Participation in the 2013 and 2014 PQRS
    According to the 2010 Reporting Experience Report, a total of 
$391,635,495 in PQRS incentives was paid by CMS for the 2010 program 
year, which encompassed 168,843 individual eligible professionals. In 
2010, eligible professionals earned a 2.0 percent incentive (that is, a 
bonus payment equal to 2.0 percent of the total allowed part B charges 
for covered professional services under the PFS furnished by the 
eligible professional in the reporting period) for satisfactory 
reporting under PQRS. For 2013 and 2014, eligible professionals can 
earn a 0.5 percent incentive for satisfactory reporting, a reduction of 
1.5 percent from 2010. Therefore, based on 2010, we would expect that 
approximately $97 million (approximately \1/4\ of $391,635,495) in 
incentive payments would be distributed to eligible professionals who 
satisfactorily report. However, we estimate that, due to the 
implementation of payment adjustments beginning in 2015, participation 
in PQRS would rise to approximately 300,000 eligible professionals and 
400,000 eligible professionals in 2013 and 2014 respectively.
    The average incentive distributed to each eligible professional in 
2010 was $2,157. Taking into account the 1.5 percent incentive 
reduction from 2.0 percent in 2010 to 0.5 percent in 2013 and 2014, we 
estimate that the average amount per eligible professional earning an 
incentive in 2013 and 2014 would be $539. Therefore, we estimated that 
we would distribute approximately $162 million ($539 x 300,000 eligible 
professionals) and $216 million ($539 x 400,000 eligible professionals) 
in incentive payments in 2013 and 2014, respectively. We believe these 
incentive payments will help offset the cost to

[[Page 69338]]

eligible professionals participating in PQRS for the applicable year. 
Please note that, beginning 2015, incentive payments for satisfactory 
reporting in PQRS will cease and payment adjustments for not 
satisfactorily reporting will commence.
    We noted that the total burden associated with participating in 
PQRS is the time and effort associated with indicating intent to 
participate in PQRS, if applicable, and submitting PQRS quality 
measures data. When establishing these burden estimates, we assumed the 
following:
     The requirements for reporting for the PQRS 2013 and 2014 
incentives and payment adjustments for 2015 and beyond would be 
established as proposed in this 2013 Medicare PFS final rule with 
comment period.
     For an eligible professional using the claims, registry, 
or EHR-based reporting mechanisms and group practices using the 
registry or EHR-based reporting mechanisms, that the eligible 
professional or group practice would report on 3 measures.
     With respect to labor costs, we believe that a billing 
clerk would handle the administrative duties associated with 
participating, while a computer analyst would handle duties related to 
reporting PQRS quality measures. According to the Bureau of Labor 
Statistics, the mean hourly wage for a billing clerk is approximately 
$16/hour whereas the mean hourly wage for a computer analyst is 
approximately $40/hour.
b. Burden Estimate on Participation in 2013 and 2014--New Individual 
Eligible Professionals: Preparation
    For an eligible professional who wishes to participate in PQRS as 
an individual using the traditional reporting mechanisms, the eligible 
professional need not indicate his/her intent to participate. Instead, 
the eligible professional may simply begin reporting quality measures 
data. Therefore, these burden estimates for individual eligible 
professionals participating in PQRS are based on the reporting 
mechanism the individual eligible professional chooses. However, we 
believe a new eligible professional or group practice would spend 5 
hours--which includes 2 hours to review the PQRS measures list, review 
the various reporting options, and select a reporting option and 
measures on which to report and 3 hours to review the measure 
specifications and develop a mechanism for incorporating reporting of 
the selected measures into their office work flows. Therefore, we 
believe that the initial administrative costs associated with 
participating in PQRS would be approximately $80 ($16/hour x 5 hours).
c. Burden Estimate on Participation in 2013 and 2014 via the Claims 
Reporting Mechanism--Individual Eligible Professionals
(1) The Traditional Claims-based Reporting Mechanism
    In 2010, approximately 200,000 of the roughly 245,000 eligible 
professionals (or 84 percent) of eligible professionals used the 
claims-based reporting mechanism. We believe that although the number 
of eligible professionals or group practices using the claims-based 
reporting mechanism will increase in 2013 and 2014, we anticipated that 
the percentage of eligible professionals or group practices using the 
claims-based reporting mechanism will decrease slightly as eligible 
professionals and group practices transition towards using the EHR-
based reporting mechanism. Therefore, we estimated that the percentage 
of PQRS participants using the claims-based reporting mechanism will 
decrease as we anticipate that more eligible professionals would use 
the registry and EHR-based reporting mechanisms. For these reasons, we 
estimated that approximately 320,000 eligible professionals would 
participate in PQRS using the traditional claims-based reporting 
mechanism by 2014.
    With respect to an eligible professional who participated in PQRS 
via claims, the eligible professional must gather the required 
information, select the appropriate quality data codes (QDCs), and 
include the appropriate QDCs on the claims they submitted for payment. 
PQRS will collect QDCs as additional (optional) line items on the 
existing HIPAA transaction 837-P and/or CMS Form 1500 (OCN 0938-0999). 
Based on our experience with the Physician Voluntary Reporting Program 
(PVRP), we continue to estimate that the time needed to perform all the 
steps necessary to report each measure via claims would range from 0.25 
minutes to 12 minutes, depending on the complexity of the measure. 
Therefore, the time spent reporting 3 measures would range from 0.75 
minutes to 36 minutes. Using an average labor cost of $40/hour, we 
estimated that the time cost of reporting for an eligible professional 
via claims would range from $0.50 (0.75 minutes x $40/hour) to $24.00 
(36 minutes x $40/hour) per reported case. With respect to how many 
cases an eligible professional would report when using the claims-based 
reporting mechanism, we established that an eligible professional would 
need to report on 50 percent of the eligible professional's applicable 
cases. The actual number of cases on which an eligible professional 
reports would vary depending on the number of the eligible 
professional's applicable cases. However, in prior years, when the 
reporting threshold was 80 percent, we found that the median number of 
reporting cases for each measure was 9. Since we reduced the reporting 
threshold to 50 percent, we estimated that the average number of 
reporting cases for each measure would be reduced to 6. Based on these 
estimates, we estimated that the total cost of reporting for an 
eligible professional choosing the claims-based reporting mechanism 
would range from ($0.50/per reported case x 6 reported cases) $3.00 to 
($24.00/reported case x 6 reported cases) $144.
(2) The Administrative Claims Reporting Mechanism
    We note that, for the 2015 PQRS payment adjustments, we are 
finalizing an administrative claims reporting option for eligible 
professionals and group practices. The burden associated with reporting 
using the administrative claims reporting option is the time and effort 
associated with using this option. To submit quality measures data for 
PQRS using the administrative claims reporting option, an eligible 
professional or group practice would need to (1) register as an 
administrative claims reporter for the applicable payment adjustment 
and (2) report quality measures data. With respect to registration, we 
believe it would take approximately 2 hours to register to participate 
in PQRS as an administrative claims reporter. Therefore, we estimated 
that the cost of undergoing the administrative claims selection process 
would be ($16/hour x 2 hours) $32.
    With respect to reporting, we noted that any burden associated with 
reporting would be negligible, as an eligible professional or group 
practice would not be required to attach reporting G-codes on the 
claims they submitted. Rather, CMS would bear the burden of calculating 
the measures rates from claims data submitted by the eligible 
professional or group practice. We note that there would be no 
additional burden on the eligible professional or group practice to 
submit these claims, as the eligible professional or group practice 
would have already submitted these claims for reimbursement purposes.

[[Page 69339]]

d. Burden Estimate on Participation in the CYs 2013 and 2014 PQRS via 
the Registry-Based or EHR-Based Reporting Mechanism
    In 2010, approximately 40,000 of the roughly 245,000 eligible 
professionals (or 16 percent) of eligible professionals used the 
registry-based reporting mechanism. We believe the number of eligible 
professionals and group practices using the registry based reporting 
mechanism would remain the same, as we believe the decision for an 
eligible professional or group practice to purchase a registry would 
not likely be solely to report PQRS quality measures data to CMS. 
Rather, we believe that eligible professionals use registries for 
functions other than PQRS and therefore would obtain a registry solely 
for PQRS reporting by CY 2014.
    In 2010, only 14 of the roughly 245,000 eligible professionals (or 
<1 percent) of eligible professionals used the EHR-based reporting 
mechanism. We believe the number of eligible professionals and group 
practices using the EHR-based reporting mechanism would increase as 
eligible professionals become more familiar with EHR products. In 
particular, we believe eligible professionals and group practices would 
transition from using the claims-based to the EHR-based reporting 
mechanisms. We estimated that approximately 40,000 eligible 
professionals (4 percent), whether participating as an individual or 
part of a group practice, would use the EHR-based reporting mechanism 
in CY 2014.
    With respect to an eligible professional or group practice who 
participated in PQRS via a qualified registry, direct EHR product, or 
EHR data submission vendor product, we believe there would be little to 
no burden associated for an eligible professional to report PQRS 
quality measures data to CMS, because the selected reporting mechanism 
would submit the quality measures data for the eligible professional. 
While we noted that there may be start-up costs associated with 
purchasing a qualified registry, direct EHR product, or EHR data 
submission vendor, we believe that an eligible professional or group 
practice would not purchase a qualified registry, direct EHR product, 
or EHR data submission vendor product solely for the purpose of 
reporting PQRS quality measures. Therefore, we have not included the 
cost of purchasing a qualified registry, direct EHR, or EHR data 
submission vendor product in our burden estimates.
e. Burden Estimate on Participation in the CYs 2013 and 2014 PQRS--
Group Practices
    Unlike eligible professionals who choose to report individually, we 
noted that we proposed that eligible professionals choosing to 
participate as part of a group practice under the GPRO would need to 
indicate their intent to participate in PQRS as a group practice. The 
total burden for group practices who submit PQRS quality measures data 
via the GPRO web-interface would be the time and effort associated with 
submitting this data. To submit quality measures data for PQRS, a group 
practice would need to (1) be selected to participate in the PQRS GPRO 
and (2) report quality measures data. With respect to the 
administrative duties for being selected to participate in PQRS as a 
GPRO, we believe it would take approximately 6 hours--including 2 hours 
to decide to participate in PQRS as a GPRO; 2 hours to self-nominate, 
and 2 hours to undergo the vetting process with CMS officials--for a 
group practice to be selected to participate in PQRS GPRO for the 
applicable year. Therefore, we estimated that the cost of undergoing 
the GPRO selection process would be ($16/hour x 6 hours) $96.
    With respect to reporting PQRS quality measures using the GPRO web-
interface, the total reporting burden is the time and effort associated 
with the group practice submitting the quality measures data (that is, 
completing the data collection interface). Based on burden estimates 
for the PGP demonstration, which uses the same data submission methods, 
we estimated the burden associated with a group practice completing the 
data collection interface would be approximately 79 hours. Therefore, 
we estimated that the report cost for a group practice to submit PQRS 
quality measures data for an applicable year would be ($40/hour x 79 
hours) $3,160.
f. Maintenance of Certification Program Incentive
    Eligible professionals who wish to qualify for an additional 0.5 
percent Maintenance of Certification Program incentive would need to 
``more frequently'' than is required to qualify for or maintain board 
certification status participate in a qualified Maintenance of 
Certification Program for the year in which the eligible professionals 
seek to qualify for this additional incentive and successfully complete 
a qualified Maintenance of Certification Program practice assessment 
for the applicable year. Although we understand that there is a cost 
associated with participating in a Maintenance of Certification Board, 
we believe that most of the eligible professionals attempting to earn 
this additional incentive would already be enrolled in a Maintenance of 
Certification Board for reasons other than earning the additional 
Maintenance of Certification Program incentive. Therefore, the burden 
to earn this additional incentive would depend on what a certification 
board establishes as ``more frequently'' and the time needed to 
complete the practice assessment component. We expect that the amount 
of time needed to complete a qualified Maintenance of Certification 
Program practice assessment would be spread out over time since a 
quality improvement component is often required. With respect to the 
practice assessment component, according to an informal poll conducted 
by ABMS in 2012, the time an individual spent to complete the practice 
assessment component of the Maintenance of Certification ranged from 8-
12 hours.
g. Burden Estimate on Vendor Participation in the 2013 and 2014
    Aside from the burden of eligible professionals and group practices 
participating in PQRS, we believe that registry and EHR vendor products 
incur costs associated with participating in PQRS.
    Based on the number of registries that have self-nominated to 
become a qualified PQRS registry in prior program years, we estimated 
that approximately 50 additional registries would self-nominate to be 
considered a qualified registry for PQRS. With respect to qualified 
registries, the total burden for qualified registries who submitted 
PQRS quality measures data would be the time and effort associated with 
submitting this data. To submit quality measures data for the proposed 
PQRS program years, a registry would need to (1) become qualified for 
the applicable year and (2) report quality measures data on behalf of 
its eligible professionals. With respect to administrative duties 
related to the qualification process, we estimated that it would take a 
total of 10 hours--including 1 hour to complete the self-nomination 
statement, 2 hours to interview with CMS, 2 hours to calculate 
numerators, denominators, and measure results for each measure the 
registry wished to report using a CMS-provided measure flow, and 5 
hours to complete an XML submission--to become qualified to report PQRS 
quality measures data. Therefore, we estimated that it would cost a 
registry approximately ($16.00/hour x 10 hours) $160 to become 
qualified to submit PQRS quality

[[Page 69340]]

measures data on behalf of its eligible professionals.
    With respect to the reporting of quality measures data, the burden 
associated with reporting is the time and effort associated with the 
registry calculating quality measures results from the data submitted 
to the registry by its eligible professionals, submitting numerator and 
denominator data on quality measures, and calculating these measure 
results. We believe, however, that registries already perform these 
functions for its eligible professionals irrespective of participating 
in PQRS. Therefore, we believe there is little to no additional burden 
associated with reporting PQRS quality measures data. Whether there is 
any additional reporting burden would vary with each registry, 
depending on the registry's level of knowledge with submitting quality 
measures data for PQRS.
    With respect to EHR products, the total burden for direct EHR 
products and EHR data submission vendors who submit PQRS quality 
measures data would be the time and effort associated with submitting 
this data. To submit quality measures data for PQRS, a direct EHR 
product or EHR data submission vendor would need to report quality 
measures data on behalf of its eligible professionals. Please note that 
since we are not continuing to require direct EHR products and EHR data 
submission vendors to become qualified to submit PQRS quality measures 
data, there is no burden associated with a qualification process for 
direct EHR products and EHR data submission vendor products. With 
respect to reporting quality measures data, we believe the burden 
associated with the EHR vendor programming its EHR product(s) to 
extract the clinical data that the eligible professional would need to 
submit to CMS will depend on the vendor's familiarity with PQRS and the 
vendor's system and programming capabilities. Since we believe that an 
EHR vendor would be submitting data for reasons other than reporting 
under PQRS, we believe there would be no additional burden for an EHR 
vendor to submit quality measures data for PQRS reporting.
g. Summary of Burden Estimates on Participation in the 2013 and 2014 
PQRS-Eligible Professionals and Vendors

         Table 131--Estimated Costs for Reporting PQRS Quality Measures Data For Eligible Professionals
----------------------------------------------------------------------------------------------------------------
                                                   Estimated       Number of
                               Estimated hours       cases         measures       Hourly rate      Total cost
----------------------------------------------------------------------------------------------------------------
Individual Eligible                        5.0               1             N/A             $16  $80.
 Professional (EP):
 Preparation.
Individual EP: Claims........              0.2               6               3             $40  $144.
Individual EP: Administrative              2                 1             N/A             $16  $32.
 Claims.
Individual EP: Registry......            N/A                 1             N/A             N/A  Minimal.
Individual EP: HER...........            N/A                 1             N/A             N/A  Minimal.
Group Practice: Self-                      6.0               1             N/A             $16  $96.
 Nomination.
Group Practice: Reporting....             79                 1             N/A             $40  $3,160.
----------------------------------------------------------------------------------------------------------------


                          Table 132--Estimated Costs To Vendors To Participate in PQRS
----------------------------------------------------------------------------------------------------------------
                                                             Estimated hours     Hourly rate       Total cost
----------------------------------------------------------------------------------------------------------------
Registry: Self-Nomination.................................                10              $160              $160
EHR: Programming..........................................                 0                 0                 0
----------------------------------------------------------------------------------------------------------------

    We invited but received no public comments on our estimates related 
to the impact of the collection of information requirements related to 
PQRS. However, we believe that the estimated changes from the 
requirements and burden estimates currently approved by OMB under OCN 
0938-1059 are due to a combination of all revisions being made at Sec.  
414.90(b), newly designated Sec.  414.90(f), and newly createdSec.  
414.90(e), rather than just one outstanding provision. Therefore, 
please note that we have combined all impacts of the collection of 
information requirements related to PQRS in this section, in lieu of 
separating these impacts as it was proposed. Otherwise, our burden 
estimates remain unchanged.

C. ICRs Regarding Physician Quality Reporting System--Requirements for 
the Payment Adjustments (Sec.  414.90)

    While Sec.  414.90 contains information collection requirements 
regarding the PQRS payment adjustments, this rule will not revise any 
of the information collection requirements or burden estimates that are 
associated with those provisions, except for the provisions that would 
allow the administrative claims reporting option. Otherwise, all of the 
requirements and burden estimates are currently approved by OMB under 
OCN 0938-1083 and are not subject to additional OMB review under the 
authority of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et 
seq.).
    Specifically, although we are finalizing the criteria to report 1 
measure or measures group for the 2015 PQRS payment adjustment, we do 
not expect eligible professional and group practices to stop reporting 
when they have met this threshold. Rather, since the reporting period 
for the 2013 PQRS incentive and 2015 PQRS payment adjustment coincide, 
we expect that all eligible professionals and group practices who use 
the traditional PQRS reporting mechanisms--claims, registry, EHR, and 
GPRO web interface--will attempt to report PQRS quality measures to 
meet the criteria for the 2013 PQRS Incentive. Therefore, the burden 
estimates for the 2013 PQRS incentive apply to the 2015 PQRS payment 
adjustment.
    With respect to the 2016 PQRS payment adjustment, we did not 
finalize the criteria to report 1 measure or measures group. Therefore, 
at this time, eligible professionals and group practices using the 
traditional PQRS reporting mechanisms--claims, registry, EHR, and GPRO 
web interface must meet the criteria for the 2014 PQRS incentive for 
the 2016 PQRS payment adjustment. Therefore, the burden estimates for 
the 2014 PQRS incentive apply to the 2016 PQRS payment adjustment.

[[Page 69341]]

(2) The Administrative Claims Reporting Mechanism
    We note that, for the 2015 PQRS payment adjustment, we are 
finalizing an administrative claims reporting option for eligible 
professionals and group practices. The burden associated with reporting 
using the administrative claims reporting option is the time and effort 
associated with using this option. To submit quality measures data for 
PQRS using the administrative claims reporting option, an eligible 
professional or group practice would need to (1) elect to use the 
administrative claims-based reporting mechanism for the applicable 
payment adjustment and (2) be analyzed under the administrative claims-
based reporting mechanism. With respect to election, we believe it 
would take approximately 2 hours to register to participate in PQRS as 
an administrative claims reporter. Therefore, we estimated that the 
cost of undergoing the administrative claims selection process would be 
($16/hour x 2 hours) $32.
    With respect to reporting, we noted that any burden associated with 
reporting would be negligible, as an eligible professional or group 
practice would not be required to attach reporting G-codes on the 
claims they submitted. Rather, CMS would calculate the administrative 
claims measures rates from claims submitted by group practices and 
eligible professionals. We note that there would be no additional 
burden on the eligible professional or group practice to submit these 
claims, as the eligible professional or group practice would have 
already submitted these claims for reimbursement purposes.

D. Summary of Annual Burden Estimates for Codified Requirements

    The requirements for the eRx Incentive Program for 2012-2014 were 
established in the CY 2012 Medicare PFS final rule. Although we made 
proposals related to the eRx Incentive Program in the CY 2013 Medicare 
PFS, these proposals have no additional burden or impact on the public. 
Therefore, this rule does not revise the requirements or burden 
estimates approved by OMB under OCN 0938-1059. We invited but received 
no public comment on our proposed impact analysis and are therefore 
finalizing the analysis for the collection of information requirements 
associated with the Electronic Prescribing (eRx) Incentive Program.

                                  Table 133--Summary of Annual Burden Estimates
----------------------------------------------------------------------------------------------------------------
                                                                                    Burden per     Total burden
    Regulation section(s)            OCN          Respondents      Responses      response (hr)        (hr)
----------------------------------------------------------------------------------------------------------------
Sec.   410.38(g) re:          0938-New........         580,000  580,000........  10 min.........          96,667
 Physician.
Sec.   410.38(g) re: PA, NP,  ................  ..............  ...............  3 min..........          29,000
 or CNS.
Sec.   414.90...............  0938-1059.......         400,000  400,000          0.5 (31.5               200,000
                                                                 (400,000         minutes--the
                                                                 responses x 3    median).
                                                                 measures).
----------------------------------------------------------------------------------------------------------------

E. Additional Information Collection Requirements

    While this final rule with comment period will impose collection of 
information requirements that are set out in the regulatory text (see 
above), this rule also sets out information collection requirements 
that are set out only in the preamble. Following is a discussion of the 
preamble-specific information collections, all of which have already 
received OMB approval.
1. Part B Drug Payment
    The discussion of average sales price (ASP) issues in section 
III.B.1 of this final rule with comment period rule does not contain 
any new information collection requirements with respect to payment for 
Medicare Part B drugs and biologicals under the ASP methodology. Drug 
manufacturers are required to submit ASP data to us on a quarterly 
basis. The ASP reporting requirements are set forth in section 1927(b) 
of the Act. The burden associated with this requirement is the time and 
effort required by manufacturers of Medicare Part B drugs and 
biologicals to calculate, record, and submit the required data to CMS. 
All of the requirements and burden estimates are currently approved by 
OMB under OCN 0938-0921, and are not subject to additional OMB review 
under the authority of the Paperwork Reduction Act of 1995 (44 U.S.C. 
3501 et seq.).
2. CAHPS Survey for the Physician Quality Reporting System and 
Physician Compare
    As explained previously, the burden estimates related to PQRS are 
under OCN 0938-1083. However, we note that, to meet the criteria for 
the 2013 and 2014 PQRS incentives, we are requiring that group 
practices using the GPRO web interface complete a CAHPS survey. This 
would require the collection of information to obtain the patient 
experience data that will be included in the quality information 
reported by eligible professionals. The data collected in the survey 
will be scored and reported via Physician Compare on the cms.gov Web 
site. The information collection--a survey--will be targeted to Fee-
for-service Medicare beneficiaries who have received care in the prior 
12 months from the physician group practices participating in Physician 
Quality Reporting. The survey will be administered in English and 
Spanish, and beneficiaries may have assistance to complete the survey 
or designate a proxy respond on their behalf.
    Administering the CAHPS survey is different from the estimates 
provided from reporting measures, as beneficiaries must actively 
participate in the reporting of data by completing these surveys. 
According to estimates we have performed with respect to administering 
this survey, we anticipate that it will take approximately 39.53 hours 
to administer the CAHPS survey. We estimate that the cost per response 
will be $7,673.50. We understand the estimated cost is high. However, 
as we indicate in Section G in this final rule, CMS will assume the 
expense of administering the CAHPS survey. A summary of the burden 
estimates for administering the CAHPS survey is provided below:

[[Page 69342]]



 
----------------------------------------------------------------------------------------------------------------
                                     Time per        Hour per       Annual hour      Cost per       Annual cost
                                     response        response         burden         response         burden
----------------------------------------------------------------------------------------------------------------
Reporting.......................           20.24           0.337          39,530         $7.6735        $900,100
Record Keeping..................               0               0               0          0                    0
Third Party Disclosure..........               0               0               0          0                    0
                                 -------------------------------------------------------------------------------
    Total.......................          *20.24           0.337          39,530         $7.6735        $900,100
----------------------------------------------------------------------------------------------------------------
* Minutes.

F. Submission of PRA-Related Comments

    If you comment on these information collection and recordkeeping 
requirements, please submit your comments to the Office of Information 
and Regulatory Affairs, Office of Management and Budget, Attention: CMS 
Desk Officer, [CMS-1590-FC]; Fax: (202) 395-6974; or Email: [email protected].

VI. Waiver of Proposed Rulemaking

    We ordinarily publish a notice of proposed rulemaking in the 
Federal Register and invite public comment on the proposed rule. The 
notice of proposed rulemaking includes a reference to the legal 
authority under which the rule is proposed, and the terms and substance 
of the proposed rule or a description of the subjects and issues 
involved. This procedure can be waived, however, if an agency finds 
good cause that a notice-and-comment procedure is impracticable, 
unnecessary, or contrary to the public interest and incorporates a 
statement of the finding and its reasons in the rule issued.
    We utilize HCPCS codes for Medicare payment purposes. The HCPCS is 
a national drug coding system comprised of Level I (CPT) codes and 
Level II (HCPCS National Codes) that are intended to provide uniformity 
to coding procedures, services, and supplies across all types of 
medical providers and suppliers. Level I (CPT) codes are copyrighted by 
the AMA and consist of several categories, including Category I codes 
which are 5-digit numeric codes, and Category III codes which are 
temporary codes to track emerging technology, services, and procedures. 
The AMA issues an annual update of the CPT code set each Fall, with 
January 1 as the effective date for implementing the updated CPT codes. 
The HCPCS, including both Level I and Level II codes, is similarly 
updated annually on a CY basis. Annual coding changes are not available 
to the public until the Fall immediately preceding the annual January 
update of the PFS. Because of the timing of the release of these new 
codes, it is impracticable for us to provide prior notice and solicit 
comment on these codes and the RVUs assigned to them in advance of 
publication of the final rule that implements the PFS. Yet, it is 
imperative that these coding changes be accounted for and recognized 
timely under the PFS for payment because services represented by these 
codes will be provided to Medicare beneficiaries by physicians during 
the CY in which they become effective. Moreover, regulations 
implementing HIPAA (42 CFR parts 160 and 162) require that the HCPCS be 
used to report health care services, including services paid under the 
PFS. We assign interim RVUs to any new codes based on a review of the 
AMA RUC recommendations for valuing these services. We also assign 
interim RVUs to certain codes for which we did not receive specific AMA 
RUC recommendations, but that are components of new combined codes. We 
set interim RVUs for the component codes in order to conform them to 
the value of the combined code. Finally, we assign interim RVUs to 
certain codes for which we received AMA RUC recommendations for only 
one component (work or PE) but not both. By reviewing these AMA RUC 
recommendations for the new codes, we are able to assign RVUs to 
services based on input from the medical community and to establish 
payment for them, on an interim basis, that corresponds to the relative 
resources associated with furnishing the services. We are also able to 
determine, on an interim final basis, whether the codes will be subject 
other payment policies. If we did not assign RVUs to new codes on an 
interim basis, the alternative would be to either not pay for these 
services during the initial CY or have each Medicare contractor 
establish a payment rate for these new codes. We believe both of these 
alternatives are contrary to the public interest, particularly since 
the AMA RUC process allows for an assessment of the valuation of these 
services by the medical community prior to our establishing payment for 
these codes on an interim basis. Therefore, we believe it would be 
contrary to the public interest to delay establishment of fee schedule 
payment amounts for these codes.
    For the reasons previously outlined in this section, we find good 
cause to waive the notice of proposed rulemaking for the interim RVUs 
for selected procedure codes identified in Addendum C and to establish 
RVUs for these codes on an interim final basis. We are providing a 60-
day public comment period.
    Section II.C. of this final rule with comment period discusses the 
identification and review of potentially misvalued codes by the AMA 
RUC, as well as our review and decisions regarding the AMA RUC 
recommendations. Similar to the AMA RUC recommendations for new and 
revised codes previously discussed, due to the timing of the AMA RUC 
recommendations for the potentially misvalued codes, it was 
impracticable for CMS to solicit public comment regarding specific 
proposals for revision prior to this final rule with comment period. We 
believe it is in the public interest to implement the revised RVUs for 
the codes that were identified as misvalued, and that have been 
reviewed and re-evaluated by the AMA RUC, on an interim final basis for 
CY 2013. The revisions of RVUs for these codes will establish a more 
appropriate payment that better corresponds to the relative resources 
associated with furnishing these services. A delay in implementing 
revised values for these misvalued codes would not only perpetuate the 
known misvaluation for these services, it would also perpetuate a 
distortion in the payment for other services under the PFS. 
Implementing the changes now allows for a more equitable distribution 
of payments across all PFS services. We believe a delay in 
implementation of these revisions would be contrary to the public 
interest, particularly since the AMA RUC process allows for an 
assessment of the valuation of these services by the medical community 
prior to the AMA RUC's recommendation to CMS. For the

[[Page 69343]]

reasons previously described, we find good cause to waive notice and 
comment procedures with respect to the misvalued codes and to revise 
RVUs for these codes on an interim final basis. We are providing a 60-
day public comment period.
    We ordinarily provide a 60-day delay in the effective date of the 
provisions of a rule in accordance with the Administrative Procedure 
Act (APA) (5 U.S.C. 553(d)), which requires a 30-day delayed effective 
date, and the Congressional Review Act (5 U.S.C. 801(a)(3)), which 
requires a 60-day delayed effective date for major rules. However, we 
can waive the delay in the effective date if the Secretary finds, for 
good cause, that the delay is impracticable, unnecessary, or contrary 
to the public interest, and incorporates a statement of the finding and 
the reasons in the rule issued (5 U.S.C. 553(d)(3); 5 U.S.C. 808(2)).

VII. Response to Comments

    Because of the large number of public comments we normally receive 
on Federal Register documents, we are not able to acknowledge or 
respond to them individually. We considered all comments we received by 
the date and time specified in the ``DATES'' section of this preamble, 
and, when we proceeded with a subsequent document, we responded to the 
comments in the preamble to that document.

VIII. Regulatory Impact Analysis

A. Statement of Need

    This final rule with comment period is necessary in order to make 
payment and policy changes under the Medicare PFS and to make required 
statutory changes under the Middle Class Tax Relief and Job Creation 
Act of 2012 (MCTRJCA), the Affordable Care Act, and other statutory 
changes. This final rule with comment period also is necessary to make 
changes to Part B drug payment policy and other related Part B related 
policies.

B. Overall Impact

    We have examined the impact of this rule as required by Executive 
Order 12866 on Regulatory Planning and Review (September 30, 1993), 
Executive Order 13563 on Improving Regulation and Regulatory Review 
(February 2, 2012), the Regulatory Flexibility Act (RFA) (September 19, 
1980, Pub. L. 96-354), section 1102(b) of the Social Security Act, 
section 202 of the Unfunded Mandates Reform Act of 1995 (March 22, 
1995; Pub. L. 104-4), Executive Order 13132 on Federalism (August 4, 
1999) and the Congressional Review Act (5 U.S.C. 804(2)).
    Executive Orders 12866 and 13563 direct agencies to assess all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). A 
regulatory impact analysis (RIA) must be prepared for major rules with 
economically significant effects ($100 million or more in any 1 year). 
We estimate, as discussed below in this section, that the PFS 
provisions included in this proposed rule will redistribute more than 
$100 million in 1 year. Therefore, we estimate that this rulemaking is 
``economically significant'' as measured by the $100 million threshold, 
and hence also a major rule under the Congressional Review Act. 
Accordingly, we have prepared a RIA that, to the best of our ability, 
presents the costs and benefits of the rulemaking. The RFA requires 
agencies to analyze options for regulatory relief of small entities. 
For purposes of the RFA, small entities include small businesses, 
nonprofit organizations, and small governmental jurisdictions. Most 
hospitals and most other providers and suppliers are small entities, 
either by nonprofit status or by having revenues of $7.0 million to 
$34.5 million in any 1 year (for details see the SBA's Web site at 
www.sba.gov/content/table-small-business-size-standards (refer to the 
620000 series)). Individuals and states are not included in the 
definition of a small entity.
    The RFA requires that we analyze regulatory options for small 
businesses and other entities. We prepare a regulatory flexibility 
analysis unless we certify that a rule would not have a significant 
economic impact on a substantial number of small entities. The analysis 
must include a justification concerning the reason action is being 
taken, the kinds and number of small entities that the rule affects, 
and an explanation of any meaningful options that achieve the 
objectives with less significant adverse economic impact on the small 
entities.
    For purposes of the RFA, physicians, NPPs, and suppliers including 
IDTFs are considered small businesses if they generate revenues of $10 
million or less based on SBA size standards. Approximately 95 percent 
of physicians are considered to be small entities. There are over 1 
million physicians, other practitioners, and medical suppliers that 
receive Medicare payment under the PFS.
    Because we acknowledge that many of the affected entities are small 
entities, the analysis discussed throughout the preamble of this 
proposed rule constitutes our regulatory flexibility analysis for the 
remaining provisions and addresses comments received on these issues.
    In addition, section 1102(b) of the Act requires us to prepare a 
regulatory impact analysis if a rule may have a significant impact on 
the operations of a substantial number of small rural hospitals. This 
analysis must conform to the provisions of section 604 of the RFA. For 
purposes of section 1102(b) of the Act, we define a small rural 
hospital as a hospital that is located outside of a Metropolitan 
Statistical Area for Medicare payment regulations and has fewer than 
100 beds. We are not preparing an analysis for section 1102(b) of the 
Act because we have determined, and the Secretary certifies, that this 
proposed rule would not have a significant impact on the operations of 
a substantial number of small rural hospitals.
    Section 202 of the Unfunded Mandates Reform Act of 1995 also 
requires that agencies assess anticipated costs and benefits on State, 
local, or tribal governments or on the private sector before issuing 
any rule whose mandates require spending in any 1 year of $100 million 
in 1995 dollars, updated annually for inflation. In 2012, that 
threshold is approximately $139 million. This final rule with comment 
period would have no consequential spending effect on state, local, or 
tribal governments or on the private sector.
    Executive Order 13132 establishes certain requirements that an 
agency must meet when it promulgates a proposed rule (and subsequent 
final rule) that imposes substantial direct requirement costs on state 
and local governments, preempts state law, or otherwise has federalism 
implications. Since this regulation does not impose any costs on state 
or local governments, the requirements of Executive Order 13132 are not 
applicable.
    We have prepared the following analysis, which together with the 
information provided in the rest of this preamble, meets all assessment 
requirements. The analysis explains the rationale for and purposes of 
this final rule with comment period; details the costs and benefits of 
the rule; analyzes alternatives; and presents the measures we would use 
to minimize the burden on small entities. As indicated elsewhere in 
this final rule with comment period, we proposed to implement a variety 
of changes to our regulations, payments, or payment

[[Page 69344]]

policies to ensure that our payment systems reflect changes in medical 
practice and the relative value of services, and to implement statutory 
provisions. We provided information for each of the policy changes in 
the relevant sections of this final rule with comment period. We are 
unaware of any relevant federal rules that duplicate, overlap, or 
conflict with this final rule with comment period. The relevant 
sections of this final rule with comment period contain a description 
of significant alternatives if applicable.

C. Relative Value Unit (RVU) Impacts

1. Resource-Based Work, PE, and Malpractice RVUs
    Section 1848(c)(2)(B)(ii)(II) of the Act requires that increases or 
decreases in RVUs may not cause the amount of expenditures for the year 
to differ by more than $20 million from what expenditures would have 
been in the absence of these changes. If this threshold is exceeded, we 
make adjustments to preserve BN.
    Our estimates of changes in Medicare revenues for PFS services 
compare payment rates for CY 2012 with final payment rates for CY 2013 
using CY 2011 Medicare utilization as the basis for the comparison. To 
the extent that there are year-to-year changes in the volume and mix of 
services furnished by physicians, the actual impact on total Medicare 
revenues would be different from those shown in Tables 134 (CY 2013 PFS 
Final Rule with Comment Period Estimated Impact on Total Allowed 
Charges by Specialty) and 135 (CY 2013 PFS Final Rule with Comment 
Period Estimated Impact on Total Allowed Charges by Specialty by 
Selected Policy). The payment impacts reflect averages for each 
specialty based on Medicare utilization. The payment impact for an 
individual physician would be different from the average and would 
depend on the mix of services the physician furnishes. The average 
change in total revenues would be less than the impact displayed here 
because physicians furnish services to both Medicare and non-Medicare 
patients and specialties may receive substantial Medicare revenues for 
services that are not paid under the PFS. For instance, independent 
laboratories receive approximately 85 percent of their Medicare 
revenues from clinical laboratory services that are not paid under the 
PFS.
    Tables 134 and 135 show the payment impact on PFS services. We note 
that these impacts do not include the effect of the January 2013 
conversion factor changes under current law. The annual update to the 
PFS conversion factor is calculated based on a statutory formula that 
measures actual versus allowed or ``target'' expenditures, and applies 
a sustainable growth rate (SGR) calculation intended to control growth 
in aggregate Medicare expenditures for physicians' services. This 
update methodology is typically referred to as the ``SGR'' methodology, 
although the SGR is only one component of the formula. Medicare PFS 
payments for services are not withheld if the percentage increase in 
actual expenditures exceeds the SGR. Rather, the PFS update, as 
specified in section 1848(d)(4) of the Act, is adjusted to eventually 
bring actual expenditures back in line with targets. If actual 
expenditures exceed allowed expenditures, the update is reduced. If 
actual expenditures are less than allowed expenditures, the update is 
increased. By law, we are required to apply these updates in accordance 
with section 1848(d) and (f) of the Act, and any negative updates can 
only be averted by an Act of the Congress. While the Congress has 
provided temporary relief from negative updates for every year since 
2003, a long-term solution is critical. We are committed to working 
with the Congress to permanently reform the SGR methodology for 
Medicare PFS updates. We provide our most recent estimate of the SGR 
and physician update for CY 2013 in section III.N. of this final rule 
with comment period.
    The following is an explanation of the information represented in 
Table 134:
     Column A (Specialty): The Medicare specialty code as 
reflected in our physician/supplier enrollment files.
     Column B (Allowed Charges): The aggregate estimated PFS 
allowed charges for the specialty based on CY 2011 utilization and CY 
2012 rates. That is, allowed charges are the PFS amounts for covered 
services and include coinsurance and deductibles (which are the 
financial responsibility of the beneficiary). These amounts have been 
summed across all services furnished by physicians, practitioners, and 
suppliers within a specialty to arrive at the total allowed charges for 
the specialty.
     Column C (Impact of Work and Malpractice (MP) RVU 
Changes): This column shows the estimated CY 2013 impact on total 
allowed charges of the changes in the work and malpractice RVUs, 
including the impact of changes due to potentially misvalued codes.
     Column D (Impact of PE RVU Changes): This column shows the 
estimated CY 2013 impact on total allowed charges of the changes in the 
PE RVUs.
     Column E (Combined Impact): This column shows the 
estimated CY 2013 combined impact on total allowed charges of all the 
changes in the previous columns.

 Table 134--CY 2013 PFS Final Rule With Comment Period Estimated Impact on Total Allowed Charges by Specialty *
----------------------------------------------------------------------------------------------------------------
                       (A)                              (B)             (C)             (D)             (E)
Specialty                                                Allowed       Impact of       Impact of        Combined
                                                         charges     work and MP          PE RVU          impact
                                                           (mil)             RVU         changes               %
                                                                         changes               %
                                                                               %
----------------------------------------------------------------------------------------------------------------
TOTAL...........................................        $ 86,588               0               0               0
01-ALLERGY/IMMUNOLOGY...........................             200               0               3               3
02-ANESTHESIOLOGY **............................           1,923               0               1               1
03-CARDIAC SURGERY..............................             369               0              -1              -1
04-CARDIOLOGY...................................           6,733              -1              -2              -2
05-COLON AND RECTAL SURGERY.....................             153               0               2               2
06-CRITICAL CARE................................             263               0               1               1
07-DERMATOLOGY..................................           3,024               0               0               0
08-EMERGENCY MEDICINE...........................           2,839               0               0               0
09-ENDOCRINOLOGY................................             437               0               1               1
10-FAMILY PRACTICE..............................           5,943               2               4               7

[[Page 69345]]

 
11-GASTROENTEROLOGY.............................           1,896               0               0               0
12-GENERAL PRACTICE.............................             587               0               1               1
13-GENERAL SURGERY..............................           2,283               0               1               0
14-GERIATRICS...................................             220               1               3               5
15-HAND SURGERY.................................             135               0               1               1
16-HEMATOLOGY/ONCOLOGY..........................           1,909               0               2               2
17-INFECTIOUS DISEASE...........................             629               0               1               1
18-INTERNAL MEDICINE............................          11,163               2               3               4
19-INTERVENTIONAL PAIN MGMT.....................             539               0               1               1
20-INTERVENTIONAL RADIOLOGY.....................             204               0              -2              -3
21-MULTISPECIALTY CLINIC/OTHER PHY..............              81               0               0              -1
22-NEPHROLOGY...................................           2,080               0               0               0
23-NEUROLOGY....................................           1,604              -2              -5              -7
24-NEUROSURGERY.................................             687               0               0               0
25-NUCLEAR MEDICINE.............................              49               0              -2              -3
27-OBSTETRICS/GYNECOLOGY........................             704               0               0               0
28-OPHTHALMOLOGY................................           5,645              -3               0              -3
29-ORTHOPEDIC SURGERY...........................           3,643               0               0               0
30-OTOLARNGOLOGY................................           1,076               0               2               2
31-PATHOLOGY....................................           1,210               0              -6              -6
32-PEDIATRICS...................................              65               1               3               3
33-PHYSICAL MEDICINE............................             999              -1              -3              -4
34-PLASTIC SURGERY..............................             356              -1               1               1
35-PSYCHIATRY...................................           1,170              -1               3               2
36-PULMONARY DISEASE............................           1,703               0               1               1
37-RADIATION ONCOLOGY...........................           1,988               0              -7              -7
38-RADIOLOGY....................................           4,818               0              -3              -3
39-RHEUMATOLOGY.................................             548               0               0               0
40-THORACIC SURGERY.............................             343               0              -1              -1
41-UROLOGY......................................           1,918               0              -1              -1
42-VASCULAR SURGERY.............................             888               0              -2              -2
43-AUDIOLOGIST..................................              57               0              -4              -4
44-CHIROPRACTOR.................................             746               0               1               1
45-CLINICAL PSYCHOLOGIST........................             575               1              -3              -2
46-CLINICAL SOCIAL WORKER.......................             406               1              -3              -2
47-DIAGNOSTIC TESTING FACILITY..................             888               0              -7              -7
48-INDEPENDENT LABORATORY.......................           1,073               0             -14             -14
49-NURSE ANES/ANES ASST **......................           1,104               0               1               1
50-NURSE PRACTITIONER...........................           1,623               1               3               4
51-OPTOMETRY....................................           1,061              -1               1               1
52-ORAL/MAXILLOFACIAL SURGERY...................              45               0               1               1
53-PHYSICAL/OCCUPATIONAL THERAPY................           2,636               0               4               4
54-PHYSICIAN ASSISTANT..........................           1,229               1               2               3
55-PODIATRY.....................................           1,925               0               2               2
56-PORTABLE X-RAY SUPPLIER......................             106               0               5               5
57-RADIATION THERAPY CENTERS....................              72               0              -9              -9
98-OTHER........................................              19               0               1               1
----------------------------------------------------------------------------------------------------------------
* Table 83 shows only the proposed payment policy impact on PFS services. We note that these impacts do not
  include the effects of the negative January 2013 conversion factor change under current law.
** These figures have been revised to correct errors in the calculations presented in the CY 2013 PFS proposed
  rule.

    Table 135 shows the estimated impact of selected policies in this 
final rule with comment period on total allowed charges, by specialty. 
The following is an explanation of the information represented in Table 
135:
     Column A (Specialty): The Medicare specialty code as 
reflected in our physician/supplier enrollment files.
     Column B (Allowed Charges): The aggregate estimated PFS 
allowed charges for the specialty based on CY 2011 utilization and CY 
2012 rates. That is, allowed charges are the PFS amounts for covered 
services and include coinsurance and deductibles (which are the 
financial responsibility of the beneficiary). These amounts have been 
summed across all services furnished by physicians, practitioners, and 
suppliers within a specialty to arrive at the total allowed charges for 
the specialty.
     Column (C) (Impact of End of PPIS Transition): This column 
shows the estimated CY 2013 impact on total allowed charges of the 
changes in the RVUs due to the final year of the PPIS transition.
     Column D (Impact of New and Revised Codes, Updated Claims 
Data, MPPR on the TC of ophthalmology and cardiovascular diagnostic 
tests, and Other Factors): This column shows the

[[Page 69346]]

estimated CY 2013 impact on total allowed charges of the changes in the 
RVUs, due to new and revised codes, proposed multiple procedure payment 
reduction for the TC of cardiovascular and ophthalmology diagnostic 
tests furnished on the same day (section III.B.4. of this final rule 
with comment period), and other final policies that resulted in minimal 
redistribution of payments under the PFS, the use of CY 2011 claims 
data to model payment rates, and other factors.
     Column E (Impact of Updated Equipment Interest Rate 
Assumption): This column shows the estimated CY 2013 impact on total 
allowed charges of the changes in the RVUs resulting from our update to 
the equipment interest rate assumption as discussed in section 
III.A.2.f. of this final rule with comment period.
     Column F (Impact of Discharge Transitional Care Management 
Services): This column shows the estimated CY 2013 combined impact on 
total allowed charges of the changes in the RVUs resulting from our 
policy to recognize new CPT codes that pay for post-discharge 
transitional care management services in the 30 days following an 
inpatient hospital, outpatient observation or partial hospitalization, 
skilled nursing facility (SNF), or community mental health center 
(CMHC) discharge as discussed in section III.H.1. of this final rule 
with comment period.
     Column G (Impact of Input and Price Changes for Certain 
Radiation Therapy Procedures): This column shows the estimated CY 2013 
combined impact on total allowed charges of the changes in the RVUs 
resulting from our policy to adjust inputs on certain radiation therapy 
procedures.
     Column H (Cumulative Impact): This column shows the 
estimated CY 2013 combined impact on total allowed charges of all 
changes from the policies in this final rule with comment period in the 
previous columns.
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2. CY 2013 PFS Impact Discussion
a. Changes in RVUs
    The most widespread specialty impacts of the RVU changes are 
generally related to several factors. First, as discussed in section 
III.A.2. of this final rule with comment period, we are currently 
implementing the final year of the 4-year transition to new PE RVUs 
using the PPIS data that were adopted in the CY 2010 PFS final rule 
with comment period. This impact appears in column C of Table 135. The 
impacts of the final year of the transition are generally consistent 
with the impacts that would be expected based on the impacts displayed 
in the CY 2012 final rule with comment period. The second factor is the 
post-discharge transitional care management policy, under which we will 
pay for care coordination in the 30 days following an inpatient 
hospital, outpatient hospital observation services or partial 
hospitalization, SNF, or CMHC discharge from the treating physician in 
the hospital to the beneficiary's primary physician in the community. 
We estimate that CPT codes 99495 and 99496 for TCM will redistribute 
approximately $0.6 billion in allowed charges to primary care 
specialties under the physician fee schedule (estimated using the CY 
2012 CF), with approximately 20 percent of that representing 
redistributed beneficiary coinsurance. The redistributive effect of 
this policy appears on column F of Table 135.
    Column E in Table 135 also reflects updates to the proposed 
interest rate assumption used in the medical equipment calculation in 
the PE RVU methodology. Other final rule policies, including the 
multiple procedure payment reduction policy for the technical component 
of diagnostic cardiovascular and ophthalmological procedures, as well 
as new values for new and revised codes are included in Column D. 
Column G in Table 135 isolates the impact of revisions to equipment 
inputs and prices for certain radiation therapy services. Table 135 
shows the same information as provided in Table 134, but rather than 
isolating the policy impact on physician work, PE, and malpractice 
separately, Table 135 shows the impact of varied final policies on 
total RVUs.
b. Combined Impact
    Column E of Table 134 and column H of Table 135 display the 
estimated CY 2013 combined impact on total allowed charges by specialty 
of all the RVU and MPPR changes. These impacts range from an increase 
of 7 percent for family practice to a decrease of 14 percent for 
independent laboratory. We have received numerous new codes with new 
values and revised codes with new values for CY 2013 as a result of our 
ongoing misvalued codes initiative. Many of the new and revised codes 
that we valued on an interim basis for CY 2013 originated with the 
potentially misvalued codes initiative. Reductions for pathology, 
neurology, and independent laboratories are a result of the potentially 
misvalued code initiative. In the case of independent laboratories, we 
note that independent laboratories receive the majority of the Medicare 
revenue from the Clinical Lab Fee Schedule, which is unaffected by the 
potentially misvalued code initiative. Again, these impacts are 
estimated prior to the application of the negative CY 2013 Conversion 
Factor (CF) update applicable under the current statute.
    Table 136 (Impact of Final Rule with Comment Period on CY 2013 
Payment for Selected Procedures) shows the estimated impact on total 
payments for selected high volume procedures of all of the changes 
discussed previously. We have included CY 2013 payment rates with and 
without the effect of the CY 2013 negative PFS CF update for comparison 
purposes. We selected these procedures because they are the most 
commonly furnished by a broad spectrum of physician specialties. There 
are separate columns that show the change in the facility rates and the 
nonfacility rates. For an explanation of facility and nonfacility PE, 
we refer readers to Addendum A of this final rule with comment period.

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D. Effect of Proposed Changes to Medicare Telehealth Services Under the 
PFS

    As discussed in section III.E.3 of this final rule with comment 
period, we are finalizing our proposal to add several new codes to the 
list of Medicare telehealth services. While we expect these changes to 
increase access to care in rural areas, based on recent utilization of 
similar services already on the telehealth list, we estimate no 
significant impact on PFS expenditures from the additions.

E. Effect of Proposed Definition of Certified Registered Nurse 
Anesthetists' (CRNA) Services

    As discussed in section III.K.1. of this final rule with comment 
period, we clarified that ``anesthesia and related care'', with respect 
to the statutory benefit category for CRNAs under Section 1861(bb)(2) 
of the Social Security Act, means those services that a certified 
registered nurse anesthetist is legally authorized to perform in the 
state in which the service is furnished.
    Our final rule clarification recognizes local variation in state 
scope of practice, which does not diverge significantly from current 
practice. Therefore, we estimate no significant budgetary impact from 
this proposed change.

F. Effects of Proposed Change to Ordering Requirements for Portable X-
Ray Services Under the PFS

    As discussed in section III.K.2. of this final rule with comment 
period, we are finalizing our proposal to revise our current regulation 
that limits ordering of portable x-ray services to only a doctor of 
medicine or a doctor of osteopathy to allow other physicians and 
nonphysician practitioners (acting within the scope of state law and 
their Medicare benefit) to order portable x-ray services. We estimated 
no significant impact on PFS expenditures from the additions.

G. Geographic Practice Cost Indices (GPCIs)

    As discussed in section III.E. of this final rule with comment 
period, we are required to review and revise the GPCIs at least every 3 
years and phase in the adjustment over 2 years (if there has not been 
an adjustment in the past year). For CY 2013, we did not propose any 
revisions related to the data or methodologies used to calculate the 
GPCIs. However, since the 1.0 work GPCI floor provided in section 1848 
(e)(1)(E) of the Act is set to expire prior to the implementation of 
the CY 2013 PFS, the CY 2013 physician work GPCIs and summarized 
geographic adjustment factors (GAFs) published in addendums D and E of 
this CY 2013 PFS final rule with comment period do not reflect the 1.0 
work GPCI floor for CY 2013. As required by section 1848 (e)(1)(G) and 
section1848 (e)(1)(I) of the Act, the 1.5 work GPCI floor for Alaska 
and the 1.0 PE GPCI floor for frontier states are applicable in CY 
2013.

H. Other Provisions of the Final Regulation

1. Ambulance Fee Schedule-
    As discussed in section III.A. of this final rule with comment 
period, section 306 of the TPTCCA and section 3007 of the MCTRJCA 
required the extension of certain add-on payments for ground ambulance 
services, and the extension of certain rural area designations for 
purposes of air ambulance payment, through CY 2012. As further 
discussed in section III.A. of this final rule with comment period, 
this legislation is self-implementing, and we proposed to amend the 
regulation text at Sec.  414.610 only to conform the regulations to 
these self-implementing statutory requirements. As a result, we did not 
make any policy proposals associated with these legislative provisions 
and there is no associated regulatory impact.
2. Part B Drug Payment: ASP Issues
    As discussed in section III of this final rule with comment period, 
we proposed to update the AMP-based price substitution policy that 
would allow Medicare to pay based off lower market prices for those 
drugs and biologicals that consistently exceed the applicable threshold 
percentage. Our impact analysis is unchanged from last year (76 FR 
73462): based on estimates published in various OIG reports cited in 
the CY 2012 PFS final rule with comment period (76 FR 73290-1), we 
believe that this proposal will generate minor savings for the Medicare 
program and its beneficiaries since any substituted prices would be for 
amounts less than the calculated 106 percent of the ASP.
    Our policy clarification regarding Pharmacy Billing for Part B 
Drugs Administered Incident to a Physician's Services, which is 
discussed in section III of this final rule with comment period states 
that only physicians and not pharmacies (or DME suppliers) are allowed 
to bill Medicare under Part B for drugs administered to beneficiaries 
in physicians' offices. We do not believe that this clarification will 
significantly impact the quantity or payment amount for Part B drugs 
that are administered through implanted DME and or the procedures used 
to refill such pumps because it is a clarification of current policy.
3. Medicare Program; Durable Medical Equipment (DME) Face-to-Face 
Encounters and Written Orders Prior to Delivery
a. Overall Impact
    The majority of changes regarding the impact between the proposed 
and the final result from the change in timeframe, from 90 days before 
the written order or 30 days after to six months before the written 
order. Moreover, the effective date for this regulation is July 1, 
2013; therefore, only 6 months of year 1 (calendar year 2013) are 
included in this analysis. . We estimated the overall economic impact 
of this provision on the health care sector to be a cost of $30.2 
million in the first year approximately half of which would be in CY 
2013. The 5 year impact is $172.3 million. This overall impact is 
composed of additional administrative paperwork costs to private sector 
providers; a slight increase in Medicare spending, consisting of 
additional costs and some offsetting savings; and additional 
opportunity and out-of-pocket costs to Medicare beneficiaries. We 
believe there are likely to be other benefits and cost savings that 
result from the DME face-to-face requirement; however, many of those 
benefits cannot be quantified. For instance, we expect to see savings 
in the form of reduced fraud, waste, and abuse, including a reduction 
in improper Medicare fee-for-service payments (note that not all 
improper payments are fraudulent). Our detailed cost and benefit 
analysis is explained below. We specifically solicited comments on the 
potential increased costs and benefits associated with this provision.
    The following is a summary of the comments we received regarding 
the potential increased costs and benefits associated with this 
provision.
    Comment: Several commenters stated that if the belief is that fraud 
is on the physician/non-physician provider side, then having a strong 
rationale for the DME equipment in their encounter note should provide 
the paper trail to determine the medical need for the DME and establish 
the trail of the request and justification for each piece of DME. No 
additional paperwork would need to be transmitted and no interpretation 
of the encounter note (by non-clinician DME suppliers) would need to be 
done. The process could create a clear auditing trail for 
investigators.

[[Page 69353]]

    Response: CMS appreciates these comments; however, CMS must 
implement the regulation based on the statutory requirement, which is 
to require a physician to document the occurrence of a face-to-face 
encounter for covered items of DME. Through the implementation of the 
statutory requirements and based on comments, CMS tried to balance the 
need to protect the trust fund and limit burden through many ways 
including the list of covered items and the documentation requirements.
    Comment: Commenters appreciated CMS's efforts to reduce waste, 
fraud and abuse. Commenters stated that CMS should apply the new 
encounter and documentation requirements initially to a smaller number 
of HCPCS codes and first evaluate the impact of the requirements on 
beneficiary access to DME and costs to providers before expanding the 
list in the future.
    Response: CMS believes that this is an important requirement aimed 
at reducing waste, fraud and abuse. CMS utilized a criterion driven 
approach to select these items and did not receive sufficiently 
detailed alternative criteria to those proposed to be implementable. 
CMS will monitor the effects of this requirement on reducing waste, 
fraud and abuse and monitor beneficiary access to care.

           Table 137--Overall Economic Impact to Health Sector
                              [In millions]
------------------------------------------------------------------------
                                                 Year 1        5 years
------------------------------------------------------------------------
Private Sector (Paperwork Cost).............         $11.2        $ 64.8
Net Medicare impact of additional visits and           5            30
 G code billings............................
Beneficiaries...............................          14.4          77.5
    Total Economic Impact to Health Sector..          30.6         172.3
------------------------------------------------------------------------
Note: CY 2013 only includes the first 6 months of Year 1.

    The definition of small entity in the RFA includes non-profit 
organizations. Most suppliers and providers are small entities as that 
term is used in the RFA. Likewise, the vast majority of physician and 
NP practices are considered small businesses according to the Small 
Business Administration's size standards with total revenues of $10 
million or less in any 1 year. While the economic costs and benefits of 
this rule are substantial in the aggregate, the economic impacts on 
individual entities will be relatively small. We estimate that 90 to 95 
percent of DME suppliers and practitioners who order DME are small 
entities under the RFA definition. Physicians and other professionals 
would receive extra payments for some of the costs imposed, and other 
costs (for example, for additional practitioner visits) would be 
reimbursed by Medicare under regular payment rules. The rationale 
behind requiring a face-to-face encounter is to reduce inappropriate 
claims from those DME suppliers who have been abusing or defrauding the 
program. The impact on these suppliers could be significant; however, 
since we believe that the purpose of the statute and this regulation is 
to reduce abusive and fraudulent DME sales, we do not view the burden 
placed on those providers and suppliers in the form of lost revenues as 
a condition that we must mitigate. We believe that the effect on 
legitimate suppliers and practitioners would be minimal.
Anticipated Effects
b. Costs
(1) Private Sector Paperwork Costs
    We believe that most practitioners are already seeing the 
beneficiary no more than 6 months prior to the written order. However, 
this regulation potentially requires increased documentation.
    Although we have no quantitative data for a specific dollar figure 
for the additional DME that may now be authorized in accordance with 
Sec.  410.38(g), nor can we determine if there would be cost avoidance 
and a reduction of unnecessary DME, we acknowledge the potential for 
this provision to surpass the economically significant threshold. We do 
not believe that this final rule with comment period would 
significantly affect the number of legitimate written orders for DME. 
However, we would expect a decline in fraudulent, wasteful and abusive 
orders, thereby causing a decrease in the amount paid for DME overall.
    The covered items of DME as outlined in III.C, including the list 
of specified covered items, contains items that meet at least one of 
the following four criteria: (1) Items that currently require a written 
order prior to delivery per instructions in our Program Integrity 
Manual; (2) items that cost more than $1,000; (3) items that we, based 
on our experience and recommendations from the DME MACs, believe are 
particularly susceptible to fraud, waste, and abuse; (4) items 
determined by CMS as vulnerable to fraud, waste and abuse based on 
reports of the HHS Office of Inspector General, the Government 
Accountability Office or other oversight entities. CMS will not include 
items on the covered list of items that are cited in statute explicitly 
as not having a face-to-face encounter requirement. A summary of 
comments regarding the criteria is available in III.C.
    We also have estimated the number of different covered Medicare 
items subject to this final rule with comment period at approximately 
155 HCPCS codes for items of DME. As new products enter the market this 
number could increase, which could increase the impact. In addition, we 
propose a G-code to pay physicians for documenting the encounter 
conducted by a PA, a NP, or a CNS.
    We anticipated there would be an impact as a result of additional 
office visits for the face-to-face encounter and the additional time 
spent by physicians to document the face-to-face encounters with a 
beneficiary when it is furnished by a PA, a NP, or a CNS.
    In our estimate of overall cost we included the estimates from 
section III, of this final rule with comment period (Collection of 
Information Requirements section). These are estimated at $11.2 million 
in year 1 and $ 64.8 million over 5 years. These are driven by the 
physician documenting face-to-face encounters with a beneficiary when 
it is furnished by a PA, a NP, or a CNS, including the time to 
communicate the practitioners' findings to physicians so they can 
complete the necessary documentation.

[[Page 69354]]



                Table 138--Private Sector Paperwork Costs
                              [In millions]
------------------------------------------------------------------------
                                          Year 1            5 years
------------------------------------------------------------------------
Physician time to document                       $9.8              $57
 occurrence of a face-to-face
 encounter cost...................
PA, NP, or CNS costs..............                1.4                7.8
                                   -------------------------------------
    Total Cost....................               11.2               64.8
------------------------------------------------------------------------
Note: CY 2013 only includes the first 6 months of Year 1.

(2) Medicare Costs
    Medicare would incur additional costs associated with this final 
rule with comment period related to additional face-to-face encounters 
in the form of office visits, and additional payment for time spent 
documenting the face-to-face encounter if furnished by the PA, NP or 
CNS and not by the physician directly. Subsequently, a G-Code is being 
created to allow Medicare payment to physicians for documenting the 
face-to-face encounters that are furnished by a PA, NP, and CNS, and is 
included in this final rule with comment period.
    From a programmatic standpoint we believe that there would be 
375,000 additional office visits billed and 500,000 G code claims for 
the documentation in year 1. It is difficult to determine how many PAs, 
NPs or CNSs wrote orders for covered items of DME and while we lack 
exact empirical data, in order to provide an estimate, we assumed that 
5 percent of the orders for covered items of DME were written by a PA, 
NP or CNS. For the purpose of this estimate, we assumed that each order 
requires a separate face-to-face encounter, recognizing fully that the 
estimate might be inflated.
    While we believe that currently the majority of practitioners 
evaluate beneficiaries before ordering DME, some may not, and 
therefore, a certain number of beneficiaries would be required to have 
a new visit in order to fulfill the face-to-face encounter requirement. 
Actuarial estimates indicated approximately 2.5 percent of those 
obtaining covered items of DME in a given year did not see a 
practitioner in the 6 months preceding the order. This percentage 
changed due to the modified timeframe from the proposed rule. We 
estimated that 250,000 beneficiaries would not see their practitioners 
in the 6 months prior to the written order. We assumed that 1.5 visits 
per year per affected beneficiary would be required to cover the DME 
services that currently fail to meet the face-to-face requirement. The 
range would be about one to three; possibly less than one if many 
beneficiaries choose not to meet the requirement or reschedule 
services. DME claims for beneficiaries who failed to meet the physician 
contact requirements averaged 3 line items per beneficiary. However, 
about 40 percent of these line items occur on the same date and so 
probably refer to the same event and could be authorized during a 
single visit. Some additional coordination is probable for DME 
purchases within a narrow time frame. To estimate the impact of the 
additional office visits, we assumed 375,000 additional office visits 
(1.5 visits * 250,000 beneficiaries). We also assumed that the average 
cost for these office visits is around $65, which is consistent with a 
mid-level office visit under the PFS. This represents the total amount 
that the practitioners would receive, either from Medicare or the 
beneficiary, who is responsible for the 20 percent coinsurance.
    Physicians are now required to document the face-to-face encounter 
if it was furnished by a PA, NP, or CNS. In order to allow payment for 
this documentation, a G code is established for this service. There are 
approximately 10 million DME users and it we assumed that roughly 5 
percent of face-to-face encounters are actually furnished by these 
other practitioner types, thereby requiring documentation of the 
encounter. Therefore, we assumed that about 500,000 of these 
documentation services would be billed. As discussed in section III.M.3 
of this final rule with comment period, we are establishing work and 
malpractice RVUs for HCPCS codes for G0454 by crosswalking to the work 
and malpractice RVUs for CPT code 99211 (Level 1 office or other 
outpatient visit, established patient). With regard to practice expense 
RVUs, we are not including any direct practice expense inputs for 
clinical labor, disposable medical supplies, or equipment in the direct 
PE input database for this code; practice expense RVUs will reflect 
resources for overhead costs only. The work, malpractice, and practice 
expense RVUs for HCPCS code G0454 are reflected in Addendum B of this 
CY 2013 PFS final rule with comment period www.cms.gov/
physicianfeesched/. A complete list of the interim final times assigned 
to HCPCS code G0454 is available on the CMS Web site at www.cms.gov/
physicianfeesched/. This represents the total amount that the physician 
would receive, either from Medicare or the beneficiary, who is 
responsible for the 20 percent coinsurance.
    Therefore the estimated gross cost is estimated to be $10 million 
in CY 2013 and $115 million over 5 years; note that there are also 
savings to Medicare that must be netted against the cost of additional 
practitioner office visits, which are described later in the Benefits 
section. There is a high degree of uncertainty surrounding this 
estimate because it was difficult to predict how physicians and 
beneficiaries would respond to the new requirement.
    This provision would assist in providing better documentation which 
may help to lower the error rate and thus reduce improper payments, 
including those stemming from waste, fraud and abuse. Since there is a 
large amount of potential variation in the amount of time that a face-
to-face encounter may take for an item of DME, as a proxy our estimate 
is based on the amount of time needed for a mid-level visit to evaluate 
a beneficiary (E&M code 99213). The time allotted for this visit to 
furnish the face-to-face evaluation under a 99213 is 15 minutes. We 
solicited comments as to the appropriateness of E&M Code 99213 as a 
proxy measure of time required for a face-to-face encounter but did not 
receive any public comments.
    Based on actual data, projecting these historical patterns in light 
of the draft regulation was not straight-forward. Some line items may 
be bundled (perhaps because they were used together). Beneficiaries may 
also change their behavior in response to the regulation. For example, 
beneficiaries who would be required to visit a physician in order for 
Medicare to pay for a new piece of equipment may substitute this visit 
for a later visit that would have been for a routine service. In this 
situation, the overall number of visits would not increase. Moreover, 
some beneficiaries may choose not to pursue the DME item at that time. 
On

[[Page 69355]]

the other hand, the final rule with comment period points out that some 
of the encounters reported on the practitioner claim now may not 
support the need for the item of DME. We assume that beneficiaries 
would decide not to schedule 10 percent of the additional visits 
required as a result of not needing the DME item and that some would 
substitute a required service for a later planned visit.

 Table 139--Medicare 5-Year Costs for Additional Face-to-Face Visits and
                             G Code Billings
------------------------------------------------------------------------
     2013           2014           2015           2016          2017
------------------------------------------------------------------------
      $10            $25            $25            $25            $30
------------------------------------------------------------------------
Note: These costs represent 80 percent of the allowed charges for the
  additional visits and the new G codes.

    The requirement for a face-to-face encounter with a beneficiary in 
a certain time period as a condition of payment for DME is a new 
statutory requirement. It is not subject to the physician fee schedule 
budget neutrality requirement under section 1848(c)(2)(B)(ii)(II) of 
the Act. However, by regulation, we are making an additional payment 
through a new G-code for physician work documenting the face-to-face 
encounters that are performed by a PA, NP, and CNS. This additional 
regulatory spending is subject to the physician fee schedule budget 
neutrality requirement under section 1848(c)(2)(B)(ii)(II) of the Act.
(c) Beneficiary Cost Impact
    From a programmatic standpoint, approximately 2.5 percent of those 
obtaining covered items of DME in that year did not see a practitioner 
in the 6 months preceding the order. We estimated that 250,000 
beneficiaries would not see their practitioners in the 6 months prior 
to the written order for the covered item. As mentioned above, we 
assumed that 1.5 visits per year per affected beneficiary would be 
required to cover the DME services that currently fail to meet the 
face-to-face requirement. The range would be about one to three; 
possibly less than one if many beneficiaries chose not to meet the 
requirement or reschedule services. DME claims for beneficiaries who 
failed to meet the physician contact requirements averaged 3 line items 
per beneficiary. However, about 40 percent of these line items occur on 
the same date and so probably refer to the same event and could be 
authorized during a single visit. Some additional coordination is 
probable for DME purchases within a narrow time frame. There are 
effects on travel time and cost for these beneficiaries. We estimate 
that there will be an additional 375,000 office visits as a number of 
beneficiaries would not have seen their practitioner in the six months 
prior to the written order for the covered item. If it takes a 
beneficiary 1.25 hours to go to a practitioner, the total estimate is 
approximately 468,750 hours of time for this final rule with comment 
period. We assumed that an average trip requires one hour and 15 
minutes (1.25 hours) (45 minutes of round trip travel time and 30 
minutes in the doctor's office--half for waiting and half for time with 
the staff). As a proxy we use $20 to estimate the cost per hour 
including loss of leisure time and travel cost for a beneficiary to see 
a practitioner. This is consistent with previous estimates of 
beneficiary leisure time as proposed in the May 4, 2011 proposed rule 
entitled ``Medicare & Medicaid Programs; Influenza Vaccination Standard 
for Certain Medicare & Medicaid Participating Providers and Suppliers'' 
(76 FR 25469). This creates an economic cost of nearly $9,375,000 in 
year 1 and $52.5 million over 5 years. There will be additional out of 
pocket expenses at the 20 percent Medicare Part B coinsurance. We 
estimated this cost to be $5 million in year 1 and $25 million over 5 
years.

  Table 140--Beneficiary Cost Impact Resulting From Additional Face-to-
                   Face Visits To Obtain DME Services
                 Beneficiary Cost: Out of Pocket Expense
                              [In millions]
------------------------------------------------------------------------
     2013           2014           2015           2016          2017
------------------------------------------------------------------------
       $5             $5             $5             $5             $5
------------------------------------------------------------------------


 
----------------------------------------------------------------------------------------------------------------
                                                       Year 1                              5 Years
----------------------------------------------------------------------------------------------------------------
Total beneficiaries visits impacted...  375,000............................  2,100,000.
Time per beneficiary..................  1.25 hours.........................  1.25 hours.
Total Time............................  468,750............................  2,625,000.
Beneficiary Time Cost ($20)...........  $9.4 million.......................  $52,500,000.
Out of Pocket Expense.................  $5 million.........................  $25,000,000.
Estimated Total Beneficiary Cost        $ 14.4 million.....................  $ 77.5 million.
 Impact.
----------------------------------------------------------------------------------------------------------------
Note: These costs represent 20 percent of the allowed charges for the additional visits and the new G codes.

b. Benefits
    There would be quantifiable benefits from an expected reduction in 
Medicare DME services provided. In addition, we anticipated additional, 
qualitative benefits from a decrease in waste, fraud, and abuse, which 
would decrease the number of services. Further, requiring that there be 
a face-to-face evaluation of the beneficiary helps ensure appropriate 
orders are based on the individual's medical condition, which increases 
the quality of care that the beneficiary receives. It is difficult to 
measure how much waste, fraud, and abuse will be prevented as a result 
of this final rule with comment period since it is impossible to 
determine what would have happened in the absence of the final rule 
with comment period. This provision is expected to improve physician's 
documentation of DME, and therefore, will help reduce improper payments 
and move the agency towards its strategic goal to reduce the Medicare 
fee-for-service error rate for DME items, which has a higher error rate 
than other Medicare services. Fraud is an improper payment, but not all 
improper payments are fraud.
    Therefore, creating a measure of how much this final rule with 
comment period would save in terms of a reduction in waste, fraud and 
abuse is not possible. With that stated, in 2009 Medicare paid $1.7 
billion for DME items covered by this proposed rule, and we estimated 
that $1.9 billion would be paid for covered items in 2012, and $9.9 
billion over 5 years. Preventing waste, fraud and abuse by changing 
behavior that results in just a small percentage reduction in 
inappropriate or unnecessary ordering of DME services will generate 
Medicare savings. This is an area where savings

[[Page 69356]]

can be found through increased oversight We believe that the cost of 
the visits will be offset by the savings produced by this provision.
    We project Medicare savings from reduced DME services; these 
savings partially offset the costs of additional physician office 
visits and documentation payments described earlier in the impact 
analysis. The year-to-year Medicare savings from reduced DME services 
is as follows:

                       Table 141--Year-to-Year Medicare Savings From Reduced DME Services
                                                  [In millions]
----------------------------------------------------------------------------------------------------------------
                                                                       2013     2014     2015     2016     2017
----------------------------------------------------------------------------------------------------------------
DME savings........................................................     -$5     -$20     -$20     -$20     -$20
----------------------------------------------------------------------------------------------------------------

    Based on an analysis of 2007 DME claims, approximately 1 percent of 
total DME spending was for those beneficiaries who had little contact 
with their physician during the year. The gross savings to Medicare has 
been reduced from the estimated savings in the proposed rule due to the 
change in timeframe from 90 days to 6 months. We believe that some 
beneficiaries who would not order a DME service because they did not 
have face-to-face visit within 90 days prior to the written order, 
would likely have a face-to-face visit within the 6-month timeframe. 
For this subset of spending we assumed that there would be a 20 percent 
reduction in spending due to the face-to- face requirement. We found 
similar reductions in DME expenditures among managed care enrollees 
compared to fee-for service (FFS) beneficiaries in the Medical 
Expenditure Panel Survey. This assumption is fairly speculative but we 
think it is modest compared to the estimates of improper payments 
across Medicare services including DME. The savings would occur because 
some beneficiaries would not choose to go to the physician to authorize 
the DME item, some physicians would not order the items that would 
otherwise have been provided in the absence of the regulation, and some 
suppliers would not be able to achieve a payment that might have 
occurred through an unnecessary sale or outright fraud.
    The overall net impact to Medicare of the DME face-to-face 
encounter policy is $5 million in the first year and $30 million over 
the first 5 years.
    This regulation produced an extra benefit that is difficult to 
quantify, but is an extremely positive one in terms of greater 
practitioner involvement. By increasing practitioner interactions with 
beneficiaries before ordering DME, beneficiaries would receive more 
appropriate DME and benefit from higher quality care. Beneficiaries 
would also benefit from reduced out-of-pocket costs by not having to 
pay for unnecessary DME. This accomplished the objective of achieving 
greater practitioner accountability noted in the provisions of and the 
amendments made by section 6407 and other sections of the Affordable 
Care Act.
Alternatives Considered
    In this final rule with comment period, we considered a variety of 
options and sought comments on these options in other sections of this 
final rule with comment period. We expected public comment on how to 
limit the burden associated with the supplier being notified that a 
face-to-face encounter has occurred. We proposed several options for 
the physician documentation of a face-to-face encounter furnished by 
that physician. We believe just submitting the medical record for the 
applicable date of service would create the least cost while still 
producing the desired benefits. We had also proposed different options 
for how the physician must document the face-to-face encounter if 
performed by a NP, PA, or CNS. In this final rule with comment period 
we establish that physicians must document a face-to-face encounter 
furnished by a PA, NP or CNS by signing or cosigning the pertinent 
portion of the medical record thereby documenting that the beneficiary 
was evaluated or treated for a condition relevant to an item of DME on 
that date of service.
    Finally, there are other possible periods of time that could be set 
as the window within which face-to-face encounters must occur. We 
believe the 6 month timeframe for the face-to-face to occur helps to 
best limit burden.
4. Non-Random Prepayment Review
    We estimated no significant budgetary impact. We believe that the 
overall costs for most providers and suppliers would remain the same 
unless they are subject to non-random prepayment complex medical review 
for an extended period of time.
5. Ambulance Coverage-Physician Certification Statement
    We estimated no significant budgetary impact.
6. Physician Compare Web Site
    Section IV.N.2. of this final rule with comment period addresses 
the background of the Physician Compare Web site. As described in 
section IV.N.2. of this final rule with comment period, we are 
developing aspects of the Physician Compare Web site using a phased 
approach. In the first phase, which was completed in 2011, we posted 
the names of those eligible professionals who satisfactorily 
participated in the 2009 Physician Quality Reporting System. The second 
phase of the plan, which was completed in 2012, included posting the 
names of eligible professionals who were successful electronic 
prescribers under the 2009 eRx Incentive Program, as well as eligible 
professionals (EPs) who participated in the EHR Incentive Program. The 
next phase of the plan included posting of performance information with 
respect to the 2012 Physician Quality Reporting System GPRO measures 
which is targeted to be completed in 2013.
    We are finalizing proposals to include performance information for 
the 2013 Physician Quality Reporting System GPRO web interface measures 
data, and targeted posting this data in 2014, in addition to 2013 
patient experience data for group practices participating in the 2013 
Physician Quality Reporting System GPRO. As reporting of physician 
performance rates and patient experience data on the Physician Compare 
Web site would be performed directly by us using the data that we 
collect under the 2012 Physician Quality Reporting System GPRO and 
other data collection methods, we did not anticipate any notable impact 
on eligible professionals with respect to the posting of information on 
the Physician Compare Web site.
    We invited but received no public comment on the Regulatory Impact 
Analysis related to Physician Compare and are therefore finalizing this 
analysis.

[[Page 69357]]

7. Physician Payment, Efficiency, and Quality Improvements--Physician 
Quality Reporting System
    According to the 2010 Reporting Experience Report, a total of 
$391,635,495 in Physician Quality Reporting System (PQRS) incentives 
was paid by CMS for the 2010 program year, which encompassed 168,843 
individual eligible professionals. In 2010, eligible professionals 
earned a 2.0 percent incentive (that is, a bonus payment equal to 2.0 
percent of the total allowed part B charges for covered professional 
services under the PFS furnished by the eligible professional during 
the reporting period) for satisfactory reporting under the PQRS. For 
2013 and 2014, eligible professionals can earn a 0.5 percent incentive 
for satisfactory reporting, a reduction of 1.5 percent from 2010. 
Therefore, based on 2010, which is the latest year in which PQRS has 
full participation data, we would expect that approximately $97 million 
(approximately \1/4\ of $391,635,495) in incentive payments would be 
distributed to eligible professionals who satisfactorily report. 
However, we expect that due to the implementation of payment 
adjustments beginning in 2015, participation in the PQRS would rise 
incrementally to approximately 300,000 eligible professionals and 
400,000 eligible professionals in 2013 and 2014, respectively.
    The average incentive distributed to each eligible professional in 
2010 was $2,157. Taking into account the 1.5 percent incentive 
reduction from 2.0 percent in 2010 to 0.5 percent in 2013 and 2014, we 
estimated that the average amount per eligible professional earning an 
incentive in 2013 and 2014 would be $539. Therefore, we estimate that 
the PQRS would distribute approximately $162 million ($539 x 300,000 
eligible professionals) and $216 million ($539 x 400,000 eligible 
professionals) in incentive payments in 2013 and 2014, respectively. We 
believe these incentive payments will help offset the cost to eligible 
professionals for participating in the PQRS for the applicable year. 
Please note that, beginning 2015, incentive payments for satisfactory 
reporting in the PQRS will cease and payment adjustments for not 
satisfactorily reporting will commence.
    We note that the total burden associated with participating in the 
PQRS is the time and effort associated with indicating intent to 
participate in the PQRS, if applicable, and submitting PQRS quality 
measures data. When establishing these burden estimates, we assumed the 
following:
     The requirements for reporting for the PQRS 2013 and 2014 
incentives and payment adjustments for 2015 and beyond would be 
established as proposed in this 2013 Medicare PFS final rule with 
comment period.
     For an eligible professional or group practice using the 
claims, registry, or EHR-based reporting mechanisms, we assume that the 
eligible professional or group practice would report on 3 measures.
     With respect to labor costs, we believe that a billing 
clerk will handle the administrative duties associated with 
participating, while a computer analyst will handle duties related to 
reporting PQRS quality measures. According to the Bureau of Labor 
Statistics, the mean hourly wage for a billing clerk is approximately 
$16/hour whereas the mean hourly wage for a computer analyst is 
approximately $40/hour.
    For an eligible professional who wished to participate in the PQRS 
as an individual, the eligible professional need not indicate his/her 
intent to participate, if using the traditional reporting mechanisms. 
The eligible professional may simply begin reporting quality measures 
data. Therefore, these burden estimates for individual eligible 
professionals participating in the PQRS are based on the traditional 
reporting mechanism the individual eligible professional chooses. 
However, we believe a new eligible professional or group practice would 
spend 5 hours--which includes 2 hours to review the PQRS measures list, 
review the various reporting options, and select a reporting option and 
measures on which to report and 3 hours to review the measure 
specifications and develop a mechanism for incorporating reporting of 
the selected measures into their office work flows. Therefore, we 
believe that the initial administrative costs associated with 
participating in the PQRS would be approximately $80 ($16/hour x 5 
hours).
    Traditional Claims-Based Reporting Mechanism. With respect to an 
eligible professional who participates in the PQRS via claims, the 
eligible professional must gather the required information, select the 
appropriate quality data codes (QDCs), and include the appropriate QDCs 
on the claims they submit for payment. The PQRS collects QDCs as 
additional (optional) line items on the existing HIPAA transaction 837-
P and/or CMS Form 1500 (OCN: 0938-0999). Based on our experience with 
Physician Voluntary Reporting Program (PVRP), we continued to estimate 
that the time needed to perform all the steps necessary to report each 
measure via claims would range from 0.25 minutes to 12 minutes, 
depending on the complexity of the measure. Therefore, the time spent 
reporting 3 measures would range from 0.75 minutes to 36 minutes. Using 
an average labor cost of $40/hour, we estimated that time cost of 
reporting for an eligible professional via claims would range from 
$0.50 (0.75 minutes x $40/hour) to $24.00 (36 minutes x $40/hour) per 
reported case. With respect to how many cases an eligible professional 
would report when using the claims-based reporting mechanism, we 
established that an eligible professional would need to report on 50 
percent of the eligible professional's applicable cases. The actual 
number of cases on which an eligible professional would report would 
vary depending on the number of the eligible professional's applicable 
cases. However, in prior years, when the reporting threshold was 80 
percent, we found that the median number of reporting cases for each 
measure was 9. Since we reduced the reporting threshold to 50 percent, 
we estimated that the average number of reporting cases for each 
measure would be reduced to 6. Based on these estimates, we estimated 
that the total cost of reporting for an eligible professional choosing 
the claims-based reporting mechanism would range from ($0.50/per 
reported case x 6 reported cases) $3.00 to ($24.00/reported case x 6 
reported cases) $144.
    Administrative Claims-Based Reporting Mechanism. We note that, for 
the 2015 PQRS payment adjustments, we are finalizing an administrative 
claims reporting option for eligible professionals and group practices. 
The burden associated with reporting using the administrative claims 
reporting option is the time and effort associated with using this 
option. To submit quality measures data for PQRS using the 
administrative claims reporting option, an eligible professional or 
group practice would need to (1) register as an administrative claims 
reporter for the applicable payment adjustment and (2) report quality 
measures data. With respect to registration, we believe it would take 
approximately 2 hours to register for and to participate in PQRS as an 
administrative claims reporter. Therefore, we estimated that the cost 
of undergoing the GPRO selection process would be ($16/hour x 2 hours) 
$32. With respect to reporting, we noted that any burden associated 
with reporting would be negligible, as an eligible professional or 
group practice would not be required to attach reporting G-codes on the 
claims they submitted.

[[Page 69358]]

Rather, CMS would bear the burden with respect to calculating the 
measure rates for claims. We noted that there would be no additional 
burden on the eligible professional or group practice to submit these 
claims, as the eligible professional or group practice would have 
already submitted these claims for reimbursement purposes.
    Registry-Based and EHR-Based Reporting Mechanisms. With respect to 
an eligible professional or group practice who participates in the PQRS 
via a qualified registry, direct EHR product, or EHR data submission 
vendor product, we believe there would be little to no burden 
associated for an eligible professional to report PQRS quality measures 
data to CMS, because the selected reporting mechanism submits the 
quality measures data for the eligible professional. While we note that 
there may be start-up costs associated with purchasing a qualified 
registry, direct EHR product, or EHR data submission vendor, we believe 
that an eligible professional or group practice would not purchase a 
qualified registry, direct EHR product, or EHR data submission vendor 
product solely for the purpose of reporting PQRS quality measures. 
Therefore, we did not include the cost of purchasing a qualified 
registry, direct EHR, or EHR data submission vendor product in our 
burden estimates.
    The Group Practice Reporting Option. Unlike eligible professionals 
who choose to report individually, we noted that eligible professionals 
choosing to participate as part of a group practice under the GPRO must 
indicate their intent to participate in the PQRS as a group practice. 
The total burden for group practices who submitted PQRS quality 
measures data via the proposed GPRO web-interface would be the time and 
effort associated with submitting this data. To submit quality measures 
data for the PQRS, a group practice would need to (1) be selected to 
participate in the PQRS GPRO and (2) report quality measures data. With 
respect to the administrative duties for being selected to participate 
in the PQRS as a group practice, we believe it would take approximately 
6 hours--including 2 hours to decide whether to participate in the PQRS 
GPRO as a group practice, 2 hours to self-nominate, and 2 hours to 
undergo the vetting process with CMS officials--for a group practice to 
be selected to participate in the PQRS GPRO for the applicable year. 
Therefore, we estimated that the cost of undergoing the GPRO selection 
process would be ($16/hour x 6 hours) $96. With respect to reporting, 
the total reporting burden was the time and effort associated with the 
group practice submitting the quality measures data (that is, completed 
the data collection interface). Based on burden estimates for the PGP 
demonstration, which uses the same data submission methods, we 
estimated the burden associated with a group practice completing the 
data collection interface would be approximately 79 hours. Therefore, 
we estimated that the report cost for a group practice to submit PQRS 
quality measures data for the final reporting options in an applicable 
year would be ($40/hour x 79 hours) $3,160.
    Maintenance of Certification Program Incentive. Eligible 
professionals who wish to quality for an additional 0.5 percent 
Maintenance of Certification Program incentive must ``more frequently'' 
than is required to qualify for or maintain board certification status 
participate in a qualified Maintenance of Certification Program for 
2013 and/or 2014 and successfully complete a qualified Maintenance of 
Certification Program practice assessment for the applicable year. 
Although we understand that there is a cost associated with 
participating in a Maintenance of Certification Board, we believe that 
most of the eligible professionals attempting to earn this additional 
incentive would already be enrolled in a Maintenance of Certification 
Board for reasons other than earning the additional Maintenance of 
Certification Program incentive. Therefore, the burden to earn this 
additional incentive would depend on what a certification board 
establishes as ``more frequently'' and the time needed to complete the 
practice assessment component. We expect that the amount of time needed 
to complete a qualified Maintenance of Certification Program practice 
assessment would be spread out over time since a quality improvement 
component is often required. With respect to the practice assessment 
component, according to an informal poll conducted by ABMS in 2012, the 
time an individual spent to complete the practice assessment component 
of the Maintenance of Certification ranged from 8-12 hours.
    Registry and EHR Vendors. Aside from the burden of eligible 
professionals and group practices participating in the PQRS, we believe 
that registry, direct EHR, and EHR data submission vendor products 
incur costs associated with participating in the PQRS.
    Registry Vendors. With respect to qualified registries, the total 
burden for qualified registries who submit PQRS quality measures data 
would be the time and effort associated with submitting this data. To 
submit quality measures data for the program years we are finalizing 
for PQRS, a registry would need to (1) become qualified for the 
applicable year and (2) report quality measures data on behalf of its 
eligible professionals. With respect to administrative duties related 
to the qualification process, we estimated that it will take a total of 
10 hours--including 1 hour to complete the self-nomination statement, 2 
hours to interview with CMS, 2 hours to calculate numerators, 
denominators, and measure results for each measure the registry wishes 
to report using a CMS-provided measure flow, and 5 hours to complete an 
XML submission--to become qualified to report PQRS quality measures 
data. Therefore, we estimated that it would cost a registry 
approximately ($16.00/hour x 10 hours) $160 to become qualified to 
submit PQRS quality measures data on behalf of its eligible 
professionals.
    With respect to the reporting of quality measures data, we believe 
the burden associated with reporting was the time and effort associated 
with the registry calculating quality measures results from the data 
submitted to the registry by its eligible professionals, submitting 
numerator and denominator data on quality measures, and calculating 
these measure results. We believe, however, that registries already 
perform these functions for its eligible professionals irrespective of 
participating in the PQRS. Therefore, we believe there would be little 
to no additional burden associated with reporting PQRS quality measures 
data. Whether there is any additional reporting burden will vary with 
each registry, depending on the registry's level of savvy with 
submitting quality measures data for the PQRS.
    EHR Vendors. With respect to EHR products, the total burden for 
direct EHR products and EHR data submission vendors who submit PQRS 
quality measures data would be the time and effort associated with 
submitting this data. To submit quality measures data for the proposed 
program years under the PQRS, a direct EHR product or EHR data 
submission vendor would need to report quality measures data on behalf 
of its eligible professionals. Please note that we are not continuing 
to require direct EHR products and EHR data submission vendors to 
become qualified to submit PQRS quality measures data. With respect to 
reporting quality measures data, we believe the burden associated with 
the EHR vendor programming its EHR product(s) to extract the clinical 
data that the eligible professional must submit to CMS would depend on 
the vendor's familiarity with

[[Page 69359]]

the PQRS and the vendor's system and programming capabilities. We 
believe it would take a vendor approximately 40 hours (for experienced 
vendors) to 200 hours (for first-time vendor participants) to submit 
PQRS quality measures data. Therefore, we estimated that it would cost 
an EHR vendor ($40/hour x 40 hours) $1,600 to $8,000 to submit PQRS 
quality measures data for its eligible professionals.

 Table 142--Estimated Costs for Reporting Physician Quality Reporting System Quality Measures Data for Eligible
                                                  Professionals
----------------------------------------------------------------------------------------------------------------
                                     Estimated       Estimated       Number of
                                       hours           cases         Measures       Hourly rate     Total cost
----------------------------------------------------------------------------------------------------------------
Individual Eligible Professional             5.0               1             N/A             $16             $80
 (EP): Preparation..............
Individual EP: Claims...........             0.2               6               3              40             144
Individual EP: Administrative                  2               1             N/A              16              32
 Claims.........................
Individual EP: Registry.........             N/A               1             N/A             N/A             (*)
Individual EP: EHR..............             N/A               1             N/A             N/A             (*)
Group Practice: Self-Nomination.             6.0               1             N/A              16              96
Group Practice: Reporting.......              79               1             N/A              40           3,160
----------------------------------------------------------------------------------------------------------------
* Minimal.


         Table 143--Estimated Costs to Vendors To Participate in the Physician Quality Reporting System
----------------------------------------------------------------------------------------------------------------
                                                                     Estimated
                                                                       hours        Hourly rate     Total cost
----------------------------------------------------------------------------------------------------------------
Registry: Self-Nomination.......................................              10             $40            $400
EHR: Programming................................................          40-200              40     1,600-1,800
----------------------------------------------------------------------------------------------------------------

    We invited but received no public comment on the Regulatory Impact 
Analysis related to PQRS and are therefore finalizing this analysis.
8. Electronic Prescribing (eRx) Incentive Program
    Please note that the requirements for becoming a successful 
electronic prescriber for the 2013 incentive and 2014 payment 
adjustment were established in the CY 2012 MPFS final rule with comment 
period. The final provisions contained in this CY 2013 MPFS final rule 
with comment period would make additional changes to the requirements 
for the 2013 incentive and 2014 payment adjustment for group practices. 
Specifically, CMS is finalizing a new criterion for being a successful 
electronic prescriber for the 2013 incentive and 2014 payment 
adjustments for group practices of 2-24 eligible professionals given 
that CMS is modifying the definition of group practice. However, we 
note that any additional impact as a result of this additional 
requirement would be minimal, as it is our understanding the eligible 
professionals who would use this new reporting option are already 
participating in the eRx Incentive Program as individual eligible 
professionals.
    For the reasons stated, the final changes would have no additional 
impact other than the impact of the 2013 and 2014 payment adjustments 
described in the CY 2012 MPFS final rule with comment period. We 
invited but received no public comment on the Regulatory Impact 
Analysis related to the eRx Incentive Program and are therefore 
finalizing this analysis.
9. Medicare Shared Savings Program
    Please note that the requirements for participating in the Medicare 
Shared Saving Program and the impacts of these requirements were 
established in the final rule for the Medicare Shared Savings Program 
that appeared in the Federal Register on November 2, 2011 (76 FR 
67962). The requirements for the Medicare Shared Savings Program set 
forth in the CY 2013 MPFS final rule with comment period imposed 
requirements that eligible professionals in group practices within 
accountable care organizations would need to satisfy for purposes of 
the PQRS payment adjustment under the Medicare Shared Savings Program 
as the proposals related to the ACOs for the PQRS payment adjustment 
mirror the requirements that were established for earning the PQRS 
incentives.
    We invited but received no public comment on the Regulatory Impact 
Analysis related to the Medicare Shared Savings Program and are 
therefore finalizing this analysis.
10. Medicare EHR Incentive Program
    Please note that the requirements for reporting clinical quality 
measures (CQMs) to achieve meaningful use under the EHR Incentive 
Program were established in a standalone final rule published on July 
28, 2010 (75 FR 44544) and September 4, 2012 (77 FR 53968). The 
requirements contained in this CY 2013 MPFS final rule with comment 
period merely propose methods to report CQMs for purposes of achieving 
meaningful use under the EHR Incentive Program. Therefore, the impacts 
of the extension of the use of attestation and the PQRS-Medicare EHR 
Incentive Pilot to report CQMs were absorbed in the impacts discussion 
published in the EHR Incentive Program final rules published on July 
28, 2010 and September 4, 2012.
    We invited but received no public comment on the Regulatory Impact 
Analysis related to The Medicare EHR Incentive Program and are 
therefore finalizing this analysis.
11. Chiropractic Services Demonstration
    As discussed in section III of this final rule with comment period, 
we continue the recoupment of the $50 million in expenditures from this 
demonstration in order to satisfy the BN requirement in section 
651(f)(1)(B) of the MMA. We initiated this recoupment in CY 2010 and 
this will be the fourth year. As discussed in the CY 2010 PFS final 
rule with comment period, we finalized a policy to recoup $10 million 
each year through adjustments to the PFS for all chiropractors in CY s 
2010 through 2014. To implement this required BN adjustment, we are 
recouping $10 million in CY 2013 by reducing the payment amount under 
the PFS for the chiropractic CPT codes (that is, CPT codes 98940, 
98941, and 98942) by approximately 2 percent.

[[Page 69360]]

12. Physician Value-Based Payment Modifier and the Physician Feedback 
Reporting Program
    The Physician Value-Based Payment Modifier and the Physician 
Feedback Program final policies discussed in section IV.I. of this 
final rule with comment period would not impact CY 2013 physician 
payments under the PFS. However, we expect that our proposals to use 
the PQRS quality measures in the Physician Feedback reports and in the 
value-based payment modifier to be implemented in CY 2015 may result in 
increased participation in the PQRS in CY 2013. We anticipate that as 
we approach implementation of the value-based payment modifier, 
physicians would increasingly participate in the PQRS to determine and 
understand how the value-based payment modifier could affect their 
payments.
13. Medicare Coverage of Hepatitis B Vaccine: Modification of High Risk 
Groups Eligible for Medicare Part B Coverage of Hepatitis B Vaccine
    As discussed in section III of this final rule with comment period, 
section 1861(s)(10)(B) of the Act authorizes Medicare coverage of 
hepatitis B vaccine and its administration if furnished to an 
individual who is at high or intermediate risk of contracting hepatitis 
B, as determined by the Secretary under regulations. Our current 
regulations are established at 42 CFR 410.63. We proposed to modify 
Sec.  410.63(a)(1) by adding persons diagnosed with diabetes mellitus 
to the high risk group. While it is estimated that approximately 23 
percent of non-institutionalized Medicare beneficiaries are diagnosed 
with diabetes mellitus, it is unclear how many of these beneficiaries 
would obtain these services. Therefore, the estimated impact of adding 
persons diagnosed with diabetes mellitus to the high risk group 
eligible for coverage of hepatitis B vaccine and its administration is 
unknown for CY 2013.
14. Existing Standards for E-Prescribing Under Medicare Part D and 
Identification and Lifting the LTC Exemption
    The e-prescribing standard updates that are adopted in this final 
rule with comment period impose no new requirements as the burden of 
using the updated standards is anticipated to be the same as using the 
old standards. We believe that prescribers and dispensers that are now 
e-prescribing largely invested in the hardware, software, and 
connectivity necessary to e-prescribe. We do not anticipate that the 
retirement of NCPDP SCRIPT 8.1 in favor of NCPDP SCRIPT 10.6 will 
result in significant costs. Nor do we believe that the eventual 
retirement of the NCPDP Formulary and Benefit 1.0 and the adoption of 
the updates for NCPDP Formulary and Benefits 3.0 as the official Part D 
standard will result in significant costs.
    The removal of the LTC exception to the NCPDP SCRIPT standard would 
impose a small burden on the LTC industry. LTC entities who use and 
developed proprietary solutions may need to invest in software 
programming updates if they had not already incorporated the Part D e-
prescribing standards in their solutions. It is reasonable to assume 
that a small number of proprietary solutions would have to be modified 
to enable adherence to the adopted e-prescribing standards. Other costs 
may be incurred through staff training on the use of the e-prescribing 
standards and the use of any e-prescribing solution adopted by a LTC 
facility. Additional training cost may involve prescribers and 
dispensers learning the new workflows that an electronic prescription 
may or may not require.

I. Alternatives Considered

    This final rule with comment period contains a range of policies, 
including some provisions related to specific statutory provisions. The 
preceding preamble provided descriptions of the statutory provisions 
that are addressed, identified those policies when discretion has been 
exercised, presented rationale for our final policies and, where 
relevant, alternatives that were considered.

J. Impact on Beneficiaries

    There are a number of changes in this final rule with comment 
period that would have an effect on beneficiaries. In general, we 
believe that many of the changes adopted in this final rule with 
comment period, including the refinements of the PQRS with its focus on 
measuring, submitting, and analyzing quality data; establishing the 
value-based payment modifier to adjust physician payment beginning in 
CY 2015; creating a separate payment for post-discharge transitional 
care management services in the 30 days after a beneficiary has been 
discharged from an inpatient hospital admission, from outpatient 
observation services and partial hospitalization program, from a SNF, 
or from a CMHC; improved accuracy in payment through revisions to the 
inputs used to calculate payments under the PFS for certain radiation 
therapy services; capital interest rate assumptions; multiple procedure 
payment reduction for ophthalmology and cardiovascular diagnostic 
tests; revised values for many services identified through the 
misvalued codes initiative, and revisions to payment for Part B drugs 
would have a positive impact and improve the quality and value of care 
furnished to Medicare beneficiaries.
    Most of the aforementioned policy changes could result in a change 
in beneficiary liability as it relates to coinsurance (which is 20 
percent of the fee schedule amount if applicable for the particular 
provision after the beneficiary has met the deductible). To illustrate 
this point, as shown in Table 136, the CY 2012 national payment amount 
in the nonfacility setting for CPT code 99203 (Office/outpatient visit, 
new) is $105.18 which means that in CY 2012 a beneficiary would be 
responsible for 20 percent of this amount, or $21.04. Based on this 
final rule with comment period, using the current (CY 2012) CF of 
34.0376, the CY 2013 national payment amount in the nonfacility setting 
for CPT code 99203, as shown in Table 136, is $107.80, which means 
that, in CY 2013, the proposed beneficiary coinsurance for this service 
would be $21.56. Payment amounts and associated coinsurance would be 
lower using the current law CY 2013 CF with the negative SGR 
adjustment.
    The transitional care management policy would also have an impact 
on beneficiary coinsurance for those beneficiaries who have a hospital 
visit in CY 2013 and require moderate to high complexity decision-
making by their community physician in the 30 days post discharge. 
Prior to the new TCM policy discussed in section III.H. of this final 
rule with comment period such a recently discharged beneficiary may 
have had an established patient follow-up visit with their community 
physician. The CY 2013 national payment amount in the nonfacility 
setting for CPT code 99215 (Office/outpatient visit, established), the 
highest level of an established patient office visit, is $142.96, which 
means that a beneficiary would be responsible for 20 percent of this 
amount, or $28.59. Under the new transitional care management policy, 
if a beneficiary received the highest level transitional care 
management visit, 99496, which has a national payment amount of 
$231.11, the beneficiary would be responsible for 20 percent of this 
amount, or $46.22

K. Accounting Statement

    As required by OMB Circular A-4 (available at http://www.whitehouse.

[[Page 69361]]

gov/omb/circulars/a004/a-4.pdf), in Tables 144 and 145 (Accounting 
Statement), we have prepared an accounting statement showing the 
estimated expenditures associated with this final rule with comment 
period. This estimate includes the estimated FY 2012 cash benefit 
impact associated with certain Affordable Care Act and MCTRJCA 
provisions, and the CY 2013 incurred benefit impact associated with the 
estimated CY 2013 PFS conversion factor update based on the Mid-Session 
Review of the FY 2013 President's Budget baseline.

      Table 144--Accounting Statement: Classification of Estimated
                              Expenditures
------------------------------------------------------------------------
                Category                            Transfers
------------------------------------------------------------------------
CY 2013 Annualized Monetized Transfers.  Estimated decrease in
                                          expenditures of $24.8 billion
                                          for PFS conversion factor
                                          update.
From Whom To Whom?.....................  Federal Government to
                                          physicians, other
                                          practitioners and providers
                                          and suppliers who receive
                                          payment under Medicare.
CY 2013 Annualized Monetized Transfers.  Estimated increase in payment
                                          of 162 millions.
From Whom To Whom?.....................  Federal Government to eligible
                                          professionals participated in
                                          (Physician Quality Reporting
                                          System (PQRS)).
------------------------------------------------------------------------


   Table 145--Accounting Statement: Classification of Estimated Costs,
                    Transfer, and Savings in CY 2013
                             [$ in millions]
------------------------------------------------------------------------
                Category                             Benefit
------------------------------------------------------------------------
Qualitative (unquantified) benefits of   No precise estimate available.
 fraud, waste, and abuse prevented, and
 of improved quality of services to
 patients.
------------------------------------------------------------------------
                Category                               Cost
------------------------------------------------------------------------
Costs associated with DME face-to-face   $30.6 million.*
 encounters and written orders prior to
 delivery.
Qualitative costs of reporting PQRS      No precise estimate available.
 quality measures data for eligible
 professionals and for vendors to
 participate in the PQRS.
------------------------------------------------------------------------
* It includes the monetized costs of beneficiary travel time ($9.4
  million), out of pocket expenses ($5 million), private sector
  paperwork costs ($11.2 million), and the increased Medicare payment to
  the providers associated with the additional visits and G code
  billings ($5 million).

L. Conclusion

    The analysis in the previous sections, together with the remainder 
of this preamble, provides an initial ``Regulatory Flexibility 
Analysis.''
    In accordance with the provisions of Executive Order 12866, this 
regulation was reviewed by the Office of Management and Budget.

List of Subjects

42 CFR Part 410

    Health facilities, Health professions, Kidney diseases, 
Laboratories, Medicare, Reporting and recordkeeping requirements, Rural 
areas, X-rays.

42 CFR Part 414

    Administrative practice and procedure, Health facilities, Health 
professions, Kidney diseases, Medicare, Reporting and recordkeeping 
requirements.

42 CFR Part 415

    Health facilities, Health professions, Medicare, Reporting and 
recordkeeping requirements.

42 CFR Part 421

    Administrative practice and procedure, Health facilities, Health 
professions, Medicare, Reporting and recordkeeping requirements.

42 CFR Part 423

    Administrative practice and procedure, Emergency medical services, 
Health facilities, Health maintenance organizations (HMO), Health 
professionals, Incorporation by reference, Medicare, Penalties, 
Privacy, Reporting and recordkeeping requirements.

42 CFR Part 425

    Administrative practice and procedure, Health facilities, Health 
professions, Medicare, Reporting and recordkeeping requirements.

42 CFR Part 486

    Grant programs--health, Health facilities, Medicare, Reporting and 
recordkeeping requirements, X-rays.

42 CFR Part 495

    Administrative practice and procedure, Electronic health records, 
Health facilities, Health professions, Health maintenance organizations 
(HMO), Medicaid, Medicare, Penalties, Privacy, Reporting and 
recordkeeping requirements.

    For the reasons set forth in the preamble, the Centers for Medicare 
& Medicaid Services amend 42 CFR chapters IV as set forth below:

PART 410--SUPPLEMENTARY MEDICAL INSURANCE (SMI) BENEFITS

0
1. The authority citation for part 410 continues to read as follows:

    Authority: Secs. 1102, 1834, 1871, 1881, and 1893 of the Social 
Security Act (42 U.S.C. 1302. 1395m, 1395hh, and 1395ddd.



0
2. Section 410.26 is amended by adding new paragraph (b)(8) to read as 
follows:


Sec.  410.26  Services and supplies incident to a physician's 
professional services: Conditions.

* * * * *
    (b) * * *
    (8) Claims for drugs payable administered by a physician as defined 
in section 1861(r) of the Social Security Act to refill an implanted 
item of DME may only be paid under Part B to the physician as a drug 
incident to a physician's service under section 1861(s)(2)(A). These 
drugs are not payable to a pharmacy/supplier as DME under section 
1861(s)(6) of the Act.
* * * * *

0
3. Section 410.32 is amended by--
0
A. Revising paragraphs (b)(2)(iii) introductory text, (d)(2)(i), and 
(e).

[[Page 69362]]

0
B. Redesignating paragraphs (c)(2) and (c)(3) as paragraphs (c)(3) and 
(c)(4), respectively.
0
C. Adding new paragraph (c)(2).
    The revisions and addition read as follows:


Sec.  410.32  Diagnostic x-ray tests, diagnostic laboratory tests, and 
other diagnostic tests: Conditions.

* * * * *
    (b) * * *
    (2) * * *
    (iii) Diagnostic psychological and neuropsychological testing 
services when--
* * * * *
    (c) * * *
    (2) These services are ordered by a physician as provided in 
paragraph (a) or by a nonphysician practitioner as provided in 
paragraph (a)(2) of this section.
* * * * *
    (d) * * *
    (2) * * *
    (i) Ordering the service. The physician or (qualified nonphysican 
practitioner, as defined in paragraph (a)(2) of this section), who 
orders the service must maintain documentation of medical necessity in 
the beneficiary's medical record.
* * * * *
    (e) Diagnostic laboratory tests furnished in hospitals and CAHs. 
The provisions of paragraphs (a) and (d)(2) through (d)(4) of this 
section, inclusive, of this section apply to all diagnostic laboratory 
test furnished by hospitals and CAHs to outpatients.


Sec.  410.37  [Amended.]

0
4. Amend Sec.  410.37 by--
0
A. Amending paragraph (a)(1)(iii) by removing the phrase ``In the case 
of an individual at high risk for colorectal cancer,'' and by removing 
``screening'' and adding ``Screening'' in its place.
0
B. Removing paragraph (g)(1).
0
C. Redesignating paragraphs (g)(2) through (g)(4) as paragraph (g)(1) 
through (g)(3), respectively.
0
D. In newly redesignated paragraph (g)(1), removing the reference 
``(g)(4)'' and adding in its place the reference ``(g)(3)''.

0
5. Section 410.38 is amended by revising paragraph (g) to read as 
follows:


Sec.  410.38  Durable medical equipment: Scope and conditions.

* * * * *
    (g)(1) Items requiring a written order. As a condition of payment, 
Specified Covered Items (as described in paragraph (g)(2) of this 
section) require a written order that meets the requirements in 
paragraphs (g)(3) and (4) of this section before delivery of the item.
    (2) Specified covered items. (i) Specified Covered Items are items 
of durable medical equipment that CMS has specified in accordance with 
section 1834(a)(11)(B)(i) of the Act. A list of these items is updated 
annually in the Federal Register.
    (ii) The list of Specified Covered Items includes the following:
    (A) Any item described by a Healthcare Common Procedure Coding 
System (HCPCS) code for the following types of durable medical 
equipment:
    (1) Transcutaneous electrical nerve stimulation (TENS) unit.
    (2) Rollabout chair.
    (3) Oxygen and respiratory equipment.
    (4) Hospital beds and accessories.
    (5) Traction-cervical.
    (B) Any item of durable medical equipment that appears on the 
Durable Medical Equipment, Prosthetics, Orthotics, and Supplies Fee 
Schedule with a price ceiling at or greater than $1,000.
    (C) Any other item of durable medical equipment that CMS adds to 
the list of Specified Covered Items through the notice and comment 
rulemaking process in order to reduce the risk of fraud, waste, and 
abuse.
    (iii) The list of specific covered items excludes the following:
    (A) Any item that is no longer covered by Medicare.
    (B) Any HCPCS code that is discontinued.
    (3) Face-to-face encounter requirements. (i) For orders issued in 
accordance with paragraphs (g)(1) and (2) of this section, as a 
condition of payment for the Specified Covered Item, all of the 
following must occur:
    (A) The physician must document and communicate to the DME supplier 
that the physician or a physician assistant, a nurse practitioner, or a 
clinical nurse specialist has had a face-to-face encounter with the 
beneficiary on the date of the written order up to 6 months before the 
date of the written order.
    (B) During the face-to-face encounter the physician, a physician 
assistant, a nurse practitioner, or a clinical nurse specialist must 
conduct a needs assessment, evaluate, and/or treat the beneficiary for 
the medical condition that supports the need for each covered item of 
DME ordered.
    (C) The face-to-face encounter must be documented in the pertinent 
portion of the medical record (for example, history, physical 
examination, diagnostic tests, summary of findings, diagnoses, 
treatment plans or other information as it may be appropriate). 
Physician must sign or cosign the pertinent portion of the medical 
record indicating the occurrence of a face-to-face encounter for the 
beneficiary for the date of the face-to-face encounter when performed 
by a physician assistant, a nurse practitioner, or a clinical nurse 
specialist. For purposes of this paragraph (g), a face-to-face 
encounter does not include DME items and services furnished from an 
``incident to'' service.
    (ii) For purposes of this paragraph (g), a face-to-face encounter 
may occur via telehealth in accordance with all of the following:
    (A) Section 1834(m) of the Act.
    (B)(1) Medicare telehealth regulations in Sec.  410.78 and Sec.  
414.65 of this chapter; and
    (2) Subject to the list of payable Medicare telehealth services 
established by the applicable PFS.
    (4) Written order issuance requirements. Written orders issued in 
accordance with paragraphs (g)(1) and (2) of this section must include 
all of the following:
    (i) Beneficiary's name.
    (ii) Item of DME ordered.
    (iii) Signature of the prescribing practitioner.
    (iv) Prescribing practitioner NPI.
    (v) The date of the order.
    (5) Supplier's order and documentation requirements. (i) A supplier 
must maintain the written order and the supporting documentation 
provided by the physician, physician assistant, nurse practitioner, or 
clinical nurse specialist and make them available to CMS upon request 
for 7 years from the date of service consistent with Sec.  424.516(f) 
of this chapter.
    (ii) Upon request by CMS or its agents, a supplier must submit 
additional documentation to CMS or its agents to support and 
substantiate that a face-to-face encounter has occurred.

0
6. Section 410.40 is amended by--
0
A. In paragraph (c)(3)(ii), the word ``fro'' is revised to read 
``from.''
0
B. Redesignating paragraph (d)(2) as (d)(2)(i).
0
C. Adding paragraph (d)(2)(ii).
    The addition reads as follows:


Sec.  410.40  Coverage of ambulance services.

* * * * *
    (d) * * *
    (2) * * *
    (ii) In all cases, the provider or supplier must keep appropriate 
documentation on file and, upon request, present it to the contractor. 
The presence of the signed physician certification statement does not 
alone demonstrate that the ambulance

[[Page 69363]]

transport was medically necessary. All other program criteria must be 
met in order for payment to be made.
* * * * *
0
7. Section 410.59 is amended by adding paragraph (a)(4) to read as 
follows:


Sec.  410.59  Outpatient occupational therapy services: Conditions.

    (a) * * *
    (4) Claims submitted for furnished services contain prescribed 
information on patient functional limitations.
* * * * *

0
8. Section 410.60 is amended by adding paragraph (a)(4) to read as 
follows:


Sec.  410.60  Outpatient physical therapy services: Conditions.

    (a) * * *
    (4) Claims submitted for furnished services contain prescribed 
information on patient functional limitations.
* * * * *

0
9. Section 410.61 is amended by revising paragraph (c) to read as 
follows:


Sec.  410.61  Plan of treatment requirements for outpatient 
rehabilitation services.

* * * * *
    (c) Content of the plan. The plan prescribes the type, amount, 
frequency, and duration of the physical therapy, occupational therapy, 
or speech-language pathology services to be furnished to the 
individual, and indicates the diagnosis and anticipated goals that are 
consistent with the patient function reporting on claims for services.
* * * * *

0
10. Section 410.62 is amended by adding paragraph (a)(4) to read as 
follows:


Sec.  410.62  Outpatient speech-language-pathology services: Conditions 
and exclusions.

    (a) * * *
    (4) Claims submitted for furnished services contain prescribed 
information on patient functional limitations.
* * * * *

0
11. Section 410.63 is amended by--
0
A. Removing ``and'' from the end of paragraph (a)(1)(vi).
0
B. Removing the period from the end of paragraph (a)(1)(vii) and adding 
``; and'' in its place.
0
C. Adding paragraph (a)(1)(viii).
    The addition reads as follows:


Sec.  410.63  Hepatitis B vaccine and blood clotting factors: 
Conditions.

* * * * *
    (a) * * *
    (1) * * *
    (viii) Persons diagnosed with diabetes mellitus.
* * * * *

0
12. Section 410.69 is amended in paragraph (b) by adding the definition 
of ``Anesthesia and related care'' in alphabetical order to read as 
follows:


Sec.  410.69  Services of a certified registered nurse anesthetist or 
an anesthesiologist's assistant: Basic rule and definitions.

* * * * *
    (b) * * *
    Anesthesia and related care means those services that a certified 
registered nurse anesthetist is legally authorized to perform in the 
state in which the services are furnished.
* * * * *

0
13. Section 410.78 is amended by revising the introductory text of 
paragraph (b) to read as follows:


Sec.  410.78  Telehealth services.

* * * * *
    (b) General rule. Medicare Part B pays for office or other 
outpatient visits, subsequent hospital care services (with the 
limitation of one telehealth visit every 3 days by the patient's 
admitting physician or practitioner), subsequent nursing facility care 
services (not including the Federally-mandated periodic visits under 
Sec.  483.40(c) of this chapter and with the limitation of one 
telehealth visit every 30 days by the patient's admitting physician or 
nonphysician practitioner), professional consultations, psychiatric 
diagnostic interview examination, neurobehavioral status exam, 
individual psychotherapy, pharmacologic management, end-stage renal 
disease-related services included in the monthly capitation payment 
(except for one ``hands on'' visit per month to examine the access 
site), individual and group medical nutrition therapy services, 
individual and group kidney disease education services, individual and 
group diabetes self-management training services (except for one hour 
of ``hands on'' services to be furnished in the initial year training 
period to ensure effective injection training), individual and group 
health and behavior assessment and intervention services, smoking 
cessation services, alcohol and/or substance abuse and brief 
intervention services, screening and behavioral counseling 
interventions in primary care to reduce alcohol misuse, screening for 
depression in adults, screening for sexually transmitted infections 
(STIs) and high intensity behavioral counseling (HIBC) to prevent STIs, 
intensive behavioral therapy for cardiovascular disease, and behavioral 
counseling for obesity furnished by an interactive telecommunications 
system if the following conditions are met:
* * * * *

0
14. Section 410.105 is amended by--
0
A. Revising paragraph (c)(1)(ii).
0
B. Adding new paragraph (d).
    The revision and addition read as follows:


Sec.  410.105  Requirement for coverage of CORF services.

* * * * *
    (c) * * *
    (1) * * *
    (ii) Prescribes the type, amount, frequency, and duration of the 
services to be furnished, and indicates the diagnosis and anticipated 
rehabilitation goals that are consistent with the patient function 
reporting on the claims for services.
* * * * *
    (d) Claims submitted for physical therapy, occupational therapy or 
speech-language-pathology services, contain prescribed information on 
patient functional limitations.

0
15. Section 410.160 is amended by revising paragraph (b)(8) to read as 
follows:


Sec.  410.160  Part B annual deductible.

* * * * *
    (b) * * *
    (8) Beginning January 1, 2011, a surgical service furnished in 
connection with, as a result of, and in the same clinical encounter as 
a planned colorectal cancer screening test. A surgical service 
furnished in connection with, as a result of, and in the same clinical 
encounter as a colorectal cancer screening test means--a surgical 
service furnished on the same date as a planned colorectal cancer 
screening test as described in Sec.  410.37.
* * * * *

PART 414--PAYMENT FOR PART B MEDICAL AND OTHER HEALTH SERVICES

0
16. The authority citation for part 414 continues to read as follows:

    Authority:  Secs. 1102, 1871, and 1881(b)(l) of the Social 
Security Act (42 U.S.C. 1302, 1395hh, and 1395rr(b)(l)).


0
17. Section 414.65 is amended by revising paragraph (a)(1) to read as 
follows:


Sec.  414.65  Payment for telehealth services.

    (a) * * *
    (1) The Medicare payment amount for office or other outpatient 
visits, subsequent hospital care services (with

[[Page 69364]]

the limitation of one telehealth visit every 3 days by the patient's 
admitting physician or practitioner), subsequent nursing facility care 
services (with the limitation of one telehealth visit every 30 days by 
the patient's admitting physician or nonphysician practitioner), 
professional consultations, psychiatric diagnostic interview 
examination, neurobehavioral status exam, individual psychotherapy, 
pharmacologic management, end-stage renal disease-related services 
included in the monthly capitation payment (except for one ``hands on'' 
visit per month to examine the access site), individual and group 
medical nutrition therapy services, individual and group kidney disease 
education services, individual and group diabetes self-management 
training services (except for one hour of ``hands on'' services to be 
furnished in the initial year training period to ensure effective 
injection training), individual and group health and behavior 
assessment and intervention, smoking cessation services, alcohol and/or 
substance abuse and brief intervention services, screening and 
behavioral counseling interventions in primary care to reduce alcohol 
misuse, screening for depression in adults, screening for sexually 
transmitted infections (STIs) and high intensity behavioral counseling 
(HIBC) to prevent STIs, intensive behavioral therapy for cardiovascular 
disease, and behavioral counseling for obesity furnished via an 
interactive telecommunications system is equal to the current fee 
schedule amount applicable for the service of the physician or 
practitioner.
    (i) Emergency department or initial inpatient telehealth 
consultations. The Medicare payment amount for emergency department or 
initial inpatient telehealth consultations furnished via an interactive 
telecommunications system is equal to the current fee schedule amount 
applicable to initial hospital care provided by a physician or 
practitioner.
    (ii) Follow-up inpatient telehealth consultations. The Medicare 
payment amount for follow-up inpatient telehealth consultations 
furnished via an interactive telecommunications system is equal to the 
current fee schedule amount applicable to subsequent hospital care 
provided by a physician or practitioner.
* * * * *

0
18. Section 414.90 is amended by--
0
A. In paragraph (b), revising the definitions ``Group practice'' and 
``Qualified registry.''
0
B. In paragraph (b), removing the term ``Qualified electronic health 
record product''.
0
C. In paragraph (b), adding the definitions ``Administrative claims,'' 
``Direct electronic health record (EHR) product,'' ``Electronic health 
record (EHR) data submission vendor product,'' and ``Group practice 
reporting option (GPRO) web interface'' in alphabetical order.
0
D. Revising paragraphs (c) and (d).
0
E. Redesignating paragraphs (e), (f), (g), (h), (i), and (j) as 
paragraphs (f), (g), (i), (j), (k), and (l), respectively.
0
F. Adding new paragraphs (e) and (h).
0
G. Revising newly designated paragraphs (f), (g), (i), and (j).
    The revisions and additions read as follows:


Sec.  414.90  Physician Quality Reporting System.

* * * * *
    (b) * * *
    Administrative claims means a reporting mechanism under which an 
eligible professional or group practice uses claims to report data on 
the proposed PQRS quality measures. Under this reporting mechanism, CMS 
analyzes claims data to determine which measures an eligible 
professional or group practice reports.
    Direct electronic health record (EHR) product means an electronic 
health record vendor's product and version that submits data on 
Physician Quality Reporting System measures directly to CMS.
    Electronic health record (EHR) data submission vendor product means 
an entity that receives and transmits data on Physician Quality 
Reporting System measures from an EHR product to CMS.
* * * * *
    Group practice means a physician group practice that is defined by 
a TIN, with 2 or more individual eligible professionals (or, as 
identified by NPIs) that has reassigned their billing rights to the 
TIN.
    Group practice reporting option (GPRO) web interface means a web 
product developed by CMS that is used by group practices that are 
selected to participate in the group practice reporting option (GPRO) 
to submit data on Physician Quality Reporting System quality measures.
* * * * *
    Qualified registry means a medical registry or a maintenance of 
certification program operated by a specialty body of the American 
Board of Medical Specialties that, with respect to a particular program 
year, has self-nominated and successfully completed a vetting process 
(as specified by CMS) to demonstrate its compliance with the Physician 
Quality Reporting System qualification requirements specified by CMS 
for that program year. The registry may act as a data submission 
vendor, which has the requisite legal authority to provide Physician 
Quality Reporting System data (as specified by CMS) on behalf of an 
eligible professional to CMS. If CMS finds that a qualified registry 
submits grossly inaccurate data for reporting periods occurring in a 
particular year, CMS reserves the right to disqualify a registry for 
reporting periods occurring in the subsequent year.
* * * * *
    (c) Incentive payments. For 2007 to 2014, with respect to covered 
professional services furnished during a reporting period by an 
eligible professional, an eligible professional (or in the case of a 
group practice under paragraph (i) of this section, a group practice) 
may receive an incentive if--
    (1) There are any quality measures that have been established under 
the Physician Quality Reporting System that are applicable to any such 
services furnished by such professional (or in the case of a group 
practice under paragraph (i) of this section, such group practice) for 
such reporting period; and
    (2) If the eligible professional (or in the case of a group 
practice under paragraph (j) of this section, the group practice) 
satisfactorily submits (as determined under paragraph (g) of this 
section for the eligible professional and paragraph (i) of this section 
for the group practice) to the Secretary data on such quality measures 
in accordance with the Physician Quality Reporting System for such 
reporting period, in addition to the amount otherwise paid under 
section 1848 of the Act, there also must be paid to the eligible 
professional (or to an employer or facility in the cases described in 
section 1842(b)(6)(A) of the Act or, in the case of a group practice 
under paragraph (i) of this section, to the group practice) from the 
Federal Supplementary Medical Insurance Trust Fund established under 
section 1841 of the Act an amount equal to the applicable quality 
percent (as specified in paragraph (c)(3) of this section) of the 
eligible professional's (or, in the case of a group practice under 
paragraph (i) of this section, the group practice's) total estimated 
allowed charges for all covered professional services furnished by the 
eligible professional (or, in the case of a group practice under 
paragraph (i) of this section, by the group practice) during the 
reporting period.

[[Page 69365]]

    (3) The applicable quality percent is as follows:
    (i) For 2007 and 2008, 1.5 percent.
    (ii) For 2009 and 2010, 2.0 percent.
    (iii) For 2011, 1.0 percent.
    (iv) For 2012, 2013, and 2014, 0.5 percent.
    (4) For purposes of this paragraph (c)--
    (i) The eligible professional's (or, in the case of a group 
practice under paragraph (i) of this section, the group practice's) 
total estimated allowed charges for covered professional services 
furnished during a reporting period are determined based on claims 
processed in the National Claims History (NCH) no later than 2 months 
after the end of the applicable reporting period;
    (ii) In the case of the eligible professional who furnishes covered 
professional services in more than one practice, incentive payments are 
separately determined for each practice based on claims submitted for 
the eligible professional for each practice;
    (iii) Incentive payments to a group practice under this paragraph 
must be in lieu of the payments that would otherwise be made under the 
Physician Quality Reporting System to eligible professionals in the 
group practice for meeting the criteria for satisfactory reporting for 
individual eligible professionals. For any program year in which the 
group practice (as identified by the TIN) is selected to participate in 
the Physician Quality Reporting System group practice reporting option, 
the eligible professional cannot individually qualify for a Physician 
Quality Reporting System incentive payment by meeting the requirements 
specified in paragraph (g) of this section.
    (iv) Incentive payments earned by the eligible professional (or in 
the case of a group practice under paragraph (i) of this section, by 
the group practice) for a particular program year will be paid as a 
single consolidated payment to the TIN holder of record.
    (d) Additional incentive payment. Through 2014, if an eligible 
professional meets the requirements described in paragraph (d)(2) of 
this section, the applicable percent for such year, as described in 
paragraphs (c)(3)(iii) and (iv) of this section, must be increased by 
0.5 percentage points.
    (1) In order to qualify for the additional incentive payment 
described in paragraph (d) of this section, an eligible professional 
must meet all of the following requirements:
    (i) Satisfactorily submits data on quality measures for purposes of 
this section for the applicable incentive year.
    (ii) Have such data submitted on their behalf through a Maintenance 
of Certification program (as defined in paragraph (b) of this section) 
that meets:
    (A) The criteria for a registry (as specified by CMS); or
    (B) An alternative form and manner determined appropriate by the 
Secretary.
    (iii) The eligible professional, more frequently than is required 
to qualify for or maintain board certification status--
    (A) Participates in a maintenance of certification program (as 
defined in paragraph (b) of this section) for a year; and
    (B) Successfully completes a qualified maintenance of certification 
program practice assessment (as defined in paragraph (b) of this 
section) for such year.
    (2) In order for an eligible professional to receive the additional 
incentive payment, a Maintenance of Certification Program must submit 
to the Secretary, on behalf of the eligible professional, information--
    (i) In a form and manner specified by the Secretary, that the 
eligible professional has successfully met the requirements of 
paragraph (d)(1)(iii) of this section, which may be in the form of a 
structural measure.
    (ii) If requested by the Secretary, on the survey of patient 
experience with care.
    (iii) As the Secretary may require, on the methods, measures, and 
data used under the Maintenance of Certification Program and the 
qualified Maintenance of Certification Program practice assessment.
    (e) Payment adjustments. For 2015 and subsequent years, with 
respect to covered professional services furnished by an eligible 
professional, if the eligible professional does not satisfactorily 
submit data on quality measures for covered professional services for 
the quality reporting period for the year (as determined under section 
1848(m)(3)(A) of the Act), the fee schedule amount for such services 
furnished by such professional during the year (including the fee 
schedule amount for purposes for determining a payment based on such 
amount) shall be equal to the applicable percent of the fee schedule 
amount that would otherwise apply to such services under this 
subsection.
    (1) The applicable percent is as follows:
    (i) For 2015, 98.5 percent; and
    (ii) For 2016 and each subsequent year, 98 percent.
    (2) [Reserved.]
    (f) Use of consensus-based quality measures. For measures selected 
for inclusion in the Physician Quality Reporting System quality measure 
set, CMS will use consensus-based quality measures that meet one of the 
following criteria:
    (1) Be such measures selected by the Secretary from measures that 
have been endorsed by the entity with a contract with the Secretary 
under section 1890(a) of the Act.
    (2) In the case of a specified area or medical topic determined 
appropriate by the Secretary for which a feasible and practical measure 
has not been endorsed by the entity with a contract under section 
1890(a) of the Act, the Secretary may specify a measure that is not so 
endorsed as long as due consideration is given to measures that have 
been endorsed or adopted by a consensus organization identified by the 
Secretary.
    (3) For each quality measure adopted by the Secretary under this 
paragraph, the Secretary ensures that eligible professionals have the 
opportunity to provide input during the development, endorsement, or 
selection of quality measures applicable to services they furnish.
    (g) Requirements for the incentive payments. In order to qualify to 
earn a Physician Quality Reporting System incentive payment for a 
particular program year, an individual eligible professional, as 
identified by a unique TIN/NPI combination, (or in the case of a group 
practice under paragraph (i) of this section, by the group practice) 
must meet the criteria for satisfactory reporting specified by CMS for 
such year by reporting on either individual Physician Quality Reporting 
System quality measures or Physician Quality Reporting System measures 
groups identified by CMS during a reporting period specified in 
paragraph (g)(1) of this section and using one of the reporting 
mechanisms specified in paragraph (g)(2) or (g)(3) of this section.
    (1) Reporting periods. For purposes of this paragraph, the 
reporting period is--
    (i) The 12-month period from January 1 through December 31 of such 
program year.
    (ii) A 6-month period from July 1 through December 31 of such 
program year.
    (A) For 2011, such 6-month reporting period is not available for 
EHR-based reporting of individual Physician Quality Reporting System 
quality measures.
    (B) For 2012 and subsequent program years, such 6-month reporting 
period from July 1 through December 31 of such program year is only 
available for registry-based reporting of Physician Quality Reporting 
System measures groups by eligible professionals.

[[Page 69366]]

    (2) Reporting mechanisms for individual eligible professionals. An 
individual eligible professional who wishes to participate in the 
Physician Quality Reporting System must report information on Physician 
Quality Reporting System quality measures identified by CMS in one of 
the following manners:
    (i) Claims. Reporting Physician Quality Reporting System quality 
measures or Physician Quality Reporting System measures groups to CMS, 
by no later than 2 months after the end of the applicable reporting 
period, on the eligible professional's Medicare Part B claims for 
covered professional services furnished during the applicable reporting 
period.
    (A) If an eligible professional re-submits a Medicare Part B claim 
for reprocessing, the eligible professional may not attach a G-code at 
that time for reporting on individual Physician Quality Reporting 
System measures or measures groups.
    (B) [Reserved]
    (ii) Registry. Reporting Physician Quality Reporting System quality 
measures or Physician Quality Reporting System measures groups to a 
qualified registry (as specified in paragraph (b) of this section) in 
the form and manner and by the deadline specified by the qualified 
registry selected by the eligible professional. The selected registry 
must submit information, as required by CMS, for covered professional 
services furnished by the eligible professional during the applicable 
reporting period to CMS on the eligible professional's behalf.
    (iii) Direct EHR product. Reporting Physician Quality Reporting 
System quality measures to CMS by extracting clinical data using a 
secure data submission method, as required by CMS, from a direct EHR 
product (as defined in paragraph (b) of this section) by the deadline 
specified by CMS for covered professional services furnished by the 
eligible professional during the applicable reporting period.
    (iv) EHR data submission vendor. Reporting Physician Quality 
Reporting System quality measures to CMS by extracting clinical data 
using a secure data submission method, as required by CMS, from an EHR 
data submission vendor product (as defined in paragraph (b) of this 
section) by the deadline specified by CMS for covered professional 
services furnished by the eligible professional during the applicable 
reporting period.
    (v) Although an eligible professional may attempt to qualify for 
the Physician Quality Reporting System incentive payment by reporting 
on both individual Physician Quality Reporting System quality measures 
and measures groups, using more than one reporting mechanism (as 
specified in paragraph (g)(2) of this section), or reporting for more 
than one reporting period, he or she will receive only one Physician 
Quality Reporting System incentive payment per TIN/NPI combination for 
a program year.
    (3) Reporting mechanisms for group practices. A group practice (as 
defined in paragraph (b) of this section) who wishes to participate in 
the Physician Quality Reporting System must report information on 
Physician Quality Reporting System quality measures identified by CMS 
in one of the following manners:
    (i) Web interface. For 2013 and subsequent years, reporting 
Physician Quality Reporting System quality measures to CMS using a CMS 
web interface in the form and manner and by the deadline specified by 
CMS.
    (ii) Registry. For 2013 and subsequent years, reporting on 
Physician Quality Reporting System quality measures to a qualified 
registry (as specified in paragraph (b) of this section) in the form 
and manner and by the deadline specified by the qualified registry 
selected by the eligible professional. The selected registry must 
submit information, as required by CMS, for covered professional 
services furnished by the eligible professional during the applicable 
reporting period to CMS on the eligible professional's behalf.
    (iii) Direct EHR product. For 2014 and subsequent years, reporting 
Physician Quality Reporting System quality measures to CMS by 
extracting clinical data using a secure data submission method, as 
required by CMS, from a direct EHR product (as defined in paragraph (b) 
of this section) by the deadline specified by CMS for covered 
professional services furnished by the eligible professional during the 
applicable reporting period.
    (iv) EHR data submission vendor. For 2014 and subsequent years, 
reporting Physician Quality Reporting System quality measures to CMS by 
extracting clinical data using a secure data submission method, as 
required by CMS, from an EHR data submission vendor product (as defined 
in paragraph (b) of this section) by the deadline specified by CMS for 
covered professional services furnished by the eligible professional 
during the applicable reporting period.
    (v) Although a group practice may attempt to qualify for the 
Physician Quality Reporting System incentive payment by using more than 
one reporting mechanism (as specified in paragraph (g)(3) of this 
section), or reporting for more than one reporting period, the group 
practice will receive only one Physician Quality Reporting System 
incentive payment for a program year.
    (h) Requirements for the payment adjustments. In order to satisfy 
the requirements for the Physician Quality Reporting System payment 
adjustment for a particular program year, an individual eligible 
professional, as identified by a unique TIN/NPI combination (or in the 
case of a group practice under paragraph (i) of this section, by the 
group practice) must meet the criteria for satisfactory reporting 
specified by CMS for such year by reporting on either individual 
Physician Quality Reporting System measures or Physician Quality 
Reporting System measures groups identified by CMS during a reporting 
period specified in paragraph (h)(1) of this section and using one of 
the reporting mechanisms specified in paragraph (h)(2) or (h)(3) of 
this section.
    (1) For purposes of this paragraph (h), the reporting period for 
the payment adjustment, with respect to a payment adjustment year, is 
the 12-month period from January 1 through December 31 that falls 2 
years prior to the year in which the payment adjustment is applied.
    (i) For the 2015 and 2016 PQRS payment adjustments only, an 
alternative 6-month reporting period, from July 1-December 31 that fall 
2 years prior to the year in which the payment adjustment is applied, 
is also available.
    (ii) [Reserved]
    (2) Reporting mechanisms for individual eligible professionals. An 
individual eligible professional participating in the Physician Quality 
Reporting System must report information on Physician Quality Reporting 
System quality measures identified by CMS in one of the following 
manners:
    (i) Claims. Reporting Physician Quality Reporting System quality 
measures or Physician Quality Reporting System measures groups to CMS, 
by no later than 2 months after the end of the applicable reporting 
period, on the eligible professional's Medicare Part B claims for 
covered professional services furnished during the applicable reporting 
period.
    (A) If an eligible professional re-submits a Medicare Part B claim 
for reprocessing, the eligible professional may not attach a G-code at 
that time for reporting on individual Physician Quality Reporting 
System measures or measures groups.

[[Page 69367]]

    (B) [Reserved]
    (ii) Registry. Reporting Physician Quality Reporting System quality 
measures or Physician Quality Reporting System measures groups to a 
qualified registry (as specified in paragraph (b) of this section) in 
the form and manner and by the deadline specified by the qualified 
registry selected by the eligible professional. The selected registry 
must submit information, as required by CMS, for covered professional 
services furnished by the eligible professional during the applicable 
reporting period to CMS on the eligible professional's behalf.
    (iii) Direct EHR product. Reporting Physician Quality Reporting 
System quality measures to CMS by extracting clinical data using a 
secure data submission method, as required by CMS, from a direct EHR 
product (as defined in paragraph (b) of this section) by the deadline 
specified by CMS for covered professional services furnished by the 
eligible professional during the applicable reporting period.
    (iv) EHR data submission vendor. Reporting Physician Quality 
Reporting System quality measures to CMS by extracting clinical data 
using a secure data submission method, as required by CMS, from an EHR 
data submission vendor product (as defined in paragraph (b) of this 
section) by the deadline specified by CMS for covered professional 
services furnished by the eligible professional during the applicable 
reporting period.
    (v) Administrative claims. For 2015, reporting data on Physician 
Quality Reporting System quality measures via administrative claims 
during the applicable reporting period. Eligible professionals that are 
administrative claims reporters must meet the following requirement for 
the payment adjustment:
    (A) Elect to participate in the Physician Quality Reporting System 
using the administrative claims reporting option.
    (B) Reporting Medicare Part B claims data for CMS to determine 
whether the eligible professional has performed services applicable to 
certain individual Physician Quality Reporting System quality measures.
    (3) Reporting mechanisms for group practices. A group practice (as 
defined in paragraph (b) of this section) participating in the 
Physician Quality Reporting System must report information on Physician 
Quality Reporting System quality measures identified by CMS in one of 
the following manners:
    (i) Web interface. For the 2015 payment adjustment and subsequent 
payment adjustments, reporting Physician Quality Reporting System 
quality measures to CMS using a CMS web interface in the form and 
manner and by the deadline specified by CMS.
    (ii) Registry. For the 2015 subsequent adjustment and subsequent 
payment adjustments, reporting on Physician Quality Reporting System 
quality measures to a qualified registry (as specified in paragraph (b) 
of this section) in the form and manner and by the deadline specified 
by the qualified registry selected by the eligible professional. The 
selected registry will submit information, as required by CMS, for 
covered professional services furnished by the eligible professional 
during the applicable reporting period to CMS on the eligible 
professional's behalf.
    (iii) Direct EHR product. For the 2016 subsequent adjustment and 
subsequent payment adjustments, reporting Physician Quality Reporting 
System quality measures to CMS by extracting clinical data using a 
secure data submission method, as required by CMS, from a direct EHR 
product (as defined in paragraph (b) of this section) by the deadline 
specified by CMS for covered professional services furnished by the 
eligible professional during the applicable reporting period.
    (iv) EHR data submission vendor. For the 2016 subsequent adjustment 
and subsequent payment adjustments, reporting Physician Quality 
Reporting System quality measures to CMS by extracting clinical data 
using a secure data submission method, as required by CMS, from an EHR 
data submission vendor product (as defined in paragraph (b) of this 
section) by the deadline specified by CMS for covered professional 
services furnished by the group practice during the applicable 
reporting period.
    (v) Administrative claims. For 2015, reporting data on Physician 
Quality Reporting System quality measures via administrative claims 
during the applicable reporting period. Group practices that are 
administrative claims reporters must meet the following requirement for 
the payment adjustment:
    (A) Elect to participate in the Physician Quality Reporting System 
using the administrative claims reporting option.
    (B) Reporting Medicare Part B claims data for CMS to determine 
whether the group practice has performed services applicable to certain 
individual Physician Quality Reporting System quality measures.
    (i) Requirements for group practices. Under the Physician Quality 
Reporting System, a group practice (as defined in paragraph (b) of this 
section) must meet all of the following requirements:
    (1) Meet the participation requirements specified by CMS for the 
Physician Quality Reporting System group practice reporting option.
    (2) Report measures in the form and manner specified by CMS.
    (3) Meet other requirements for satisfactory reporting specified by 
CMS.
    (4) Meet other requirements for satisfactory reporting specified by 
CMS.
    (5) Meet participation requirements.
    (i) If an eligible professional, as identified by an individual 
NPI, has reassigned his or her Medicare billing rights to a group 
practice (as identified by the TIN) selected to participate in the 
Physician Quality Reporting System group practice reporting option for 
a program year, then for that program year the eligible professional 
must participate in the Physician Quality Reporting System via the 
group practice reporting option.
    (ii) If, for the program year, the eligible professional 
participates in the Physician Quality Reporting System as part of a 
group practice (as identified by the TIN) that is not selected to 
participate in the Physician Quality Reporting System group practice 
reporting option for that program year, then the eligible professional 
may individually participate and qualify for a Physician Quality 
Reporting System incentive by meeting the requirements specified in 
paragraph (g) of this section under that TIN.
    (j) Informal review. Eligible professionals (or in the case of 
reporting under paragraph (g) of this section, group practices) may 
seek an informal review of the determination that an eligible 
professional (or in the case of reporting under paragraph (g) of this 
section, group practices) did not satisfactorily submit data on quality 
measures under the Physician Quality Reporting System.
    (1) To request an informal review for the PQRS incentives, an 
eligible professional (or in the case of reporting under paragraph (g) 
of this section, group practices) must submit a request to CMS via the 
Web within 90 days of the release of the feedback reports. The request 
must be submitted in writing or via email and summarize the concern(s) 
and reasons for requesting an informal review and may also include 
information to assist in the review.
    (i) CMS will provide a written response within 90 days of the 
receipt of the original request.
    (ii) All decisions based on the informal review will be final.

[[Page 69368]]

    (iii) There will be no further review or appeal.
    (2) To request an informal review for the PQRS payment adjustments, 
an eligible professional or group practices must submit a request to 
CMS via the Web by February 28 of the year in which the eligible 
professional is receiving the applicable payment adjustment. The 
request must be submitted in writing and summarize the concern(s) and 
reasons for requesting an informal review and may also include 
information to assist in the review.
    (i) CMS will provide a timely, written response after the receipt 
of the original request.
    (ii) All decisions based on the informal review will be final.
    (iii) There will be no further review or appeal.
* * * * *

0
19. Section 414.92 is amended by--
0
A. Revising paragraphs (c)(2)(ii)(A)(5) and (c)(2)(ii)(A)(6).
0
B. Adding paragraph (f)(2)(i)(A) and adding and reserving paragraph 
(f)(2)(i)(B).
0
C. Redesignating paragraph (g) as paragraph (h), and adding new 
paragraph (g).
    The revision and addition reads as follows:


Sec.  414.92  Electronic Prescribing Incentive Program.

* * * * *
    (c) * * *
    (2) * * *
    (ii) * * *
    (A) * * *
    (5) Eligible professionals who achieve meaningful use during the 
respective 6 or 12-month payment adjustment reporting periods.
    (6) Eligible professionals who have registered to participate in 
the EHR Incentive Program and adopted Certified EHR Technology prior to 
application of the respective payment adjustment.
* * * * *
    (f) * * *
    (2) * * *
    (i) * * *
    (A) If an eligible professional re-submits a Medicare Part B claim 
for reprocessing, the eligible professional may not attach a G-code at 
that time for reporting on the electronic prescribing measure.
    (B) [Reserved]
* * * * *
    (g) Informal review. Eligible professionals (or in the case of 
reporting under paragraph (e) of this section, group practices) may 
seek an informal review of the determination that an eligible 
professional (or in the case of reporting under paragraph (e) of this 
section, group practices) did not meet the requirements for the 2012 
and 2013 incentives or the 2013 and 2014 payment adjustments.
    (1) To request an informal review for the 2012 and 2013 incentives, 
an eligible professional or group practice must submit a request to CMS 
via email within 90 days of the release of the feedback reports. The 
request must be submitted in writing and summarize the concern(s) and 
reasons for requesting an informal review and may also include 
information to assist in the review.
    (2) To request an informal review for the 2013 and 2014 payment 
adjustments, an eligible professional or group practices must submit a 
request to CMS via email by February 28 of the year in which the 
eligible professional is receiving the applicable payment adjustment. 
The request must be submitted in writing and summarize the concern(s) 
and reasons for requesting an informal review and may also include 
information to assist in the review.
    (3) CMS will provide a written response of CMS' determination.
    (i) All decisions based on the informal review will be final.
    (ii) There will be no further review or appeal.
* * * * *

0
20. Section 414.610 is amended by revising paragraphs (c)(1)(ii), 
(c)(5)(ii), and (h) to read as follows:


Sec.  414.610  Basis of payment.

* * * * *
    (c) * * *
    (1) * * *
    (ii) For services furnished during the period July 1, 2008 through 
December 31, 2012, ambulance services originating in--
    (A) Urban areas (both base rate and mileage) are paid based on a 
rate that is 2 percent higher than otherwise is applicable under this 
section; and
    (B) Rural areas (both base rate and mileage) are paid based on a 
rate that is 3 percent higher than otherwise is applicable under this 
section.
* * * * *
    (5) * * *
    (ii) For services furnished during the period July 1, 2004 through 
December 31, 2012, the payment amount for the ground ambulance base 
rate is increased by 22.6 percent where the point of pickup is in a 
rural area determined to be in the lowest 25 percent of rural 
population arrayed by population density. The amount of this increase 
is based on CMS's estimate of the ratio of the average cost per trip 
for the rural areas in the lowest quartile of population compared to 
the average cost per trip for the rural areas in the highest quartile 
of population. In making this estimate, CMS may use data provided by 
the GAO.
* * * * *
    (h) Treatment of certain areas for payment for air ambulance 
services. Any area that was designated as a rural area for purposes of 
making payments under the ambulance fee schedule for air ambulance 
services furnished on December 31, 2006, must be treated as a rural 
area for purposes of making payments under the ambulance fee schedule 
for air ambulance services furnished during the period July 1, 2008 
through December 31, 2012.

0
21. Section 414.904 is amended by revising paragraphs (d)(3)(ii), 
(d)(3)(iii), and (d)(3)(iv) to read as follows:


Sec.  414.904  Average sales price as the basis for payment.

* * * * *
    (d) * * *
    (3) * * *
    (ii) Payment at 103 percent of the average manufacturer price for a 
billing code will be applied at such times when all of the following 
criteria are met:
    (A) The threshold for making price substitutions, as defined in 
paragraph (d)(3)(iii) of this section is met.
    (B) 103 percent of the average manufacturer price is less than the 
106 percent of the average sales price for the quarter in which the 
substitution would be applied.
    (C) Beginning in 2013, the drug and dosage form described by the 
HCPCS code is not identified by the FDA to be in short supply at the 
time that ASP calculations are finalized.
    (iii) The applicable percentage threshold for average manufacturer 
price comparisons is 5 percent and is reached when--
    (A) The average sales price for the billing code has exceeded the 
average manufacturer price for the billing code by 5 percent or more in 
2 consecutive quarters, or 3 of the previous 4 quarters immediately 
preceding the quarter to which the price substitution would be applied; 
and
    (B) The average manufacturer price for the billing code is 
calculated using the same set of National Drug Codes used for the 
average sales price for the billing code.
    (iv) The applicable percentage threshold for widely available 
market price comparisons is 5 percent.
* * * * *

0
22. Subpart N is added to Part 414 to read as follows:

[[Page 69369]]

Subpart N--Value-Based Payment Modifier Under the Physician Fee 
Schedule
Sec.
414.1200 Basis and scope.
414.1205 Definitions.
414.1210 Application of the value-based payment modifier.
414.1215 Performance and payment adjustment periods for the value-
based payment modifier.
414.1220 Reporting mechanisms for the value-based payment modifier.
414.1225 Alignment of Physician Quality Reporting System (PQRS) 
quality measures and quality measures for the value-based payment 
modifier.
414.1230 Additional measures for groups of physicians.
414.1235 Cost measures.
414.1240 Attribution for quality of care and cost measures.
414.1245 Scoring methods for the value-based payment modifier using 
the quality-tiering approach.
414.1250 Benchmarks for quality of care measures.
414.1255 Benchmarks for cost measures.
414.1260 Composite scores.
414.1265 Reliability of measures.
414.1270 Determination and calculation of Value-Based Payment 
Modifier adjustments.
414.1275 Value-based payment modifier quality-tiering scoring 
methodology.
414.1280 Limitation on review.
414.1285 Informal inquiry process.

Subpart N--Value-Based Payment Modifier Under the Physician Fee 
Schedule


Sec.  414.1200  Basis and scope.

    (a) Basis. This subpart implements section 1848(p) of the Act by 
establishing a payment modifier that provides for differential payment 
starting in 2015 to a group of physicians under the Medicare physician 
fee schedule based on the quality of care furnished compared to cost 
during a performance period.
    (b) Scope. This subpart sets forth the following:
    (1) The application of the value-based payment modifier.
    (2) Performance and payment adjustment periods.
    (3) Reporting mechanisms for the value-based payment modifier.
    (4) Alignment of PQRS quality of care measures with the quality 
measures for the value-based payment modifier.
    (5) Additional measures for groups of physicians.
    (6) Cost measures.
    (7) Attribution for quality of care and cost measures.
    (8) Scoring methods for the value-based payment modifier.
    (9) Benchmarks for quality of care measures.
    (10) Benchmarks for cost measures.
    (11) Composite scores.
    (12) Reliability of measures.
    (13) Payment adjustments.
    (14) Value-based payment modifier quality-tiering scoring 
methodology.
    (15) Limitation of review.
    (16) Inquiry process.


Sec.  414.1205  Definitions.

    As used in this subpart, unless otherwise indicated--
    Accountable care organization (ACO) has the same meaning given this 
term under Sec.  425.20 of this chapter.
    Critical access hospital has the same meaning given this term under 
Sec.  400.202 of this chapter.
    Electronic health record (EHR) has the same meaning given this term 
under Sec.  414.92 of this chapter.
    Eligible professional has the same meaning given this term under 
section 1848(k)(3)(B) of the Act.
    Federally Qualified Health Center has the same meaning given this 
term under Sec.  405.2401(b) of this chapter.
    Group of physicians means a single Tax Identification Number (TIN) 
with 2 or more eligible professionals, as identified by their 
individual National Provider Identifier (NPI), who have reassigned 
their Medicare billing rights to the TIN.
    Performance period means the calendar year that will be used to 
assess the quality of care furnished compared to cost.
    Performance rate mean the calculated rate for each quality or cost 
measure such as the percent of times that a particular clinical quality 
action was reported as being performed, or a particular outcome was 
attained, for the applicable persons to whom a measure applies as 
described in the denominator for the measure.
    Physician has the same meaning given this term under section 
1861(r) of the Act.
    Physician Fee Schedule has the same meaning given this term under 
part 410 of this chapter.
    Physician Quality Reporting System means the system established 
under section 1848(k) of the Act.
    Risk score means the beneficiary risk score derived from the CMS 
Hierarchical Condition Categories (HCC) model.
    Taxpayer Identification Number (TIN) has the same meaning given 
this term under Sec.  425.20 of this chapter.
    Value-based payment modifier means the percentage as determined 
under Sec.  414.1270 by which amounts paid to a physician or group of 
physicians under the Medicare physician fee schedule established under 
section 1848 of the Act are adjusted based upon a comparison of the 
quality of care furnished to cost as determined by this subpart.


Sec.  414.1210  Application of the value-based payment modifier.

    (a) The value-based payment modifier is applicable to physicians:
    (1) For CY 2015, in groups with 100 or more eligible professionals 
based on the performance period described at Sec.  414.1215(a).
    (2) [Reserved]
    (b) Exceptions. (1) Groups of physicians that are participating in 
the Medicare Shared Savings Program, the testing of the Pioneer ACO 
model, or other similar Innovation Center or CMS initiatives shall not 
be subject to any adjustments under the value-based payment modifier 
for CY 2015 and CY 2016.
    (2) [Reserved]
    (c) Group size determination. Identification of the groups of 
physicians subject to the value-based payment modifier is based on a 
query of PECOS on October 15, 2013. Groups of physicians are removed 
from this October 15 list if, based on a claims analysis, the group of 
physicians did not have 100 or more eligible professionals that 
submitted claims during the performance period.


Sec.  414.1215  Performance and payment adjustment periods for the 
value-based payment modifier.

    (a) The performance period is calendar year 2013 for value-based 
payment modifier adjustments made in the calendar year 2015 payment 
adjustment period.
    (b) The performance period is calendar year 2014 for value-based 
payment modifier adjustments made in the calendar year 2016 payment 
adjustment period.


Sec.  414.1220  Reporting mechanisms for the value-based payment 
modifier.

    Groups of physicians subject to the value-based payment modifier 
may submit data on quality measures as specified under the Physician 
Quality Reporting System and in Sec.  414.90(g) for which they are 
eligible and Sec.  414.90(h)(3)(vi) administrative claims.


Sec.  414.1225  Alignment of Physician Quality Reporting System quality 
measures and quality measures for the value-based payment modifier.

    All of the quality measures for which groups of physicians are 
eligible to report under the Physician Quality Reporting System 
starting in CY 2013 are used to calculate the value-based payment 
modifier program to the extent the group of physicians submits data on 
such measures.

[[Page 69370]]

Sec.  414.1230  Additional measures for groups of physicians.

    The value-based payment modifier includes the following additional 
quality measures for all groups of physicians subject to the value-
based payment modifier:
    (a) A composite of rates of potentially preventable hospital 
admissions for heart failure, chronic obstructive pulmonary disease, 
and diabetes. The rate of potentially preventable hospital admissions 
for diabetes is a composite measure of uncontrolled diabetes, short 
term diabetes complications, long term diabetes complications and lower 
extremity amputation for diabetes.
    (b) A composite of rates of potentially preventable hospital 
admissions for dehydration, urinary tract infections, and bacterial 
pneumonia.
    (c) Rates of an all-cause hospital readmissions measure.


Sec.  414.1235  Cost measures.

    Costs for groups of physicians subject to the value-based payment 
modifier are assessed based on the following 6 cost measures:
    (a) Total per capita costs for all attributed beneficiaries; and
    (b) Total per capita costs for all attributed beneficiaries with 
diabetes, coronary artery disease, chronic obstructive pulmonary 
disease, or heart failure.
    (c) Total per capita costs include all fee-for-service payments 
made under Medicare Part A and Part B.
    (1) Payments under Medicare Part A and Part B will be adjusted 
using CMS' payment standardization methodology to ensure fair 
comparisons across geographic areas.
    (2) The CMS-HCC model (and adjustments for ESRD status) is used to 
adjust standardized payments for each cost measure; that is--
    (i) Total per capita costs; and
    (ii) Total per capita costs for beneficiaries with the following 
conditions: coronary artery disease, COPD, diabetes, and heart failure.


Sec.  414.1240  Attribution for quality of care and cost measures.

    Beneficiaries are attributed to groups of physicians subject to the 
value-based payment modifier using a method generally consistent with 
the method of assignment of beneficiaries under Sec.  425.402 of this 
chapter.


Sec.  414.1245  Scoring methods for the value-based payment modifier 
using the quality-tiering approach.

    For each quality of care and cost measure, a standardized score is 
calculated for each group of physicians subject to the value-based 
payment modifier by dividing--
    (a) The difference between their performance rate and the 
benchmark, by
    (b) The measure's standard deviation.


Sec.  414.1250  Benchmarks for quality of care measures.

    (a) The benchmark for quality of care measures reported through the 
PQRS using the claims, registries, EHR, or web interface is the 
national mean for that measure's performance rate (regardless of the 
reporting mechanism) during the year prior to the performance period. 
In calculating the national benchmark, individuals' and groups of 
physicians' performance rates are weighted by the number of 
beneficiaries used to calculate the individuals' or group of 
physician's performance rate.
    (b) The benchmark for each quality of care measure reported through 
the PQRS using the administrative claims option is the national mean 
for that measure's performance rate during the year prior to the 
performance period.


Sec.  414.1255  Benchmarks for cost measures.

    The benchmark for each cost measure is the national mean of the 
performance rates calculated among all groups of physicians for which 
beneficiaries are attributed to the group of physicians and are subject 
to the value-based payment modifier. In calculating the national 
benchmark, groups of physicians' performance rates are weighted by the 
number of beneficiaries used to calculate the group of physician's 
performance rate.


Sec.  414.1260  Composite scores.

    (a)(1) The standardized score for each quality of care measure is 
classified into one of the following equally weighted domains to 
determine the quality composite:
    (i) Patient safety.
    (ii) Patient experience.
    (iii) Care coordination.
    (iv) Clinical care.
    (v) Population/community health.
    (vi) Efficiency.
    (2) If a domain includes no measure or does not reach the minimum 
case size in Sec.  414.1265, the remaining domains are equally weighted 
to form the quality of care composite.
    (b)(1) The standardized score for each cost measure is grouped into 
two separate and equally weighted domains to determine the cost 
composite:
    (i) Total per capita costs for all attributed beneficiaries (one 
measures); and
    (ii) Total per capita costs for all attributed beneficiaries with 
specific conditions: Diabetes, coronary artery disease, chronic 
obstructive pulmonary disease, or heart failure (four measures).
    (2) Measures within each domain are equally weighted.


Sec.  414.1265  Reliability of measures.

    To calculate a composite score for a quality or cost measure based 
on claims, a group of physicians subject to the value-based payment 
modifier must have 20 or more cases for that measure.
    (a) In a performance period, if a group of physicians has fewer 
than 20 cases for a measure, that measure is excluded from its domain 
and the remaining measures in the domain are given equal weight.
    (b) In a performance period, if a reliable quality of care 
composite or cost composite cannot be calculated, payments shall not be 
adjusted under the value-based payment modifier.


Sec.  414.1270  Determination and calculation of Value-Based Payment 
Modifier adjustments.

    (a) Downward payment adjustments. A downward payment adjustment 
will be applied to a group of physicians subject to the value-based 
payment modifier if:
    (1) Such group does neither self-nominates for the PQRS GPRO and 
reports at least one measure nor elects the PQRS administrative claims 
option for CY 2013 as defined in Sec.  414.90(h);
    (i) Such adjustment will be -1.0 percent.
    (ii) [Reserved]
    (2) Such group elects that its value-based payment modifier be 
calculated using a quality-tiering approach, and is determined to have 
poor performance (low quality and high costs),
    (i) Such adjustment will not exceed -1.0 percent as specified in 
Sec.  414.1275.
    (ii) [Reserved]
    (b) No payment adjustments. There will be no value-based payment 
modifier adjustment applied to a group of physicians subject to the 
value-based payment modifier if such group either
    (1) Self-nominates for the PQRS GPRO and reports at least one 
measure; or
    (2) Elects the PQRS administrative claims option for CY 2013 as 
defined in Sec.  414.90(h).
    (c) Upward payment adjustments. If a group of physicians subject to 
the value-based payment modifier elects that the value-based payment 
modifier be calculated using a quality-tiering approach, upward payment 
adjustments are determined based on the projected aggregate amount of 
downward payment adjustments determined under paragraph (a) of this 
section and applied as specified in Sec.  414.1275.

[[Page 69371]]

Sec.  414.1275  Value-based payment modifier quality-tiering scoring 
methodology.

    (a) The value-based payment modifier amount for a group of 
physicians subject to the value-based payment modifier that elects the 
quality-tiering approach is based upon a comparison of the composite of 
quality of care measures and a composite of cost measures.
    (b) Quality composite and cost composite are classified into high, 
average, and low categories based on whether the composites are 
statistically above, not different from, or below the mean composite 
scores.
    (1) Quality composites that are one or more standard deviations 
above the mean are classified into the high category. Quality 
composites that are one or more standard deviations below the mean are 
classified into the low category.
    (2) Cost composites that are one or more standard deviations below 
the mean are classified into the low category. Cost composites that are 
one or more standard deviations above the mean are classified into the 
high category.
    (c) The following value-based payment modifier percents apply:

      Value-Based Payment Modifier Amounts for Groups of Physicians Requesting the Quality-Tiering Approach
----------------------------------------------------------------------------------------------------------------
                          Quality/cost                               Low cost      Average cost      High cost
----------------------------------------------------------------------------------------------------------------
High quality....................................................       \1\ +2.0x       \1\ +1.0x           +0.0%
Average quality.................................................       \1\ +1.0x           +0.0%           -0.5%
Low quality.....................................................           +0.0%           -0.5%           -1.0%
----------------------------------------------------------------------------------------------------------------
\1\ Groups of physicians eligible for an additional +1.0x if reporting Physician Quality Reporting System
  quality measures through the GPRO using the web interface, claims, registries, or EHRs, and average
  beneficiary risk score in the top 25 percent of all beneficiary risk scores.

    (d) Groups of physicians subject to the value-based payment 
modifier that have an attributed beneficiary population with an average 
risk score in the top 25 percent of the risk scores of beneficiaries 
nationwide and elect the quality-tiering approach, receive a greater 
upward payment adjustment as follows:
    (1) Classified as high quality/low cost receive an upward 
adjustment of +3x (rather than +2x); and
    (2) Classified as either high quality/average cost or average 
quality/low cost receive an upward adjustment of +2x (rather than +1x).


Sec.  414.1280  Limitation on review.

    (a) There shall be no administrative or judicial review under 
section 1869 of the Act, section 1878 of the Act, or otherwise of all 
of the following:
    (1) The establishment of the value-based payment modifier.
    (2) The evaluation of the quality of care composite, including the 
establishment of appropriate measure of the quality of care.
    (3) The evaluation of costs composite, including establishment of 
appropriate measures of costs.
    (4) The dates of implementation of the value-based payment 
modifier.
    (5) The specification of the initial performance period and any 
other performance period.
    (6) The application of the value-based payment modifier.
    (7) The determination of costs.
    (b) [Reserved.]


Sec.  414.1285  Informal inquiry process.

    After the dissemination of the annual Physician Feedback reports, a 
group of physicians may contact CMS to inquire about its report and the 
calculation of the value-based payment modifier.

PART 415--SERVICES FURNISHED BY PHYSICIANS IN PROVIDERS, 
SUPERVISING PHYSICIANS IN TEACHING SETTINGS, AND RESIDENTS IN 
CERTAIN SETTINGS

0
23. The authority citation for part 415 continues to read as follows:


    Authority: Secs. 1102 and 1871 of the Social Security Act (42 
U.S.C. 1302 and 1395hh).


Sec.  415.130  [Amended]

0
24. In Sec.  415.130(d)(1) and (d)(2), remove the reference to 
``December 31, 2011'' and add in its place the reference to ``June 30, 
2012.''

PART 421--MEDICARE CONTRACTING

0
25. The authority citation for part 421 continues to read as follows:

    Authority: Sec. 1102 and 1871 of the Social Security Act (42 
U.S.C. 1302 and 1395hh).

Subpart F--[Removed and Reserved]

0
26. Subpart F is removed and reserved.

PART 423--VOLUNTARY MEDICARE PRESCRIPTION DRUG BENEFIT

0
27. The authority citation for part 423 continues to read as follows:

    Authority: Sections 1102, 1106, 1860D-1 through 1860D-42, and 
1871 of the Social Security Act (42 U.S.C. 1302, 1306, 1395w-101 
through 1395w-152, and 1395hh).


0
28. Section 423.160 is amended by--
0
A. Revising paragraphs (a)(3)(iv), (b)(1)(i), and (b)(1)(ii).
0
B. Adding paragraphs (b)(1)(iii) and (b)(2)(iii).
    The revisions and additions read as follows:


Sec.  423.160  Standards for electronic prescribing.

    (a) * * *
    (3) * * *
    (iv) Until November 1, 2014, entities transmitting prescriptions or 
prescription-related information where the prescriber is required by 
law to issue a prescription for a patient to a non-prescribing provider 
(such as a nursing facility) that in turn forwards the prescription to 
a dispenser are exempt from the requirement to use the NCPDP SCRIPT 
Standard adopted by this section in transmitting such prescriptions or 
prescription-related information. As of November 1, 2014, such entities 
will be required to use the adopted NCPCP SCRIPT standard(s).
* * * * *
    (b) * * *
    (1) * * *
    (i) Before April 1, 2009 the standards specified in paragraphs 
(b)(2)(i), (b)(3), (b)(4), (b)(5), and (b)(6) of this section.
    (ii) From April 1, 2009 until January 14, 2013, the standards 
specified in paragraphs (b)(2)(ii), (b)(3)-(b)(4), (b)(5) and (b)(6) of 
this section.
    (iii) From January 15, 2013 until October 31, 2013 the standards 
specified in paragraphs (b)(2)(ii), (b)(3)-(b)(4), (b)(5) and (b)(6) of 
this section.
* * * * *
    (2) * * *
    (iii) The National Council for Prescription Drug Programs SCRIPT 
standard, Implementation Guide Version 10.6 approved November 12, 2008 
(incorporated by reference in paragraph (c)(1)(v) of this section), to 
provide for the communication of a prescription or related prescription 
related information between prescribers and dispensers for the 
following:
    (A) Get message transaction.

[[Page 69372]]

    (B) Status response transaction.
    (C) Error response transaction.
    (D) New prescription transaction.
    (E) Prescription change request transaction.
    (F) Prescription change response transaction.
    (G) Refill prescription request transaction.
    (H) Refill prescription response transaction.
    (I) Verification transaction.
    (J) Password change transaction.
    (K) Cancel prescription request transaction.
    (L) Cancel prescription response transaction.
    (M) Fill status notification.
* * * * *

PART 425--MEDICARE SHARED SAVINGS PROGRAM

0
29. The authority citation for part 425 continues to read as follows:

    Authority:  Secs. 1102, 1106, 1871, and 1899 of the Social 
Security Act (42 U.S.C. 1302 and 1395hh).


0
30. Section 425.308 is amended by revising paragraph (e) to read as 
follows:


Sec.  425.308  Public reporting and transparency.

* * * * *
    (e) Results of claims based measures. Quality measures reported 
using the GPRO web interface and patient experience of care survey 
measures will be reported on Physician Compare in the same way as for 
the group practices that report under the Physician Quality Reporting 
System.

0
31. Section 425.504 is amended by adding paragraph (b) to read as 
follows:


Sec.  425.504  Incorporating reporting requirements related to the 
Physician Quality Reporting System.

* * * * *
    (b) Physician Quality Reporting System payment adjustment. (1) 
ACOs, on behalf of their ACO provider/suppliers who are eligible 
professionals, must submit one of the measures determined under Sec.  
425.500 using the GPRO web interface established by CMS, to 
satisfactorily report on behalf of their eligible professionals for 
purposes of the 2015 Physician Quality Reporting System payment 
adjustment under the Shared Savings Program.
    (2)(i) ACO providers/suppliers that are eligible professionals 
within an ACO may only participate under their ACO participant TIN as a 
group practice under the Physician Quality Reporting System Group 
Practice Reporting Option of the Shared Savings Program for purposes of 
the 2015 Physician Quality Reporting System payment adjustment under 
the Shared Savings Program.
    (ii) Under the Shared Savings Program, an ACO, on behalf of its ACO 
providers/suppliers who are eligible professionals, must satisfactorily 
report one of the measures determined under Subpart F of this part 
during the reporting period for a year, as defined in paragraph (b)(6) 
of this section, according to the method of submission established by 
CMS under the Shared Savings Program for purposes of the 2015 Physician 
Quality Reporting System payment adjustment.
    (3) If an ACO, on behalf of its ACO providers/suppliers who are 
eligible professionals, does not satisfactorily report for purposes of 
a 2015 Physician Quality Reporting System payment adjustment, each ACO 
supplier/provider who is an eligible professional, will receive a 
payment adjustment, as described in paragraph (b)(5) of this section.
    (4) ACO participant TINs and individual ACO providers/suppliers who 
are eligible professionals cannot satisfactorily report for purposes of 
a 2015 Physician Quality Reporting System payment adjustment outside of 
the Medicare Shared Savings Program.
    (5) For eligible professionals subject to the 2015 Physician 
Quality Reporting System payment adjustment under the Medicare Shared 
Savings Program, the Medicare Part B Physician Fee Schedule amount for 
covered professional services furnished during the program year is 
equal to the applicable percent of the Medicare Part B Physician Fee 
Schedule amount that would otherwise apply to such services under 
section 1848 of the Act.
    (i) The applicable percent for 2015 is 98.5 percent.
    (ii) The applicable percent for 2016 and subsequent years is 98.0 
percent.
    (6) The reporting period for a year is the calendar year from 
January 1 through December 31 that occurs 2 years prior to the program 
year in which the payment adjustment is applied.

PART 486--CONDITIONS FOR COVERAGE OF SPECIALIZED SERVICES FURNISHED 
BY SUPPLIERS

0
32. The authority citation for part 486 continues to read as follows:

    Authority: Secs. 1102, 1138, and 1871 of the Social Security Act 
(42 U.S.C. 1302, 1320b-8, and 1395hh) and section 371 of the Public 
Health Service Act (42 U.S.C. 273).


0
33. Section 486.106 is amended by revising the introductory text and 
paragraphs (a) and (b) to read as follows:


Sec.  486.106  Condition for coverage: Referral for service and 
preservation of records.

    All portable X-ray services performed for Medicare beneficiaries 
are ordered by a physician or a nonphysician practitioner as provided 
in Sec.  410.32(a) of this chapter or by a nonphysician practitioner as 
provided in Sec.  410.32(a)(2) and records are properly preserved.
    (a) Standard--referral by a physician or nonphysician 
practitioners. Portable X-ray examinations are performed only on the 
order of a physician licensed to practice in the State or by a 
nonphysician practitioner acting within the scope of State law. Such 
nonphysician practitioners may be treated the same as physicians 
treating beneficiaries for the purpose of this paragraph. The 
supplier's records show that:
    (1) The portable X-ray test was ordered by a licensed physician or 
a nonphysician practitioner acting within the State scope of law; and
    (2) Such physician or nonphysician practitioner's written, signed 
order specifies the reason a portable X-ray test is required, the area 
of the body to be exposed, the number of radiographs to be obtained, 
and the views needed; it also includes a statement concerning the 
condition of the patient which indicates why portable X-ray services 
are necessary.
    (b) Standard--records of examinations performed. The supplier makes 
for each patient a record of the date of the portable X-ray 
examination, the name of the patient, a description of the procedures 
ordered and performed, the referring physician or nonphysician 
practitioner, the operator(s) of the portable X-ray equipment who 
performed the examination, the physician to whom the radiograph was 
sent, and the date it was sent.
* * * * *

PART 495--STANDARDS FOR THE ELECTRONIC HEALTH RECORD TECHNOLOGY 
INCENTIVE PROGRAM

0
34. The authority citation for part 495 continues to read as follows:

    Authority: Secs. 1102 and 1871 of the Social Security Act (42 
U.S.C. 1302 and 1395hh).


0
35. Section 495.8 is amended by revising paragraph (a)(2)(v) to read as 
follows:


Sec.  495.8  Demonstration of meaningful use criteria.

    (a) * * *
    (2) * * *
    (v) Exception for Medicare EPs for 2012 and 2013--Participation in 
the

[[Page 69373]]

Physician Quality Reporting System-Medicare EHR Incentive Pilot. To 
satisfy the clinical quality measure reporting requirements of 
meaningful use, aside from attestation, an EP participating in the 
Physician Quality Reporting System may also participate in the 
Physician Quality Reporting System-Medicare EHR Incentive Pilot through 
one of the following methods:
    (A) Submission of data extracted from the EP's certified EHR 
technology through a Physician Quality Reporting System qualified EHR 
data submission vendor; or
    (B) Submission of data extracted from the EP's certified EHR 
technology, which must also be through a Physician Quality Reporting 
System qualified EHR.
* * * * *

    Authority: (Catalog of Federal Domestic Assistance Program No. 
93.773, Medicare--Hospital Insurance; and Program No. 93.774, 
Medicare--Supplementary Medical Insurance Program)

    Dated: October 24, 2012.
Marilyn Tavenner,
Acting Administrator, Centers for Medicare & Medicaid Services.
    Approved: October 25, 2012.
Kathleen Sebelius,
Secretary.
[FR Doc. 2012-26900 Filed 11-1-12; 4:15 pm]
BILLING CODE 4120-01-P