September 2005 | Vol. 23, No. 9

Important Government Relations News

by William B. Schroedter, BS RVT FSVU
Chair, SVU Government Relations Committee

On August 8, 2005, the Centers for Medicare and Medicaid Services (CMS) published its proposed annual update to the Medicare Physician Fee Schedule for 2006. Public comments on the Proposed Rule may be submitted to CMS until September 30, 2005.  These documents, running several hundred pages each, are being sorted through and SVU will certainly submit comments to CMS on issues that could potentially impact you and your ability to practice our profession. The two most significant changes that impact the SVU community are summarized below.

The first and most ominous item of note is the Proposed Rule's acknowledgement of a forecasted update of negative 4.3 percent for 2006 under the current sustainable growth rate (SGR) system. The SGR system projects the growth rate in spending for physician services based on changes in the number of beneficiaries in the Medicare fee-for-service program; input prices for physician services; laws/regulations; and the gross domestic product (GDP), the measure of goods and services produced in the U.S.  As SVU noted in a recent Member Notice, this system has been widely criticized for failing to associate the payment of physicians with the costs of providing health care services and for neglecting variations in volume and quality control among individual physicians. 

CMS attributes the anticipated reduction for 2006, and the further negative updates that are expected in subsequent years, to the considerable growth in Medicare spending that has occurred in light of the increased utilization of: physician office visits, minor procedures, more complex imaging services (e.g., MRIs and echocardiograms), physician-ordered tests, and physician-administered prescription medications. The agency also expressly supports MedPAC's recent recommendation for the development of measures associated with the quality and efficiency of patient care. SVU recently encouraged its members to initiate an open dialogue on this important issue with their two U.S. Senators and U.S. Representative. We will continue to monitor, and participate in, this process to ensure beneficiary access to quality health care services.

A second proposed change that could have the potential to impact noninvasive vascular testing if in the future the rule is expanded to include additional procedures. CMS proposed to reduce the payment of a second or subsequent diagnostic imaging service(s) when multiple procedures within the same "family" (from one of eleven "families" of imaging procedures when performed on the same patient within the same session.  Specifically, CMS would provide full payment for the technical component of the highest priced procedure and then payment at 50 percent of the technical component for each additional procedure performed on the same patient during the same session. Therefore, the reduction would apply if a patient has an ultrasound of the abdomen (76700) performed within the same session as an ultrasound of the pelvis (76856) because those procedures are in the same "family", but it would not apply if a patient has an ultrasound of the abdomen performed within the same session as a CT of the abdomen because those procedures are in different "families."

This revision parallels the proposal that was announced by CMS in the Proposed Hospital Outpatient Prospective Payment System Rule for 2006.  CMS justifies this change in policy by noting that, once initiated by the first procedure, the subsequent procedure(s) do not involve any duplication of the following clinical labor activities or supplies, with the exception of film: greeting the patient, positioning and escorting the patient, providing education and obtaining consent, retrieving prior exams, setting up the IV, and preparing and cleaning the room. CMS notes that this reduction to avoid the duplication of payment for the technical component of multiple diagnostic imaging services is supported by MedPAC in its March 2005 Report to Congress on Medicare Payment Policy. CMS also references Medicare's "longstanding policy" of applying a reduction for multiple surgical procedures performed by the same physician on the same patient on the same day.  If accepted in the Final Rule, this proposal is expected to have a dramatic, adverse effect on imaging revenues. Fortunately, non-invasive vascular codes are not currently included in any of the identified codes; however it would appear likely we could get included in future years.  

While not likely to impact the typical SVU member, we also note that, for purposes of the prohibition against physician self-referrals under the "Stark Law," the Proposed Rule amends the definition of "designated health services" (DHS), to include diagnostic nuclear medicine services (in the definition of "radiology and certain other imaging services") and to include therapeutic nuclear medicine services and supplies (in the definition of "radiation therapy services and supplies"). This proposal represents a response from CMS to the controversy surrounding the dramatic increase in the utilization of imaging services in recent years. If this change becomes final, physicians who invested in such equipment would be forced to divest their ownership or investment interests, unless the arrangement is protected by an exception to the Stark Law.  Otherwise, the Stark Law would prevent these physicians from submitting claims based on such services to Medicare. 

In summary, the Medicare Physician Fee Schedule Proposed Rule for 2006 contains several proposals that will have a substantial impact on the imaging community if they are incorporated into the Final Rule. SVU is studying the implications of these potential changes and will formally submit comments on the Proposed Rule to CMS. We will continue to update you on the progress and implications of these significant policy issues in future e-Spectrum newsletter issues or by email member notices.

As you read the other Government Relations articles in this issue, you will notice that several issues with great potential to dramatically affect us, lie not with CMS but with Congress. Therefore, we ask you again to please take the time to write your Senators and Representative and voice your support for these issues — the “Preserving Patient Access to Physicians Act of 2005” (H.R. 2356 / S. 1081) and the “SAAAVE Act” (H.R. 827 / S. 390). Grassroots letters are an important part of getting Congressional members to sign onto this important legislation.

SVU members are urged to send a letter to their two U.S. Senators and sole U.S. Representative to ask for their support of this favorable legislation. Sample Congressional letters are posted on the SVU website under Comments to Government. You find their names and contact information by going to www.senate.gov and www.house.gov and use the search functions. Alternatively, you can obtain your Representative’s or Senator’s office fax numbers by calling the U.S. Capitol Switchboard at 202-224-3121 and asking to be connected to your Representative’s or Senator’s office, and then tell them you are a constituent and would like the office fax number to fax a letter to the Representative or Senator about the specific legislation. Thank you for your support of SVU’s Government Relations effort on behalf of the vascular ultrasound profession.