Physician Value-Based Payment Modifier

Physician Value-Based Payment Modifiers, Physician Quality Reporting System (“PQRS”) and Meaningful Use will continue to affect rates in the years ahead as the Centers for Medicare & Medicaid Services (CMS) gears more towards paying for value and better care.  

The 2010 Patient Protection and Affordable Care Act requires that the CMS adjust Medicare Physician Fee Schedule payments to a physician or group of physicians based on the quality and cost of care furnished to their Medicare fee-for-service beneficiaries. Quality of care is reported to Medicare through measures encompassed in the PQRS.  

Eligible professionals who provide low-quality care at high costs will be subject to significant deductions in reimbursement while those who deliver high-quality care at a low cost will be eligible for increased reimbursement. These changes were started with select providers in 2015 and will affect all providers by 2017. Eligible professionals include physicians, practitioners, physical therapists, occupational therapists, qualified speech-language pathologists and qualified audiologists. 

Medicare compares the list of eligible professionals that are enrolled in Medicare’s Provider Enrollment, Chain and Ownership System (“PECOS”) to the claims data for the applicable calendar year. In the event that a provider did not submit any claims to Medicare during that year, the data will not be used in determining the group size. 

The Affordable Care Act also requires CMS to provide reports to physicians that show the cost of care associated with the quality of care given to the Medicare fee-for-service beneficiaries. These confidential reports are known as Quality and Resource Use Reports (“QRUR”). The reports can be found on the CMS Enterprise Portal and are typically released 8-9 months after the reporting period.  

Payment changes will go into effect at the beginning of the year and will be based upon previously submitted PQRS data. 

On January 1, 2015, value modifier changes were applied to physician payments with 100 or more eligible professionals based on the PQRS data that was submitted in 2013.  

As of January 1, 2016, value modifier changes are applied to physician payments with 10 or more eligible professionals based on the PQRS data that was submitted in 2014.  

In 2015 and 2016, CMS will not apply the value modifier to groups in which one or more physicians participated in the Medicare Shared Savings Program, the Pioneer Accountable Care Organization (“ACO”) Model, or the Comprehensive Primary Care (“CPC”) initiative during the performance period. 

As of January 1, 2017, value modifier changes will be applied to physician payments for solo physician practices and physicians in groups with 2 or more eligible professionals based on the PQRS data that was submitted in 2015.  

CMS provides specific policies through rulemaking regarding application of the value modifier groups participating in Medicare Shared Savings Program ACOs, Pioneer ACOs, the Comprehensive Primary Care Initiative, and other similar initiatives. 

Providers should continue to follow CMS guidelines and report on all necessary measures to avoid suffering a steady decline in reimbursement rates.