Podiatry Coding & Billing Alert

Get the latest on the 2014 CF, the SGR formula, and sequestration cuts.

The New Year brought some good news about the conversion factor (CF) that sets the annual payment rate for the Medicare Physician Fee Schedule (MPFS) — but just for a little while.

See how recent Congressional action will impact your practice’s bottom line by reading the answers to the following questions:

Question 1: I’ve read that Congress voted to delay the 20.1 percent conversion factor cut until the end of March. Was that delay finalized, and if so, what is the new conversion factor (CF)?

Answer 1: Yes, President Obama signed the three-month conversion factor delay into law on Dec. 26, 2013 as part of the Bipartisan Budget Act of 2013. That means you won’t have to worry about taking a major Medicare pay cut until April 1. The ruling didn’t simply keep the CF at 2013 levels, it actually included a 0.5 percent raise. When all calculations were finalized, the 2014 conversion factor is $35.8228 from Jan. 1 through March 31.

To read the complete Bipartisan Budget Act of 2013, visit www.gpo.gov/fdsys/pkg/BILLS-113hjres59enr/pdf/BILLS-113hjres59enr.pdf. The discussion about the 2014 conversion factor starts on page 32.

Question 2: Will the sustainable growth rate (SGR) formula kick in on April 1?

Answer 2: That depends. Congress may actually be poised to eliminate the SGR formula and institute more modern payment systems for Medicare claims. In December, the House of Representatives’ Ways and Means Committee and the Senate Finance Committee approved a bill that would eliminate the SGR in favor of freezing or slightly increasing 2014 payments until a more permanent solution for calculating Medicare pay could be devised, which would largely be based on physician performance.

Favorable physician response: “Strong, bipartisan votes by the Senate Finance and House Ways and Means committees, following similar action last July by the House Energy and Commerce Committee, shows that there is overwhelming, bipartisan support for ending SGR in a fiscally responsible manner and closing the book on the annual cycle of draconian Medicare physician payment cuts and short-term patches,” said AMA President Ardis Dee Hoven, M.D., in a statement responding to the bill. “This long-overdue policy change provides the stability that physicians need to pursue delivery innovations that help improve patient care and reduce costs for American taxpayers.”

To read a summary of the House Ways and Means Committee’s proposal, visit waysandmeans.house.gov/uploadedfiles/sgr_reform_short_summary_2013.pdf.

Question 3: Have the sequestration cuts been halted for 2014?

Answer 3: Although you may have heard that Congress’s deal in early December included averting some of the sequestration cuts, that does not impact the two-percent cut to Medicare that kicked in last April. In fact, the sequester cuts were extended for another two years through the end of 2015.

Of course, Congressional intervention could take place down the road to reverse these cuts, but at this point they are still impacting your Medicare pay. For more information on the Sequestration cuts, visit the “Frequently Asked Questions About Sequestration: An Update for FY 2014” at democrats.budget.house.gov/committee-report/frequently-asked-questions-about-sequestration-under-budget-control-act-2011.