Life Sciences

Medicare & Reimbursement Advisor Weekly, November 20th, 2009

Medicare & Reimbursement Advisor Weekly, November 20, 2009

Inside:

Conversation: Texas medical director

Cardiologists, oncologists, other specialty customers affected by unheralded Medicare cut

Payers may forgo PA restrictions in more collaborative model

Trends: Copay, out-of-pocket collection down in LTC



Conversation: Texas medical director

As a managed markets professional, I thought this comment from a medical director I spoke to this week might help you understand perspective on what gets attention and what could hurt product adoption. Barry Lachman, MD, medical director for Parkland Community HP, a Medicaid managed care plan in Texas, said medical directors in the Houston area are upset at MD Anderson Cancer Center for “aggressively promoting” proton beam therapy in the face of what Lachman said is still a lack of scientific evidence, although some commercial plans cover the therapy for certain cancer indications. Lachman said he bases most first-line health technology and drug decisions on Hayes, an evidence and literature source which rates therapy and technology products A through D. “If Hayes, for example, decided to rate Proton Beam a B, and Medicare didn’t exclude it, we would cover it right away.” Second-line decisions are based on Aetna, which the plan uses for prior authorizations as well.



Cardiologists, oncologists, other specialty customers affected by unheralded Medicare cut

If you have a product prescribed by specialty physicians, consider this: Next year’s Medicare physician pay schedule will likely hurt your specialty provider customers, particularly those in rural communities.

As of January 1, 2010, the Centers for Medicare & Medicaid Services (CMS) plans to eliminate a series of five-digit CPT codes that specialist physicians, such as cardiologists, oncologists, and surgeons use to bill for medical or surgical consults. These consults occur at the request of a practitioner who wants a specialist’s opinion regarding his or her patient.

“When these doctors find out about this, they are going to go ballistic,” says Larry deGhetaldi, MD, administrator of the Palo Alto Medical Foundation, a multi-specialty group practice with 900 physicians in Santa Cruz, CA. He adds that if it weren’t for the complexity and anxiety over health reform, “this would have been the major freak-out issue.”

Under current CMS rules, the CPT code for consultation calls for reimbursement is between $20 and $50 higher than for a comparable office visit. But by eliminating the CPT codes, those specialists will be forced to bill under a different payment code bracket, which covers for a simple office visit.

The rule change could have an impact on some specialists’ willingness to be available for specialty referral care, either in the hospital or in their office practices, says Ted Mazer, MD, a San Diego–area otolaryngologist.

“The potential impact on already endangered ER call panels should have been considered as well. The devaluation of the consultants’ services may adversely impact access in both city and rural settings,” Mazer says, especially in areas where there is already a shortage of some specialists.

When this change takes effect, Mazer worries that the confusion in what codes Medicare will accept will cause delays in payment, resulting in cash flow problems for specialty physicians as well.

The policy change has come about, in part, because of a desire of the Obama administration to increase reimbursement to primary care physicians, who are increasingly in short supply. But such redistribution may tend to worsen the schism between those groups and specialists.

“Patients in certain parts of the country who undergo a routine hospital admission will have 10 consults,” deGhetaldi says. “If they force this new patient code, that will control some of these costs.”



Payers may forgo PA restrictions in more collaborative model

Even if the products you support are orals for cardiovascular conditions, the following may be helpful to give you insight into a plan’s new-age thinking about utilization management. A flurry of single-source biologics with attractive side effect profiles is expected to enter the cancer care market without competition in the next few years. Requiring prior authorizations (PA) on the coming wave of expensive oncology-specific biologics is an option “but not Aetna’s preferred option as it might preclude payers from engaging in relationships with community oncologists, academic centers, hospitals, and cancer centers,” says Aetna’s Ira Klein, MD, medical director of oncology condition analysis. In lieu of a PA, Klein says payers could try a single-specialty arrangement with an oncology provider, or build a private label insurance product in which the plan acts as a third-party administrator.

PAs would close the door to these arrangements and stall recent collaboration among oncology groups and payers.

Editor’s note: E-mail bcote_18@hotmail.com to view the full article.



Trends: Copay, out-of-pocket collection down in LTC

Results of six skilled nursing facility polls show some of the trends in LTC and indirectly suggest some potential opportunities for marketing and managed markets to explore. To view more details of any individual poll (e.g., sample, demographics) or to discuss LTC research needs, contact the editor.

NOVEMBER 4, 2009

Quick poll: Does your facility provide frontline staff with chronic obstructive pulmonary disorder (COPD) training? Of those that said no, 82% said this training is an unmet need but budget, staffing, and other operational issues have prevented facilities from implementation.

62%: No

37%: Yes

JULY 15, 2009

Approximately what percentage of residents in your facility are short stay? Short-stay residents are typically those who stay fewer than 14 days.

37%: 0%–10% are short stay

31%: 11%–25%

13%: 26%–50%

12%: 76%–100%

5%: 51%–75%

JUNE 17, 2009

Quick poll: Is your facility concerned about the Quality of Life F-tags that went into effect on June 12? The goal of these is to give residents a greater voice and choice in their care, environment, and experience in nursing homes.

61%: Yes

38%: No

MARCH 25, 2009

Due to the economic downturn, has your facility experienced difficulty collecting out-of-pocket payments from residents?

80%: Yes

20%: No

MARCH 11, 2009

Has your facility been targeted for a medical review in the last 12 months? The local Medicare administrative contractors or fiscal intermediaries who process claims can target skilled nursing facilities on payment, billing, and reimbursement problems.

70%: No

29%: Yes