Endocrine Insider
September 13, 2007

On August 31, The Endocrine Society submitted comments to the Center for Medicare and Medicaid Services (CMS) on the proposed 2008 physician payment fee schedule. As anticipated, the proposed rule included a 9.9 percent payment cut for physician services. The Society opposes these cuts, and in its comments encouraged CMS to work with Congress and medical specialty societies to revamp the way that physician payments for services are calculated. The complex formula currently used to value physician services has led to multi-year proposed cuts and should be revised. The Society has also requested that CMS reconsider its plan to use the $1.35 billion set-aside for physician bonuses under the voluntary Medicare Physician Quality Reporting Initiative (PQRI) and instead apply those funds to physician payments and reduce the 9.9 percent payment cuts. By doing so, CMS will ultimately assist a wider range of physicians than the limited number of physicians who may receive a bonus under the PQRI.

The Society’s comments also stated continued concern with shrinking payment for dual energy x-ray absorptiometry (DXA) services both as a result of the Deficit Reduction Act of 2006 (DRA) as well as changes made by CMS to the anticipated equipment costs related to these services. Finally, the Society requested that CMS look into the value associated with thyroid code 10022 to determine if it is appropriately valued.

Separately, CMS has requested comments from interested parties on the Hospital Outpatient Prospective Payment System update for calendar year 2008, and the Office of Management and Budget directly requested the comments of the Society on the issue of payment for quality reporting. In the rule, CMS proposes to provide payment bonuses to hospital outpatient departments that report on various performance measures. While most of the performance measures proposed for use in the reporting program are process measures, those selected for tracking the care of patients with diabetes are outcomes measures that are not risk-adjusted but are inherently dependent upon severity of disease and patient compliance with treatment plans. We have concerns about the use of these measures as a basis for determining payment, particularly without appropriate risk adjustment. The measures of concern include:

PQRI #1: A1C less than 9
PQRI #2 LDL less than 100 in type 1 and type 2 diabetes
PQRI #3 BP less than 140/80 in type 1 and type 2 diabetes

The use of these measures in a reporting system has the potential to have a negative effect on hospitals, endocrinologists, and the patients that they treat. If hospitals’ and/or physicians’ payments are based on meeting the requirements listed above, many physicians may have to choose not to care for non-compliant patients or patients with greater disease severity. In its comments, the Society requested that CMS focus on providing payments for process measures for all conditions, including diabetes, rather than basing payments on outcomes measures. If CMS chooses to include the outcomes-based measures for diabetes care, the Society recommends that these measures be risk-adjusted to take into account the severity of disease or demographic characteristics of the patient population.