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2016 Medicare Proposed Fee Schedule: A Few Notes for Anesthesiologists


On July 8, the Centers for Medicare and Medicaid Services (CMS) issued a proposed rule updating payment policies, payment rates, and quality provisions for services furnished under the Medicare Physician Fee Schedule (PFS) on or after January 1, 2016. The proposed rule implements several policies mandated under the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) back in April, the same legislation that fixed the flawed Sustainable Growth Rate formula.

Among the many provisions of the proposed fee schedule, the following items are among those most noteworthy for the coming year, particularly for anesthesiologists.

2016 Anesthesia Conversion Factor

The proposed national anesthesia conversion factor (CF) for 2016 is $22.6296, a very minimal increase from the CF of $22.6093 which went into effect on July 1, 2015.

Nonfacility Cataract Surgeries

CMS is accepting comments on the viability of some (maybe most) cataract surgeries being performed in a nonfacility office setting, with only complicated cases or cases on patients with comorbidities being performed in an Ambulatory Surgical Center or a Hospital Outpatient Department. Because many cataract surgeries already are done with only local or topical anesthetic, the implication of moving cataract surgeries to a nonfacility setting would reduce or eliminate billing for anesthesia for these procedures. If your practice provides anesthesia for cataract surgeries, you may want to add your comments.

Anesthesia in Screening Colonoscopies

The 2015 Medicare Fee Schedule statutorily included separately billable anesthesia services as integral to screening colonoscopies, regardless of the diagnosis or tissue removed, and prohibited Medicare Administrative Contractors (MACs) from applying deductibles for the surgical or anesthesia services for those procedures. However, as most of you know, Medicare did not make all necessary changes to the regulations to expressly reflect the inapplicability of the deductible to those anesthesia services.

In the 2016 proposed MPFS, that technical change has been made. Meanwhile, the MACs should already have updated their payment processed to reflect that change.


The guidelines to successfully report or participate in the Physician Quality Reporting System (PQRS) for the 2016 reporting year (affecting 2018 payments) remain largely the same. One change is that group practices using the GPRO option will now be able to choose the Qualified Clinical Data Registry reporting option, which was previously available only to providers who reported as individuals.

As well, more than 40 new individual measures are proposed across all reporting options, including four new cross-cutting measures. As well, three new measures groups (registry only) and one new GPRO web measure is included in the proposed rule. Five new measures are being proposed by the American Society of Anesthesiologists for the registry reporting option:

  • Anesthesiology Smoking Abstinence
  • Perioperative Temperature Management
  • Post-Anesthetic Transfer of Care Measure: Procedure Room to a Post-Anesthesia Care Unit (PACU)
  • Post-Anesthetic Transfer of Care Measure:  Use of Checklist or Protocol for Direct Transfer of Care from Procedure Room to Intensive Care Unit (ICU)
  • Prevention of Post-Operative Nausea and Vomiting

As well, CMS is seeking to remove measure 193 Perioperative Temperature Management, which may be why the ASA is attempting to add it back in with updated parameters.

Finally, under MACRA, PQRS is set to expire with the 2016 reporting year (affecting 2018 payments). The Merit-Based Incentive Payment System (MIPS), mandated through MACRA, will replace PQRS and other Medicare quality programs beginning with the 2017 reporting year (affecting 2019 payments).

Value-Based Payment Modifier

For the 2016 reporting year (affecting 2018 payments), CMS will now include several non-physician practitioners (NPPs) in the Value-Based Payment Modifier (VBPM) program: PAs, NPs, CNSs, and CRNAs. As in the past, those providers newly introduced to the program will be held harmless from downward adjustments, but that provision applies only to those providers who practice as solo NPPs or those who are in a group of only NPPs. Any solo physician or group of two or more physicians and/or NPPs will be subject to upward or downward payment adjustments based on their ratio of quality to cost as compared to other providers in the Medicare program.

CMS did hold steady the adjustment factors and percentages for the upward or downward payment adjustments to +2.0x and -2.0 percent for solo practitioners and groups up to nine providers and +4.0x and -4.0 percent for groups of 10 or more providers.

Like PQRS, the VBPM program is set to expire with the 2016 reporting year (affecting 2018 payments) to be replaced by MIPS.

Potentially Misvalued Codes

The Affordable Care Act (ACA) instructed CMS to identify “misvalued codes” in the Physician Fee Schedule, and PAMA mandated a target for adjustments to misvalued codes in the fee schedule for calendar years 2017 through 2020, with a target amount of 0.5 percent of the estimated expenditures under the PFS for each of those four years. Subsequently, the Achieving a Better Life Experience Act of 2014 (ABLE) accelerated the application of the target by specifying it would apply for calendar years 2016 through 2018, and increasing the target to 1 percent for 2016.

In the 2016 proposed rule, CMS is introducing a methodology for the implementation of this provision, which includes how net reductions in misvalued codes would be calculated. Based on that methodology, CMS has identified changes that achieve 0.25 percent in net reductions. Within that methodology is a review of high expenditure services across specialties with Medicare allowed charges of $10,000,000 or more. Look for CMS to make further misvalued code changes in the final rule as they move closer to the statutory goal of 1 percent.

Misvalued GI Anesthesia Codes

Because anesthesia procedure codes 00740 (Anesthesia for procedure on gastrointestinal tract using an endoscope) and 00810 (Anesthesia for procedure on lower intestine using an endoscope) are used for anesthesia furnished in conjunction with lower GI procedures in more than 50 percent of several types of colonoscopy cases, Medicare has flagged these codes for review in their misvalued codes initiative. While the base value of these codes will not necessarily be lowered, because of the mandate to reduce costs by 1 percent through revaluing codes, these codes are easy targets because of their increased use.

For more information, review the CMS Fact Sheet about the Proposed Fee Schedule, or view the Proposed Fee Schedule in its entirety. Visit the Federal Register website to comment on the rule.

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Charity Singleton Craig

Charity Singleton Craig is a freelance writer and editor who provides communications and marketing services for CIPROMS. She is responsible for creating, editing, and managing all content, design, and interaction on the company website and social media channels in order to promote CIPROMS as a thought leader in healthcare billing and management.

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