Tuesday, December 13, 2016

CMS Updates 2017 Medicare Part B Physician Fee Schedule File


Therapy File Posted on AHCA Website

Dan Ciolek

On November 15, 2016, the Centers for Medicare and Medicaid Services (CMS) published the CY 2017 Medicare Physician Fee Schedule (PFS) Final Rule (CMS-1654-F) in the Federal Register. This final rule reflects the requirements of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) which repealed the Sustainable Growth Rate formula. Further, the MACRA allowed for a one-half percent (0.5%) update from July 1, 2015, to December 31, 2015, a one-half percent (0.5%) update for CY 2016, and allows a one-half percent (0.5%) update for CY 2017. The MACRA also extends the physician work geographic practice cost index (GPCI) floor of 1.0, and the therapy cap exceptions process, through December 2017 (The CY 2017 therapy cap amount is increased to $1,980 for outpatient occupational therapy and $1,980 for physical therapy and speech-language pathology services combined). Additionally, as required by the ACA, the 1.5 work GPCI floor for Alaska and the 1.0 practice expense GPCI floor for frontier states are permanent, and therefore, applicable in CY 2017.


You may note that after all required adjustments, the conversion factor has increased from $35.8043 in CY 2016 to $35.8887 for CY 2017. In a positive note for SNF, Table 52 in the Final Rule titled CY 2017 PFS ESTIMATED IMPACT ON TOTAL ALLOWED CHARGES BY SPECIALTY indicates that, due to relative changes in the weights of various PFS procedure codes, the value of Part B physical and occupational therapy code payments in aggregate should increase 1% in 2017.  


The final rule continues the multiple procedure payment reduction (MPPR) policy for “always therapy” services. The MPPR policy required, effective April 1, 2013, a 50 percent reduction to be applied to the practice expense component of payment for the second and subsequent “always therapy” service(s) that are furnished to a single patient by a single provider on one date of service (including services furnished in different sessions or in different therapy disciplines). The MPPR worksheet in the Excel file discussed below lists those “always therapy” services subject to the MPPR policy and the reduced fee payment amounts.


Further, the final rule updates the Medicare Part B therapy code list for CY 2017 by adding eight “always therapy” codes (97161 – 97168) for physical therapy (PT) and occupational therapy (OT) evaluative procedures and deleting the four codes currently used to report these services (97001 – 97004) at the end of December 2016. Please see Transmittal 3654/Change Request 9782 and Centers for Medicare and Medicaid Services (CMS) MLN Matters article MM9782 for complete information on the 2017 Annual Update to the Therapy Code List.


Finally, supporting documentation and downloads for Regulation #CMS-1654-F may be found here. An overview of the Physician Fee Schedule Payment Policies may be found here and an overview of skilled nursing facility consolidated billing and annual updates may be found here.


Thanks again to the efforts of Tony Marshall, President and CEO of the Georgia Health Care Association; AHCA is able to offer members the 2017 therapy fees for each CPT/HCPCS Code in each geographic area are provided in this Excel File. The file contains the following information:


1. The 2017 Medicare Part B Fee Schedule for Outpatient Rehabilitation for each Carrier and Locality (Part B Fees)

2. The 2017 Medicare Part B MPPR Fee Schedule for "Always Therapy Services (50% MPPR Factor) for each Carrier and Locality (MPPR Fees)

3. The 2017 Relative Value Units for each Outpatient Rehabilitation Therapy Code (RVUs)

4. The 2017 Geographic Practice Cost Indices by Medicare Carrier and Locality (GPCI)

5. The 2017 Counties Included in 2017 Localities (GPCI Counties)

The Part B Fee Schedule amounts are calculated as follows:

((A1 x B1) + (A2 x B2) + (A3 x B3)) x Conversion Factor (Part B Fees), and

 ((A1 x B1) + ((A2 x B2) x (1-MPPR Factor) + (A3 x B3)) x Conversion Factor (MPPR Part B Fees), where:

 A1 = Physician Work RVU
A2 = Non-Facility Practice Expense RVU
A3 = Malpractice RVU
B1 = Work GPCI
B2 = Practice Expense GPCI
B3 = Malpractice GPCI

Conversion Factor = $35.8887

MPPR Factor = 50%

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